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The Secrets to Success in a Family Real Estate Business
Running a brokerage alongside family members can have its benefits and drawbacks. The key is to set clear parameters so that everyone thrives.
March 17, 2021
Just out of college, with a few media internships under his belt, Matt Phipps had a decision to make: pursue a career in journalism with a large media corporation or join the family real estate brokerage.
“I realized I had a unique opportunity to extend another generation to my family’s business and a strange confluence of events inspired me to join in,” Phipps says.
He had already returned home for the summer and was helping out at the brokerage after graduating college in 2003. The role, he says, gave him the opportunity to make a direct impact, helping families realize their dream of homeownership. That year, he also lost his grandfather, also a real estate professional with whom he had a close relationship.
Phipps brought his own strengths to the table, working with some tech-savvy friends who could help the brokerage distinguish itself in the marketplace by gaining traction in the digital space, which, back in 2003, was just blossoming.
His grandmother, Joyce, a mother of five with an entrepreneurial spirit, started Phipps Realty in East Greenwich, R.I., back in 1976. Matt and his father Ron Phipps attribute its success to the unwavering commitment Joyce made to running a business shaped by a strong code of ethics, mutual respect, and a focus on treating the client with the same care as a family member.
These guiding principles are the makings of a solid foundation for a successful family brokerage. Here are other considerations and parameters that need to be in place so everyone can thrive.
Play Off Each Other’s Strengths
Similar to the Phipps family, Ruthie and Ethan Assouline of Compass Realty in New York City have a deep understanding of each other’s strengths and they use that information to their advantage. In fact, Ethan saw real estate as a viable career option long before Ruthie ever considered it.
“He had a vision for our future and that future included real estate,” Ruthie says. “He actually convinced me to quit the business I was in to start a career in real estate, and he said he’d follow me soon after.”
The married couple’s strengths complement one another, Ruthie says, which makes running a business together easier.
“Ruthie is smart, quick, efficient, and has the personality to connect with other people,” says Ethan. “I knew real estate would be a good fit for her.”
Meanwhile, Ethan is good at long-term business planning and the intricacies of a deal. Together, the Assoulines assess each client’s needs and then decide who will run point with the client and who will work behind the scenes.
“We are both involved in every transaction,” Ethan says. “With my background in finance and international business though, I tend to connect with the needs of international buyers looking for real estate here in the U.S. and Ruthie connects more with local clients.”
Communicate Early and Often
When Ida Schwartz’s daughter Minette reached out to join the family business at Compass Realty in Miami, Minette says her mother welcomed her with open arms. The mother-daughter duo did have some reservations at the beginning of their business relationship, though.
“We have this beautiful mother-daughter relationship,” says Ida, “but now it’s become a business relationship as well. As a mother, you can deal with certain things, but in business, you have to deal with less because the client always comes first.”
In order to preserve their special bond and solidify a business relationship, Ida and Minette committed to communicating early and often.
“We drew up a partnership document to establish boundaries,” Minette says. “We focus on our clients and we are committed to making it happen and moving forward no matter what.”
Ida says transparency with one another and mutual respect are necessary and vital to maintaining a healthy, thriving business relationship.
“We respect each other’s decisions and when we don’t see eye to eye, we discuss things quickly and come to a compromise quickly. At the end of the day, we always do what’s best for the client.”
Communicating potential problems is key to the Phipps family and the Assoulines as well.
As principal broker, Ron Phipps says he realizes he might have to make the decision at the end of the day, but he will not do so until everyone is heard, and all points of view are considered.
“First and foremost, we’re really good at identifying what the problem is,” Ron says. “We back away from the edge and we talk it out. And then we pause and circle back a bit later to figure out what makes sense.”
Put Ego Aside
All three brokerage families agree that strong egos will only hinder the success of a family business and take away from what’s really important: the needs of the client.
“If you have to be in control and always right, being in a family business is tough,” Ron says.
The Phipps family, instead, believes in and capitalizes on what they’ve termed “cross-generational mentorship.”
“There are a lot of relationship-building tactics and business practices that I learn from Ron,” says Matt Phipps, “and I’ve helped us become more tech conscious. There are times when we lean on our junior agents and they know they can lean on us as well.”
Matt likens the evolution of Phipps Realty to two music groups: “When I started we were like the Bee Gees, a successful family group with tight harmonies. With the expansion of our team, we’ve become more similar to the Wu-Tang Clan, a larger collective of talented individuals with a diverse set of skills from various neighborhoods, cities, and towns mutually obsessed with providing the best real estate service for our communities.”
For Ruthie and Ethan, focus on the long-term goal helps keep egos in check.
“So often, people stray from the path because they allow things that don’t really matter to get in the way,” Ruthie says. “We focus on our long-term goals.”
Ethan says the couple’s business is growing at a rapid pace and they really don’t have the luxury of allowing resentment to build up, so they often let things go with ease.
The Schwartz team values their mother-daughter connection too much to allow their business partnership to sour relationship.
“We don’t let issues go too far and really nip things in the bud quickly,” Ida says. “When you operate a business like this, it’s such a fantastic feeling to know someone truly has your back,” she continues, adding that she knows without a doubt that at the end of the day, her and Minette’s goal is to take care of one another.
Separate Work and Home
Working together and being in the same family—and in the Assoulines’ case, living together—means those who work in family brokerages spend a lot of time together.
Keeping the office talk at the office presents challenges when working together, but it’s essential to a healthy relationship outside the brokerage.
Every weekend, the Assoulines take a walk together. On these walks, they have an agreement that they will not talk about work or anything stressful. These walks have a specific purpose: to simply spend some quality time together.
“The walk is supposed to be enjoyable physically and mentally,” Ruthie says. “It really reminds us of what we’re grateful for and gives us an energy boost for the week.”
Ida and Minette have pretty strict boundaries on work calls after a certain time of day or while one or the other is on vacation.
“Unless it’s a real emergency, after a certain time of day, we’re truly done with work,” Ida says. “We tend to our own families and we have boundaries. It’s important to have some kind of balance.”
The beauty of a family brokerage is the authenticity of the relationships. Not all family members can work together, but when personalities complement one another, and members of the same family have similar goals, a family real estate company can really shine.
“There’s a degree of comfort in knowing that you have each other’s back in a way that’s personal and not just responsibility-driven,” Ron says.