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The 5 Employees You Need to Hire to Grow Your Brokerage in 2021
March 27, 2021
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The 5 Employees You Need to Hire to Grow Your Brokerage in 2021

Having been in real estate for 27 years, I have opened or relaunched nine real estate brokerages. Some were small independent brokerages and others were large brokerages with a national franchise. So I have had a lot of experience with hiring (and firing) employees at the brokerage level.In this article, I will share which employees you need to hire to successfully grow your real estate brokerage from a small brokerage with just one employee to a large brokerage with a full staff.Beginner’s Mind: Roles Are Not EmployeesBefore you start hiring for your brokerage, there is a simple rule of thumb you need to understand. You need to hire for roles, not employees. Roles are a title given that encompasses all of the responsibilities of an employee. Each employee can—and likely will—have one or more roles within your real estate brokerage, especially in the early stages of growth.For example, you may choose to start your real estate brokerage with just one employee and yourself. If you do, then you must divide the roles required to run the brokerage between the two of you. As your brokerage grows and you hire new employees, you will train and hand off each of the roles to the new employees.There are 10 essential roles to run a real estate brokerage. Each role has specific tasks called responsibilities. Below is a list of each of the roles and the corresponding responsibilities required to run a successful real estate brokerage.10 Roles & Responsibilities for a Real Estate BrokerageRoleResponsibilitiesOffice ManagerFinancial managementReceptionistAnswer phones, greet guests, showing coordination, open and close officeTransaction ManagerFile review and complianceMarketing ManagerCreate and prepare all marketing materials for agents and brokerageListing ManagerCoordinate and prepare properties for saleLead ManagerCoordinate and manage leads and follow-upManaging BrokerReview file for legal complianceMentorMentor agents and lead training classesSales ManagerRecruit agents and lead sales teamTransaction CoordinatorAssists agents with managing dates and deadlines, signatures, and gathering required documentationHow Many Employees Do You Need to Start & Grow Your Real Estate Brokerage?Figuring out how many employees you will need to run a successful real estate brokerage is not easy. Making the right hire and when depends greatly on what real estate brokerage model you are running and what types of services you choose to offer your agents.In an attempt to answer this question for you, I will make some assumptions. First, let’s assume you are opening a full-service brokerage; you provide full listing assistance, agent marketing, transaction coordination, and maybe you provide some paid leads. In exchange for what you offer, the agents are on a 60/40 split plus an additional referral fee on brokerage leads. Lastly, let’s assume your average agent is producing the National Association of Realtors (NAR) average of one transaction a month.Let’s take a look at how your brokerage will most likely grow over the next few years from this starting point, called the Incubation Phase, all the way to your goal, the Large Brokerage Phase. To help with your forecasting, each example below will include the employees necessary, the coordinating roles, and the estimated salary of each employee.Incubation Phase (< 24 Agents)In the Incubation Phase (less than 24 agents), your focus should be on sustainably growing your brokerage while keeping your eye on expenses. Many new brokerages never make it out of this phase due to mismanaging their expenses or underestimating the difficulty of recruiting. Either way, to keep costs low, you will need to share all the roles and responsibilities required to manage a brokerage with only one full-time employee.Here is a quick breakdown of how you might share roles with your first hire, an office manager:Hire: Office ManagerWhen you are just starting, you need to hire an employee who is a multitasker. Not because you are trying to take advantage or you can’t hire a specialist, but because the size of your brokerage at this phase isn’t going to produce enough revenue to hire multiple people. Therefore, they are going to have to handle multiple operational roles.Depending on the number of transactions you are closing each month, you will need either a part-time or full-time employee. The starting salary for this position will be between $32,000 and $65,000 a year.DIY: Sales ManagerSince you’re a licensed broker, have sales skills, and care about your brokerage more than anyone else, you will probably be the one responsible for the tasks of recruiting, mentoring, lead management, and Managing Broker duties. To keep costs low, you may not take a salary in the beginning, but over time you can start paying yourself a reasonable salary.Outsource: Transaction CoordinationConsider outsourcing transaction coordination from the beginning. For one, it will save you and your Office Manager a lot of time not chasing agents for their paperwork. Secondly, if you charge your agents for transaction coordination, it may actually become a profit center for your brokerage, and third, they may be able to manage your brokerage compliance file.Today there are many outstanding transaction coordinators. Most are state-specific due to the local nuances, and charge between $150 and $300 a file, depending on the volume you will be sending them.Purchase: Agent Marketing SoftwareIn this phase, you are going to need to be very resourceful, as it is not uncommon to be running your brokerage at a loss at this time. Software solutions like Breakthrough Broker (free version) or Lab Coat Agents Marketing Center (seven-day free trial) can help with managing your agents’ marketing needs at little to no cost to you.I’ll cover this in detail in my next article, Essential Software for Real Estate Brokerages in 2021.Incubating Brokerage Employee Roles & SalariesEmployeesRolesSalariesEmployee 1 (Office Manager)Office Manager, Receptionist, Transaction Manager, Listing Manager, Marketing ManagerFull-time $32,000-$65,000/YrEmployee 2 (You)Sales Manager, Managing Broker, Mentor, Lead Manager$0-$40,000/YrOutsourceTransaction Coordinator$150-$300/FileTotal$55,000-$125,000Small Brokerage (25-39 Agents)When your real estate brokerage passes 25 agents and enters the Small Brokerage Phase, hiring another employee is critical for growth. Ideally, at this point your staff will be onboarding at least 10 listings and closing over 25 transactions each month. This will become increasingly difficult for one person to manage on their own.New Hire: Marketing & Listing ManagerWhen you hit the first milestone of 25 agents, you need to be prepared to hire a third employee and separate Listing Management and Marketing Management tasks from the other operational duties of the brokerage.Your third employee may be part time at first, then move to a full-time position later. While the cost to hire this position depends on the experience of the employee, you can expect to pay between $15 and $20 an hour to find someone with the skills necessary to handle the responsibilities of both the Listing and Marketing Management Roles.Find someone who is great with getting things done while keeping a smile on their face, as they will be working directly with your listing agents.Small Brokerage Employee Roles & SalariesEmployeesRolesSalariesEmployee 1 (Office Manager)Office Manager, Receptionist, Transaction ManagerFull-time $45,000/Yr +Employee 2 (You)Sales Manager, Managing Broker, Mentor, Lead Manager$0-$40,000/Yr + bonusEmployee 3 (Marketing and Listing Manager)Listing Manager, Marketing ManagerPart-time or full-time $30,000- $45,000/YrOutsourceTransaction Coordinator$150-$300/FileTotal$85,000-$165,000Medium Brokerage (40-59 Agents)Congratulations on the successful growth of your real estate brokerage! You have reached 40+ agents and the Medium Brokerage phase.Of course, as they say, “Mo money, mo problems.” With success comes the challenges of handling even more listings, agents, and closings. All while still recruiting, onboarding agents, and serving your agents. At this point you, as the head of sales, are reaching your limit.The good news is your brokerage should be productive enough to pay you a fair salary and hire someone to take some tasks off your busy plate.Hire: Managing Broker/MentorAt this stage of growth, you need help mentoring the newer agents and handling the Managing Broker duties. You may believe, as the owner of a real estate brokerage, that hiring someone else to be the Managing Broker and Mentor to the agents may seem like a mistake.Remember, as the owner of your real estate brokerage, your number one responsibility is to attract new recruits and lead the agents within your brokerage. Hiring someone to handle the day-to-day new agent questions and review the contracts will keep your head clear and your time free to focus on growing your brokerages productivity.Pro Tip: Hire From Within When PossibleAn experienced agent in your brokerage may make an ideal Managing Broker. The compensation can start at $40,000 per year or they may be willing to handle the Managing Broker responsibilities for a free or reduced CAP or reduced fees. The compensation for mentoring can be structured as 50% of the additional split that a new agent pays in exchange for the additional supervision and training.Medium Brokerage Employee Roles & SalariesEmployeesRolesSalariesEmployee 1 (Office Manager)Office Manager, Receptionist, Transaction ManagerFull-time $45,000/Yr +Employee 2 (You)Sales Manager, Lead Manager$60,000/Yr + bonusEmployee 3 (Marketing and Listing Manager)Listing Manager, Marketing ManagerPart-time or full-time $30,000- $45,000/YrEmployee 4 (Managing Broker)Managing Broker, MentorFull-time $40,000/Yr +OutsourceTransaction Coordinator$150-$300/FileTotal$145,000-$265,000Large Brokerage (60 Agents or More)When you reach the tipping point of 60+ agents, your Large Brokerage is well on its way to becoming a respected brand in your community. Don’t run out and buy an Escalade wrapped with your logos yet! This is your opportunity to 10X your brokerage—or burn your staff out if you don’t follow my advice.Your 60+ agents on a slow month are now onboarding 10+ listings and closing 30 transactions each month, but in the spring they can easily bring in 50 listings and over 80 closings in a single month.Sure your hard-working and talented staff could easily handle the transactions if they came in consistently throughout the year, but your staff may get overwhelmed in the busy months if you don’t prepare by staffing up for the busy seasons. To continue your growth, serve your agents, and not burn out your key employees, you need to staff up to the next level.Hire: Receptionist/Transaction ManagerThe next hire is to provide some relief to your Office Manager. Start with a part-time receptionist to answer phones, greet agents and guests, and handle the day-to-day office operations. The starting salary for this position is around $15 to $20 an hour. If you see the need, bring the receptionist on full time to handle the receptionist duties and Transaction Management.Hire: Marketing ManagerAs your brokerage grows, your agents will have different marketing needs. Managing these marketing needs can become challenging for a full-service brokerage. If you wish to retain your top-producing agents and teams, you will need to give them access to a highly skilled graphic design professional. Start with someone working part time, and if you see there is demand, bring them on full time. A highly skilled graphic design person can easily start at $60 an hour and go higher.The responsibilities of the Marketing Manager can also be outsourced to a qualified graphic design person. The risk is that an outsourced person is not an employee, so it is difficult to hold them accountable for strict deadlines.Large Brokerage Employee Roles & SalariesEmployeesRolesSalariesEmployee 1 (Office Manager)Office ManagerFull-time $50,000/Yr +Employee 2 (You)Sales Manager, Lead Manager$60,000/Yr + bonusEmployee 3 (Listing Manager) Listing ManagerPart-time or full-time $30,000-$45,000/Yr +Employee 4 (Managing Broker)Managing Broker, MentorFull-time $40,000/Yr +Employee 5 (Receptionist)Receptionist, Transaction ManagerPart-time or full-time $30,000-$45,000/Yr +Employee 6 or Outsource (Marketing Manager)Marketing ManagerPart-time or full-time $20,000-$60,000/Yr +OutsourceTransaction Coordinator$150-$300/FileTotal$235,000-$395,000Bottom LineThere are many factors that will determine how many employees your brokerage will need and when you will need to hire them. Some of these factors are your brokerage model, your splits and fees, and if your brokerage is a traditional brick-and-mortar or virtual.In any case, keep your expenses low by utilizing software and outsourcing before hiring employees. Be prepared by having a plan to hire long before you actually need the employee. This will give you time to budget, hire, and train your next employee.Further Reading for Aspiring Broker OwnersIf you are building or considering starting your own real estate brokerage, check out my archive of articles on starting, running, and growing your brokerage.3 Foolproof Team Models for 2021: Hiring, Splits, Lead Gen + MoreThe Ultimate Guide to Recruiting Agents for Your Team or BrokerageAsk Sean: Should I Buy a Franchise or Start My Own Brokerage?How to Craft a Powerful Story to Attract Top Agents to Your BrokerageHow to Create an Inspiring Mission, Vision & Values for Your BrokerageAre Brick & Mortar Real Estate Offices a Waste of Money in 2021?How to Select the Right Office for Your Real Estate Brokerage

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