Percentage split step ladder.... If an agent starts at a 60/40 split, at what point should they ask for have their split increase?

Asked by Leslie Lawson, Temecula, CA Tue Jun 21, 2011

looking for some advice in this current market on agent commission and splits. Thanks

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Cliff Perotti, Agent, Chicago, IL
Tue Jun 21, 2011
BEST ANSWER
Leslie...

From the company's perspective...Commission splits are created to cover the fixed and variable costs of doing business, plus a profit %. The average brokerage in the U.S. is at a negative NOI, so you will find commissions overall rolling back slightly, in order for brokerages to survive. Ask your broker, "What is the amount of money you are trying to achieve from my production annually?" In Northern CA, the answer might be $25K...so, based upon your production level, once the brokerage has achieved that number, the company's split should become more generous.

From the agent's perspective...It's all about value proposition. Are you getting services, leads, brand recognition, office space, phones, websites, etc. that you feel are worth the amount of money you are contributing to the company. If not, then check out your options and then approach your broker/manger with what you've learned and how you feel about it.

At the end of the day, remember that nothing is free..and if it's too cheap at a competitor, there's a reason.

Good luck!
1 vote
Ryan Smith, Agent, Murrieta, CA
Thu Jun 23, 2011
Agents that do not require much hand holding should be earning no less than 100% of the commission. I see so many agents being taken advantage of. If a good agent is paying their broker more than $2,950 a year then something is wrong.

All the best!
Web Reference:  http://www.ajsocalteam.com
1 vote
Sheelah Clar…, Agent, Hendersonville, NC
Tue Jun 21, 2011
I agree with Sally Grenier. Your company's policy is your guide. If your company doesn't have a policy, then ask your broker about the possiblities.
1 vote
Leslie Lawson, Agent, Temecula, CA
Sat Jun 25, 2011
thank you so much for your help! All answers were QUITE helpful!
0 votes
Sally Grenier, Agent, Boulder, CO
Tue Jun 21, 2011
What is your company's policy? Seems like a question for your managing broker. At my office, we sign an agreement annually, based on the previous year's earnings. But...everthing is negotiable. Just ask for a higher split!
Good luck!
0 votes
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