What percentage of the commission do real estate agents get after the broker is paid the commission of a sale?
Posted on November 15th, 2009 in Renting & Real Estate | 4 Comments »
act1withme_2000 asked:
After the sale of a home, let’s say a real estate company gets 3%. What percentage of that 3% does the agent typically get from the broker if the agent made the sale? This should be answered preferably by an agent, and in California if that makes a difference! What would be an ideal percentage of that 3% for new agents, and when should an agent get a raise?
4 Responses
Jacksonville FL Real Estate
That varies greatly by brokerage but not by state. In other words, the state you are in does not affect the amount of money you make.
Some brokerages give the agent 100% (of the 3% commission), but then there are usually lots of fees to pay – desk fees, processing fees, etc. In some cases, these can run $1000 a month if you sell a house or not.
Other brokerages give you only 50% (of the 3% commission) and don’t have so many fees. They might charge a technology fee and a MLS membership fee, but it is generally under $200 per month. Many of these will step up this percentage at specified sales levels (like if you sell 8 homes a year or more).
Then there are all kinds of arrangements inbetween.
Some brokerages also provide residuals and extra incentives for mentoring and bringing new agents into the brokerage.
Keep in mind that about 80% of people who become real estate agents end up washing out of the business. The overall average of homes sold per year is only 1. That means there are lots of licensed agents out there that are not selling any homes at all.
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I am a North Carolina real estate agent. Honestly, what an agent gets from a broker varies widely based on the agreement between the broker and the agent. Newer agents may get 50% of that 3%. The more you productive you are as an agent, the more your broker may give you. However, buyers/sellers must also realize how much the agent has to pay out of pocket for materials and resources to bring the deal to a close. So depending on the price of the home, it may or may not be worthwhile for an agent to spend excessive time and travel on a lower priced home.
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I was an agent in CA and it is not the same accross the board. Often brokrages negotiate a % with the agent when they sign on. I’ve seen anywhere from 50/50 to 100% to the agent. It depends on many factors. But for the most part I’d say 70/30 in favor of the agent is a good place to start with a yearly cap of around $15,000-20,000. (If you contribue the cap amount in a year everything over you take in at 100%)