{"id":3752,"date":"2008-08-04T16:24:41","date_gmt":"2008-08-04T23:24:41","guid":{"rendered":"http:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/?p=3752"},"modified":"2008-08-04T16:34:48","modified_gmt":"2008-08-04T23:34:48","slug":"another-real-estate-model-a-less-radical-variation-on-a-current-theme-that-can-work-within-the-present-regulatory-context-a-national-franchise-of-real-estate-franchisors-each-of-whom-is-committed-t","status":"publish","type":"post","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/3752\/another-real-estate-model-a-less-radical-variation-on-a-current-theme-that-can-work-within-the-present-regulatory-context-a-national-franchise-of-real-estate-franchisors-each-of-whom-is-committed-t\/","title":{"rendered":"Another real estate model, a less-radical variation on a current theme that can work within the present regulatory context: A national franchise of real estate franchisors, each of whom is committed to sustaining the value of the brand"},"content":{"rendered":"

I read Rob Hahn’s ideas about brokerage-as-law-firm last week<\/a>. I thought that much was kind of naive — a reflection of a lack of understanding the legal realities of real estate brokerage — but I didn’t jump in because I thought some of his other ideas were interesting.<\/p>\n

Here’s the problem: A law firm is based on 1040 employment. The real estate brokerage safe harbor makes it extremely beneficial for brokers to have nothing but 1099 employees. There is no reason to expect that to change unless the IRS removes the safe harbor — three weeks after hell has frozen over.<\/p>\n

The Team model works, but it’s inherently small-time.<\/p>\n

Branding could work — but doesn’t — because the independent contractor status of agents dilutes the brand to homeopathic concentrations.<\/p>\n

Hard-branding like Bloodhound does can only work with very strict control. Redfin has this — but it also has 1040 employees.<\/p>\n

All that notwithstanding, present-day brokers are at risk of being wiped out at any minute by several liability — the designated broker is responsible for every idiot he puts out on the street.<\/p>\n

Here’s a solution that makes sense to me:<\/p>\n

The ideal case would be to get rid of licensing altogether, to get rid of the broker’s level of licensing or to get rid of the salesperson’s level of licensing and call everyone a broker, but none<\/em> of that is necessary.<\/p>\n

Instead, imagine an IntegratedRealty.com business entity that consists of a franchised brand for fly-you-own-flag brokers or brokerage entities. As the owner of IntegratedRealty.com, I franchise the brand and require certain standards and practices from the franchisees. I maintain offices, so, to all appearances to the public, we’re just like Realty Executives. Except that I am not anyone’s broker, and each individual franchised broker is the head of his or her own Team. They write and own their own contracts, and they’re free to sever their relationship with IntegratedRealty.com per the terms of our contract, with their representation contracts going along with them.<\/p>\n

This could be rolled out city-by-city, like Realty Executives, or cross-competitively like RE\/Max. Each new instance of IntegratedRealty.com could itself be a franchise, so you could Read more<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

I read Rob Hahn’s ideas about brokerage-as-law-firm last week. I thought that much was kind of naive — a reflection of a lack of understanding the legal realities of real estate brokerage — but I didn’t jump in because I thought some of his other ideas were interesting. Here’s the problem: A law firm is […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_crdt_document":"","jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[4,6,5,19],"tags":[],"class_list":{"0":"post-3752","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"hentry","6":"category-disintermediation","7":"category-marketing","8":"category-real-estate","9":"category-technology","11":"no-featured-image"},"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack-related-posts":[{"id":542,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/542\/when-real-estate-brokers-face-a-substantial-cost-for-head-count-only-the-most-profitable-heads-will-survive-unsevered\/","url_meta":{"origin":3752,"position":0},"title":"When real estate brokers face a substantial cost for head-count, only the most profitable heads will survive unsevered . . .","author":"Greg Swann","date":"October 15, 2006","format":false,"excerpt":"Mark Nadel\u2019s white paper on real estate commissions is very thoroughgoing, rich in detail and a rational understanding of human motivation -- without slipping over to the hyperbole that afflicts much criticism of the residential real estate industry. But Nadel is an outsider, so, while his diagnosis of what ails\u2026","rel":"","context":"In "Disintermediation"","block_context":{"text":"Disintermediation","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/disintermediation\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":3617,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/3617\/the-new-real-estate-model-part-3\/","url_meta":{"origin":3752,"position":1},"title":"The New Real Estate Model – Part 3.1: The Solution","author":"Sean Purcell","date":"August 4, 2008","format":false,"excerpt":"This final post (Part 3) grew rather lengthy.\u00a0 Considering the fact this has already stretched into a three-part series, I chose to extend the series to five rather than attempt a conclusion of\u00a0 somnolent proportions.\u00a0 If brevity is the soul of wit, creating a new model for real estate is\u2026","rel":"","context":"In "Disintermediation"","block_context":{"text":"Disintermediation","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/disintermediation\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":613,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/613\/a-horrifying-thought-experiment-elaborating-on-a-brokerage-business-model-that-could-completely-disintermediate-buyers-agents\/","url_meta":{"origin":3752,"position":2},"title":"A horrifying thought experiment: Elaborating on a brokerage business model that could completely disintermediate buyer’s agents . . .","author":"Greg Swann","date":"November 7, 2006","format":false,"excerpt":"I wrote this this morning, and it's been bugging me all day:Here's a thought: The $99 divorce. It only works where the split is unclouded by children or property. But imagine a $999 FSBO package: The usual MLS-only marketing package with a buy-back guarantee for the buyer. Quoting me: \"From\u2026","rel":"","context":"In "Disintermediation"","block_context":{"text":"Disintermediation","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/disintermediation\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":15417,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/15417\/hey-california-realtors-are-you-making-minimum-wage-for-your-efforts-if-not-your-broker-just-went-into-cardiac-arrest\/","url_meta":{"origin":3752,"position":3},"title":"Hey, California Realtors: Are you making minimum wage for your efforts? If not, your broker just went into cardiac arrest.","author":"Greg Swann","date":"December 5, 2011","format":false,"excerpt":"Teri Lussier pointed this out to me last week, and I've been waiting since then for someone to plumb the implications. Ah, well, when there's constabulary work to be done... Here's the news: The state of California is making ZipRealty pay it agents minimum wage for their time. That's huge.\u2026","rel":"","context":"In "Big Mother"","block_context":{"text":"Big Mother","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/big-mother\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":1019,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/1019\/is-your-broker-profitable-traditional-brokerage\/","url_meta":{"origin":3752,"position":4},"title":"Is Your Broker Profitable?- Traditional Brokerage","author":"Brian Brady","date":"February 8, 2007","format":false,"excerpt":"Have you ever analyzed the business model your broker has? Try to run the numbers sometime and see just how much profit the owners(s) of your real estate brokerage really earn. I learned a lot about running a mortgage brokerage and real estate brokerage from 1999-2002. I've owned both and\u2026","rel":"","context":"In "Real Estate"","block_context":{"text":"Real Estate","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/real-estate\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":6703,"url":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/6703\/turning-liquidblue-into-steady-green-is-it-possible-to-found-a-new-real-estate-brokerage-without-going-broke\/","url_meta":{"origin":3752,"position":5},"title":"Turning LiquidBlue into steady green: Is it possible to found a new real estate brokerage without going broke?","author":"Greg Swann","date":"January 27, 2009","format":false,"excerpt":"Cleveland real estate broker John Kalinowski and I have been batting around some ideas of his on how to structure his new brokerage to make it work well for everyone -- clients, agents and ownership. Surely I'm not the best person to ask about this, since we are doing everything\u2026","rel":"","context":"In "Group Therapy"","block_context":{"text":"Group Therapy","link":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/category\/group-therapy\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]}],"_links":{"self":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts\/3752","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/comments?post=3752"}],"version-history":[{"count":1,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts\/3752\/revisions"}],"predecessor-version":[{"id":3753,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/posts\/3752\/revisions\/3753"}],"wp:attachment":[{"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/media?parent=3752"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/categories?post=3752"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.bloodhoundrealty.com\/BloodhoundBlog\/wp-json\/wp\/v2\/tags?post=3752"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}