Broker Salaries & Commission
How do brokers who work in a large firm, i.e., Brown Harris Stevens, Corcoran, etc., get paid? Do they have a regular salary in addition to a commission? How much of the commission on a sale do they have to give to the company?
How do brokers who work in a large firm, i.e., Brown Harris Stevens, Corcoran, etc., get paid? Do they have a regular salary in addition to a commission? How much of the commission on a sale do they have to give to the company?
Howrealnyc: – Just because you sell privately, without an agent, does NOT mean you got the best price in your pocket. Saving 25K, but selling for 40K less doesn’t add up to me.
Firstly I don’t know of too many places for sale for $410,000 which at 6% realizes a $25k saving for FSBO.
In April 2005 we sold a triplex co-op in Park Slope for $925k within 72 hours of our Craiglist posting (the eventual buyer actually called within 10 hours). Every broker we’d spoken to (and that includes 2 Corcoran brokers) estimated we’d get $850,000 max.
To have netted 925,000 with a broker would have meant we’d have to have sold it for $984,000 and there was no way we were going to get that for a 1200 sq ft 4th, 5th & 6th floor walk-up.
As long as your property is in a desirable area then a well constructed website with photos, floor plan and lots of details plus an add on Craigslist (or even the NY Times) seems to be all one needs to recoup most if not all of the brokers fee.
If the 6% ceiling is ever seriously broken then that might change but while the big players insist on their cartel they’re going to see more and more of the best properties going FSBO – it really is that easy.
PS: REMAX agents get 95% of their commissions, however they also PAY the broker/owner from $1000 – $3000 per month to be affiliated there.
Howard
Foxtons was a different company, (note my smile at WAS).
They paid a salary plus commissions, insurance & gave you a car. They changed the real estate landscape forever, and look what happened to them. BYE BYE!
The industry is definately changing. Has been changing, and will continue to change.
75% of Real Estate companies are “Old School” (50/50 Commission split with the office) MOST Franchise offices (C21. ERA, Coldwell Banker, etc) also take an additional percentage for “franchise fees”. The broker/owner pays for most general advertising amd marketing, but any good agent will also pay additional advertising out of pocket, but will get all the calls/emails generated.
Agents also must pay MLS fees, E/O Insurance, Board of Realtor dues, etc.
HOWEVER, i’m not sure how it affects a sellers (10/18 10:48) decision whether to list or not… if you’re selling, make sure you have the right agent.
Just because you sell privately, without an agent, does NOT mean you got the best price in your pocket. Saving 25K, but selling for 40K less doesn’t add up to me.
I completely understand a sellers desire to save the commission, but how did the real estate industry come into being and survive all these years if sellers did not get SOME value for their dollars?
Another forum post, another day!
Howard
howard@communityhomesales.com
I would say brevoort is probably right on regarding the turnover in the industry.
I work downtown and pass by the city real estate licensing exam center on William street. Once a week they give the test and everytime the line is wrapped around the block with tons of people from all walks of life, real estate law books in hand.
“Based on this feedback, I’m selling my next apartment FSBO!”
If you live in a desireable neighbourhood and you set a realisitc price (this is the key), there is no reason why you cat sell your own apt.
Once you agree on the price, you hand it over to the lawyers, and they do the rest.
Ive done it twice.
Most are not making real money.
It’s one of the highest turn-over industries around (revolving door) which is why you see so many new ones.
For every one doing well there are 10 or more struggling.
Not for the feint of heart. But it’s an easier gig than acting (or writing, dancing….)
I don’t understand how there are so many brokers in NYC. There’s no way they’re all making money. Sure, there’s a ton of real estate to be sold, but it’s not infinite. It would seem that the brokers outnumber the listings, no?
Based on this feedback, I’m selling my next apartment FSBO!
So the bajillion brokers working for Corcoran are independent contractors? That’s crazy.