Your Relationship with Your Agent: Part 3 “How does my agent get paid?”

Every so often, I come across someone (client or stranger) who asks me “So how do you get paid?” Very good question I say! And it can vary from region to region, but in Oregon, here’s the deal:

1. A broker lists a home for a commission (usually a percentage of the sales price-this varies too)
2. When the home sells, the listing broker shares part of their commission with the broker who brought the buyer to the transaction (or they can represent both sides- not recommended in my opinion).
3. The agent gets paid after the deed is recorded-and that’s if everything goes according to plan and the sale goes through to the end!

This all seems very simple…The other question I get is, how come you guys get paid so much to sell a house! Welllllll, let me break this down:

1. We work for free until a home closes. Yes, you heard that right. I don’t have a salary and I won’t actually give you the statistics on how many homes actual get to the point of recording compared to those that don’t.
2. We pay for marketing. Whether it be marketing a home or paying for advertising for our services, we pay for it. Flyers, business cards, website advertising, supplies, etc.
3. Errors and omission insurance- yep, gotta have that.
4. Company franchise fee and split. I work for a company, I pay them to use their services and to help me market myself.
5. Health insurance- we pay for our own health insurance.
6. Taxes- yep, we have to pay those too!
7. Referral fees- when another broker sends a client your way (thank you, that’s awesome) they ask for a referral fee.
8. National Association of REALTORS membership- being a designated REALTOR isn’t free 🙂
9. Multiple Listing Service- that awesome program that I help you find homes with and is pretty much my life source, I pay a fee each month for that.
10. Gas- we kind of drive a lot…..

Well folks, that’s the breakdown. Its kind of cut and dry, but its a fact of life. I know it seems like we get paid a lot for what seems like a minimal amount of work, but hopefully the breakdown above helps you understand the behind the scenes aspect and the process. Being a real estate agent can be a very successful and enjoyable career, but we do put in our time and money. And if you have a great agent, they put in a little extra time 😉 I love my clients, and in the end, the feeling is almost always mutual (at least I hope it is!) . I love going the extra mile for those awesome people who make me want to come to work everyday!