The 6% commission

In real estate, I hear stories of how agents negotiate on their commission to win listings right now.  I charge 6% + $395, and I do not discount.  I understand this might cause me to lose some listings, but I have my reasoning for not discounting my rate.  For the sake of argument, we will say I just listed a $200,000 house.

I don't actually receive 6% commission.  Whoever brings the buyer gets 2.4% ($4,800), which they split with their company.  My company and I split 3.6% ($7,200).  The $395 is often used to cover the cost of the title services we receive to assist with the closing, so that usually does not go to my company or myself.

I have a contract with my company to receive 75% of the commission the company receives.  So of the $7,200, my company receives $1,800 and I receive $5,400.  We're not done though.  My company is awesome and pays the overhead for my office, most of my office supplies, postage for my advertisements, and covers my website.  Let me tell you that most companies do NOT do that.  Not only do they take up to 60% of the commission split from some agents, most also charge dues between $120 - $200/month.

Yes, off of a $200,000 property, I do make about $5,400 in commission.  As soon as I receive that check, 25% of that goes towards taxes that I have to pay for on my own since I am a 1099 employee.  So, $1,350 goes to taxes and I receive $4,050.  According to the National Realtors Association, the average (median) full-time agent had 11 transactions in 2017.  My average home price last year was $172,093.75.  Six of those were listings and 2 of them were buyers.  That brings my average commission to 3.3%, which I split with the company I was at (which took 60% of that commission at that time).  I was a part time agent last year, so after putting 25% aside for taxes, I made $13,630.  That's not a bad part-time salary for a girl from the Midwest.  Even if I would been with my current company with 75% coming back  to me, I still would have only made $25,555.

Numbers aside, I am an agent that is loyal to my clients and the vendors I work with.  I communicate regularly with lenders involved in the transaction and the title companies to ensure that once there is an accepted offer the transaction moves smoothly.  I am responsible for the deadlines of the contract and will work to ensure that we stay ahead of the deadlines to be in compliance of the legally binding document.  I also put your needs above my own.  I understand I do not get paid until a closing happens, but I do not let my clients settle on buying a house if it isn't the right house for them or push them to accept an offer if I feel the offer is not as good as it should be.  I always tell my clients that they are the ones that are making the long-term decision, and that I support them in what they decide.  I believe in customer service.