Agents

Broker Financial Comparisons

 

In these tough financial times, the large real estate brokerage firms are becoming a less attractive option for new and experienced agents.  One of the most common reasons agents fail to make it in this business is lack of sufficient income.  After spending 8 years with the large brokers, I’ve learned a great deal about how our industry really works.  What do you expect from a career in real estate?  Like most of us, you want to be able to work for yourself, have flexible hours and make a lot of money.  While this is one of the best industries in the world, it’s not as easy and profitable as most of the larger brokers would lead you to believe.  Here’s an example:

 

Let’s say you sell 12 homes a year at an average sales price of $200,000 and receive a commission of 3% on each sale.  Your commission would $6000 per closing. This gives you a total annual gross income of $72,000.  Outlined below are examples of what your annual income would be after the split from larger brokers as opposed to what they would be with a transaction based broker such as Newton Realty.     

 

Agent income after 50/50 split:                                 $36,000   (based on annual gross income of $72,000)

Estimated annual realtor operating expenses:                -  $13,750

(Board dues, advertising, gas, phone & equip)

Miscellaneous annual office fees:                      -  $ 1,200

Self employment tax (social security)                            -  $ 3,157

Adjusted net income (before taxes)                        $17,893

 

 

Agent income after 65/35 split:                                 $46,800   (based on annual gross income of $72,000)

Estimated annual realtor operating expenses:                -  $13,750

(Board dues, advertising, gas, phone & equip)

Miscellaneous annual office fees:                      -  $ 1,200

Self employment tax (social security)                            -  $ 4,778

Adjusted net income (before taxes)                        $27,072

 

 

Agent income after 80/20 split:                                 $57,600   (based on annual gross income of $72,000)

Estimated annual realtor operating expenses:                -  $13,750

(Board dues, advertising, gas, phone & equip)

Miscellaneous annual office fees:                      -  $ 1,200

Self employment tax (social security)                            -  $ 6,398

Adjusted net income (before taxes)                        $36,252

 

 

 

 

Agent income after Newton Realty fees:                  $69,000 (based on annual gross income of $72,000)

Estimated annual realtor operating expenses:                -  $13,750

(Board dues, advertising, gas, phone & equip)

Miscellaneous annual office fees:                      -   $ -0-

Self employment tax (social security)                            -  $ 8,287

Adjusted net income (before taxes)                       $46,963

 

 

With Newton Realty, the same $72,000 gross income would yield an adjusted net income of approximately $46,963.  The annual savings of Newton Realty versus traditional split brokerage could range between $10,000 and $29,000 per year. It’s kind of like buying name brand versus generic.  When selecting a real estate broker, an agent should demand three things:  Training, support and low fees. Call today and find out how Newton Realty can help launch your real estate career, while helping you save more of YOUR hard earned money.