How Do Real Estate Teams Work?
The Advantages of Working With a Real Estate Team
Working with a team is becoming more common for real estate agents in the millennium, and it provides a real benefit for both agents and their clients. The National Association of Realtors conducted a 2018 survey and found that 26% of agents work in a partnership or with a team.
A real estate team gives clients two or more experienced agents—at a minimum—working on their behalf. It's twice the number of agents for the same price. The client gains collective knowledge and wisdom. Team members often brainstorm offer strategies for clients. In a pinch, any one of the team members can cover for another. No client should ever feel neglected.
The Basics of a Real Estate Team
There are no set procedures that all real estate teams must follow, but team members almost invariably pitch in for each other and share the team spirit.
A client can contact any other member of the team for assistance if one particular agent isn't available. Someone is always there, even if the client has been assigned to the care of a particular agent.
One agent might be in charge of handling buyer phone calls on listings and sign calls, while another might escort buyers on home-showing tours or host open houses. Another might draw up purchase offers, manage the lending process, or attend home inspections.
Roles can depend on each agent's expertise and affinities, and duties can and often do overlap.
Teams can also provide a big benefit to new agents as they learn the ropes, providing a measure of training and mentoring.
The Team Leader
The team leader is generally the agent who handles the listings. Team leaders list, then team members work with buyers. In some team formats, all members are encouraged to pursue listings under certain circumstances, but most often the leader is the rainmaker—the individual who brings in the business.
Listings are the lifeline of the real estate industry.
A team leader can't possibly be in 10 places at once without the support of a team. Team members can hold four or five open houses simultaneously. The open houses attract buyers, which keeps everyone very busy.
How Compensation Works
Leaders compensate members in various ways. Pay can range from a flat rate for a salaried associate or a portion of the team leader's commission to a particular percentage split based on performance. It might be a combination of all of the above.
Fiduciary Relationships and Real Estate Teams
Team leaders often operate within a single agency, so they represent only the sellers. They don't have to worry much about whether they're looking out for the buyer. They have a fiduciary responsibility to only the seller.
This usually works well because many different qualities and skill sets go into representing sellers versus buyers.
It makes little difference to most leaders whether a team member is the procuring cause who produces a buyer, or if it's an agent at another company. A team leader's interest is in selling the home for the seller.
Dual agency applies if a team member brings a buyer, just the same as if another agent from another office within the same brokerage represents the buyer. Not all dual agency is dual representation.
At the time of writing, Elizabeth Weintraub, CalBRE #00697006, is a Broker-Associate at Lyon Real Estate in Sacramento, California.