Keeping it in the Family
Baker Tilly rounded out its recommendations by stressing the importance of finding the right balance of ownership and participation among family members taking an active role in the business, as well as the importance of seeking out advice regarding the transition when questions arise.
Family transfers are among the most common ways for an agent to leave the business. While the job market has improved dramatically in the last few years, many Millennials and recent college graduates continue to struggle to find work. Working in a parent’s real estate office may be an appealing employment option.
There are also children of agents and managing brokers who start out in one career and then find themselves gravitating toward real estate later on. Having children or other family members on board early on gives them time to acclimate themselves to the systems in place and to acquaint themselves with the market. Just as importantly, it also gives the agent time to assess whether or not those relatives are indeed motivated enough — not to mention capable of – carrying on the business.
Typically, a gradual transition from the older generation to the younger takes place. In an industry that relies so heavily on connections and referrals, letting past clients know that one’s children are taking over the business offers a certain assurance of continuity. Younger family members who are brought on board early as part of a transition plan can forge their own connections with those clients, while learning the market and familiarizing themselves with the systems that are already in place.
Barbara Mawicke was a solo agent with Coldwell Banker in Winnetka for 38 years before her son, John Mawicke, and daughter, M’Liz Simonds, joined her in business last fall. Together, they formed a team under @properties. While she had never considered bringing them on board before, when they expressed an interest, she decided to take them up on their offer. Both of her children have held real estate licenses for many years, and both bring something new to the team. John has a background in finance, for example, while M’Liz has worked in development offices and in banking.
“It’s wonderful,” Barbara Mawicke said. “It’s certainly made it easier to take the burdens of running everything off of me. There are so many things you have to do today, from marketing to showings to meeting people to servicing houses. You can’t be in three places at once. We’re able to expand our business a little bit because we have more people to do many more jobs.”
Next: Selling the Business