There isn’t a step-by-step how-to guide on how to open a real estate brokerage in Minnesota. Sure, there are rules, and the Department of Commerce website outlines what is needed to operate a brokerage, but we are on our own when it comes to the exact steps to start a company and are just supposed to know how to make everything work.
People who buy a franchise probably get help from the headquarters, and when they do, they get up and running. I have to do everything the hard way. For the most part, I am finding what I need — it just takes time to assemble it all so that it can be shared companywide.
My brokerage has been in existence for only a month, and I just brought on my first agent and am talking to some others. I am not collecting agents; I am being very strategic, and eventually I can unveil my grand plan, but not today. I need to have some secrets.
It isn’t as hard to start a real estate brokerage as most people would imagine, and it is also harder to start one than you might guess.
During this past two weeks, I have dumped a lot of time into taking training classes. I am now confident that I can run a real estate company and sell real estate without ever printing a contract, and I can review contracts written by my agents and even electronically approve them. Contracts can be stored in the cloud so that I don’t need to have agents email contracts to me; they can just stay where they are so I can see them.
I did not have to buy or rent any software to set up my virtual office. In Minnesota, we have Instanet forms as part of our MLS (multiple listing service) with Authentisign for electronic signatures. It is fairly easy to create all of the contracts needed in a real estate transaction and have them signed electronically using a tablet or computer or even a phone.
Even though I have used Instanet forms for years, I had no idea of the features included with broker-level access, which are what I call “back office” features. I can see and review contracts generated by anyone in my office. As each company customizes Instanet for their agents, each company creates a slightly different user experience.
My back office is now complete with the ability to add forms and clauses and share forms with my agents, and I can look at transactions that have been completed and make sure everything is OK. I can put procedures and checklists into the system so that I don’t have to hire an office administrator right away. Instead, I can pay someone to help with marketing and lead generation.
There are many real estate agents in my market who don’t fully utilize the electronic forms. Most of the offers I get are handwritten on printed electronic forms and signed the old-school way. It could just be that they don’t have clients who want to use electronic signatures. They could also be scanning the signed documents back into the system where they can be reviewed and shared with their office.
My clients probably don’t care about how a paperless office works for real estate agents, and I won’t put it in any of my marketing materials, but they will benefit because my overhead will be low, and I can pass some of the savings along to them.
I have been rethinking the real estate brokerage, and now I wonder why so many agents are left to figure out how to create paperless real estate transactions. Why aren’t real estate brokers and companies leading the way?
From a business point of view, I don’t see a downside to using technology instead of renting more space or hiring more people. The word “can’t” isn’t really part of my vocabulary. I just need to make sure that the agents I bring on are like-minded and either know how to leverage technology or are willing to learn.
Clearly, our MLS is leading the way by offering electronic forms, and my clients seem to love having access to the contracts and the ability to sign them from anywhere.
Having a paperless office helps keep costs down and makes it possible to actually provide oversight –which is what brokers are supposed to do.