Whatever happened to the local real estate agent? Most likely, he's joined a national corporation

Richard Currier opened his real estate office in Cambridge, Mass., 10 years ago. Since then, there have never been more than 10 agents working for Currier Associates. Right now, Mr. Currier has five agents, though he considers eight about ideal. Just three years before Currier opened his doors, William M. Raveis started his real estate company in Fairfield, Conn. Since then, William Raveis Real Estate has become the largest realty firm in Connecticut, with 42 offices and more than 1,200 agents.

While their histories have taken distinctly different paths, both men have one thing very much in common: a determination to remain independent, not to join one of the large national firms whose influence on the real estate business has dramatically altered the landscape for buying and selling homes since the 1970s.

They may be swimming against the tide.

In the 1970s, a business that belonged almost exclusively to the local entrepreneur - someone many people in town knew personally - met Corporate America. Lawns began sprouting signs with names like Century 21, ERA, and RE/MAX. Later, they were joined by signs from Merrill Lynch, Better Homes & Gardens, and Coldwell Banker.

In the 1980s, real estate met the age of acquisition and the computer. Last week, for instance, Coldwell Banker, a division of Sears, Roebuck & Co., bought real estate companies in Boston; Columbus, Ohio; and Louisville, Ky. Its Boston purchase of Foster & Foster Inc. gave Coldwell 15 offices in the western suburbs.

In the last 60 days, the company has acquired seven real estate firms with a total of 41 offices in the United States, says Joe H. Hanauer, chairman of Coldwell's residential group. With over 2,000 offices, Coldwell is the second-largest residential real estate company in the US, though it is still well behind the leader, the Century 21 division of Metropolitan Life Insurance Company. Century 21 has about 6,800 franchised offices.

Meanwhile, real estate offices around the country are unpacking new computer screens, keyboards, and printers. Agents and brokers who had used nothing more technical than a business calculator now have to learn to use software that will provide them screens full of information about houses on the market, including price, size, and the location of nearby schools and churches.

Some agents are also using computers to ``qualify'' buyers to see how much house they can afford, find the most attractive mortgages, and compare prices of recently sold homes to find a fair price for a house that's about to go on the market. The computers also help with an office's accounting, billing, and letter writing.

Next year, Century 21 will start giving its agents laptop computers so they can do all of this in a customer's home, says Marv Hart, Century 21's executive vice-president.

Eventually, almost every real estate office will have to have some computer capability. And with more affordable computers, that is already possible for many small companies, like Currier Associates in Cambridge.

The real battle for these companies, indeed for everyone in the real estate business, will be for market share. It will be a battle that pits major national corporations against independent companies ranging in size from one or two agents to those with a thousand or more. For now, the independents are holding their own.

``Some of the franchises haven't done as much lately, but some of the independents are growing very rapidly, says Stephen E. Roulac, president of the Roulac Real Estate Consulting Group of Deloitte, Haskins & Sells. ``I'm talking about chains with $50 million to $100 million in revenues. They are getting to be major players.'' Raveis's company had $40 million in revenues last year.

``In general, though, what you're seeing is a movement to larger firms overall,'' Mr. Roulac says. ``This size gives them more of an ability to provide the economy of service and power of service you get with a bigger scale.'' The larger firms, Roulac believes, can be more efficient, more automated, and can give customers a wider variety of the latest financing instruments.

While real estate is still a highly fragmented business, it is becoming less so all the time. Last year, there were about 15,000 active brokerage firms in the US. They accounted for $500 billion in transactions, but the 32 largest franchised and nonfranchised firms handled $252 billion, or over half of the total, according to Roulac. Just eight companies were responsible for more than 13 percent of the industry's commissions in 1986.

For some independent real estate companies, this kind of power is hard to resist. For several years, Joe Klock managed to resist the urgings of several national firms to buy his chain of offices in Miami. Some of the suitors were rejected, Mr. Klock says, because ``they weren't run by real estate people and didn't seem to have real estate as a top priority.''

Finally, in 1983, Klock joined Coldwell Banker. ``I had 300 people in the organization,'' Klock recalls. ``I was in my late 50s and I asked myself what opportunities I would be able to offer them five or 10 years down the line.''

Being part of a larger firm not only gives Klock's customers more services, it gives his employees more ways to advance their careers, much like an ambitious checkout clerk in a grocery store can rise to management in the company.

``The small real estate firm is to the big company what the corner grocery is to the supermarket,'' Klock says. ``It doesn't take a genius to figure out who can offer more.''

In Cambridge, however, Currier believes he and his five agents can handle about everything their customers need.

``I have much better control over my agents and the quality of service,'' he says. ``I handpick my agents and work with my people on the whole process so they feel comfortable getting an appointment without being a phone marketer.''

Currier's ``niche,'' if he has one, is being very close to several aspects of the Cambridge community to maintain contacts. The city's six leading brokers are all independent, and they do 60 to 70 percent of the business there, he says.

Across the Charles River in Boston, the Moran Company, with its four agents, specializes in the upscale Back Bay, Beacon Hill, and South End neighborhoods. Here, agents don't find houses in the Multiple Listing Service, a kind of catalog of houses and condominiums on the market, but keep in touch with other brokerages to find out what's for sale.

``There will always be a place for the small `boutique' office'' like Moran and Currier, Coldwell Banker's Mr. Hanauer says.

Raveis agrees, though he thinks the small firm - especially one in a large urban area - will have to become even more specialized.

``The small firm will survive if it remains small and specialized,'' he says. ``As long as they deal in a particular neighborhood or in a particular kind of property, like condominiums or certain types of houses, it won't be like they're competing with an 800-pound gorilla.''

In small and medium-size markets, small brokerages should be able to coexist comfortably with national corporations, and in smaller towns there may be almost no outside competition, Raveis says.

Despite the growth of national realty corporations, small firms still dominate the industry, Roulac notes. He points to a survey by the National Association of Realtors which found that 66 percent of US real estate companies have 10 agents or fewer. Only 4 percent of the brokerage firms had more than 50 agents.

But the large firms are attracting more salespeople. The association survey found that 44 percent of all agents work for firms with 50 or more agents.

The growth of the large national firms and the major regional independents coincides with other changes in the real estate business, changes that could make it even harder for the small, unaffiliated broker to remain independent:

Real estate as a ``financial service.'' Besides the major national franchise and nonfranchise firms, the traditional broker also has to compete with institutions promoting one-stop shopping that includes real estate. Roulac, for instance, cites Great Western Real Estate of Santa Ana, Calif., which is owned by Great Western Financial Corporation, the third-largest thrift in the US.

Vertical integration. This concept, which held that the largest real estate firms would be able to provide a wide variety of real estate services at a lower overall price, lost some momentum last year as real estate corporations faced difficulties assimilating all their growth. But the process is likely to continue as large firms continue to expand.

Access to nationwide sources of mortgage financing. The technology exists to let home buyers select the best mortgages for them - choosing among different rates and fixed and variable loans - from lenders anywhere in the country. But most brokers still steer customers to local lenders.

Century 21, however, has a national mortgage subsidiary, and Coldwell Banker introduced Mortgage One in 1985, a nationwide information network that provides a computerized review of mortgage options from local and national lenders, as well as mortgages from its Sears parent. Sears mortgages are packaged and sold to investors through its Dean Witter subsidiary.

Even some of the small brokerages that have managed to stay independent may have to succumb one day.

``We are a business of independent, stubborn people,'' Currier says. ``But some of the changes could force us to become aligned.''

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