- Successful retiring agents should sell their book of business to new incoming agents.
- Successful agents with a valuable rolodex and influence in the market are missing out on a profitable and interesting opportunity as they exit the market.
- Companies like Re/Max can buy retiring agents books of business and then use them to help recruit new agents.
John Lalas, a young agent at Re/Max Insight’s Dover, New Hampshire, office is thoroughly enjoying settling in at his new company, learning from his boss Scott Patterson and top agents like Patti Kemen.
When Kemen decides to retire, Lalas, a former pizzeria owner in his 20s, said he would be delighted to buy her book of business. Like a lot of new agents, his deals at the moment are coming as a buyer agent, representing friends from college.
“Patti Kemen is like the queen of real estate,” he said. “She has been in it for 35 years. If she sold her book of business I would have to make that information mine because she is so good, so knowledgeable. Any input she has, I have to take a pen out and write it down.”
And if Re/Max Insight franchise co-owner Jason Amiss has his way, buying a top-selling agent’s book of business could be a possibility for Lalas and other rookie agents.
“Much like traditional mergers and acquisitions in the real estate brokerage space, agents themselves are, and have built, businesses,” he said.
“Why not sell that book of business to a younger agent, one looking to build their business in a specific region or niche of the market?” he said.
Outgoing agents will need to think about the value that can be attached to their systems, personal and team production, sales history, database reach and intangible asset value, he added.
To Amiss, it’s a no-brainer. The more experienced, transitioning agents, looking to retire or simply go “reactive” all too often just think they will hang their license and take or give a referral or two, he said.
“But the successful agents with years of experience and a valued rolodex and sphere of influence could be missing out on a very interesting and profitable opportunity,” he added.
“For brokerages, this marks a very interesting time in the business,” said Amiss. “More millennials are entering the business and more mature agents are having great success again in these markets and may want to exit on top rather than being forced out of the business due to the macroeconomic climate.”
Amiss has big plans for making the system more seamless and profitable for both the outgoing agents and newcomers
“This is an area that I have on my radar for 2016 and one that we will be building a program for, for our existing agents.”
He has agents at outside brokerages in mind too. He could use the purchase of a book as a recruiting tool for Re/Max Insight, for instance.
With a background in business and sales tech, Amiss doesn’t see why a good real estate business should “wither on the vine” when a top salesperson retires.
For a new agent like Lalas or an agent coming from another business, the transition process of getting up-to-speed in a new market can take a good 9 to 12 months, said Amiss.
Meanwhile, the Re/Max Insight business owner is working on other on-boarding programs and continuing education for his 94 agents in 6 offices serving New Hampshire, Massachusetts and Maine.
He is rolling out a peer mentoring program, identifying both a core mentor in every office as well as a back-up mentor and rotating it once a year.
Amiss is introducing Re/Max Exclusive Momentum coaching program to agents old and new, giving them new ideas for running their businesses in a module form. There will be marketing and real estate modules, plus education in lead and broker conversion.
“We also provide a dedicated trainer/on-boarding manager just to ensure new and incumbent agents are up-to-date with the latest on Re/Max tools, their social media profiles,” he said.
Amiss is not a licensed agent; his focus since setting up the Re/Max franchise six-and-a-half years ago has been solely on growing the business through mergers, recruiting and marketing. Amiss’s business partner, Mark Bishop, takes care of the transactional side.
Since starting the business, Amiss has initiated four mergers, taking Re/Max Insight to six offices in New Hampshire and Massachusetts. He has recruited ten people this year, most of them experienced.
“We are looking to grow further,” he said. “I firmly believe the dynamic of a small brokerages is going away — you need to scale. The age of the super-broker is coming back, with a regional focus rather than town by town.”
The business is on track to grow 85 percent year-over-year with roughly the same team, he said. Volumes were $229 million last year, and this year that should be pushed out to $400 million.