Pay Structures Used by Real Estate Brokers
In regards to the commission split between brokers and agents, brokers will typically use one of the following pay structures:
A straight commission split is the standard pay structure. The split can be anywhere from 90/10 to 10/90. Agents with more experience and a higher sales volume tend to get a larger percentage compared to new agents that need more assistance.
A tiered split structure works a little differently. Brokers will take out a larger split until an agent reaches a certain sales amount. The more the agent sells, the smaller the broker’s cut will be. At the start of the year, the commission split resets back to the first tier.
It’s less common, but some brokers will offer agents 100% of the commission in exchange for a monthly fee that covers supportive services and office space. This is a good option for established agents that have cash on hand for the first few months of fees.
Salaried positions are also rare, but they do exist. If this payment structure is used, agents typically get a regular salary plus a bonus for each close. New agents who need income coming in as they launch their career are most likely to select this pay structure.
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