How much money do Realtors make?

Many people have heard that 20% of the Realtors make all the money.  This is like the glass of water that’s either 1/2 full or half empty.  The 20% makes all the money because the 80% are in and out of the business before the year is up, having sold nothing.  If they have sold a property, (usually to a family member or friend), the size of their first check, after all the splits is usually the laststraw.                                                                            The misconception that Real Estate is easy, and anyone can do it, is the reason.  Nothing could be further from the truth.  Real Estate is extremely complicated, very difficult, and highly stressfull.  For most of what we do, we receive no compensation.  Our work week is Monday through Sunday, most holidays included, 8 AM to 9 PM.  We only make money when the sale of a property closes… and then the money is split.  A 5% brokerage fee is split between the Listing company, and the Company that brought the Buyer.  Of the 2.5% each company received, it is split again between the Agent and his office.  Beginning Agents have a 50/50 split, growing as they become more successful.  Of the Agent’s split, he gives another 5-8%,  (varying by Company), to Corporate.  There are also dues to various organizations, fees for the usage of websites, (including the Multiple Listing Service), and other extraneous but necessary marketing tools, (even Voice Mail), Errors & Omissions Insurance, a large amount of gasoline,  increased car insurance since we take Clients in our cars, Internet exposure and other tools, gadgets, mandatory Continuing Education Classes (12 credits every two years), printing, postage, etcetera.  Every year there are new and increased dues and fees.

We are Independent Contractors, receiving no salary or benefits of any kind at all.  We buy our own health insurance.  Employees of a company receive a matching social security payment from their company, of which few people are aware.  Independent Contractors do not receive this benefit, therefore, we pay double the amount to make up for the other half.

Clients are not handed to us,  we have to find them ourselves, and recruit them before they decided to buy or sell.  Once they have decided, they have often already chosen a Realtor. One way of finding potential Sellers is through personal marketing through contacts, websites, mailings, and technology networking, all at the Agent’s expense.  Networking through friends, businesses, joining organizations, campaigns, church groups, etcetera, are all necessary means of business development,  which are time consuming and another expense.

So what is the reason the 20% stay in the business?  It is stimulating, part science, part art.  It employs a combination of law, psychology, marketing, communications, problem solving, and intuition.  We are inquisitive people by nature, need the freedom to make our own schedules, and need to be in and out of different places all day.  We are proactive individuals,  love all forms of communication, and care about people.   To us, the market and dealing with the public is addictive.

I hope this information is useful to you.                                                                                           If you have any other questions, please feel free to contact me.

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Can I get a better price buying a home if I use the listing Agent?

Many people believe they can get a lower price by buying the property directly from the Listing Agent since the Agent would then get paid for both sides. The answer is NO, and for three very simple reasons. 

1.  The Listing Agent has a written contract with the Seller, with a fiduciary responsibility to get the highest possible price for the Seller. 

2.  The property is listed by The Company, not the Agent; and the Company will not ‘donate’ part of the brokerage fee to any Buyer.  The property will sell to someone else.

3. The biggest reason not to deal with a Listing Agent, is you are placing yourself in the hands of your adversary, a professional in a business unlike your own. Could you walk into any other business and do the same job as those trained professionals? Would you represent yourself in a law suit? People assume Real Estate is simple, and because they are intelligent, they can do it themselves.  It is extremely complicated in ways you have never imagined possible.  You stand to lose working with the enemy.
If you want the lowest possible price, hire a Buyer’s Agent to represent and negotiate in your behalf. You NEED, and deserve, to be represented.

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How to choose a Realtor to buy a home

  • You may meet Realtors you like while visiting Open Houses.  Take a business card from any who are helpful to you, and call them with questions later.
  • Friends, family, and business acquiantances may recommend someone.  In this case, make sure this person worked with the Agent HIMSELF, and he’s not just recommending a friend.
  • ALWAYS use a Buyer’s Agent.  They are looking out for your best interests in every way, and you can tell them anything & everything.
  • Question the number of years the Agent has been in the business.  (6+ yrs is excellent experience)
  • Ask how he/she works.  Some Agents say they will give you a list of properties to drive by, and if you are interested, let him know. Cross this Agent off your list. You want an Agent who will show you multiple properties at once. Shopping is an education in the market, and will enhance your thoughts about what you need, like, and want. /li>
  • Do NOT take a recommendation from someone on the Internet. You don’t know who they are, or how good the person’s judgement is. A negative comment may be from the competition, or written for spiteful personal reasons. The recommendation could be coming from the Agent himself, his 8 year old son, Mother, or a close friend who’s never worked with him.  It’s happened!
  • I hope this helps you make a good decision, and if you have any further questions feel free to contact me:
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How to choose a Realtor to sell my home

Common Pitfalls:

Choosing a Realtor because he/she is a friend or relative, or the Realtor who suggests the highest price, one who offers a discounted brokerage fee, (can’t get a listing on their own merits, and not a good negotiators!), or one who says you don’t need to do much to get your home ready to sell, or “don’t bother fixing up anything, whoever buys the house is going to renovate anyway” – (ask the Buyer’s name & how much money he has in the bank, while you’re at it, ask if you can borrow the crystal ball for a few days). These are not good reasons to hire someone. Look for knowledge of the market, an understanding of current Buyers expectations, creative abilities, marketing tools available, and exposure.
If you have a Relative in the family whom you like, and still want to enjoy Thanksgiving dinner with, tell the Realtor you choose, you want him to receive a referral fee. You may do the same for a Realtor friend, and it will save the friendship, to boot!

#1 Priority: How the Agent will present your property. Seeing is believing.

When an appointment is made, ask to see some of their listings, past or present, including the Market History and Photos. The photos & written description are of primary importantance to the selling of your home. Buyers say if they don’t like the first photo, they skip over the listing. If they’re not interested by the description of the property, they skip the listing, and if they don’t like the additional photos, they don’t want to see the property.

Here’s what to look for in the description:

Description and Target Marketing:

1. The beginning of the written description should attract the attention of the ‘Target Buyers’, the people who are looking for what you have to sell. It should grab their attention immediately in the first phrase, with the key feature of the property.

2. The kitchen is the most important room of the house, it needs to be mentioned soon, there is always something positive one can say about it even if its only “bright white kitchen”, cabinet packed, great functionality, expandable, etc.

3. The description should include any updates, such as the young age of a roof, improved heating or electric system, etc.

Here’s what to look for in photos:


1. The photos should all show a lot of floor, and only a sliver of ceiling; this shows the size of the room. (No one is interested in the ceiling!)

2. Rooms with sun coming through a window should still be light, (there is a camera trick to do this).

3. Only 1 or 2 exterior photos before interior photos. Additional exterior photos can come at the end of the interior shots.

In the current season for Active listings, or the season in which it went under agreement, which can be seen on the market history.

4. Taken on a sunny day

5. The photo of the front of the house should be taken showing a corner of the house for a 3D effect, and the garage should be at the far side of the house, for good curb appeal. (Garage doors steal focus and ruin curb appeal).

6. The front of the house should be straight, not tilted.

7. The rooms should follow in a succession which indicates where they are. The last room within the view of the current room, and last shot of the current room showing part of the next room.

8. No repeated, almost identical shots of the same room.

9. No photos that look like a shot of furniture!

Market History:

1. Check the market history for any price changes, and if so, how many, and ask why.

2. Compare the original list price with the price when the property went under agreement.

3. If a property was under agreement and came back on the market, ask why. “Financing”, for the most part can be avoided by a true pre-approval, and a knowledgable agent who can spot the difference.

IMPORTANT Questions:

1. How many and on which websites will my home be shown? The more the better.

2. How many photos are you able to include on, and will your description of the house be shown as well as the websites? (public record) VERY IMPORTANT! Some Realtors are not members, and as a result, can only put 6 photos on it, and can not enhance the listing. This is the most popular Real Estate website in the country.

3. How many listings do you currently have on the market? Less is more. The more they have, the less time they will have to spend on yours.

4. Will you be present through-out the entire home inspection, & take notes? Being present, listening and taking notes will help you understand the seriousness/not serious citings & their ramifications. This is important to know when the Buyers respond to the inspection.

5. How often will I hear from you; and will I be talking to you or to an Assistant? (You’re paying for the Agent, not an Assistant).

6. How long have you been in the business? The need for some years of experience is for full knowledge of the process, pitfalls, problem solving, etcetera. Some people with only a few years have great marketing abilities.

7. How often will you do Public Open Houses; and how will you decide when to do them? (We recommend limiting them to no more than 2 per month, unless your competition is doing one; then it is to your advantage to be open at the same time.

8. How will I know what Buyers are saying about our house? There are various ways, but the best are ones you can access direct through the Internet as soon as the feedback is sent.

All other usually recommended questions are not really relevant. The Agents market knowledge, understanding of Buyers expectations, ability, and resources available to him/her are all that matter. Without this, the rest can’t help sell your house.

Best wishes for your selling success and happiness in your new home.
Feel free to contact me if you have any questions or doubts. You may email me at or for a faster response, to

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