Nationally syndicated author, Emile L’Eplattenier is currently featuring Attorney, James Tupitza in his ARTICLE which explains how to start a real estate brokerage company. Emile points out that before you start your business, you need to fully understand WHY you want to be in business. He follows with important practical advice.
Are the changes really unprecedented?
Many people say the real estate brokerage business is going through rapid unprecedented changes. The business has always been changing. Fifty years ago, real estate was sold by men (almost no women) wearing black suits, white shirts and black ties, working Monday to Friday 9-5. That brought on the change to women agents, weekend and evening hours. That followed the Re-Max revolution, then KW and then 20 other ideas. In the end one thing has never changed. People who are willing to: a) put in long hours, b) focus of serving others first, and c) be educated to the highest level in the law, marketing, and technology, always make a good living while enjoying themselves.
One thing Emile did not say. By far the highest risk in the real estate brokerage business is property management. Popular consensus is the big risk of property management is found with employees “borrowing” money held in trust. Managing that risk is easy, compared to the big risk. Employee fidelity may be managed by background checks, audit controls, and multiple people checking one another. However, there is a real Big Risk.
The Fair Housing Act
The big risk is the federal Fair Housing Act (FHA). The FHA has good intentions. Clearly, no one should be denied a housing opportunity because of the race, sex, national origin, age or mental capacity. The problem is there are always a few people seeking to take advantage of a law not really intended to apply to them. When you mix that type of person with a lawyer of marginal ethics, you can imagine the result.
The FHA allows a Plaintiff who even recovers $1 in damages to be awarded attorneys’ fees. While this may aid in preventing discrimination under FHA, it has also been abused. When it is abused, the broker is almost always in the center of the target.