In the world of real estate sales, commission reigns supreme. Traditionally, real estate agents have accepted high splits and brokerage fees that cut into their commission. So, how can a hard-working agent actually maximize their hard-earned commission? Through the power of choice.
There is plenty of content out there describing how an agent can expand their network, meet potential clients face to face and grow their earnings through handy tips like posting more on social media.
But agents need to be thinking more large-scale than quick cash when it comes to commission. To do that, we’ll break down two of today’s fastest-growing options when it comes to building out your commission for more long-term wealth:
- 100% Commission Plans
- Revenue Share Programs
Is 100% Really 100%?
In short, yes. As the name suggests, a plan like this means you get to keep all of your commission, minus a small transaction fee. You don’t have to split your commission with your broker and unlike the traditional method where a broker retains a certain percent of your fees, a 100% commission plan helps agents to keep more of what they earn.
Let’s break things down a little more to help paint a picture. If the total commission for a transaction is $10,000, you’d maybe get 70 or 80% of that with a traditional split. When you opt for a brokerage with a 100% plan, you get–you guessed it–all $10,000. The catch, if there is one, is that the brokerage will require you to pay a monthly fee for this plan for the use of their office space or for membership. This is typically a flat rate no matter the total number of transactions you complete.
Opting for a 100% commission plan allows you to take advantage of the fruits of your labor. You were the one who made the sale, after all. So, why shouldn’t you keep the money you earned?
What About Revenue Sharing?
With revenue share, agents have the potential to tap into a long-term income stream, continuing to earn residual income based on the transactions of their referrals even after they’re done working.
This kind of income program is used as an incentive structure for agents to refer new agents to join their brokerage. This win-win arrangement pays agents based on their transactions and those of their referrals, rather than redirecting money elsewhere to grow the business and is a great way to attract and reward team members.
No matter what your goals are in real estate, missing out on higher earning potential can leave you feeling like you’re constantly chasing something unreachable. At HomeSmart, the nation’s largest 100% commission-based brokerage, agents are given these options so they can do what’s best for them and their professional and financial goals. Being proactive in your goals through one of these two options can help you see more earnings over time.