Pros & Cons Of Joining REAL Broker (Agent Review)
REAL Broker, LLC is a cloud-based real estate brokerage that offers its real estate agents huge advantages BUT there are some obviously trade-offs and sacrifices you have to make when joining a cloud-based brokerage.
In this article, I want to review REAL Broker’s Pros & Cons to help you decide for yourself if a virtual, cloud-based brokerage is right for you or not.
For me, I ultimately decided that the benefits outway the tradeoffs, and I did join REAL but you may come to a different conclusion.
CON: No Face-To-Face Interaction
So one of the most obvious trade-offs to a cloud-based brokerage, is you are giving up the in-person face-to-face, and belly-to-belly interaction with the people at your brokerage.
Now, I still do get face-to-face interactions with my clients using services like Zoom. I use zoom daily now to do buyer consultation with my clients, mastermind with other agents, or attend training.
But if I’m being honest, video calls are not quite the same as being in the same room as someone.
Now, there are some benefits to doing everything over video instead of in person.
I feel like I am now more efficient with my time, I don’t have to drive into my physical office to take advantage of training and I don’t have to make my clients take time off of work just to drive to my office for a chat. They can instead do a video call on their lunch breaks or after work which many of them find MORE convenient.
I feel like a lot of agents could benefit in their businesses by giving up in-person meets for virtual ones.
In my opinion, I think there are two categories of real estate agents who are going to find this lack of physical connection the most impactful.
The first is extrovert agents. Those agents who love talking and connecting with others and see going to the brokerage as a social experience.
My mom who is a real estate agent falls into this category. When she drives into her brokerage for a class, she gets there an hour early to talk to other agents and the staff. After the training is over, she stays an hour later chatting people up. She can turn going in for training into an all-day event.
This type of agent may have a hard time adjusting to a cloud-based brokerage at first.
However, there are a few things someone like my mom can do to scratch that social itch.
First, my mom is a member of the Women's Council Of Realtors. They hold regular meetings, social events, and in-person training. In my opinion, this makes a great substitute for the lack of physical connection a social agent may get from other agents in their brokerage.
My mom and I are also both members of the National Association of Realtors and the Maryland Association of Realtors. Both of which have in-person training, have positions we can volunteer for, and have regular social events for REALTORs.
So for any agent who is avoiding a cloud-based brokerage like REAL Broker because they think it may be lonely or isolating, I would encourage them to get involved in their local associations.
Volunteer for positions and attend their in-person training and social events. Networking with agents outside of your brokerage may actually help your career.
You can also consider adding business networking events as one of your lead generation tasks. I know several agents make it a point to go to 1–2 networking launchings a week or even more to pass out business cards, build relationships and socialize.
Just search for networking events on sites like Meetup.com or search for a networking group with BNI.com. I know several agents who close multiple deals a year from their BNI network.
Now there is another category of real estate agents who may struggle with the lack of in-person interactions and that is brand new agents.
There is something to be said about being able to walk down the hall and ask your broker or team leader a question and that is something you probably can’t do with a cloud-based brokerage like REAL broker.
With REAL, a new agent absolutely can still get all of their questions answered, it would just be in the form of a phone call, video call, email, text, online tutorial, or FAQ page.
The only real difference is HOW they are getting their questions answered.
And to this point, I would ask an agent to place value on how much it is worth to them to have their questions answered by someone in the same room as them VS over the phone, email, or video call.
Would you pay an extra $5,000 a year for this? $10,000, $15,000?
I ask this because my last brokerage had a cap of $28,000 a year plus I paid $6,000 a year for an office within my brokerage. By me joining REAL Broker, I am saving $22,000 a year!
So for me personally, being able to get my questions answered in person rather than through email or a phone call was not worth me paying an extra $22,0000 a year.
REAL Broker also does have teams. So if you are looking for some in-person guidance and someone to hold your hand a bit during your first few months in the business, joining a team at REAL may be a good option for a new agent.
However, I do need to point out that REAL is still a relatively small brokerage. We just passed 2,000 agents at the time of writing this article. So there is a chance there may not be many options for teams in your area.
If you would like me to help you connect with a team at REAL in your area, shoot me an email at Malcolm@LivingInMaryland.com and I’d be happy to ask around for you.
-PRO: Lower Cap and Splits
One of the most obvious benefits to joining a cloud-based brokerage like REAL broker, is their fees to the agent are significantly less than franchise-based brokerages.
BUT I want to point out this DOES NOT MEAN they provide less value!
Because REAL Broker, LLC is a national company and supports their agents directly, they do not have to pay for MANY expenses franchise based brokerages do such as:
Office Space
Office Staff
Office Manager
Regional Manager Fees
Franchise Fees
THIS is why REAL is able to only charge its agents a $12,000 a year cap.
Most Keller Williams brokerages charge their agents between $24,000 and $28,000 and some brokerages charge as much as $50,000 a year.
Let’s say your current cap is $24,000 a year and you save $12,000 a year by joining REAL. Ask yourself “how would an extra $12,000 a year help you?”
That’s a vacation to Disneyland for your family right there. That is money you can put towards hiring a transactional coordinator so you can be less stressed. That is $12,000 worth of Facebook ads to explode your business OR that is 1–2 fewer transactions you have to do a year so you can spend more time with your family.
For me, I saved $22,000 a year by leaving Keller Williams and joining REAL. THAT kind of money can have a pretty big impact on a person’s life and business.
REAL also has a very generous split of 15/85.
Now, to be honest, as an agent who does 20–30 deals a year and always caps, the split percentage is not as significant to me. It really only affects when in the year I cap. Whether it takes me 6 months or 3 months.
BUT a 15/85 split is GREAT for new or part-time agents.
Let’s say you are only going to do 3 transactions a year at $300,000 each with a 3% commission.
At REAL, you would keep 85% of that $9,000 commission and keep $7,650 while paying REAL $1,350.
After all 3 transactions, you would have paid REAL a total of $4,050.
At a typical franchised-based brokerage, let’s say you have a 70/30 split (many of them are even worse than that!)
On your $9,000 commission, you would have to pay them $2,700 and you keep $6,300.
After all 3 transactions, you would have paid them $8,100. Double what you would have paid REAL!
This is not even factoring franchise fees, monthly fees, “technology fees” and other hidden fees most franchised brokerages charge.
The fact is, if you don’t have the production to cap or just barley cap, you will take home significantly MORE MONEY with REAL’s 15/85 split than you will with MOST other brokerage splits.
CON: -No Brokers Office Access
Giving up your broker's office and access to their conference rooms is one of the obvious trade-offs for using an online brokerage.
But I would say 2020 has taught me, and probably you as well, that we DON’T NEED our broker's office to be successful.
I probably stepped foot in my brokerage 3 times all of 2020 and that was just to check my mailbox. Despite this, 2020 was my best year in real estate YET.
In a lot of ways, I became MORE EFFICIENT with my time by working from home rather than driving into an office.
I don’t have to spend 25 minutes driving to and from my office anymore. So that is almost an extra of my life back a day.
I don’t have all the distractions of other agents popping by to chat me up. I hate to admit it but I can remember putting in 8 hour days at my office but I spent 6 of them just BS’ing with other agents.
Lastly, I don’t have unnecessary meetings and training I’m getting roped into attending. There is such a thing as going to TO MANY classes.
Now, I fully understand this may not be true for EVERYONE.
Some people may have the opposite problem where their house is a place full of distractions. I totally get that some people NEED an office to drive to every day to focus and get away from their spouse or kids.
If that is you, I would just say there is nothing stopping you from finding your own office space to rent out. It would just be in a generic office building instead of your brokerage.
I am saving $22,000 a year by giving up my office in my last brokerage. I could EASILY afford to find my own space for a fraction of that savings.
Another part of giving up the office experience is giving up your access to conference rooms.
This is the 1 part of my brokerage office I actually used the most. I would meet clients here for my buyer consultations and occasionally listing presentations.
But giving this up actually has not been as much of a disruption to my business as I thought it might be.
90% of my buyer consultations I now do through a Zoom video call.
Frankly, I think my clients prefer this. Coordinating with them to take time off of work to drive to my office was sometimes a hassle and left me feeling a little guilty.
By doing my consultations over a video call, they don’t need to take time off work, they don’t need to find a babysitter, they don’t need to drive to my office. It’s a win-win for everyone.
OCCASIONALLY I do get a client who would prefer to meet me in person.
In these situations, I simply arrange to meet them at a local Starbucks and buy them a cup of coffee.
And if I did want a more professional location, I request to use one of the many conference rooms at my preferred title company or lender's office. They are more than happy to let me use them!
My business has not skipped a beat by giving up access to my brokerage office or conference rooms. In fact, I think it has become more efficient.
-PRO: 4 Ways To EARN REAL Stock
One of the things I LOVE most about REAL Brokerage is not only can I BUY stock in the company but they WANT ME to own stock in it. In fact, there are 4 different ways REAL GIVES ME stock in the company.
Let’s review REAL Broker’s stock incentives.
The first way you earn stock in the company is simply by capping. When you pay your $12,000 a year cap, they reward you for capping with FREE stock in the company.
REAL also offers purchase options. You can put 5% of your commission to purchase REAL Broker stock and by doing this, REAL will reward you with an additional 25% free stock BONUS. So if you purchase $1,000 worth of REAL stock this way, they will GIVE YOU an additional $250 worth.
REAL also gives you free stock when you attract agents to the company and they put you down as their sponsor. This is in addition to the very generous revenue share program they offer (more on that below).
REAL also has an Elite Agent Award in which they give their top agents an additional $24,000 worth of free stocks for hitting certain production milestones.
By making ALL of us part owners in the company, REAL makes all of its agents invested in the growth of the company. This also helps foster a sense of community and collaboration.
If I help other agents succeed, the company does better and my stocks are worth more money. It’s that simple. NEVER have I owned stock in a company in which I had an actual influence on the price of that stock AND I LOVE THAT!
-CON: REAL Brand Is Not As Recognizable
So I do want to acknowledge this, brand loyalty can be a real thing and REAL Broker does not have as recognizable of a brand as some other real estate companies.
And they're very well may be some people out there who have used a REMAX agent to sell every home they have ever lived in going all the way back to the 1970’s.
But in my opinion, those types of people are few and far between.
In TODAY's real estate market, the little logo in the corner of your business card is NOT a major factor in whether a client hires you or not.
My clients hire me because I have a good reputation, I’m knowledgeable, and I’m patient enough to walk them through the process.
They do NOT hire me because I work for one real estate company or another.
In fact, if I were to ask all of my clients from the past 12 months WHAT company I worked for, I bet 90% could not even tell you!
Now, this is NOT what the franchise-based brokerages will tell you.
When you interview with them, they will give you this whole dog & pony show and make dubious claims about how YOU being associated with THEIR brand and THEIR brokerage is going to make you MORE credible and lead to you making MORE sales….and this is all a load of crap in my opinion.
They understand that in today's world, their value proposition to us agents is becoming less and less relevant. That is why they cling to the one thing that is incredibly hard to quantify and that is being able to stick their logo on our business cards.
But our industry is changing and to our consumers today, the AGENT is far more important than the COMPANY.
PRO: HUGE Revenue Share Potential
REAL is NOT the first brokerage to offer a revenue share program for attracting new agents. Keller Williams adopted a similar program in the early 2000s and has lead to them growing into the largest brokerage in the world by agent count.
But, in my opinion, REAL has perfected the revenue share program and has the MOST PROFITABLE one out there for agents!
For every agent you directly attract, REAL will pay you $4,000 a year out of the $12,000 a year cap they pay to REAL.
Just for comparison sake, EXP Reality only offers $2,800 for each tier 1 agent you attract and Keller Williams offers even less than that.
After you attract 10 agents to your tier 1, you unlock your tier 2 and will receive $3,200 a year for each capping agent your tier 1 agents bring in.
After you attract 15 agents to your tier 1 you unlock your tier 3 rewards.
Attract 20 agents to your tier 1 to unlock tier 4 benefits and attract 25 agents to tier 1 to unlock your tier 5 benefits. (See image above)
So you can quickly see the huge potential for building passive income through just attracting real estate agents to our company.
This is THE BEST revenue share program out there and actually, MOST brokerages don’t have ANY revenue share program at all!
Now I get that not everyone wants to be a full-time recruiter. We all have real estate businesses we are trying to run and grow.
But, just through being a great agent and networking, people will ask you about REAL.
If through your day-to-day work, or through clients interested in getting their licenses, if you can attract just 3 capping agents to REAL, you will receive $12,000 a year from rev share which is enough to cover your entire cap.
So for the average agent, I would say make THAT your goal. Over the next 1–2 years just look for opportunities for conversations with agents try to get at least 3 in your downline and get your entire cap paid for.
And I will say from experience the conversation about REAL’s value proposition is FAR easier than trying to attract them to a franchise-based brokerage like Keller Williams.
Once I point out to agents that they will probably pay AT LEAST half what they are paying at their current brokerage, can earn free stock, and have a huge opportunity for revenue share, I can literally see the light bulb turn on in their heads.
Final Review Of REAL Broker, LLC
Cloud-based brokerages ARE the future of our industry!
And if we are being honest, they are a better fit for MOST of the agent’s businesses than brick & mortar, franchise-based brokerages.
Yes, there are some trade-offs with a cloud-based brokerage but in my opinion, those trade-offs are not nearly as relevant to my actual business as I originally thought AND the huge benefits I get at REAL far out ways them.
REAL as a company has huge potential to grow and disrupt our industry!
I’m proud to be part of a company that I think is going to have a HUGE positive impact on many real estate agent’s lives and businesses and change the industry for the better.
Let’s schedule a 1-on-1 zoom call with myself and talk about how REAL can change your business and answer any of your questions.
Ready to join now? Sign up here https://www.joinreal.com/malcolm-lawson/refer
Or check out these other articles:
An Honest Review Of REAL Broker
Is REAL Broker Good For Real Estate Teams?