In recent years, the real estate industry has seen a rapid rate of mergers and acquisitions — but there’s also a countertrend where independent local brokerages are surging in popularity.
When it comes to brokerages, I’m proud to say local is better — and homeowners agree: In a survey of more than 3,000 U.S. homeowners, nearly 90 percent of consumers said they preferred working with an agent who had an established local real estate company.
Separately, last year’s annual Real Trends 500 ranking of the top 500 U.S. residential real estate firms found indie brokerages represented by Leading Real Estate Companies of the World produced more than a quarter of the total sales units among the top 500 brokerages.
Here are the top five reasons indie brokerages continue to distinguish themselves in a crowded field and demonstrate tremendous growth nationwide.
Locally-owned brokerages are highly invested in the community where they do business and, as a result, earn a strong level of trust from consumers.
At Baird & Warner, we’ve been doing business in the Chicago area for 163 years — that’s a track record people can rely on. We know Chicago and Chicago knows us. We feel that our firm and broker associates truly understand Chicago-area buyers and sellers, what makes them unique and what drives their housing choices.
That’s why we’re best equipped to provide a high level of value to them. Today’s buyers and sellers are definitely looking at their housing choices through a lens that seeks ways to meet or enhance their lifestyle.
Being a local brokerage means we are intimately in touch with our communities and better able to understand and serve the needs of our clients well.
Unencumbered by bureaucratic red tape or having to run things by a distant “headquarters,” indie brokerages are best positioned to respond to changes in market conditions faster than national players headquartered in other states.
Being able to leverage new marketing strategies more in line with local market conditions achieves better results for buyers and sellers.
When market conditions shift and new technology comes online, indie brokerages can make adjustments more quickly and say, “Here’s the data, and here’s the solution.” This is a huge benefit to consumers and agents.
3. Neighborhood intel
Consumers can find a plethora of data online about a home, but that isn’t enough. What they need is a local neighborhood expert to navigate the data points and distill what’s relevant, important and useful.
There are some terrific national agents, but when you combine local expertise with a local brokerage that’s focusing all of its energies in the community where you live, the result for the consumer is extraordinary.
The local agent knows the properties — inside and out — as well as how to apply the available data to help guide buyers and sellers in the best direction for them.
As each home is different and occupies a unique place in the world, so does each buyer and each seller have different circumstances. The local agent can put it all together and develop a customized plan that has the highest probability of success for the client.
4. Culture of giving
When a brokerage stays local and is committed to positively affecting its hometown, it’s demonstrating a belief in the value of the community and an investment in its success.
Local brokers believe strongly in giving back to their community through philanthropic endeavors, and we are no exception. For example, our Good Will Network has donated more than $2 million since its founding in 2002 to Chicago-area charities, many of which our agents nominated.
Colleagues working together toward a shared purpose can have a great positive effect on company culture. This seems especially true for younger agents.
A 2016 study found 64 percent of millennials consider a company’s social and environmental commitments when deciding where to work, and 88 percent said their job is more fulfilling when they have access to opportunities to have a positive social and environmental impact.
5. Deep bench of talent
Talent is gravitating toward indie brokerages, and consumers gravitate to where the talent is. Over half (51 percent) of Realtors today are affiliated with an independent company, according to a National Association of Realtors (NAR) 2016 survey.
As noted in Inman’s special report on indie brokerage strengths and threats, “Inman’s 2015 indie brokerage Special Report noted, from 2013 to 2014, the percentage of agents at independent firms jumped from 52 to 54 percent,” and from the mid-40-percent range since 2006.
There’s definitely a groundswell of interest in indie brokerages. Top agents want brokerages with cultures that support collaboration, social giving and independence. And they are confident an indie brokerage will offer more financial stability.
Over half of real estate professionals told Inman they felt more profitable as an independent. By generating and fostering talent, indie brokerages are built to succeed and built to grow. There’s never been a better time to be an indie brokerage.
Consumers and agents alike are choosing firms with roots in the region where they want to live and work. Grounded in the community they serve, passionate about giving back and able to quickly mine multifaceted local data and marketing, it’s clear why indie brokerages continue to be successful.
Laura Ellis is president of residential sales and executive vice president of Baird & Warner.