I came across this blog post from a Realtor in the States, which is a big eye opener when comparing real estate brokerages. Many people have the old school belief that you need a big name to help with your real estate transaction. This article sheds some much need light on that myth. With technology & the internet at hand, the playing field has been leveled! Read on!
You’re a home-owner and you’ve come to terms that you wish to sell your home. For whatever the reason, it’s just time. Maybe you’re retiring and need to down-size your home. Could it be that you are growing your family and you need a bigger home? Or, the changes in your local economy have snagged you pretty good so now because of financial and/or family distress, you have to sell your home.
Okay. Now that you know that you have to take action, who are you gonna call? The local brokerage? Or the big-name brokerage?
Most would say that the answer is simple. Go with the BIG guns, the GURU’s of listings and sales, the BIG name recognition. Names like Coldwell Banker, RE/Max, Century 21, Keller Williams, Exit, and Weichert Realtors, Realty Executives, and Realty World.
What do they all have in common? They are considered some of the most successful big guns in real estate brokerage services. Some of them have been around for quite some time. Others not as long. Their services include anything from Commercial & Residential real estate to time-shares, land acquisitions/sales, International real estate, and more. They are impressive. And their advertisements and commercials are almost second to none.
So okay, what’s the dilemma here? The choice is simple. Pick one of the giants and get on with your day, right??
Before you decide, let’s segue to another thought, just for a moment. It will shed some light as to what I’m getting at. Have you ever encountered any legal commercials on television, the radio, or even in print where they typically say something like the following: Don’t pick an attorney solely based on their advertised offers, claims, abilities, etc. You should do your own research prior to hiring an attorney to represent you to make sure they can actually help you?…Take a moment to take that in.
Now, back to the point in question. The Local Brokerage or the Big Name?
Instead of discounting the Local Brokerage that could help you, have you considered really doing the math as to who may be more willing and able to help you achieve your real estate goals?
Typically speaking, if we do a simplified comparative analysis on both types of brokerages we tend to find the following:
| FEATURE | LOCAL BROKERAGE | BIG NAME BROKERAGE |
| Size (Number of Associates) | 1-50+ | 1-50+ |
| Sales Staff Training | YES | YES |
| Local Knowledge (Typically) | YES | YES |
| Full Service Brokerage (Typically) | YES | YES |
| Website with Online Tools | YES | YES |
| World-Wide Exposure | YES | YES |
| Multi-Year Experience | YES | YES |
| Real Work Ethic (Typically) | YES | YES |
| Multiple Listing Service (MLS) (Typically) | YES | YES |
| Commaraderie (Intra-Office – Typical) | YES | YES |
| Commaraderie (Inter-Office – Typical) | Usually | Usually |
| Broker Reciprocity (Typically) | YES | YES |
| Required Self-Promotion for Associates | YES | YES |
| Ownership (Typically) | Independently Owned & Operated | Independently Owned & Operated |
| Network (Typical) | Indirect | Direct |
| Drive to Help | YES | Usually |
| Experienced Marketing | YES | Usually |
| Property Exposure (Online) | Multi-Faceted | Limited |
| Associate Flexibility (Typically) | YES | Limited |
Now keep in mind that the “Features” shown on the chart above don’t always hold true for EVERY brokerage, either regular local or big name local. They are, however, generally common-place and are regularly found as being fairly accurate. If a consumer were to ask a realtor or broker if the above held true for their brokerage, they will speak in the brightest light because they want their business. But ask pro to pro, the story is a bit different. But that’s a topic for another day.
What you should look at is the following: OWNERSHIP, PROPERTY EXPOSURE, EXPERIENCED MARKETING, and ASSOCIATE FLEXIBILITY. Let’s break it down shall we?
OWNERSHIP: Why is this important? It’s important because of what it deciphers. Local Real Estate Brokerages, the non-big-name brokerages, are obviously “Independently Owned and Operated. Right? It’s typical and it’s usually a no-brainer to know this. But when you have a professional that tries to sell you on the BIG NAME of their brokerage, be it C21 – XYZ, Realty or Coldwell-Banker – ABCD Realty, more-than-likely THEY TOO are Independently Owned and Operated. What does this mean for you?
Twenty, 15, and even 10 years ago, this was a big deal. Hiring a professional who was aligned with such big names set you aside from smaller, “mom & pop” local operations even if your professional had limited or lesser experience than those “small” folks. But with the advent of new, readily available technology and the increase of shared information, now-a-days, it can actually limit your ability to truly compete (talking about Sellers now.) The playing field has been leveled quite a bit. Some might say that the tables may have been turned to some degree on the BIG NAME operations that are independently owned and operated.
Why? Well let’s touch on two other points:
First, PROPERTY EXPOSURE: Today, most smaller, local operations have, to some degree, better overall exposure for properties that are on the market. This bodes really well for Sellers AND Buyers. Now you’re probably thinking, “What is this banana talking about? How can a ‘mom & pop’ shop that has a small limited budget compete with a multi-million and even a multi-billion dollar company?”
Don’t forget about the Ownership type of many of these BIG NAME brokerages. They too have limited budgets. They may have the “fancy” websites, but they are intra-connected. Those websites are typically provided by “Corporate” where the local BIG NAME local brokerage uses a template system that ties all the information, including properties, into the BIG NAME database. Unless Corporate has a contract with smaller entities to grant even more exposure, property exposure in general is limited through the BIG NAME brokerages’ intra-network and their connection to a local board MLS system which may or may not feed into a larger IDX system (Information Data Exchange) and your typical Realtor.com feed.
They also have on more Achille’s heel…they’re usually limited to their own website SEO (Search Engine Optimization.) Some of their web rankings and world website rankings are almost non-existent as compared to some of the smaller local companies. This means that once the curtain falls, you see that they’re left to fend for themselves like the small-named, “unrecognized” local companies.
Many of the smaller, “unrecognized” local companies have websites now-a-days that rival the big guns because they have the have many of the very same tools to make your research and/or exposure through their websites that much easier and painless…just like the BIG NAME companies. Plus, they have other portals for market penetration that may not be available through the BIG NAME corporate and/or branch sites. It’s not that the BIG NAMES can’t do it, it’s just that they run on a different platform of rules and most everything has to be contractual in some way, shape, or form, especially when you are dealing with millions upon millions of dollars. Due to the increased affordability and availability of certain types of portals and online tools, the unrecognized local companies, have become very versatile and resourceful and can actually plug properties and information into many different online venues. Some of these venues include big names such as craigslist, zillow.com, trulia.com, realtor.com (via MLS), homes.com, yahoo real estate, hotpads.com, lycos, military.com, and the list goes on and on. These are invaluable connections for the home seller and home buyer alike which create a new level of competition for the Big Guns. The exposure to millions of people is just unfathomable.
Don’t underestimate the power of true online exposure. Most people use the internet today in some way or fashion (desktop, laptop, ipad, iphone, etc.) to do their research and, in many cases, start a purchase of a property.
As for the “unrecognized” real estate brokerages, they have to be very aggressive in resourcefulness and budgeting to be able to provide their clients a very real service that benefits all parties involved. Competing with the Big Names is just an everyday task. But in order to be able to do much more, brokers and their sales associates or realtors needs to have some level of flexibility.
Now, FLEXIBILITY: With some level of flexibility, associates are able to work with buyers and sellers alike to help them achieve their goals in an effective, ethical, and efficient manner. Though, as with every industry, not everyone subscribes to this, most do. They are allowed to deviate more easily from the “norm” and adjust their services to the specific needs and circumstances of their customers and clients. Larger, BIG NAME brokerages may or may not be allowed to do so. It’s not that they can’t. Corporate policy may not allow it so as to prevent precedence or other issues that may not be suitable to the company’s image. So this is important to keep in mind: “Can and will my real estate professional truly work with me?”
As for EXPERIENCED MARKETING: Remember, Big Names don’t necessarily mean BIG Returns. Even though most of the Big Name Corporations typically have a tremendous training program for their associates, the kind of training only a well established, well funded corporation can provide, not everyone takes advantage of such a lucrative opportunity to be trained by some of the best in the industry. Don’t forget about the ownership criteria. Some folks tend to rely on the BIG NAME for credibility when in fact, they may not have a clue on what to do. The resources are there, but not necessarily used. If they did, 80% of the money would not be made by 20% of the pro’s. The “unrecognized” small local brokerage doesn’t have the BIG Name to rely on for credibility and resources, so they have to work extra hard, seek effective training, and have extra pride in giving you the best they can.
So before you make your decision on by-passing a smaller, “unrecognized” local brokerage for real estate services, do a little bit more legwork and truly see who can really tailor their services to help you achieve your goals and needs in the best way possible.
I hope the above clears the smoke on some things to consider when picking a brokerage that best suits your needs. As always, your comments are welcome. All I ask is that you be respectful of others. Thanks for reading.
Sold With Kim 