© 2011 Cengage Learning

Choosing The Right Broker Chapter 2 © 2011 Cengage Learning

RATIONALE FOR CHAPTER Choosing the right broker to work for is probably the most important decision a new licensee makes.

© 2011 Cengage Learning RATIONALE FOR CHAPTER All students need to learn or be reminded that training, guidance, and mentoring are far more important than who will pay the highest commission split.

© 2011 Cengage Learning RATIONALE FOR CHAPTER Most agents will pursue a career in residential real estate, but the students need to know about what other types of specialties are available to them.

© 2011 Cengage Learning RATIONALE FOR CHAPTER The importance of initial and on-going training and education is critical to the success of students.

© 2011 Cengage Learning Focus of Presentation Differences between single and dual agency. Duties a new agent performs to obtain new business holding Open House listing For-Sale-By-Owners neighborhood prospecting (farming) and phone contact with a sphere of influence group other activities you wish to spend time on.

© 2011 Cengage Learning Focus of Presentation residential income property commercial property industrial property mobile-home parks land and farm brokerage lot sales site sales (new construction) property management loan brokerage, and the appraisal field

© 2011 Cengage Learning Focus of Presentation Think about comparing each firm’s new agent and on-going training, the drawbacks to working for a “selling broker,” who may even be in direct competition with them, and the advantages of a mentor program.

© 2011 Cengage Learning Focus of Presentation Carefully consider the importance of weighing training and support against the lure of a high commission split without either. (100 percent of nothing is nothing)

© 2011 Cengage Learning Focus of Presentation Remember, agents with professional designations generally earn considerably more money than those without.

© 2011 Cengage Learning CHAPTER TWO OUTLINE 2.1. GENERAL BROKERAGE 2.2. CHOOSING THE RIGHT BROKER 2.3. BROKER/SALESPERSON RELATIONSHIPS 2.4. CONTINUED AND ADVANCED TRAINING 2.5. PROFESSIONAL DESIGNATIONS

© 2011 Cengage Learning GENERAL BROKERAGE Describe the general real estate brokerage industry. Remember, most agents represent people who want to buy or sell a home.

© 2011 Cengage Learning GENERAL BROKERAGE Single agency versus dual agency.

© 2011 Cengage Learning GENERAL BROKERAGE Benefits of the multiple listing service (MLS) to the agent and the customer.

© 2011 Cengage Learning GENERAL BROKERAGE Different types of real estate specialties available to licensees and the knowledge needed to function effectively in each one.

© 2011 Cengage Learning GENERAL BROKERAGE Residential income property Commercial property Industrial property Mobile-home parks Land and farm brokerage lot sales Site sales Auction sales Property management Leasing Loan brokerage Appraisal

© 2011 Cengage Learning CHOOSING THE RIGHT BROKER Importance of meeting with several different brokers to get a true picture of different firms. Remember the importance of comparison in determining the right broker for you.

© 2011 Cengage Learning CHOOSING THE RIGHT BROKER Consider the high failure rate of new licensees. Main Cause: lack of training, supervision and mentoring (50% first year / 85% by the end of the third year)

© 2011 Cengage Learning CHOOSING THE RIGHT BROKER Types of training that is available at top firms o new agent training o role-playing o video and CDs o field training with a mentor or the broker.

© 2011 Cengage Learning CHOOSING THE RIGHT BROKER What to look for in an office a full time administrative staff sales manager broker availability for questions positive, successful agents Ask what commission plans are available?

© 2011 Cengage Learning CHOOSING THE RIGHT BROKER Spend time thinking about the interview process and what questions to ask.

© 2011 Cengage Learning BROKER/SALESPERSON RELATIONSHIPS It is mandatory for the broker to have a written contract with each agent in his or her employ?

© 2011 Cengage Learning BROKER/SALESPERSON RELATIONSHIPS Think about the differences between an employee and an independent contractor & the IRS requirements. (use the comparison chart in Figure 2.3)

© 2011 Cengage Learning BROKER/SALESPERSON RELATIONSHIPS An employing broker is responsible for the salespersons actions. Think about the importance of carrying automobile insurance & errors and omissions insurance.

© 2011 Cengage Learning CONTINUED AND ADVANCED TRAINING Think about the importance that education and training will have on your success.

© 2011 Cengage Learning CONTINUED AND ADVANCED TRAINING Shadow a successful agent as a way to quickly learn the ropes.

© 2011 Cengage Learning CONTINUED AND ADVANCED TRAINING Required continuing education courses every 4 years. Classes provide excellent opportunities to learn more about the real estate business.

© 2011 Cengage Learning CONTINUED AND ADVANCED TRAINING Benefit of asking seasoned agents which national speakers and trainers are the best ones to attend.

© 2011 Cengage Learning CONTINUED AND ADVANCED TRAINING What is “survival training?”

© 2011 Cengage Learning PROFESSIONAL DESIGNATIONS As agents we sell knowledge, not real estate. There is no substitute for the type of knowledge & professional edge that can be obtained by taking the courses offered by the National Association of REALTORS®.

© 2011 Cengage Learning PROFESSIONAL DESIGNATIONS Graduate, Realtor’s Institute (GRI) Certified Residential Brokerage Manager (CRB) Certified Residential Specialist (CRS) Senior Real Estate Specialist (SRES) Certified Commercial Investment Member (CCIM)