Solo real estate entrepreneurs are a unique breed. These “lone wolf” agents put an immense amount of work into a single transaction, from communicating with leads and earning their trust, to listing and showing a home, to negotiating the deal, to drawing up contracts, to completing the sale and collecting the commission. The best solo entrepreneurs handle all of this with passion and hard work, which can translate into a successful and rewarding career.
However, being a solo real estate entrepreneur has its limits—there are only so many hours you can work in a week, and only so many clients and transactions you can handle in a year. The preferable solution, chosen by many agents, is to form their own real estate teams. This concept has picked up steam over the last decade or so: A team leader brings on listing agents, buyer’s agents, marketing specialists, and other assistants to help run a brand-new business.
Being a solo real estate entrepreneur has its limits—there are only so many hours you can work in a week, and only so many clients and transactions you can handle in a year. The preferable solution, chosen by many agents, is to form their own real estate teams.”
The advantages agents seek from the team model are plentiful. A survey from Inman Group that allowed respondents to pick more than one answer found that 61 percent of respondents cited “work-life balance” as a reason to form a team, 56 percent (respondents could pick more than one answer) cited “the chance to expand their business opportunities,” and 50 percent cited “providing more effective representation for clients.” These benefits are alluring, but building a successful team requires more than hiring a few people and turning them loose to work. The process requires careful planning of goals, the structure of your team, and the roles and responsibilities taken by your team members.
This guide details the team-building process for agents who are interested in starting their own teams, as well as agents looking to revamp or expand their existing teams. It focuses on the importance of good planning, provides sample frameworks that teams of various sizes might take, details several defined roles your team may include, and explains how a team-centric brokerage can help you achieve success.
The Value of Teams
Teams offer a great benefit to your career, the associates you work with, and the clients and community you serve. The monetary benefits are obvious, but for successful solo real estate entrepreneurs who feel overwhelmed, the time savings are also significant. Team members share in your success and expertise, which ultimately helps the overall industry. And if you are good at your job of helping people sell homes and move into new ones, your additional success will translate into more happy customers. What follows are seven ways teams bring value to a real estate business.
Forming a team allows agents to return to or strengthen focus on what’s important to them within their careers.”
Successful lone wolf real estate agents may encounter an unusual paradox holding back their careers: their own success. The more sales you make, the greater your reputation grows, the more potential clients come your way—this cycle of success ultimately can lead to turning away clients because your plate is too full. Subsequently, your revenue tops out simply because you are maxed out on what you have the time and resources to do. Developing a team allows you to delegate tasks to assistants and coworkers, thus allowing you take on those extra leads, build stronger client relationships, and increase your earning potential.
Along the same lines, a hyper-successful solo real estate entrepreneur who is rolling in leads and clients may not have much time for anything else. What’s the point of working so hard if you can’t find time to enjoy the rewards of that work with your family and friends? Starting a real estate team lets agents handle an increased number of clients and transactions while still maintaining a healthy work-life balance.
Every real estate agent comes to the business with specific goals—goals that can evolve over time. As these agents enjoy more success, those goals can get away from them. Gradually, they lose the work-life balance they were seeking, work less with their target clientele (e.g., young families or more local buyers and sellers), get bogged down with busywork, and so on. Forming a team allows agents to return to or strengthen focus on what’s important to them within their careers.
An advantage of leading a team is that you (theoretically) enjoy wide latitude to run your business in the way you want. Yet, when the transactions pile up, agents might find themselves throwing that latitude out the window just to stay successful. A team allows you to stick to your principles (and partner with people who will embrace your business plan), while giving you the leverage to maintain and increase your success.
As already stated, success breeds success, but one person can only do so much with the hours in a week. Inevitably, you will hit a point where you simply can’t grow anymore. By forming a team, your business can continue to scale. The great thing about this concept is that the sky really is the limit—if the resources and clientele are there, you can continue to add people and expand your business as you see fit.
Hiring help to reduce transaction costs may seem odd, because the expense of paying your team—particularly a transaction coordinator—will always be there. But think about how much time it takes you to complete a transaction, from drawing up the contract to staying in contact with all of the necessary third parties, to concluding the process. These tasks likely consume hours of your time and take energy away from more impactful responsibilities, such as communicating with clients. A transaction coordinator and other team members can do these tasks more efficiently, thus saving money, setting the stage for more business growth, and allowing you to focus on what you do best.
The ultimate goal for a real estate team is to increase output and revenue. When many team members work in concert to get houses sold, the amount of transactions will proportionally increase. Imagine a sandwich shop and the way a production line of workers can get your sandwich made in a minute, whereas a single person may need five minutes to deliver your food. Both sandwiches might be delicious, but that production line shop can serve more customers who will leave happy. A real estate team works the same way—each person works individually yet together to achieve goals, increase productivity, and impress clients. The benefits of forming your own real estate team are real. Although relinquishing some responsibilities might be a struggle at first, the long-term advantages will soon make you feel less worried about trusting someone else to handle the minor details of each transaction.
Did You Know Webinar: Teams Are the Future
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Five Signs That It's Time to Scale
How do you know if your business is ready for a team structure? These are some signs that the timing is right—or isn’t right—for top-producing solo agents to take the plunge and start their own real estate teams.
If you are constantly on the phone, talking with leads and customers, and falling behind on the technical details of listing a home and completing the transaction, the timing might be right for a team.””
The advantages agents seek from the team model are plentiful. A survey from Inman Group that allowed respondents to pick more than one answer found that 61 percent of respondents cited “work-life balance” as a reason to form a team, 56 percent (respondents could pick more than one answer) cited “the chance to expand their business opportunities,” and 50 percent cited “providing more effective representation for clients.” These benefits are alluring, but building a successful team requires more than hiring a few people and turning them loose to work. The process requires careful planning of goals, the structure of your team, and the roles and responsibilities taken by your team members.
This guide details the team-building process for agents who are interested in starting their own teams, as well as agents looking to revamp or expand their existing teams. It focuses on the importance of good planning, provides sample frameworks that teams of various sizes might take, details several defined roles your team may include, and explains how a team-centric brokerage can help you achieve success.
Once you know the timing is right, you can move on to more serious planning.
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Should You Stay Solo or Form a Real Estate Team?
First, a Business Plan
Before forming a new team or adjusting and possibly expanding a current one, you will need to formulate a plan. On your own, managing everything you need to do and reacting to what comes next may be a lot of work, but it may not be that complex—you simply know what to do and do it. With a team, you will be directing and trusting others to deliver on their parts of every lead follow-up, listing, open house, and transaction. They need guidance and oversight. In the aforementioned Inman survey on teams, 84 percent of respondents felt that having a clear vision for the team was important. In short, your team needs your leadership, but that will be difficult without a plan everyone can follow.
A business plan is a critical part of developing a successful team, but before looking at the positives, let’s first take a look at why not having a plan is so dangerous. Most real estate agents aren’t particularly great planners. This isn’t necessarily a flaw, but more the nature of the business—real estate professionals are high-eyed people who make gut decisions and then go. Although this serves them well in some cases, it can spell disaster within a team concept. Team leaders may think, “I’ll just hire a few people to help,” and never consider the finer details, such as roles, compensation, and organizational structure. Without being intentional in your planning, chaos can ensue, as your team members may disengage, and then revenue suffers.
The end results of this chaos aren’t pretty: lost business, lost profits, and lost reputation. Team leaders may either abandon the team or muddle through with the improperly planned team, often coming away with less revenue than when they were on their own.
However, it doesn’t have to be this way. Defining roles, setting goals, and forecasting growth will provide the blueprint to succeed. You already know what hard work means—just a little bit more of it, instead of choices made from your gut, can set you on the path toward building a productive team that works in sync with itself and reaches marketing and revenue goals.
Team culture defines not only your team’s business environment, but also the way team members commit to your mission, work together, and attend to the finer details that lead to excellence. Unhappy team members don’t buy into the team culture and are usually not as productive as they could be. You set the tone and mission of the team’s business; with good planning, every decision will be made with that team culture in mind. Ultimately, you’ll want to partner with people who buy into the culture, thus better ensuring they will be happy as the successes build up.
A lack of set expectations can hurt teams as thoroughly as other planning-related deficiencies. What are your team’s goals? Which responsibilities are entrusted to each team member? How are team members held accountable? How are they recognized and rewarded for exceptional work? What do you expect of yourself as team leader? Expectations in these and other areas must be established in order to gauge success and move the business forward.
Team culture defines not only your team’s business environment, but also the way team members commit to your mission, work together, and attend to the finer details that lead to excellence.”
New teams may not be looking to expand beyond a few people, but growth will be required to get these businesses to reach their desired output. If you want to grow a bigger team, long-term planning for bringing on new team members and determining the rate of expansion is essential. Existing teams need the same kind of forecasting: What adjustments are needed now to lead the team to the place you want to be in the next year, or the year after, or five years down the line? Solo real estate entrepreneurs often live in the moment, advancing from one transaction to the next and collecting their commissions. Once you become a team leader, you must lead the team—and that’s impossible if you don’t know where you are going.
