Realty Associates Network Inc. (RANI) was born in 1987. At that time, John Michaels (Broker), saw real estate firms constantly hiring new agents, then losing over half those agents within a year. With high hopes, these new agents invested in a career that suddenly ended. After looking further into the problem, it became obvious that most beginner agents were not closing enough transactions to meet the expenses of being an agent for a corporate office. Brokerages required agents to belong to, and pay dues for, at least one Multiple Listing Service (MLS) as well as the local, state and national Board of REALTORS®. These dues, along with office fees, start-up costs, license renewals and continuing education added to these expenses. Furthermore, newer agents generally do not have as many clients as experienced agents, so less sales occur. To make up for lack of customers, the novice agents were often required to work “floor time” where, they were told, potential walk-ins could turn into clients. Floor time, however, was often not very productive and usually an inconvenience, as brokers often demanded agents be working the floor or in the office at certain times.
Broker Michaels noticed there were a small number of offices considered “independent.” These offices, brokers and sales staff did not join a REALTOR® board and often were not members of a MLS. Yet, they were duly registered to do business through IDFPR, followed all the licensing laws and had the potential to be profitable and successful. Frequently they were small, not franchised, had only a handful of salespeople (usually part-timers) and were limited to smaller residential sales. Michaels believed such offices could be improved if the Brokers would concentrate more on their part-timers, providing them with continued training as well as allowing them to choose their work hours and location.
Realty Associates Network Inc. was organized and opened to provide such an environment for real estate licensees. Basically, there were no office requirements or real estate ‘quotas’. Agents could take their time learning real estate and obtaining clients, or dedicate virtually no time by doing referrals only. Licensees were just charged a small annual fee to maintain their license in an “Active” status, as required by IDFPR. Several eventful business scenarios began to evolve. Some agents used their license to purchase properties for themselves and/or friends and relatives, allowing them to share in the cooperative commissions. One transaction covered all required fees to maintain their real estate license. Others found it convenient to have RANI refer their clients to other brokerages for listing properties in return for a referral fee. Pretty soon they were doing referrals to other states.
An attractive aspect that drew more real estate agents to the new company was the commission split. The RANI Broker agreed to pay a higher commission split to novice agents than any other brokerage would. Because the office now had well over a thousand agent-members, and also did not have the overhead of corporate and Board/MLS expenses, it could afford a generous commission to the licensee.
Eventually RANI also provided free seminars and discounted continuing education to its members, which encouraged the growth of the agent and office. As more people learned of RANI, it evolved into a sensible option for a many situations while still allowing for income opportunities with minimal expense: full-time job, raising a family, going to school, retirement, travel, etc… All are still virtually impossible to do while pursuing an expensive, time-consuming, career in real estate.
And the rest is history…