Definition of Brick-and-Mortar Brokerages

A brick-and-mortar brokerage is a real estate brokerage that operates from physical office space.

Deals close inside conference rooms, printers hum in workrooms, and clients often drop by for listing packets or key exchanges.

This structure has dominated the real estate market for decades, relying on local storefront visibility and in-person service to win business.

Pros of a Brick-and-Mortar Brokerage

Physical Office Space

A dedicated office gives every real estate agent meeting rooms, high-speed copiers, and private areas for negotiations.

Clients appreciate seeing a broker’s sign on a busy road because it signals stability and a long-term commitment to the neighborhood.

Established Localized Presence

Traditional brick-and-mortar brokerages position themselves as community fixtures.

Yard signs, office marquees, and local sponsorships reinforce the brand, reducing the education a listing agent must do when pitching services.

Training and Support, Especially for New Agents

Many brick-and-mortar brokerages offer live contract classes, floor duty rotations, and managing brokers who review paperwork at a moment’s notice.

New agents often lean on that proximity while learning the ropes of agency law, E&O insurance requirements, and MLS procedure.

Office Culture & Camaraderie

Face-to-face interaction builds chemistry.

Veteran producers swap market tips by the coffee maker, and impromptu celebrations after a big closing foster a team mentality that can motivate inexperienced agents who crave mentorship.

Cons of a Brick-and-Mortar Brokerage

Higher Overhead Costs

Physical space is expensive.

Rent, utilities, insurance, and front-desk staff raise the brokerage’s fixed costs, so splits and caps trend lower than cloud brokerage alternatives.

Commission arrangements in a typical franchise-based brokerage still hover near 70-30 or 60-40, according to industry cost studies.

Less Flexibility

A brick-and-mortar brokerage often fixes an agent’s work life to the office clock.

Many firms still assign floor duty, sometimes landing on weekends or holidays, regardless of a full appointment book. Mandatory in-office hours, weekly sales meetings, and caravan tours stack on top of that requirement, so even high producers spend a portion of every week behind a desk instead of in the field.

The extra drive time, parking cost, and rigid schedule chip away at the flexibility that draws many professionals to real estate in the first place.

Limited Technology

Legacy on-premise software is harder to update than a cloud CRM. Rolling out new marketing tools or AI lead scoring can take months when each branch office must be trained separately, leaving agents to juggle third-party apps to stay competitive.

Definition of Cloud-Based Real Estate Brokerages

A cloud-based brokerage is an entirely online real estate brokerage that manages transactions, compliance, training, and broker support inside a virtual environment.

No physical desk fees mean lower overhead, and agents connect through video calls, instant messaging, and mobile apps instead of hallways.

Pros of a Cloud-Based Brokerage

Lower Overhead Costs & Higher Splits

Without rent or utility bills, a cloud brokerage can share more company dollar with agents through higher splits, lower caps, or revenue share.

Industry analysts at The Close found that virtual brokerages often beat traditional brick-and-mortar splits on overall agent income.

Work from Anywhere

A real estate agent can draft offers from a beach house, host a buyer consultation over Zoom, or serve multiple MLS territories without changing firms.

This mobility opens new referral channels and accommodates teams spread across time zones.

Innovative Technology

Most cloud brokerages roll everything into one login that covers CRM tasks, deal paperwork, and lead-gen tools.

Because their developers ship updates every week, agents get new marketing layouts and data reports months before many office-based firms refresh their software. 

Revenue Sharing or Equity Opportunities

Many cloud-based real estate companies reward growth through revenue sharing. 

For example, Real Broker pairs steady cash flow with equity.

Sponsors receive up to 5% of the company split from Tier 1, tapering to 1 percent at Tier 5, with individual caps that keep payouts predictable.

Agents who cap, hit Elite production, or attract productive peers earn restricted stock units that vest over three years, turning production into long-term ownership.

Cons of a Cloud-Based Real Estate Brokerage

Self-Motivation Is a Must

In a virtual brokerage, nobody taps a watch if you log on at ten.

Achieving steady production means building a schedule and sticking to it, feeding the CRM every day, and carving out time for new training modules. Agents who thrive on a manager’s walk-by coaching may feel adrift without that immediate, in-person nudge.

No Walk-Ins or Physical Brand Presence

A cloud brokerage shows up on screens, not street corners. Fresh business comes from IDX searches, Google results, and social media rather than a passerby stepping through the door.

To match that storefront visibility, agents usually lean harder on digital ads, video tours, and a polished online brand.

Less In-Person Connection

Slack threads and Zoom calls replace hallway chats.

The setup works for many, yet agents who thrive on spontaneous brainstorms may want to schedule coffee meet-ups or book a local coworking seat to keep live interaction in the mix.

Cloud-Based Brokerage Spotlight: Real Broker

Company Overview

Real Broker opened its virtual doors in 2014, betting early that agents could build full-scale businesses without a storefront. The vision clicked: the platform now supports colleagues in all 50 states and across Canada, connected through the reZEN dashboard instead of office cubicles. Agent count jumped from 28,000 in Q2 2025 to about 29,200 by early August, roughly 43% growth year over year. Much of that momentum comes from producers attracted to the 85/15 split, stock awards tied to milestones, and revenue share checks that hit the bank every month.

What Makes Real Different

Real Broker runs an 85% split with a $12,000 cap, then charges a small post-cap fee per deal.

A five-tier revenue share program pays agents monthly and stock grants reward production milestones, giving both new and experienced agents routes to offset cap through revenue share and equity.

Tech, Tools, and Support

reZEN keeps every task on one screen. You can upload paperwork, message the broker, and send a deal for approval without juggling tabs.

The companion app sends a push alert as soon as compliance signs off, letting you update clients in real time without sitting at a computer.

Culture and Collaboration

Daily coaching happens on live video calls, deeper discussions run in Slack channels focused on specific topics, and quarterly meet-ups in major cities bring everyone together in person, standing in for the old hallway huddle.

Compensation and Growth Opportunities

Revenue share starts at 5% of the company split for every Tier 1 agent and declines 1% for each tier down to Tier 5.

Stock units accrue when agents cap, hit Elite production, or attract productive peers. These layers create multiple income sources on top of core commissions, making the cloud-based model attractive to both rainmakers and team builders.

Choosing the Right Fit

Factors to Consider

Before you commit, add up the office overhead, check out the software you’ll use every day, think about the training style that suits you, and decide how much brand visibility matters in your market.

A storefront brokerage offers face-to-face coaching and instant curb appeal, but those comforts often come with slimmer splits and franchise fees that trim every check.

A cloud outfit flips the math: lighter expenses, modern tools, and the freedom to work from anywhere, though success hinges on self-discipline and a knack for winning clients online.

Transitioning to Cloud-Based

Shifting the business online starts with dropping paper files into secure cloud folders, turning on an e-signature system, and walking clients through quick video-call how-tos.

After that, polish the basics. Update email signatures, swap the logo on yard signs, and refresh social bios, so everyone knows you’ve moved to a virtual setup.

Who Thrives at Real Broker

Tech-forward Realtors, relocation specialists, and team leaders who value collaboration across states often excel at Real Broker. New agents succeed when they log into daily training, pair with state mentors, and plug into referral chats.

Experienced agents appreciate the chance to grow a national network, earn revenue share, and leverage stock for long-term wealth.

FAQ’s About Cloud-Based vs Brick and Mortar Brokerages

How do overhead costs compare between the two models?

Brick-and-mortar brokerages pay rent, utilities, and receptionist salaries, overhead that usually pulls splits below 75 percent.

A cloud-based brokerage slashes those expenses and can return more company dollar to agents through higher splits or revenue share.

Will a cloud brokerage give me broker support when a deal gets complicated?

Yes. Virtual brokerages assign managing brokers to each state and handle questions through chat, email, and video calls.

Because documents live in the cloud, a broker can review a purchase agreement in minutes and push feedback straight to the agent’s dashboard.

Can a cloud-based brokerage supply leads without an office storefront?

Cloud firms create their own foot traffic online. They lean on IDX search sites, smart CRMs that rank hot leads, and coast-to-coast referral groups rather than a front lobby.

The strategy holds up in the numbers: Real Broker cleared north of 49,000 closed deals in Q2 2025 without a receptionist in sight, proving clicks can stand in for curb appeal.

Is revenue share unique to virtual brokerages?

Any brokerage can put a revenue-share program in place, but cloud outfits took the idea mainstream because lean budgets leave more money to hand back to agents.

Real Broker, for instance, pays a slice of the gross company split every month, while many office-based firms wait until overhead is covered and profit is tallied, so the payouts tend to be smaller. 

Which agents should consider staying in a traditional brokerage?

If your pipeline depends on people walking through the door, you like having a broker in the next room for quick advice, or your clients feel safest when they see a sign on Main Street, sticking with a brick-and-mortar shop probably feels right.

In that world, the extra split and work-from-anywhere perks of a cloud brokerage often take a back seat to the reassurance a physical office provides.

Interested in the Real Brand?

Thinking about joining Real? Connect with Chris Speicher to learn more today.