If you’ve had your real estate license for at least four years now, you might be pondering taking that next big step: becoming a broker. Heck, you might even be standing at the edge of the cliff ready to jump. Undoubtedly, the prestige of being a broker and the prospect of a much greater income is appealing. Of course, getting your broker’s license doesn’t happen overnight. You’re looking at additional training and passing your broker’s exam. However, these days, you can do all of that online from the comfort of your own home. (Check out Broker Responsibility Course from licenseclassroom.com). Making the move from a real estate agent to a broker is a monumental move, but it’s not for everyone. There are many pros and cons to becoming a broker. You’ll want to weigh them out carefully before taking that big leap. Here’s a few “pros and cons” for your consideration:
Pro: Money Talks
When you’re a real estate agent, you have to split your commission with your broker. As a broker, you can work solo and keep the entire commission to yourself. That in itself is a major motivator to step up your game. But wait, there’s more! If you hire a team of real estate agents to work under you, then you can earn commission off of their sales. If you have a strong team working with you and you’re a motivated and inspiring broker, the income potential is great!
Con: No Free Ride
Becoming a broker isn’t easy and it isn’t free. While the rules vary from state to state, there are multiple hours of class time that are required and it costs money. You’ll have to pay for your classes; plus, exam and license. You’ll want to pass your license exam the first time as retaking it costs more money. To help ensure you pass the first time, check out broker pre-licensing classes at licenseclassroom.com
Pro: You’re The Boss
You’ve completed the additional training and passed your broker’s exam. The reward is sweet. As a broker, you’re no longer legally required to work under someone like you did when you were a real estate agent. By law, you can work independently or you can now hire a team of agents to join in and work under YOU! Either way, the time and effort that it took to become a broker is well worth it when you become the one officially in charge!
Con: The Juggle Is Real
When you become a broker, you’ll need to keep many balls in the air. A new job title and brokerage firm automatically equates to more paperwork and responsibility. If you opt to form a team to work under you, you’ll have to hire, train and mentor new agents and office staff. You’ll need to stay up to speed on the latest real estate laws and trends. It’s easy to get overwhelmed, but a good business plan going in can help your transition from real estate agent to broker go smoothly.
You have more work options as a broker than you do as a real estate agent. You can work independently. You can work as a managing broker where you’ll oversee the daily operations of your firm, including mentoring agents and hiring staff. Or, you can take on the responsibility of the designated broker (an extension of the managing broker) where you’ll manage the entire firm – overseeing other brokers and agents with a more hands on approach.
Con: No More Safety Net
When things go wrong, you have no one to fall back on. The buck stops with you…the broker! This means, if you hire real estate agents to work for you, you are legally responsible for any business mistakes they make while working under you. On the other hand, it could be you who makes a mistake that negatively impacts your team’s livelihood. Such mistakes can backfire and damage the reputation of you and your firm. You’re held to a much higher standard of responsibility.
Just as the “Queen of Soul” sings…RESPECT. Your freshly minted status as a broker is impressive and will likely bring you a greater level of respect from your colleagues and people in your community. Many buyers and sellers prefer to work directly with the broker. They’re trusting in your advanced knowledge and experience when it comes to marketing, negotiating price and making sense of the paperwork. Earning and “keeping” that respect is key to your success as a broker.
Con: Business Expenses
As a new broker, you’ll most likely want to open your own firm which will require a start up investment. Additionally, ongoing costs such as rent, insurance, employee salaries and office supplies will add up quickly and take a chunk off of your bottom line. Eventually, you’ll be able to pass on some of those expenses to your real estate agents, but that will take some time. Be prepared to pay most of these costs upfront and any unexpected expenses that are bound to come along.
If you’re ready to step up your real estate game and become a broker, check out broker classes at: licenseclassroom.com