Ranking Agents – Who’s #1 and Does It Matter?

Suze Cumming | July 20, 2017

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How do we reconcile the difference between solo agents and teams in the ranking system?

In Real Estate, a lot of importance is put on the ranking of agents within their brokerage, marketplace, board, city and even country.   There seems to be a belief that if you are number one or at least near the top of the pile in terms of productivity, then you must be a better agent and therefore more people should hire you to sell their home.

I think it’s a myth that those who sell more real estate sell real estate for more money but that’s another topic.  Some top producers are great agents and some aren’t but the point is that the public generally wants to work with a REALTOR® who has a proven track record of success and productivity is an easy matrix to communicate. So yes, it matters.

As the team model in real estate evolves, brokerages are having challenges figuring out how to adapt the ranking system.  If an individual agent sells 50 homes and earns GCI of $750,000 how does that compare to a team of 8 agents who does 200 homes and earns GCI of $3,000,000.

One way would be to divide the productivity by 8. That means each agent is allocated 25 ends and $375,000 on GCI.  They clearly rank below the solo agent.

A second way that we see often is that all of the productivity is allocated to the team leader.

In this second method, it becomes impossible for a solo agent to compete in the rankings with teams. Some brokerages have tried to overcome this challenge by having separate ranking systems for both teams and solo agents.  This seems fairer but is confusing to the public which is who all of this is for in the first place.  Or is it?   Are rankings to benefit the public or are they to satisfy the egos of the agents?  Either way, this creates complication in many ways as most solo agents producing at this level have some administrative help and how does that fit into the equation?

A Solution?

What if we allocated the productivity to the team leader based on the percentage of the commission that the team leader receives.  For example, if each deal that happens within the team pays 50% of the commission to the team member then the remaining 50% would be allocated to the team leader for the purposes of ranking.    In the example above, the team leader would be allocated 100 ends and $1,500,000 in GCI if she was taking 50% of her team members commission.

As the team model continues to evolve we may eventually see it replace the current brokerage model.  Team leaders may be forced to pay more of the commission to team members. This would create a fairer way to evaluate productivity.   When I started in Real Estate in 1985, I worked for an office of 20 agents, one manager and we paid the brokerage 50% of our commission.  Sounds remarkably similar to what teams are building now.

I bet there are some disrupters ready to change things.

Your thoughts?

Ranking Agents – Who’s #1 and Does It Matter?

Suze Cumming | July 20, 2017

Share this page on Facebook
Tweet this page on Twitter
Share this page on LinkedIn

 

How do we reconcile the difference between solo agents and teams in the ranking system?

In Real Estate, a lot of importance is put on the ranking of agents within their brokerage, marketplace, board, city and even country.   There seems to be a belief that if you are number one or at least near the top of the pile in terms of productivity, then you must be a better agent and therefore more people should hire you to sell their home.

I think it’s a myth that those who sell more real estate sell real estate for more money but that’s another topic.  Some top producers are great agents and some aren’t but the point is that the public generally wants to work with a REALTOR® who has a proven track record of success and productivity is an easy matrix to communicate. So yes, it matters.

As the team model in real estate evolves, brokerages are having challenges figuring out how to adapt the ranking system.  If an individual agent sells 50 homes and earns GCI of $750,000 how does that compare to a team of 8 agents who does 200 homes and earns GCI of $3,000,000.

One way would be to divide the productivity by 8. That means each agent is allocated 25 ends and $375,000 on GCI.  They clearly rank below the solo agent.

A second way that we see often is that all of the productivity is allocated to the team leader.

In this second method, it becomes impossible for a solo agent to compete in the rankings with teams. Some brokerages have tried to overcome this challenge by having separate ranking systems for both teams and solo agents.  This seems fairer but is confusing to the public which is who all of this is for in the first place.  Or is it?   Are rankings to benefit the public or are they to satisfy the egos of the agents?  Either way, this creates complication in many ways as most solo agents producing at this level have some administrative help and how does that fit into the equation?

A Solution?

What if we allocated the productivity to the team leader based on the percentage of the commission that the team leader receives.  For example, if each deal that happens within the team pays 50% of the commission to the team member then the remaining 50% would be allocated to the team leader for the purposes of ranking.    In the example above, the team leader would be allocated 100 ends and $1,500,000 in GCI if she was taking 50% of her team members commission.

As the team model continues to evolve we may eventually see it replace the current brokerage model.  Team leaders may be forced to pay more of the commission to team members. This would create a fairer way to evaluate productivity.   When I started in Real Estate in 1985, I worked for an office of 20 agents, one manager and we paid the brokerage 50% of our commission.  Sounds remarkably similar to what teams are building now.

I bet there are some disrupters ready to change things.

Your thoughts?

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