With a purchase price rumored (but not substantiated) to be in the seven figures, Berkshire Hathaway HomeServices PenFed Realty Texas has purchased a Flower Mound powerhouse agent and associates, all formerly of Keller Williams’s Preston Road office in Plano.
Russell Rhodes, one of the five top producing Keller Williams agents in the world for the last ten years, his 15 associate agents and 12 administrators, are now a part of the Berkshire Hathaway HomeServices brand.
Rhodes’ Dallas-Fort Worth based team generated $196 million in sales volume last year.
Here is an example of how hard charging the Rhodes team is: of the 526 homes they sold last year throughout the DFW Metroplex, 322 were repeat client or past client referrals to Russell and his team.
To put this in another perspective, it would take a sweet deal to leave Keller Williams when you are pumping out that kind of sales volume. Which the Rhodes team apparently got. Keller Williams is known as having one of the most generous splits — that is, sharing of the commission with the broker — in the business. Every agent starts on a 70/30 split: 70% for the agent, 30% for Keller Williams. But by the time your 30% to KW reaches a certain level (about $23K in Dallas), you are “capped” and you get to keep 100% of your commission for the remainder of your fiscal year. With $196 million in sales, the Rhodes team met their cap way back during covered wagon days. Thus Rhodes left a 100% commission structure with Keller Williams to join Berkshire Hathaway Home Services PenFed.
Please note, Berkshire Hathaway HomeServices PenFed is NOT the same group that bought out Allie Beth Allman & Associates last year. It is like a cousin. The BHHS PenFed Realty is a franchise of Berkshire Hathaway HomeServices, part of the HSF Affiliates LLC family of real estate brokerage franchise networks, and is a wholly owned subsidiary of Pentagon Federal Credit Union, the third largest credit union in the US. (USAA is a competitor.) Previously an affiliate of the Prudential Real Estate network, the company changed its affiliation to Berkshire Hathaway HomeServices in November, 2014.”
PenFed + Berkshire Hathaway Home Services merged financial services (PenFed) and the suite of online tools, agent support services and highly regarded brand that Berkshire Hathaway had in the bag. The company has grown its annual sales volume to $3.8 billion with 1,700 sales agent and 50+ offices, providing complete real estate services nationwide.
“We’ve been watching the Berkshire Hathaway HomeServices brand and are impressed by its business principles and core values, which are closely aligned with our own,” Rhodes told me. “For me this is a double win, aligning with a company that is so strong in relocation. The $20 billion PenFed Credit Union based in Washington is growing, and will continue to grow through the real estate agent network. PenFed Realty’s growth has been phenomenal, and we want to be a part of it.”
Still, why leave that generous split with KW? Relocation expertise + juicy client perks = more clients than ever.
I wanted to align with a strong corporate brand in relocation for my sellers, as well as aggressive mortgage products and incentives, said Russell. With the huge influx of newcomers to the Metroplex, he says he wanted a company with strategic relocation relationships in the pocket.
The PenFen affiliation gives agents’ buyers financial perks, such as innovative and competitive mortgage products that provide up to $10,000 of buyer’s closing costs.
“There are many more perks,” said Russell. “Berkshire Hathaway is the fourth largest company in the U.S. now with interests in 26% of the nation’s top 50 companies.”
Hello, Nebraska Furniture Mart!
“It’s all about relationships,” says Russell, “with the relocation companies, with your own clients.”
He certainly should know. The ’86 TCU grad has lived in Flower Mound for more than 17 years, and was with KW for 16. He has built his successful real estate business rather unconventionally.
“I’m all about customer service, taking care of and loving my clients,” says Russell. “Money is not, and can never be, the focus. If agents have a servant’s heart, absorb and execute based on their responsibility to educate, and protect their clients in one of their most significant financial decisions, they will be blessed with clients for life and fiscally rewarded”
His strategy has not been prospecting (cold-calling, FSBO’s, etc.) but the law of reciprocity. And frankly, it’s brilliant. Russell Rhodes basically built a small warehouse club his clients belong to for life IF they remain his clients for life. Think Ducky Bobs with a truck. For free.
“Twelve years ago, I created a client appreciation program for items you might need as you go through life — entertaining, house repair and maintenance, even moving.”
He bought powerwashers, four margarita machines, two moving trucks, a pick-up, karaoke machine, tables and chairs, chafing dishes, even those industrial air movers in case of leaks or floods or whatever might befall the home. Rhodes team clients can use all this stuff for free as long as they are clients. It’s a brilliant way of continuously touching your client base, because everyone is going to need this stuff at some point.
“I’ve always felt uncomfortable calling clients, asking for business” says Russell. ” I’d rather focus on what I can do for them, for others.”
This is what he calls his “natural referral” method: getting clients into his web and making them want to stay there forever.
“I try to always apply “The Golden Rule”: if I was the client, what would I expect or hope that my agent would do for ME?”, says Russell. “That’s what I consistently ask myself.”
What does your agent do for you at Thanksgiving? The Rhodes Group provides freshly baked pies — last year they handed out 600. Come Easter, there are live bunny photos for grandma, additional bunnies for petting and loving, face painting, games, etc. for the children, and the parents get to draw plastic eggs loaded with prizes. The word, says Russell, is engagement.
“I don’t ASK for referrals,” he says, “my focus is how can I EARN them.”
No wonder his team sold 25% of all $800K+ pre-owned homes in Southern Denton County this year.
The Rhodes team includes Russell, his mother Verna, father Bo, sister Terri, and a host of other dedicated agents. I had also heard that Berkshire Hathaway Home Services PenFed sweetened Rhode’s deal with a corporate role, which he says there is but has not yet been defined. Part of it will be in training, coaching and development of other Berkshire Hathaway agents, and lead generation from the man who never asks for a referral.