Real estate agent commission breakdown
Still have a question? Ask your own!
1. Share of commission
3. Transaction fees
Completely depends on their "split" with their broker and any other fees. The share the brokerage takes could be anywhere from 50% to 0%. In many companies, agents have an agreement with their broker that their share goes up over the course or the year depending on how much they produce. So they may, before the year is over, jump to 100%, then reset to their lower split at the beginning of the following year.
It also depends on whether the particular lead came from the brokerage. We have a relocation department in our brokerage that connects us with employees relocating with large companies like IBM, Dell etc. There is usually a large fee collected by the third party relocation company (Sirva, for example, maybe 30%-40% or so taken off the top) then our split with the broker decreases for that transaction. This helps keep the relocation department running and pays the salaries of relocation employees. Our "take home" for these clients is closer to 1%. But we are willing to do it because the clients often have a short window to find a home and are very motivated and well qualified.
Then you have to account for any technology fees, desk fees, insurance, or other marketing fees charged by the brokerage, which usually come off the top before anything else is calculated.
To look at the broader question of "How much do agents make" there are some that take home more than a million dollars a year, and others that make nothing. Some literally lose money on gas, MLS fees, licensing fees, etc. It's a very strange business in that respect.
I hope this helps! Please feel free to send me a message here on Quora or on my Zillow Profile . I'd love to connect.
As you can see from the answers given thus far, the percentages differ dramatically between brokers, each with their own business model.
I work for Real , a startup brokerage founded in 2014 by a group of real estate industry veterans & technologists with the mission of making agents’ lives better. Our commission structure is 85%-15% & (unlike most) we don’t charge brokerage fees..
We’re able to do this because we don’t keep physical offices - but most agents spend 60–80% of their time on tasks that don’t really require one (lead generation, open houses / showings, marketing, etc). We don’t mandate hours or work locations, and the savings on overhead allows us to have our high commissions & no fees. We’re also placed a huge emphasis on mobile innovation & technology - our custom mobile toolkit (app) is provided to all of our agents & includes integrated MLS search, client messaging, a thriving community & much more.
Depends on how much the commission is, what bills the agent paid for marketing a home, what the office split is, what they're paying for health care, car, etc.
Bottom line is that it varies but it is a lot less than what you see on the closing paperwork.
If you hired a seasoned agent they're probably taking home a larger cut because they have better splits at their firm.
No comments:
Post a Comment