Team of One
Team of One
Though teams are all the rage, one California broker has decided he’s happier playing solo.
“As to what’s good, bad or ugly about a team, I can’t tell you because I’ve never had one,” says Ira Serkes, broker at RE/MAX Executive in Berkeley, Calif. “I can say there’s an alternative to teams.”
Serkes’ approach is straightforward. When he chooses whom to work with, Serkes believes he has a higher rate of success and gets paid more. So he’s determined the customers most profitable to his business, and he refers out all the others, gladly accepting a referral fee. “I might end up making a little less money, and I might lose that lead as a client and a source of referral business,” he says, “but I don’t have to worry about managing, organization, liability or anything else inherent in having a team.”
With a referral fee of just above 25 percent, that translates into an average take of about $5,000 for each referral. His conversion rate on referrals is about 1 in 20. On the other hand, if Serkes had a buyer’s agent working for him on a 50-50 split to whom he passed those leads, he’d earn 50 percent of the fee, and from that, he’d pay the team’s overhead. Assuming overhead of 30 percent, he’d keep 70 percent of his 50 percent split, or 35 percent of the total fee.
“My net income would be 35 percent if I referred the lead to a team member versus my current 25 percent referral fee,” explains Serkes. “I’d have the overhead and the potential liability of team members, and I’d be making a little more money and possibly keeping them as future clients. But would I be making that much more money to compensate me for the time it takes to complete that transaction and the overhead of a team?”
Serkes sees the issue in terms not only of money, but also of peace of mind.