Great Post! I agree! There is one other BIG expense that the Customer does not realize about our perceived commission. Even after the 2 way split with 2 Brokers / Agents and even after the commission split with the Real Estate Broker, we then have to pay ALL of our expenses related to that transaction and real estate in general. One of the big expense items is as independent contractors we pay the TOTAL FICA amount of 15.3% instead as an employee we would pay 7.65%. So for every dollar we NET from our Broker, we actually keep 50% (50 cents on dollar) between income tax, FICA and other real estate expenses. Most folks think Real Estate is incredibly easy and profitable. It is far from easy or profitable for 80% of all real estate agents.
Quote:
Originally Posted by miadford@gmail.com
You all don’t seem to understand who gets what as far as the commission goes:
Let’s just use a sale of $100,000.
For a 6% commission that would be $6000
Let’s even assume that the split between brokers is even. So both sides receive 3%=$3000.
Seller’s broker gets the $3k and then has an agreed upon split with the listing agent and we wi say 50% so the agent then gets $1500 and their broker gets $1500.
The same happens on the buyer representation side.
So if the splits are all even, (which in most cases it isn’t), the real estate agent is splitting any commission they receive 4 ways. And they still have to pay percentages to lead creating companies such as Zillow and many others. So out of $6k, the agent may get to keep about $800.
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