If you are an experienced or newly licensed real estate broker looking at brokerage options, your net commission is likely the key aspect to consider. Your net commission is the portion you earn on a real estate transaction after splits and fees assessed by the brokerage. The average commission split offered to new brokers is 50%. Brokers with experience may find themselves lucky to pay only 30% in commission splits. However, a different brokerage model has been in place for years and is enticing Brokers in Oregon– the 100% commission real estate broker model.
This modern real estate brokerage model guarantees brokers keep 100% of their total commission from each deal. While the model is highly beneficial and attractive to real estate brokers, it is also imperative to examine how this model works. How does a brokerage earn money if their real estate brokers keep 100% of their commission? How will it affect my career?
What Is The 100% Commission Model?
Let's start with the basics. In order for a business to simple sustain, income must equal costs. In order for a business to be profitable, income must exceed costs. A real estate broker is self employed and should be viewed as a business owner. Real estate brokers must manage their overhead in order to have a profitable business. A brokerage model that focuses on helping real estate brokers make the highest profit margin from their real estate transactions is essential. With a 100% commission brokerage, your overhead is predictable and beneficial. If $20,000 is the total commission from a real estate transaction, that exact amount goes into your bank account. With a typical real estate brokerage, they may take $6,000 - $10,000 out of your commission check and for what? How does the brokerage justify taking so much money from your check? Did they do half the work?
Be Aware of Hidden Fees!
While brokers are Realty First keep 100% of their commission, many real estate brokerage firms have hidden fees to create an additional revenue stream. These hidden fees may include:
Yearly fees
Office desk fees
Technology fees
Compliance fees
Closing transaction fees
Franchise fees
E&O insurance fees
Mentorship fees
Select a brokerage that can offer transparency in all the fees that you will be responsible for. There may be a recurring monthly fee and additional one time fees at closing. Ask the real estate brokerage for a fee schedule. This is a simple, one page form that lists all the fees that you will be responsible for. Proceed with caution if they offer a vague answer, deflect the question, or refer you to a multipage contract to find the fees you are responsible for. A simple question needs to have a simple answer. At Realty First, we have a fee schedule ready to provide upon request. Though it can be summed up in one sentence, you keep 100% of your commission and pay $119.99 per month.
Be around success
Business minded people that were also successful real estate brokers, make successful brokerages. Some 100% commission brokerages simply collect checks and provide nothing else. An inaccessible principal broker that lives on the other side of the country doesn't help build your business. Ask the principal broker about their accessibility for questions and support the brokerage will provide you. Look for someone that has grown their business and is willing to share their secret sauce recipe.
The founder of Realty First, Derek Goude, has a long-standing history of working on business development and various real estate investments. In addition, Realty First has received outstanding reviews from brokers that have joined. With the help of our 100% commission model you have more money to invest in your business. By over paying you are missing out on building a successful and long-lasting career in real estate.
Contact Realty First Today!
Your next step is to have an informal chat directly with the owner, Derek Goude. Your inquiry will be kept strictly confidential. Click the button below now!
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