Everyone wants to get more profit from their real estate deals. It is achievable because of the 100% commission plan. In recent years, the model has grown in popularity, and for some good reasons.
So, how does it function? By paying the full commission to any real estate agent on every sale. This may often come as a shock to agents who have previously worked with traditional brokers. After all, how does the broker make money if they don’t take any commission?
You may also visit the website 100commissionrealestate.com to get first-hand information about this new concept.
Comparison with traditional commission structure
In the United States, the typical split between agent and brokerage is 50%; how does this compare to the real estate broker model of 100% commission? Let us compare and contrast. Let us imagine a deal’s sales commission is $10,000.
The agent would receive $5,000 while he will receive the brokerage of $5,000 under the typical 50/50 split approach. In the broker model of 100% real estate, however, the agent receives the entire commission. That is the entire $10,000 deal commission.
After paying the transaction costs, this means larger profits for any agent. Furthermore, there are no desk or monthly fees.
If you sell ten residences in a year for $10,000 each, you will have to pay your broker $25,000 in commission. That is a substantial sum of money. However, if you only pay $200 per transaction, you will only pay $2000 at the year-end. That is an extra $23000 in your pocket.
What are the benefits of 100% Commission version of Real Estate Company?
The main benefit is, the money you keep from each property sale. Rather than giving up a portion of the commission every time you sell a home, you can keep it all, minus only transaction fees, which can be a significant difference in earnings.
The second most significant benefit is that you will become your own self-sufficient business owner. Also, if you had previously worked as a self-contractor for a brokerage, there were restrictions and constraints to consider.
You are more like an independent agent with the 100% commission real estate setup, since you may create your own showings, schedule, and appointments. As a result, you have more freedom in terms of when and how you work, how you run your business in general, and what you charge. A few more things that you must consider too.
- Complete transparency of your payment to the brokerage
- No pressure of using in-house brokerage services
- Industry and sales industry training whenever you need it, which is not on the terms of brokerage
- To fulfill any contract no sales quotas have to contend with
- As a certain real estate agent you have got the flexibility to build the brand
Some 100% commission-type real estate brokers still provide the same or equivalent services as a regular broker, but they are presented as an option rather than a contractual requirement.
The 100% commission type of real estate offers indisputable benefits to agents, particularly those who want to just break away from the pack and start their own business.