More and more agents are likely to be employees, rather than independent contractors, in the future, according to panelists at Inman Connect New York Wednesday.
In a session called “Indie Business Models in an Ever-Changing Market,” Thomas Heimann, founder and CEO of Realty Partners LLC, and Jenny Wemert, team lead at Wemert Group Realty, noted that agents are asking for more support.
“We’re finding that agents want a home. They’re lonely out there. It’s hard to compete with the large teams or brokerages and get leads. The models that are scaling the best are those that are providing more value to the agents and helping them build a business that maybe they’re not capable of doing,” Wemert said.
Heimann said his own business model is one where the customer is the agent, not the buyer or seller, so his firm focuses on training agents and helping them do their job better by providing technology, marketing support and transaction coordinator services.
But Heimann’s model also comes with a twist. He said Realty Partners is the first truly agent-owned real estate company, modeled on the way a law firm is set up. The agents own 55 percent of the company and get 55 percent of the profit each year. Agents have to qualify to become partners and must have a sales volume of at least $1 million to qualify.
But there are some brokerages that see consumers as customers, and where “providing incredible customer service experiences” is “paramount,” he said. “I think within that context, I can truly see a move towards an employee type of business model because we can better control the process.”
Wemert said, “I agree with [Heimann] as far as the employee model goes with commission compression happening, but I also think we’re going to have to be one-stop shops with affiliated partners — lenders, title, mortgage, insurance.”
She said her own firm calls itself a “teamerage” because she has a team of 52 — 30 agents plus administrative support staff. Her agents focus on customer service and getting offers accepted rather than on every detail of a deal, according to Wemert.
“The perfect agent for us has that servant heart, supportive behavior style,” she said.
Her agents are also expected to get half of their business from repeat clients and referrals after two years with the firm. That’s because the brokerage’s marketing team does the work of keeping in touch with clients by sending birthday and anniversary cards, throwing parties, running sweepstakes, and managing agents’ Facebook pages. Agents’ contact databases become the firm’s databases, according to Wemert.
“We do it on their behalf because we believe in that database. That’s going to be our future, right? That’s the foundation for our business,” she said.
Both Heimann and Wemert said their company cultures encourage agents not to see each other as competitors.
“Our team members don’t post numbers. They don’t know each other’s goals because they don’t all have the same big ‘why.’ We don’t have leaderboards,” Wemert said.