When you're looking for a real estate brokerage, it's important to ask the right questions. Here are 19 questions to help you find the best brokerage for your needs.
What Is A Real Estate Agent?
A real estate agent is a professional who helps people buy or sell homes. They are experts in the housing market and can help you find the right home for your needs, or sell your home for the best price possible. Real estate agents work with buyers and sellers to negotiate prices, prepare paperwork, and coordinate the closing process.
What Do Real Estate Agents Do?
As a real estate agent, it is their job to facilitate a real estate transaction. This means that they will work with both the buyer and the seller to help them agree on the sale of a property.
In addition to facilitating the sale, they will also be responsible for marketing the property, negotiating contracts, and handling all of the paperwork involved in the transaction.
What Is A Real Estate Broker
A real estate broker is a professional who helps connect buyers and sellers of real estate. In most cases, the broker represents the seller and works to find a buyer for the property. The broker's commission is typically a percentage of the sale price.
To become a licensed real estate broker, one must complete a certain number of hours of education and pass a state exam. There are also continuing education requirements that must be met to maintain a license.
Real estate brokers can work independently or they can be employed by a real estate agency. Those who work for an agency typically earn a salary plus a commission.
What Is A Real Estate Transaction?
A real estate transaction is a legal process in which two parties exchange money or property. The two parties involved in a real estate transaction are typically the buyer and the seller, but there can also be other interested parties, such as agents, brokers, and lenders.
The first step in any real estate transaction is usually to find a property that meets the buyer's needs. Once a property has been found, the buyer will then make an offer to the seller. If the seller accepts the offer, then both parties will sign a contract and exchange money or property.
It is important to note that real estate transactions are governed by state law, so it is important to consult with an experienced attorney before entering into any agreement.
19 Questions To Ask Real Estate Brokerage
1 - What are your commission splits?
When you're interviewing real estate brokerages to decide which one you want to work with, don't forget to ask about their commission splits!
Commission splits are the percentage of the commission that a real estate agent gets to keep after the brokerage takes its cut. For example, if you're working with a 50/50 split and you sell a home for $200,000, you would get to keep $2,000 and the brokerage would get $2,000.
The standard commission split in the industry is 50/50, but some brokerages offer higher splits to their agents. For example, Keller Williams offers a 70/30 split in favor of the agent. So if you sell that same $200,000 home, you would get to keep $3,333 and the brokerage would get $1,667.
2 - Are there any franchise fees?
When it comes to real estate, there are a lot of fees associated with buying, selling, and owning property. One question you may have for your real estate broker is whether or not there are any franchise fees.
Franchise fees can vary depending on the company, but they are typically a percentage of the sales price or a flat fee. For example, if you're buying a property for $200,000 and the franchise fee is 1%, that would be an additional $2,000. Some companies may charge a higher percentage for properties that sell for more than a certain amount.
In addition to the franchise fee, you may also have to pay other fees to the brokerage, such as an advertising fee or a transaction fee. These fees are usually negotiable, so be sure to ask about them upfront.
3 - Do you offer a commission cap?
When you're considering a real estate brokerage to work with, be sure to ask about their commission caps. This is important because it can have a big impact on your earnings potential.
A commission cap is a maximum amount that a brokerage will pay out in commissions to its agents. So, if a brokerage has a $10,000 commission cap, that means they'll only pay out $10,000 in commissions per transaction, no matter how much the total commission is.
This can be a good thing or a bad thing, depending on how you look at it. On one hand, it protects you from getting paid too little if the total commission is low. But on the other hand, it means you could potentially earn less if the total commission is high.
4 - Are there any other brokerage-related fees?
A real estate brokerage is a firm that facilitates the buying and selling of properties.
They typically receive a commission from the seller, which is a percentage of the final sale price.
Other fees may be associated with using a brokerage, such as administrative fees, marketing expenses, and transaction costs.
It's important to ask your broker about all of the fees involved in the transaction so there are no surprises.
5 - What other expenses might I be responsible for?
When you're ready to buy a home, be sure to ask your real estate brokerage about any other expenses you might be responsible for. In addition to the purchase price of the home, you may also be responsible for property taxes, insurance, and utility costs. These additional costs can add up quickly, so it's important to be aware of them in advance.
Your real estate broker should be able to give you a good estimate of these additional costs, based on the type of home you're interested in and the location. They can also help you find homes that are within your budget and provide advice on how to save money on these additional costs.
6 - Is there a referral fee or upfront charge?
Is there a referral fee or an upfront charge? This is a question you should ask your real estate brokerage before you sign a contract.
Many brokerages charge a referral fee when they refer a client to another brokerage. The referring brokerage typically receives 25% of the commission earned by the selling brokerage. Referral fees are negotiable, so be sure to ask about them upfront.
Some brokerages also charge an upfront fee, which is generally non-refundable. This fee covers the costs of marketing your property and is usually around 1% of the sale price. Again, this fee is negotiable, so be sure to ask about it before signing a contract.
7 - Would it be possible to get a tour of the brokerage and meet some of the agents and staff?
This is a question you may want to ask your potential real estate broker. It is always beneficial to have a face-to-face meeting with someone before making such an important decision.
This will give you a chance to see if the brokerage's office is well-kept and organized, as this can be indicative of how they do business. You will also be able to get a feel for the brokers themselves and see if they are approachable and knowledgeable.
Meeting other real estate agents is also important, as they will be the ones you will be working with on a day-to-day basis.
Seeing how they interact with each other and with clients will give you a good idea of what it would be like to work with them.
8 - How Many Agents at This Brokerage Work Part Time & Full Time?
When you're considering working with a real estate brokerage, it's important to know what the split is between agents who work part-time and those who work full-time.
This will give you a good idea of the level of commitment that the average agent at that brokerage has to their career.
At most brokerages, the majority of agents are part-time. This is because many people get into real estate intending to work it around another job or family obligations.
While there are some great part-time agents out there, keep in mind that they may not have the same level of commitment or availability as full-time agents.
If you're looking for someone who will be available 24/7 and can devote all their energy to helping you buy or sell your home, you'll want to ask about the percentage of full-time agents at a given brokerage.
9 - How Long Have Your Agents Stayed at This Brokerage?
When you're interviewing potential brokerages to work with, be sure to ask how long their agents typically stay with the company.
A high turnover rate could be indicative of an unhappy work environment, which is something you want to avoid.
You want to be confident that the brokerage you choose is somewhere you can see yourself building a long-term career.
Asking about agent retention is a great way to get insights into a brokerage's company culture.
If agents are happy and feel supported by their brokerage, they're more likely to stick around for the long haul.
A high turnover rate could mean that something is wrong with the company culture and that's not something you want to be a part of.
Be sure to ask about agent retention rates when you're interviewing different brokerages.
10 - Is There a Company Policy Manual?
Before you sign with a real estate brokerage, be sure to ask if they have a company policy manual. This document will outline the expectations and procedures of the brokerage and will help you understand what is expected of you as an agent.
A good company policy manual will cover topics such as office hours, dress code, clientele expectations, methods of communication, and more.
It is important to have a clear understanding of these policies before joining a brokerage, so that you know what to expect and can be sure that the brokerage is a good fit for you.
11 - Does Your Brokerage Have Social Gatherings?
If you're considering using a real estate broker to help you buy or sell a home, it's important to ask about the brokerage's social gatherings.
Some brokerages host regular events, like happy hours or holiday parties, which can be great networking opportunities.
Other brokerages may not have any formal gatherings, but their agents may still get together informally regularly.
Either way, it's worth finding out what kind of social scene your potential brokerage has.
If you're the type of person who enjoys meeting new people and networking, a brokerage with regular social gatherings may be a good fit for you.
On the other hand, if you prefer to keep to yourself, you may be more comfortable with a brokerage that doesn't have many formal events.
12 - What Are the Brokerage’s Short & Long-term Goals?
Asking your real estate broker what their short and long-term goals are for the brokerage is a great way to get insight into how they operate. A broker who is focused on long-term growth and stability is likely to have different priorities than one who is looking to make a quick sale.
Knowing what your broker's goals are will help you understand their decision-making process and whether or not they are aligning with your objectives. It's also a good way to gauge how committed they are to the brokerage and its success.
13 - Are There Mentorship Opportunities?
Asking your potential real estate brokerage about mentorship opportunities is a great way to ensure you will have adequate support as you enter the industry.
A good mentor can provide guidance and advice, help you build important relationships, and give you an inside look into the business.
Here are some questions to ask your broker about mentorship opportunities:
- What kind of mentorship opportunities are available?
- Who will be my mentor?
- What is the expected time commitment?
- What are the goals of the mentorship program?
- What are some of the topics that will be covered?
- Who else will be involved in the mentorship program?
- When does the program start and end?
14 - What Does Your Firm Offer to New Real Estate Agents?
Some brokerages may offer things like free or discounted training courses, while others may provide leads or marketing support.
15 - Is There Administrative Support?
If you're a real estate agent, you know that having administrative support can make a big difference in your business. But what do you do if you're not sure if your brokerage has the right people in place to support you?
Here are some things to look for:
First, ask yourself if your broker is available when you need them. If they're always busy or hard to get ahold of, it may be time to look for someone else.
Second, take a look at the office staff and see if they're helpful and knowledgeable. If they're not, it could be difficult to get the information and support you need.
Finally, ask other agents in your office what they think of the administrative support. If they're all complaining, it's probably not a good sign.
16 - What Is the Commission Split?
To determine the commission split, you will need to ask your real estate brokerage. The commission is typically a percentage of the total sale price of the home.
For example, if the sale price is $200,000 and the commission is 5%, then the total commission would be $10,000. The commission is then split between the listing agent and the buyer's agent.
17 - What Are the One-time & Ongoing Fees?
If you're thinking of becoming a real estate agent, it's important to be aware of the fees you'll need to pay. Some fees are one-time only, while others are ongoing.
One-time fees include the cost of taking the real estate licensing exam and joining a real estate board or association. These fees vary depending on where you live.
Ongoing fees include things like MLS dues, E&O insurance, and continuing education courses. These costs can add up, so it's important to factor them into your budget when considering a career in real estate.
18 - What Is Your Company Culture Like?
A company's culture is its values, traditions, and beliefs. They are the guiding principles that dictate how the company operates.
A strong culture can be a competitive advantage, as it can help attract and retain top talent.
While there is no single right or wrong answer when it comes to company culture, it is important to ask yourself if your culture is aligned with your business goals. If not, you may need to make some changes.
When thinking about your company's culture, consider the following questions:
- Do your employees feel like they are part of a team?
- Do they share common values?
- Do they enjoy coming to work each day?
If they can answer yes to these questions, then they likely have a strong company culture.
There is no magic formula for creating a strong company culture.
19 - What Are Your Company's Values
Asking your real estate brokerage about their company values is a great way to get a sense of what they would be like to work with.
At the very least, you should expect them to have values that focus on honesty, integrity, and professional excellence.
The best real estate brokerages will also have values that focus on teamwork, respect, and helping their clients succeed.
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