If you’ve been working as real estate agent for any amount of time, then you’re familiar with the percentage cut many agencies take from their agents. While this is a fairly common business practice, it’s not the only option for agents, and it’s not always the best option either.
Understanding A Percentage-Based Structure
With the fourth quarter of 2017 upon us, it’s only a few more months before many agents will have to start giving a larger portion of their commission to their agency. This is because many agencies that use a percentage model roll back their agents’ percentages at the first of the year.
It’s not uncommon for an agent to start a new year off at a 70 percent / 30 percent split—with the agency taking 30 percent to cover costs, fees, training and other tools they may offer. Then, as agents reach sales milestones throughout the year, that percentage shifts, with the agent retaining more of each sale.
Why Fee-Based is the Better Option
Many percentage-based agencies point to a seemingly robust suite of marketing tools and support to justify their take of each sale. While this might benefit more inexperienced agents, a fee-based model allows the savvy agent the flexibility to make their real estate practice their own and really grow their business.
With a fee-based model, agents can manage their own marketing strategy and expenses without interference or expectation from the company they’re affiliated with. This means the agent has flexibility in determining not only how they reach their clients but also how much commission they charge those clients.
Take Your Career into Your Own Hands
At Benchmark, we offer agents a completely set plan, where each agent selects their fees at time of transfer. This gives agents independence and the ability to plan exactly what out-of-pocket expenses will be for the year.
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