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I get so tired of reading about how much Realtors make in the news...Today in our local paper an article hit saying that billions of dollars have been made in Real Estate commissions this year..The media makes it sound like we are all sitting around raking in the dough and doing absolutely nothing!! How untrue..If that was the fact, I'd be sitting on a warm sunny beach right now sipping a drink with an umbrella in it. I'd like to share with you all where your well spent dollars go when you hire a Realtor to market your home.
Let's say your home is worth $175,00..(the average price of a home in the Lewis-Clark Valley)
If I list and sell your home with a 6% commission the fee would be $10,500.
That amount is split between me, the listing agent, and the agent who brings you the buyer..Most people who look to buy a home will contact a realtor to help them. It is my job as a listing agent to not only market your home to the public, but to other Realtors as well...Realtors with solid buyers, not just people who are "tile kickers" as I like to call them...
That makes the commission $5,250 per agent...BUT WAIT!!
That amount will then get spit with the Real Estate companies broker..(the owner or manager of the company who the Realtor works from)..Currently..I keep 70% of the listing side, but it varies per office and individual Realtor..
That gives me about $3500 after the spit...but there is more taken out...
There is the advertising that was done..On average I would say for a property of this price range I would probably spend..about $100 per month. The average time a home sits on the market is 3 months..so there is $300 spent for ads..making my take only $3200.
The property may need a little staging..lets say I purchased flower baskets to hang from the porch to attract buyers eyes in the spring, or put some pretty poinsettias on the mantle for the holiday season..
If the home is vacant and it is winter..I may pay someone to come and insure that the heater is in working order..or maybe another Realtors client breaks something, forgets to return the key, etc...there are so many things that come up to list..This also usually comes out of my pocket..
I may on average only gross $2500 from the sale of that property! This is not in any way a shabby pay check, by far!! But a long way from getting rich.
As I stated earlier, we also market to the public. We try to bring buyers to your property, being our listing, or another agents...We spend a lot of money on buyers as well. We drive them around going from home to home, and in many cases not sell them a thing!! We do not get paid for doing that. We also usually end up buying the home seeker lunch during a full day of home seeking..If they bring the whole family that can get spendy.
In many cases we have to "pay" for our buyers. I am a certified relocation specialist..which means I have to pay to keep that certification in order for them to "give" me buyers. If a buyer or seller is referred to my by another company, I will also have to give them 25% of my commission for that referral.
Don't forget to pay taxes in April!!! We have to pay our own taxes as well.
Each month I pay for insurance, education, plus dues in order to be able to keep my license. Being a Realtor is very expensive, in fact.
Then why do I do it? Why do I risk all that money in order to be a Realtor?
Well, I do make a good living at it, I won't lie about that. But I also sell quit a lot of homes. I like to have 3 to 5 deals going each month. Out of those deals, it seems as if one will fall through before getting to the closing table. I work very hard to get as much as possible just in case others don't make it. I also have to save money for the winter months, since it slows down here from October to January..Many agents do not do any business in these months. If I have a really HOT month, I certainly don't run out and spend all my money, I think about taking care of my family during the months where things cool off. But I enjoy the winter..I get to spend more time with my family.
That is the number 1 reason why I enjoy being a Realtor. I have a lot of flexibility. I also get a chance to meet a lot of great people, and help in times of crisis. Many times there is a crisis involved in the sale of a property. It makes me feel good to know I helped someone avoid a truck load of stress by taking away the burden of a sale of a property during financial woes, divorce, death or a major transfer.
So next time you read an article about how rich us Realtors are, I hope you remember this BLOG. If a realtor does do really well and makes a lot of money it just means that they work extremely hard. I just hope that if they are making an extreme salary they are doing some good with it, and not just showing off everything that they bought.
At this point, I want to thank all my past and current clients for making my career choice a real blessing.
Disclaimer: ActiveRain Corp. does not necessarily endorse the real estate agents, loan officers and brokers listed on this site. These real estate profiles, blogs and blog entries are provided here as a courtesy to our visitors to help them make an informed decision when buying or selling a house. ActiveRain Corp. takes no responsibility for the content in these profiles, that are written by the members of this community.