certified and gives them licence to operate as real estate agents,” said Sam Chopra, chairman, RE/MAX India.
The business model
According to industry estimates, there are close to 30 lakh people across the country who deal in the buying and selling of real estate, but only a handful of them have any sort of training and in the absence of mandated certification, choosing a broker is mostly a huge leap of faith. Usually the best brokers in most markets have offered good service and their reputation has been mostly through word-of-mouth.
“The way real estate is getting sold in the market is not correct. There is no credibility of the broker and there is no relationship with the customer. Also, the agents are not adequately paid by the brokers,” said Sandeep Singh Katiyar, CEO, Century 21 India.
RE/MAX and Century 21 operate on a similar model. They work towards bringing brokers across the country into their franchise network, provide knowledge, technology, branding and access to various markets for their clients. RE/MAX currently has a network of over 100 brokers across 35 cities in the country with plans of doubling it over the next two years. The company also runs a real estate academy where it has trained 2,000 brokers till date.
Century 21 plans to have a network of around 60-70 brokers over the next two years and then expand it to 350 in five years.
“We provide the brokers with soft skills training, marketing, knowledge of the real estate industry and the market, provide them with customer relationship management tools and also create websites for them,” said Katiyar.
On revenue front, these companies charge a one-time fee from the brokers for joining the network and then a monthly fee. They, however, do not look for a share in the commissions earned from a transaction.
But, in a bid to empower agents and attract good talent, they do push the brokers towards paying a higher share of the commission to the agents as against the traditional broker who gives a minority share of the brokerage to the agent. Under this model the agent gets anywhere between 60-90 per cent of the commission from a deal while the broker keeps the remaining 10-40 per cent.
“We are looking to empower the agents and they can get up to 90 per cent of the deal commission,” said Chopra.
What do they offer?
Professionalism is one quality that is missing from this huge