What is the Role of a Real Estate Brokerage

What is the Role of a Real Estate Brokerage

Real estate brokers aren’t as important as they were in the past.

The real estate industry is one of the most intricate markets because it isn’t consistent and has a variety of roles. Real estate brokerages are a staple in real estate because they provide agents and brokers to work with consumers.

However, the evolution of technology has changed the role that they have. Today’s agents have more control over how they operate, but they still work through brokerages.

So what exactly is the role of a real estate brokerage? Read on to learn everything you need to know.

What is a Real Estate Brokerage?

Before we can talk about what a real estate brokerage does, we must go over what exactly a brokerage is. A real estate brokerage is essentially the company the real estate agents work for. Without a brokerage, agents are unable to legally work.

A real estate brokerage company can work for themselves and hire agents. They can also build a firm while working with other firms. Because they work in the real estate industry, they have to pass a variety of state requirements and complete a brokerage exam.

Requirements to become a broker vary in each state, so it’s easier to get licensed in one place than it is another. For example, someone that becomes a real estate professional in Colorado is also a broker. If you’re wanting to hire more brokers, you’ll have to get a higher license.

How Brokerages Worked in the Past

Brokerages in the past were important in the real estate industry because they provided a central base for transactions. Brokerages provided offices, secretaries, machines to prepare documents, and would receive walk-in clients.

With these offices, brokers wouldn’t receive extra money when they were on the floor or in meetings. Brokerages also took a piece of the commission that agents earned whenever a transaction took place.

However, traditional brokerages have quickly fallen off because everything can be done electronically now. This means that brokerages have to change the way they operate to conform to today’s evolving market.

Their Role in Today’s Market

Because most modern industries are moving towards technology, brokerages also have to evolve. Rather than providing brokers with a place to operate, they now have to provide them with the technological means to do business.

Today’s brokerages will do things like analyze stats, look at market trends, and provide marketing tools to agents. To reduce as many costs as possible, brokerages cut their overhead, meaning they operate out of smaller offices instead of taking up a large building.

They’ll often include automation within their office so that they can reduce manpower and speed up their work. Aside from that, they provide agents with a mobile office so that they can work from anywhere.

A mobile office allows agents to communicate with clients, fill out paperwork, and get support from coworkers. These offices usually operate from a PBX system that connects agents with the in-house office.

Brokerages also take to marketing by producing sites that look appealing and running social media pages. Because their role isn’t as significant as it was in the past, they’re able to give agents higher percentages of transactions.

Is Starting a Real Estate Brokerage Viable?

Brokerages are still a great way to earn money because the real estate industry is going strong. If you’d like to start a brokerage firm, you should be aware of several things that go into starting one.


Starting a brokerage requires a lot of money because you need to be able to afford several overhead costs. Aside from getting licensed, you need to buy an office that you can operate out of.

You’ll then need to start hiring in-house employees and agents so that you can make transactions. This can cost you anywhere between hundreds of thousands or millions each year. While it’s best to pay out of pocket for a business, you can opt for business loans if need be.

You should keep in mind that real estate isn’t a completely stable market. Depending on the area that you’re operating out of, you could end up starting the brokerage during a slow period. You’ll have to research which seasons are the best for real estate in your region and start when it’s active.


If you’re in an area where there are several brokerages, you’ll have to make a name for yourself. This is where advertising comes in, which is best done on social media. One of the reasons why brokerages advertise on social media is because there are over 3.2 billion daily users.

Using paid ads will get your brokerage off the ground because users will see your ads display on their feeds. If you’re looking to attract a local audience, you can target those in your area on the ads. You can also take the traditional route and use posters or billboards.

Get Involved with a Brokerage Today

If you’re interested in entering the real estate industry, getting involved with a real estate brokerage would be your best bet. Depending on which state you’re in, you can become a broker just by having a real estate license.

Brokerages aren’t as important as they were in the past because of today’s technology. Their role in real estate today is all about promoting their business and providing agents with the proper means to make a sale.

Browse our blog to find more articles about real estate if you’re interested in entering the industry.

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