The End of the Brick & Mortar Real Estate Companies - Part 2


In Part 1 of this blog we discussed the current demise of the old school traditional brokerages and the rise of the 100% commission internet brokerages.  In Part 2 here we will explain in detail exactly why the brick and mortar brokerages are collapsing.  I am quoting below from the book: Death of the Big Box Realty.

The old—school big box realty franchises are dying. Agents don’t

want to work harder anymore; they want to work smarter. They

don’t need the corner offices and lukewarm leads; they can generate

leads themselves with the targeted social media outlets. advertising

opportunities such as Facebook or


Even some non—franchised independent companies offer their

agents only 50-60% commission and some agents are comfortable

paying it. with the misconception of that being the only way to

“learn” the business. These generally are the five to ten broker—agent

shops with strong “hand—holding" or training from the brokers,

which prevents them from scaling up and growing due to the intense

time involved in nurturing their sales associates.


So why give up 15% ~ 50% of their hard—earned commission to their broker?

Although the 100% commission model might not be for all agents, I argue that

it should be due to the advancement of social media and technology that

allows every broker to achieve competitive pricing and service offer-

ings similar to the big box realty players.


Proponents of the big box, broker—centric models argue that the

100% commission firms offer no support or training, but there is

insufficient evidence to back up these assertions. Some propaganda

techniques I have seen include brainwashing the prospective real-

estate agent to “look out" for the 100% commission brokers trying to recruit

them, for their supposed lack of value—added propositions. l don't blame them

for trying. but it’s very difficult to compete against price.