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  1. #1
    Join Date
    Jan 2011
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    Central Florida
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    10

    Default What makes a Broker worth the Split??

    There are some old threads that discuss some of these topics, but, as I said, they are old. So, forgive me for starting fresh but I want some newer opinions on a few things....

    Background: My girlfriend is working for a local broker. It's like a sorority. Everyone knows and likes everyone, but that doesn't pay the bills. Since my girlfriend started 7 months ago, she has received absolutely nothing from her broker. No training, no advice, no leads of any kind. The only leads she has received from the company were from walk-ins (2) during her "required" floor time. If it weren't for our mutual friend training my girlfriend, she would probably have quit. The broker has a horrendous website, and is paying an SEO company $400 a month for the privilege???? She doesn't believe in internet marketing and thinks that it is mostly a joke. The current commission split is 55/45.

    Here are my questions:
    1) What is the broker doing to deserve this money?
    2) What is a standard 'newbie' split? (is there a standard)
    3) Is the grass actually greener somewhere else?

    Thanks for the help guys. Obviously, I believe in Internet Marketing. I am setting up an automated lead capture and cultivation system for her. Why is everyone so reluctant to embrace this awesome new media?
    Social Media Marketing Made Simple - My Marketing Blog
    Central Florida Real Estate by Jodi - Real Estate Site Using Wordpress

  2. #2
    Join Date
    Dec 2008
    Location
    Tempe, AZ
    Posts
    715

    Default Re: What makes a Broker worth the Split??

    Complete newbie from what I've heard is 50/50. Our office is 70/30 for everyone. Broker (or owner) is responsible for helping you make money. The split you pay to the office should be seen as an investment in improving your business. If you have a 45% split, then you'd better believe that the 45% putting back into the company is smaller than the earning potential you gained because you work there (rarely ever the case). Grass is definitely greener somewhere else if what you say is true. Our office provides leadership and guidance from the broker and myself, we provide leads, and all tools, office, space and everything else is free. We're a company that wants to see our agents succeed, and from what I've seen, we're in the minority.
    I am a Tempe Real Estate agent, and I have been specializing in Tempe Foreclosures for several years now. I am also a market specialist in Chandler Homes for Sale.

  3. #3
    Join Date
    Mar 2007
    Location
    Las Vegas
    Posts
    1,154

    Default Re: What makes a Broker worth the Split??

    My girlfriend is working for a local broker. It's like a sorority. Everyone knows and likes everyone, but that doesn't pay the bills. Since my girlfriend started 7 months ago, she has received absolutely nothing from her broker. No training, no advice, no leads of any kind.

    The only leads she has received from the company were from walk-ins (2) during her "required" floor time.

    The current commission split is 55/45.

    Here are my questions:
    1) What is the broker doing to deserve this money?
    2) What is a standard 'newbie' split? (is there a standard)
    3) Is the grass actually greener somewhere else?
    To specifically answer your questions:

    1) With the info. you've provided, does not sound like much.
    2) Depends... 55/45 is not out of line for new agents.
    3) Not really.. read all below...

    1) Walk in leads in my experience are far superior then internet leads so the question is how much floor time has she done for those two leads? I once worked in a small office of 8 agents / their assistants and the walk ins that would come into that office were typically $700K+ sellers / buyers ready to look and buy. You could make an above average living just doing floor time. "Everyone knows and likes everyone" sounds like it is a small office... the small office I worked in we had a couple of agents out of the eight that had Very Big egos clashing daily. Put them in the same room and there would be a cat fight... you always had to watch out what you said so it would not be taken out of context. Not a great environment to be in (even though the franchise / office and tools were far above average for the industry). This was the Broker/Owners fault who was too busy out golfing / socializing / doing her own business then running a brokerage. Running a Brokerage and Selling Real estate are really two different things...

    Regardless... don't discount the "Everybody knows and likes everyone" aspect. For me... it's pretty important. Being around positive people you like when it comes to this business is extremely important... Especially right now. If it's a good environment... that tells me there is a good Broker there.

    2) How many deals does she have to close to get a better commission split? Most brokerages with % splits are on some kind of sliding scale. I know offices where you have to close a gazillion deals to get a good split and it starts all over the next year.. and I know offices where you only have to close a few to get a good split for as long as you are with them. For new agents... they are generally not going to get a good split with a major company/brokerage unless they can option to go 100% - office fees and pay a monthly fee.... something I would not suggest for most New Agents who do not have a sales background and any real estate experience in the current real estate market.

    3) For training... Personally... I prefer a brokerage that puts it's resources in building a name with good advertising for my listings. There is plenty of training out there available outside of the brokerage. Heck... all you have to do is read some of Gary Keller's books for getting the fundamentals of building a real estate system/business. The local association will have more then enough classes when it comes to the legal aspects of the biz, etc, etc. Basically... there is no shortage of learning / training if agents want to make the effort.

    It's really tough to answer questions like this due to the way the real estate biz is set up and I say that because for the most part... it's all about how many producing agents you can get signed up underneath you to have a profitable brokerage. Not too different then Multi Level Marketing if you really think about it. Agents don't get paid hourly, they don't get benefits, etc, etc.. the real cost of taking on agents and hanging their license is minimal. The difference in expenses whether you have 10 agents or 20 agents is really not that much but a Broker will generally make far more with 20 agents then if they only had 10 agents.

    Being married to a real estate trainer / Sales Manager... I've been with most of the Major Franchises and for the most part... it mainly comes down to the individual agent when it comes to closing and not the Brokerage. In other words...I've never met or even known of a Top Producing real estate agent that became one from waiting around for the Company/Brokerage to provide them with leads and everything else. There is a reason why 20% of the million real estate agents out there are doing 80% of the business.

    So... take all of the above and put it all together.... If your girlfriend is not getting anything for a 55/45 split in the current market.. she is probably better off working under a Top Producing Real Estate agent within the brokerage that has everything in place. I'm sure there is somebody in that brokerage doing business with plenty of leads.. otherwise the Brokerage would probably be out of business by now.
    Specializing in the Master Planned Communities that make up great Las Vegas Real Estate including Summerlin Real Estate. Check out my blog about the fascinating and constant changes always taking place with current Las Vegas Real Estate Trends...

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  4. #4
    Join Date
    Feb 2005
    Location
    Orange County, Ca
    Posts
    2,235

    Default Re: What makes a Broker worth the Split??

    Quote Originally Posted by svrpaul View Post
    ....it mainly comes down to the individual agent when it comes to closing and not the Brokerage. In other words...I've never met or even known of a Top Producing real estate agent that became one from waiting around for the Company/Brokerage to provide them with leads and everything else. There is a reason why 20% of the million real estate agents out there are doing 80% of the business.
    Exactly. Forget trying to get a broker to give you the magic real estate pill to success, as it does not exist. As an agent, you are running your own business. No broker is going to magically make you successful. You do it on your own, by getting out and meeting people by door knocking and open houses, generating internet leads, etc... Why would you even expect a broker to give you leads? IMO, you need to be dependent on your own abilities to be successful.

    I expect nothing from my broker except for them to stay out my way.
    Last edited by OCTeam; 01-09-2011 at 01:42 PM.
    The Hartanov Team, real estate agents in San Clemente.

  5. #5
    Join Date
    May 2008
    Location
    Anchorage, Alaska
    Posts
    1,539

    Default Re: What makes a Broker worth the Split??

    I agree with OCTeam. It's not the brokers job to make you successful. Yes, it is nice if they help but in general to be successful in this business you must do it on your own. Once you have the clout you can get better splits, office space, etc.. I started on a 60/40 split but since have gotten a better deal. If you can produce, then it doesn't matter to much where you are. I rarely rely on my broker's resources. It's just a place to hang my license and have an office.
    Ryan Tollefsen
    Team Leader | Unity Home Group

    Unity Home Group is the #1 real estate team at Keller Williams Realty In Anchorage, AK. Explore the Alaska MLS or use our web site to search through Anchorage Homes For Sale. We also have many Eagle River Real Estate listings if you are looking to be just a few minutes from town.

    Unity Home Group
    101 West Benson Boulevard #503
    Anchorage, AK 99503
    (907) 230-0332

  6. #6
    Join Date
    Jan 2011
    Location
    Central Florida
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    10

    Default Re: What makes a Broker worth the Split??

    Quote Originally Posted by Ryocheck View Post
    It's not the brokers job to make you successful.
    Really??? It's certainly in their best interest for you to be successful. If the broker doesn't matter at all then why not go to Exit realty. The spilit is 70/30. Or go to a desk fee approach, even better.... If the broker wants a business and not a club-house, they really should be focusing on making a cohesive team. That way everyone wins. The traditional method it seems that most brokers have used is to open an office, hire as many agents as possible, and hope everyone sells.

    So, you happily pay thousands of dollars per month and expect nothing in return? That seems ludicrous to me, and I think you could be doing better. If you read what I wrote and thought I was looking for a "magic pill to success" - that was a misinterpretation. As an entry level agent that didn't grow up in the area they now live, it is impossible to say "GO!" and make it as a real estate agent, especially if this is your only job.
    Social Media Marketing Made Simple - My Marketing Blog
    Central Florida Real Estate by Jodi - Real Estate Site Using Wordpress

  7. #7

    Default Re: What makes a Broker worth the Split??

    Ofitz, the main point is that NO ONE will have as much interest in your own success as you will. It'd be best to have the mentality that NOTHING will be given by anyone (let alone a broker) and EVERYTHING will be earned through hard work and determination. To expect that it is a broker's responsibility to see that every one of his/her agents are successful is simply a recipe for failure.

    Perhaps your girlfriend should sit down with her broker and discuss expectations (both ways), as surely he/she is in the best position to answer that question. Best of luck in your/her endeavors.
    View the latest offerings of Honua Kai Condos For Sale and our high-end Condos For Sale in Wailea. Not what you're looking for? Then visit our site for more info on Maui Condos For Sale, detailing some of best in the Maui market.

  8. #8
    Join Date
    Jan 2011
    Location
    Central Florida
    Posts
    10

    Default Re: What makes a Broker worth the Split??

    That makes sense in anything you do in life. No one was expecting her broker to hand her a business, but clearly some guidance is in order. If she knew what to do and how to grow her business, we probably would be talking about something else! The new agents (3 total) have less than 10 closing combined in the last 12 months. That, in my opinion, is a result of not knowing what to do. They are new, have no clue what to do, and are being told "you need to be on the floor more" and "send more postcards" at a few hundred bucks a pop. That is not mentoring.

    Either way, we used the information here to find her a new and far superior broker. I am MUCH more confident that we will be able to make a business outta this (even in Florida).

    Thanks for all the input guys!
    Social Media Marketing Made Simple - My Marketing Blog
    Central Florida Real Estate by Jodi - Real Estate Site Using Wordpress

  9. #9
    Join Date
    May 2008
    Location
    Anchorage, Alaska
    Posts
    1,539

    Default Re: What makes a Broker worth the Split??

    Good luck with the new broker. Hopefully that will do the trick.

    I will tell you the best thing for starting a new business is open house. It is cheap and will get results through time. The key in my opinion is target a specific area or neighborhood and consistently be there. Sit open houses for others in that area if you do not have listings. The neighbors will get to know you, buyers and sellers will get to know you and eventually you will be considered the area expert. You will get referrals from people you may not know or even remember. Send postcards to the neighbors of the home you will be sitting. Make sure everyone is aware you are there consistently. Use custom signs. Build a sphere from attendees and neighbors to contact, people you have actually met. Rarely do I sell the house I'm sitting but year after year I can attribute many sales to being at open house.
    Ryan Tollefsen
    Team Leader | Unity Home Group

    Unity Home Group is the #1 real estate team at Keller Williams Realty In Anchorage, AK. Explore the Alaska MLS or use our web site to search through Anchorage Homes For Sale. We also have many Eagle River Real Estate listings if you are looking to be just a few minutes from town.

    Unity Home Group
    101 West Benson Boulevard #503
    Anchorage, AK 99503
    (907) 230-0332

  10. #10

    Default Re: What makes a Broker worth the Split??

    Do your time, and become a broker yourself.
    Then you will reap the benefits....

    In Texas, it takes 2 years.
    That's what I'm working on....

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