Real Estate Thoughts October 1, 2024

High Commission Splits: A Realistic Breakdown

It’s no secret that many brokerages love to advertise high commission splits to attract new agents. On the surface, these offers can seem too good to be true — and, in many cases, they are. While a 90% split may sound like an excellent deal, the reality is often much more complex.

Here’s the truth: being a REALTOR® comes with costs — whether you’re covering them yourself or the brokerage is supporting you. From signs, CRM, and business software to advertising, websites, transaction coordination, and office fees, the expenses add up quickly.

Breaking Down the Real Costs

Let’s take a closer look at how these flashy high commission splits can get broken down with everyday expenses. In the example below, you’ll see two scenarios where an agent completes 15 transactions annually and another where the agent closes 25 transactions.

This image features a detailed breakdown of transaction and business costs for real estate agents, along with calculations of their effective commission split after various expenses.

This image features a detailed breakdown of transaction and business costs for real estate agents, along with calculations of their effective commission split after various expenses.The breakdown shows how easily the high split can be whittled down once you account for expenses like office space, marketing, technology, and more. The numbers reveal that an effective split may end up significantly lower than the advertised one. And let’s be honest — these expenses are probably underestimated!

Time is Your Most Valuable Asset

But expenses aren’t just about money. There’s another cost that’s often overlooked: time. Every minute you spend managing the administrative aspects of your business — whether it’s creating marketing materials, updating listings, managing leads, or handling transaction paperwork — is time that could be spent building client relationships and closing deals.

While these tasks are essential to running a real estate business, they often distract from the core of what agents should be doing: serving their clients.

At BHGRE Senter, REALTORS®, we alleviate those burdens for you. We cover a wide range of costs, from advertising and transaction coordination to technology platforms and office expenses. This means you can spend more time doing what you do best: helping clients achieve their real estate goals.

Maximizing Your Commission with Support

By joining a brokerage like BHGRE Senter, REALTORS®, you’re not just getting a commission split — you’re gaining a comprehensive support system designed to maximize your efficiency and success. Our model ensures that you’re not buried under the weight of endless expenses, and our systems allow you to reclaim your most valuable asset: time.

So the next time you hear about an impressive commission split, remember that the number on paper isn’t the whole story. Make sure you’re factoring in the hidden costs — and consider how much more you could take home with the right support.

Ready to grow your business with a brokerage that truly has your back? Contact Us at BHGRE Senter, REALTORS® today to learn how we can help you take your real estate career to the next level!