Why Real Estate Agents Are Embracing The 100% Commission Model 

Real estate agent 100 percent commission model - 1111In the old days, a sales person would join a brokerage firm for the power of its name recognition and they basically relied on the organized firm structure to score leads and drive sales. But in the last decade or so we’ve seen a huge shift in buyer habits, and the rise of social media changed the way in which real estate agents engage with clients.

The power of social networking has shifted the power away from large real estate brokerages to the actual individual, and their ability to drive sales is determined by their digital footprint.

This is basically where the rubber meets the road for a lot of today’s real estate agents, and although getting the full 100% of your commission sounds a little ambitious; it is the way to go. Here’s what to expect if you’re going to move into the 100% commission model:

  • You will work for yourself, so it’s bye-bye brokerage
  • You won’t have access to training or resources offered by a broker
  • You will have to pay for posting ads, home showings, and buying signs

In this business model, brokers can charge very little because there are fewer moving pieces and overheads are kept at a minimal.

Advantages of a 100% commission model

The most obvious benefit is that you get to keep all the money you make, instead of splitting it with your broker. The other advantage is that you become your own boss, meaning you get to plan your working hours and are freed from the limitations of a working contract. Flexibility is important in any business, and in this case, you will be planning the showings, schedules, and appointments based on the value of each meeting.

Other benefits include:

  • Opportunity to establish your own brand
  • Sales training only when you want it, not when your broker arranges it
  • Total transparency between you and clients

The main tool used by large brokerages to attract top real estate agents was the promise to give them leads; which of course meant that an individual had to go jump through all the hoops to get anywhere, even when there wasn’t any guarantee of getting serious leads. Brokerages are still unable to keep their promises, either because they lack resources or haven’t quiet established a good network for finding clients.

Salespeople are more successful now

We have reached a point where salespeople who push their own brands have become quite formidable in the real estate market. As a matter of fact, traditional brokerage franchises are not equipped to provide today’s agents with the resources to chase leads or build a successful online campaign – and this is why it makes sense to go it alone.

In the age of personalized marketing, the only thing keeping real estate agents tied to a brokerage firm is a lack of imagination – or the fear of failure. And in both cases, you’re likely to fail unless significant effort is made to build a brand online. It takes a while for a business to build trust and establish itself as an authority – but surprisingly, it doesn’t take that much time to do the same thing online. For an agent who’s considering the 100% commission model, going it alone means that every successful sale is a bragging right, and perception is everything – so maybe a guy with just 10 successful sales can spin it so that they look way more successful.

80% of real estate business is based on repeat clients or referrals

This explains why brokerage firms are going broke. If all it takes is for an agent to create lasting impression with their clients, it’s quite easy to do that without involving the firm. Once the broker is out of the picture, all a real estate agent needs is to keep their line open, and past clients will send in new business.

At the end of the day, 100% commission models are far too attractive to ignore, and based on current trends, it won’t matter which firm you work for – if you want to get ahead, concentrate on building your own brand online. No offices are required; you’re a virtual business, with all the freedom that comes with that.