The Real Deal
October, 2003

Neil Binder says that nobody else in Manhattan residential real estate
is “dumb enough” to follow what he is doing when it comes to training
new brokers.

He is joking, of course. Over the last 20 years, Binder has developed the most extensive training program for residential agents in Manhattan.
The principal of Bellmarc says he spends more time on training than on
any other portion of his job. He has also written two books on sales.

The training he offers new agents is intense. Agents are required to complete a two-month program during which they can’t conduct any business unless they’ve already worked in the industry. Students have to memorize every clause in a standard contract, listen to 16 audiotapes, master a 600-page sales manual, read Binder’s two books, and complete two 25-page take home exams as well as two closed book tests.

If they make it through the program – about one-third drop out – they can look forward to another follow-up training program six weeks later.

“It’s intended to be daunting,” said Binder, who said he wants to insure agents know what they are the doing from the day they start doing business.

“We want to send out brokers that are cooked from inception,” he said.
“We think customers have a right to have agents acquainted with what
they are doing.”

While the Bellmarc program tends toward the academic, there is a wide range in the types of training programs offered by residential real estate companies in New York. For many companies, training is best done in the classroom, at least initially. For others, the best way to learn is out in the field, right from the start. More often than not, it’s also a matter of company resources.

Much of the basic subject matter is the same – new agents learn about
co-ops, condos, broker law, and contracts. They learn selling, negotiating and marketing strategies, subjects not dealt with in getting their license.
They cover strategies for obtaining listings, how to conduct open houses, prepare board packages, read financial statements, assess the investment value of properties and the like.

One of the big divides is between big companies and small companies.
Large companies offer more regularly scheduled, formalized training programs, while smaller companies tend to train new agents one-on-one.

“It basically goes from none to full speed,” said Kay Brover, director of broker development for Douglas Elliman. “That’s a problem. Smaller companies don’t have the manpower to do programs. Though if you work for a really good owner, you have the benefit of that, and many companies have terrific owners and managers.”

Brover said the monthly program offered by Elliman, which lasts between two and three weeks, is “soup to nuts.” There were more than 40 new agents in September’s incoming class. The program takes off where the 45-hour course required for a New York State license leaves off. “It covers marketing, and knowing your product,” said Brover. The bent is practical, with students learning about co-ops, “not so they can pass a test, but so they can qualify a buyer.” Agents learn about financing, the law, industry organizations like the Real Estate Board of New York and other topics. Mortgage brokers, attorneys and other speakers are invited in. Brover said agents generally aren’t supposed to work during the course of the program, “but if a second cousin calls and says he wants to spend three million dollars on a new place, I’m not going to tell someone to stay in class.” Like at other firms, agents usually are paired up with a mentor as well.

Fox Residential Group, a much smaller firm than Elliman with around
40 brokers, doesn’t run any regular training programs and prefers the
one-on-one approach, said founder Barbara Fox. “I’ve been through a lot
of different routes to train people,” she said. “I think the real training comes by doing.” The company does offer an initial five-hour training session to brokers. After that, brokers learn as they do their first deal with Fox or another senior broker at their side. “Sometimes I’ll go out with them,” and
if they are not sure about something, “I show the place for them.” After the first deal, agents pretty much know the ropes, she said. “There may be
things that come up, but you know the general structure.”

Because the process of training is so time consuming, Fox limits her new hires. She said she hadn’t made any new hires for three years until she brought in a class of six new agents last year, making use of extra space
she had in her office. It was more efficient to train six new agents at once
than train six people one at a time, she said. She also said she is very selective in bringing new people in to start training. “Big companies will hire anyone who walks or talks,” she said. “I want to see how they will get along” with the rest of the company.

Some companies who are considerably larger than Fox Residential, like Stribling & Associates, also like the one-on-one approach, New agents at
the 160 broker firm sit beside the supervisor of brokerage in their office for five or six weeks, getting exposure to everything that passes across a supervisor’s desk.

Some programs, or training directors, at other companies take different approaches. Corcoran offers a comprehensive, two to three week program similar to Elliman’s, and was training 40 new agents last month. In addition
to the basics, Mitchell Lawrence, director for Broker Training and Marketing, emphasizes that new agents have to see themselves “as a business,” with
the mantra that agents are “now a business that needs to be marketed for success.” The former publicist for Paramount Pictures teaches agents to “differentiate themselves” from the competition. Word-of-mouth and mailings, as well as “outside the box” marketing methods like hosting seminars and writing newsletters are explored, and Lawrence also works with agents to help them “lay a foundation” and develop a structure for their new business. Other firms, like Citi Habitats, also offer unique programs. President Andrew Heiberger said his company is the “only firm with a training program for rentals” in place.

As far as the instruction that agents receive in getting their state licenses, usually before starting with a company, some say they are not overly impressed. “The state training is a little thin,” said Binder. “The state does
a mediocre job. It can be improved.”

Esther Muller, founder and president of the Academy for Continuing Education, said the program “is what it is,” though she noted that “it’s easier to get a driver’s license.”

The 45-hour course required by the state for a license is now shorter
than neighboring states. In New Jersey, the licensing course is 75 hours. Connecticut’s requirements to obtain a real estate salesperson’s license
were raised last month for the first time in three decades, with prospective licensees required to sit in on 60 hours of classes, up from 30 hours previously. Across the nation, by contrast, Maine and Vermont don’t even make prospective agents take real-estate classes to get an initial license (they only have to pass the test), though some states like Colorado have strict standards.