3 Tips to Expanding Real Estate Teams Profitably

3 Tips to Expanding Real Estate Teams Profitably

This article by our Founder and Managing Partner, Chris Pollinger as published by Inman News shares insights on the blueprint for expanding real estate teams profitably.

Having a team should be profitable and let elite agents reclaim their time.  To be successful you need three things. First, the right structure to be in place. Second, the temperament of each person needs to be on point. Finally, timing is critical. 
Administrative people focus on security.  Meaning they thrive and work best as a W-2 employee with regular hours and set expectations.  An hourly rate for part-time and salary for full time.  And yes, expect to contribute or provide their health insurance.  Their motivation doesn’t come from a per file bonuses or percentage.  Instead, if they do a great job appreciate them. Take them to lunch and tell them how much value they bring.  Use a payroll service or HR outsourcing company out of the gate. This ensures you are complying with all the local and national employment regulations. 
The sales side are all commission based, split driven and on 1099’s.  Don’t fall into the trap of draws or salaries.  The IRS has resources to define what you can, and can’t do, with independent contractors.   The split structure should depend on how much of the transaction process they control.  A good rule of thumb, 15% is team overhead. 30% goes to who generated the lead. 30% goes to who puts the client under contract. 25% goes to the person servicing the transaction.

The Importance Of The Right Temperament when Expanding Real Estate Teams Profitably

We use the DISC test in hiring staff.  Profiling should only make up 30% of the hiring process. It is a great screening tool. Keeping you from hiring the wrong type of person for the position you are trying to fill. Here are our screening suggestions for a few of the key positions:
  • Team Leader (Greater than 75% D, Greater than 75% I)
  • Administrative Assistant (Greater than 50% D, Greater than 25% C, Greater than 25% S)
  • Buyers Specialist (Greater than 50% D or I, Greater than 25% S)
  • Relationship Manager (Greater than 50% I, Greater than 50% S)
  • Transaction Coordinator (Greater than 50% C, Greater than 50% S)
  • Listing Specialist (Greater than 75% I, Greater than 25% S, Greater than 25% D)
  • Administrative Manager (Greater than 50% D, Greater than 25% C, Greater than 25% S)

The Importance Of The Right Timing when Expanding Real Estate Teams Profitably

Most teams wait too long to hire admin people and are too quick to bring on agents.  The sole reason your team should be expanding is to provide better service to your clients.  Hire when you are starting to drop the ball. When things start falling through the cracks because you are spread too thin. 

There is a Systematic Way to Expand Real Estate Teams Profitably

For those teams between $1 million and $5 million in GCI.  Things start to click in this range with systems. As they go into place, the team leader’s profitability goes up and the time required to run the team goes down.  We work with our clients not to exceed 30 hours a week of their personal time by the time they hit the $1 million+ GCI mark.  

Looking for the Ultimate Real Estate Team Structure?


A Parting Thought

We hope that the information provided is helpful in guiding you on your journey to building a thriving real estate business.

As luxury real estate broker consultants, real estate recruiting coaches, real estate business consultant, and CEO consultants for real estate, we are confident that our resources, insights and strategies can help you achieve your goals.

Remember, success in the luxury real estate industry starts with knowledge and strategy, and we are here to provide you with both.

Here are some links to our more popular resources:

Real Estate Insights

Downloads for your Real Estate Business

Luxe Real Estate Report and Forecasts

Tools for your Team or Brokerage


For additional and real time insights, updates and news from our Founding and Managing Partner, Chris Pollinger, you can follow him on LinkedInTwitterFacebookInstagram

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