Starting a “team” seems to be one of the hottest trends in real estate right now. Younger, hungrier agents are determined to one day have multiple assistants, several buyer agents and a moving truck with their smiling picture on the side. The fastest growing real estate company in the world, Keller Williams, teaches their agents a step-by-step process to create a team so that one day they might exit the business and live off of the passive income it provides. Zillow is even incorporating teams into their Agent Profiles and developing new tools to help teams grow.
I personally manage a 15 person team and developed Nekst to help individual agents and teams implement systems for their business.
But while building a team is more popular than ever, there exists a heated debate over whether operating as a single agent or a team is better for the consumer. What I find most remarkable is that the industry has not defined what it means to be a team.
According to Merriam-Webster, the word “Team” originated prior to the 12th century and meant “two or more draft animals harnessed to the same vehicle.” It later expanded to mean “two or more persons associated together in work or activity.” Based on this definition, one could argue that a single agent working with an assistant is actually a “team.” I personally don’t know any top producing agents who do not utilize at least one assistant (and yes, your unpaid spouse counts as your assistant).
The blur between single agents and teams gets even murkier when you look at the annual real estate ranking report produced by Real Trends. Real Trends publishes rankings for the Top 500 Agents in America by total transactions and volume in both the “Team” category and the “Individual” category.
According to the most recently published figures, Ben Caballero was ranked the #1 Individual producing agent in America by Real Trends for completing 2383 sides. In other words, Ben closed 6.52 sales per day including weekends and holidays as an “individual.” In fact, Ben sold 866 more homes than Rhonda Duffy out of Alpharetta, GA who manages the largest team in America and did 1517 sides last year. I can’t imagine how Ben could individually manage this monstrous amount of business.
Even the lowest ranking “Individual” producer on the Real Trends list, Suzie McDowell from Keller Williams, did 126.7 sides. (How she got .7 of a sale is a mystery better uncovered during my next article.) This translates to a home sale every 3 days, a workload that I, again, believe cannot be managed without some additional support.
So if the most successful real estate agents out there are working in the capacity of a team, why is there so much heated debate over whether a “team" is good or bad for the consumer? Perhaps the point of contention isn’t really about folks working together as a team but instead about how some teams operate. Let’s explore a few of the more common reasons that individual agents hate teams.
Complaint #1 - Teams include a “rainmaker” who lists homes under their name but has limited involvement with the transaction, thereby misleading the seller.
This is sometimes true but I don’t personally see this as a negative. Part of managing a team is creating and executing precise systems that are built to bring about the best selling experience for a client. Most individual agents don’t have these systems since they work independently and tend to keep track of their business in their brains. With a team, sellers are connected to a group of specialists who follow a well-defined process for ensuring a consistent and well-rounded experience for the client. Though the seller may not be in frequent communication with the rainmaker, the processes in place for managing that sale are an extension of the rainmaker himself.
Complaint #2 - Teams get better commission splits and better benefits from my brokerage.
Teams reap the benefits of economies of scale and have advantages that individual agents do not have when it comes to leveraging better splits. Just like the cast of ‘Friends' bound together to negotiate a crazy high per-episode salary towards the end of the series, successful teams are able to do the same. And when it comes to leads, I find that brokerages tend to favor the independent agent when it comes to lead distribution since teams are capable of generating leads on their own.
If you’re not getting many leads, it likely has nothing to do with your operating structure - it probably has more to do with the fact that your broker either has little confidence in your ability to close a lead OR you simply aren’t viewing your broker as a lead source who needs to be “marketed” to just like a consumer.
Complaint #3 - Teams are turning the transaction into an assembly line rather than building a 1-on-1 relationship.
Working with a team IS more like an assembly line. But so is going to a restaurant, obtaining a mortgage, checking into a hotel or attending a sporting event. Certain industries are either too complex to be managed by a single person or consumers expect a level of service that individual agents cannot adequately provide. In my opinion, real estate has become more complex and the demands of consumers are increasing.
Although there are still plenty of individual agents creating raving fans, the overall market share for individual agents seems to be declining which would worry me if I were an individual agent. The most successful teams are the ones that operate like an assembly line while also building a genuine rapport with their clients.
Complaint #4 - Their marketing is everywhere - yard signs at every corner, a Glen Beck endorsement on the radio and an ad you can’t ignore on your grocery cart.
Although this may completely irritate any agent in the market, it is not grounds for feeling negative. The fact that teams spend money on traditional advertising only helps to remind consumers of our presence in the industry. Jealousy is something we all deal with on occasion, but you should allow these feelings to motivate you rather than irritate you.
In conclusion, your decision to work alone or build a mega team should not matter. It's all about where you find fulfillment in this crazy industry. For individual agents, it may be the hug at the end of the closing that fulfills you. For a rainmaker, it may be the birds-eye view of the operation you've built from nothing that fulfills you.
But should you have the desire to reach the highest levels of success in this profession, I hope we all can agree that you can’t do it alone. Nekst is the top system for real estate team management. Nekst offers pre-written or custom real estate action plans to help you and your real estate TC stay on track from contract to close! Create Real Estate systems, assign tasks & share the real estate Client Portal with your clients to keep everyone on the same page throughout the buyer and selling process..