A real estate broker uses his experience as a guide for others who are interested in starting a high-volume business.
In this book, Shah (REO Boom, 2011) draws on his own successful creation and sale of a real estate business to offer enthusiastic guidance to potential newcomers to the industry. The key difference between Shah’s brokerage and most other well-known, franchise real estate agencies is in its disposition of the agent’s commission on each sale: it allows an agent to keep the entire commission, instead of the 50 to 80 percent offered by a franchise brokerage. The book provides many examples to demonstrate how the author’s model works out to the agent’s advantage. Although the practice is known as “100% commission,” Shah’s model succeeds by collecting a flat fee from its agents on each transaction, so the percentage that the agent retains varies. The author also encourages brokerage owners to develop additional revenue streams by providing agents with sales leads for an additional fee, subletting office space, and offering title services in-house. Volume, in both sales and recruitment, is the key revenue driver for this business model. As a result, the book seems less concerned with quality than quantity, as it encourages brokers to sign agents with no experience and to outsource marketing and website management to “dirt-cheap labor from around the globe.” Readers outside the industry may cringe at the book’s defense of transaction fees (“It’s just another way to make money. It’s pretty much a junk fee, but it’s standard across the industry”), while veteran agents will observe that although the book endorses a new revenue model, it proposes no other changes to the practice of selling real estate. Shah’s enthusiasm is undeniable, though, and he’s clearly knowledgeable about the industry, which make the book’s calculations, recruiting scripts, and other pieces of advice useful tools for readers who want to build a similar business.