If you’re wondering how to grow your brokerage operations, you might consider adding an ancillary business to your brokerage. Ancillary services are brokerage business streams that make money separate from commissions and increase and diversify business revenue. Offering ancillary services helps to differentiate the brokerage and provide a competitive advantage. Additions of these services offer clients a new product or service that complements the primary business functions.
A broker wants their additional services to streamline their customers’ home buying and selling processes. Being able to attach adjacent services to the basic transaction is essential to long-term success. Below, we discuss services that are closely associated with the functions of a real estate brokerage that, if added and implemented, have the potential to generate increased revenue for the broker.
Title companies are essential to finalizing and closing a real estate transaction. Experience exciting closing days at your office while opening the door to more revenue streams per home purchase transaction. Building a one-stop-shop for all your clients’ needs facilitates their closing process and gives them an enjoyable experience. Title and escrow services are the quickest and most effective ancillary services to add.
A similar opportunity is for the real estate broker to partner with a title agency through a joint venture. Together, the existing title agency and the real estate broker will own a new title company that has separate policies and procedures in place. Because the new entity is under common ownership, an affiliated business disclosure will be required for each home transaction in compliance with RESPA laws.
Click here to learn more about how real estate brokers can own a title company.
Most agents recommend that homebuyers secure their mortgage loan pre-qualification before searching for a home. The opportunity to help your clients attain pre-qualification to a mortgage loan assists in expediting their home purchase and benefits the brokerage from additional transaction opportunities through every closing.
Additionally, mortgage services have the ability to operate independently of property sales. Borrowers may be seeking refinancing options such as adjusting their term length for smaller or larger monthly payments. Diversifying with ancillary mortgage services provides a revenue stream for the broker can function apart from home buying and selling. The difficulty of attaching this lies in the consumer. Unlike adding title services to the brokerage, mortgages must be sold directly to a client, which may make it a less appealing choice for the broker.
Home Staging and Cleaning
Offering and organizing add-on services such as staging and cleaning allow the brokerage to remove the burden from and create a stress-free experience for the home seller. The broker will establish a positive reputation with clients, thus earning referrals, and therefore increasing the company earnings.
The integration of home insurance services can contribute to significant growth for a brokerage. Similar to providing title and mortgage assistance, combining coverage to a home buying and selling company opens the door to maximize the number of real estate transactions, simplify the process for customers and bring in new business opportunities.
Strategically attaching and implementing ancillary services to a real estate brokerage could provide major growth for the company. The extension of the company through related, new services gives the broker an advantage over the competition, creates income diversification, and enhances the reputation of the brokerage for producing the ultimate real estate experience around.