When considering starting your own real estate brokerage, you have the option to buy a franchise or start an independent brokerage.

 So, what exactly is the difference between real estate franchises and independent brokers? Franchise brokers work under and with the support of an established real estate company, while independents work under their own name and management with access to less readily available resources. But there is much more to it than that.

Real Estate Franchises

When single brokers decide to take the franchise route, they are depending on the franchise system to support their agency in a number of ways:

  • Brand Recognition: The real estate industry authority provided by a real estate franchise is probably the number one reason a broker would choose the real estate franchise route. National or even international franchises offer instant trust and make it easier to attract both clients and top agents to a brokerage.
  • Tools and Resources: Many franchises come with out of the box tools you and your Agents can use in your marketing efforts and to help you during real estate transactions.
  • Increased Recognition. With Franchises, you benefit from being a part of a large network. Every Agent and Broker/Owner pay in a small fee to the Franchisee. This cost is small to the Agent or Broker/Owner, but the collective amount gives the brand the power to advertise on your behalf in small markets and large markets, helping increase recognition for your brokerage. 
  • Strength in Numbers: The franchise system also offers support behind the name with a combined group of real estate professionals and experts including a network of real estate agents, training experts, and industry partners. Together they streamline the real estate process. Networking databases provide instant contact with home inspectors, attorneys, and marketing experts with a massive referral network that makes it easier to find the expertise needed for agents and their clients.
  • Top Agents: Because of the larger support system, it is easier to attract and onboard real estate agents. Agents are attracted to the perks of a franchise as they receive highly formalized and targeted training, so they have the skills and tools they need to succeed. Under a franchise name, they will attract more customers and have access to more listings as well as the marketing tools and technology that make their jobs easier.
  • Improved Customer Support and Service: With access to the latest technology and marketing techniques, customers of franchises often have superior customer service thanks to a more streamlined process that saves them stress, time, and money during the real estate transaction process.

Although brokers pay fees towards the franchise in exchange for the support and services they offer, they can save money in the long run. It will be more costly to pay the upfront costs to open their independent agency. There will also be out of pocket for ongoing marketing, technology, hiring, etc. 

Independent Brokerages

Another route you can take when opening up your real estate business is investing in an independent brokerage. In an independent brokerage model, brokers have a lot more flexibility when it comes to the branding of their brokerage, but don’t have the number of resources that franchise models may provide. Here are the key differentiators for an independent brokerage: 

  • Full Creative Control: If you’re someone who wants to have full creative control over your brokerage, an independent Brokerage might be a good option for you. With an independent Brokerage, it is up to you to decide what your brand will be, what systems you will operate on, and what tools and technology will fuel your business. Since you are creating your brokerage from the ground up, you have full creative control over what your Brokerage will look like.
  • Increased Responsibility: Because the independent brokerage is on their own and does not have the support of a large franchise network, they have more responsibility. It takes more work to get established and even more to maintain their share of the highly competitive market. In addition to establishing your brokerage in the market, you also are responsible for deciding what technology your brokerage will use, what marketing support you will provide to your agents, and what operating systems you will use to keep your business running. 
  • Sense of Intimacy. Some Broker/Owners who are considering an independent brokerage feel that big brands are less personal and that independent brokerages are more intimate. 

As you can see, there are many things to consider when it comes to choosing what the right brokerage model is for you. Franchise models give you a proven blueprint for building your business and provide you with a set of turnkey tools and systems you can use to jump-start your business.

On the flip side, independent brokers have more worries. They are responsible for their own marketing, technology, and set up without the support of an established brand behind them. They are less attractive to experienced real estate agents, while also being a little riskier in the eyes of newbies who need the tools and training of a franchise opportunity. Also, clients often trust the franchise as a recognized brand. Although independents don’t have to contribute any of their revenue to a franchise, they are often faced with far higher overhead.

Your choice between starting an independent or franchise brokerage is all about who you are and what you want. Our team has the experience and knowledge to help walk you through this decision and weigh your options. If you’re interested in learning more about partnering with RE/MAX as a Franchise owner, contact us today.

This material is not an offering. The information in this material is not an offer to sell or a solicitation of an offer to buy a franchise; it is for informational purposes only.  A franchise is offered in many jurisdictions only by delivery of a franchise disclosure document to you in compliance with applicable franchise disclosure laws. Further, if you are currently affiliated with another franchisor, this material is not intended to offer a RE/MAX franchise or to solicit a change in affiliation. RE/MAX INTEGRA, 7101 Syntex Dr., Mississauga, ON, L5N6H5 Minnesota File No. F-1659