Special offer

Realtors Are Rolling In Dough!

Real Estate Broker/Owner with HOME AT LAST REAL ESTATE DB915628


Yeah, right!  Most of us aren't, contrary to popular belief.  I have found that most folks don't know "the real story" behind a Realtor's pay day, so let's see if we can't clear up a little of the confusion...


Agents generally do not get any kind of "salary or draw", nor are they provided with company cars, health insurance, paid time off, company computers or company cell phones. We purchase a lot of our own advertising plus name riders, signs, brochure boxes, cameras, etc. We don't get cost of living increases or bonuses.  The average commission, in the 11+ years that I've been in the business has never gone up. An agent is an Independent Contractor.  If the agent loses his or her job for whatever reason, the agent is not eligible for unemployment payments, even though we pay into the system with our quarterly tax payments.  We bear the full responsibility for our share of State and Federal taxes because we are Independent Contractors and don't have any employer but ourselves. 

Don't forget that your agent is working for free until you buy or sell a home.  This can go on for months and even years.  Sobering thought, isn't it? 

We don't have a safety net!  It's an excellent MOTIVATOR!

Safety Net

 Photos: The money photo is actually my own (had a couple o' extra bucks that day, LOL) and the net photo is from Photobucket!  www.photobucket.com


Posted by

Carole L. MacCollum 


676 Post Road, Suite 6 Wells, Maine 04090

Mail to: P.O. Box 427, Wells, ME 04090

carolemaccollum12@gmail.com / 207-337-4792



Claudette Millette
The Buyers' Counsel - Ashland, MA
Buyer, Broker - Metrowest Mass


There was a local radio talk show host a few years ago (in Boston) who spoke about real estate agents as being the only people who actually work for free.  He was amazed that a group of people would get dressed in the morning and show up at an office all day without being paid a salary. 

I loved his stories...


Dec 05, 2010 12:57 AM
Gay E. Rosen
Julia B. Fee Sotheby's International Realty - Larchmont, NY
As Real as Real Estate Gets!

Carole: Excellent post.....Happy Holidays Gay

Dec 05, 2010 01:08 AM
Gay E. Rosen
Julia B. Fee Sotheby's International Realty - Larchmont, NY
As Real as Real Estate Gets!

Carole: Excellent post.....Happy Holidays Gay

Dec 05, 2010 01:08 AM
Navona Hart
Century 21 Realty @ Home - Farmville, VA
Selling the Best Properties in Central Virginia

I agree with this post!  Agents need to be very aware of how the money works, where their money is going!  I think it is completely fair to educate the public.  Happy holidays to you.

Dec 05, 2010 02:17 AM
Barbara-Jo Roberts Berberi, MA, PSA, TRC - Greater Clearwater Florida Residential Real Estate Professional
Charles Rutenberg Realty - Clearwater, FL
Palm Harbor, Dunedin, Clearwater, Safety Harbor

What a great post to remind our clients that we are not rolling in massive amounts of cash! However, while we do not get paid until closing, I also don't work with clients that want to "steal a house" and figure that if my commission is a couple of hundred bucks it is alright. That is where a buyer broker agreement comes into play. My time IS worth something and if you don't agree then I guess we won't be working together.

Dec 05, 2010 02:48 AM
Richie Alan Naggar
people first...then business Ran Right Realty - Riverside, CA
agent & author

Over the years, I have met many people who have made or are making 100k a year...They all share one thing...they are budgeted for the whole amount....After paying for the privilege of living and playing in their chosen world, very little is left over.....So it is for me.....I may get a nice check, but it is already spent when I do....

Dec 05, 2010 03:14 AM
Brent Wells
The LivingWell Team - Prosper, TX
Dallas - Fort Worth


Great point, many consumers buy into the belief that all agents are rolling in dough. Once the curtain is pulled back and they gain understanding its a different story. Our job is to explain and educate. An educated client is a happy client.


Dec 05, 2010 03:15 AM
Bill Gassett
RE/MAX Executive Realty - Hopkinton, MA
Metrowest Massachusetts Real Estate

Most people don't realize unlike most businesses 94% of the business is done by 6% of the Realtors. Pretty shocking considering most have the 80/20 rule!

Dec 05, 2010 03:38 AM
Steven B. Harkness

I love Active Rain because I get to see the business through the eye's of the Realtor. Having been a lender for the past seventeen plus years; I have become keenly aware of the false impression home-buyers & sellers have about what a Realtor really makes. Often times this false impression is driven by the Mercedes or other luxury car they see the top 1% of the industry drive. They wrongly assume that ALL REALTORS make the same amount of money. It's the same thing on the lending side, or at least it used to be before the market crashed. I very much like the analogy of the twenty dollar bill used by Bruce and Sandi Soli (post #8). In this economy I will bet that she takes the pieces of that now torn up $20.00 bill and tapes them back together:)



Dec 05, 2010 04:54 AM
Bryan Robertson
Los Altos, CA

I talked to a guy the other day that indicated an interest in getting into real estate.  He was not earning what he wanted and thought going into real estate would give him more money.  So I outlined how much commission is earned, then the split, the cost of desk fees, the cost of doing business, and finally how much (or little was left).  He was cured of any desire to get into the business.

Dec 05, 2010 07:07 AM
Margaret Woda
Long & Foster Real Estate, Inc. - Crofton, MD
Maryland Real Estate & Military Relocation

I don't believe that most people care how we are paid, and why should they?  We don't care what they do to earn their paycheck and who covers the cost for their ballpoint pens.  Presumably we (and they) receive fair compensation for our/their services or we/they would do something different.  It's probably never been more important to consumers to receive maximum results, so they have to weigh the cost/benefit of various business models and realize they get what they pay for.

Dec 05, 2010 07:22 AM
John Novak
Keller Williams Realty The Marketplace - Las Vegas, NV
Henderson, Las Vegas and Summerlin Real Estate

"Sobering thought, isn't it?" Absolutely. Especially when we look down and only have 18 dollars and change!

Dec 05, 2010 08:14 AM
Liz Flint
Century 21 Hardee-Team Realty - Houston, TX
Houston\Tomball Realtor (832)816-8066

Hi Carole, very will put.  I hope some of my future sellers read this blog. 

Dec 05, 2010 08:17 AM
Marie Story
Coldwell Banker - Pinecrest (Miami) - Pinecrest, FL
Broker Associate, Pinecrest (Miami) Specialist

I don't know why: If the agent loses his or her job for whatever reason, the agent is not eligible for unemployment payments, even though we pay into the system with our quarterly tax payments. 

Dec 05, 2010 12:00 PM
Jennifer Fivelsdal
JFIVE Home Realty LLC | 845-758-6842|162 Deer Run Rd Red Hook NY 12571 - Rhinebeck, NY
Mid Hudson Valley real estate connection

Good conversation; transition from a corporate environment where you were paid regular to one where you could work  for awhile without getting paid is a real adjustment.

It is important to educate the public as to how we really get paid, some do get it other will not.

Dec 05, 2010 12:25 PM
Lori Lincoln And Associates
Top Agent Serving Dighton Taunton, Rehoboth and more! - Taunton, MA
Top Agent Taunton,Dighton Rehoboth &more
I have friends and acquaintances come into the business and think it was easy money. I helped them all the best I could, watched all of them fail, then later on tell me "you make it look so easy". Like anything else all careers are not for everybody. I would be a horrible nurse as I told one of my nurse friends who came into real estate for a year, then went back to nursing, where she is so much more effective because it's her calling, and the health care business needs her.
Dec 05, 2010 03:10 PM
Ernie Hernandez
RE/MAX - Cedar Park, TX
Central Texas Real Estate, NW Austin, Cedar Park

I tell all my clients this and still.... some ask for a discount in fees! of course then I explain it again and we move on forward with no reduction in fees

Dec 06, 2010 03:53 AM
Carole L. MacCollum
Broker/Realtor 207-337-4792

Melissa: A lot of people think the business is easy...then they get in and they are out within a year or two when reality hits!

Bill: Ah the glory days...for me that was back when I first licensed in 1999.  Of course I could also cold call back then and boy, do I miss that part!

Nancy: HAHAHAH!  You are so right!

Lizette: I have worked where I got a yearly raise and it was pretty nice there for awhile!  I like this work so much better though!

Larry: You bet!

Brian:  I've actually never done that...I drive a Ford Escape (but only because my 10 year old car got squished in an ice storm in 2008  and I don't wear designer suits and lots of gold...I'm just a down to earth broker who goes the extra mile without all the glitz, LOL!

Ruthmarie:  I never subscribed to the puff and fluff stuff :) I'm just not interested in it.  I'm sure those who have are facing lots of bills now!

Alex: Thanks!  I thought it was pretty funny!

Dave: Shudder!  Our gas prices are at around $3.09 here and I am horrified to think of them continuing to do so.  Luckily, we border NH, where I filled up for $2.89 per gallon at BJ's yesterday!

Chris and Eric:  I totally agree - and I wouldn't trade for anything either!

Carla: LOL!  Send some on over; I'm hungry!  :)

Mel: In my market area, we don't have the choice to work any differently but on a commission basis.  Gosh, wouldn't I love to make 33% - 40% on a transaction.  The expenses I discuss with my seller clients are indeed directly related to their homes and the marketing/showing/web feeds & placement/etc. that we provide to get them to their goals of a SOLD sign in their front yards.  It would be pointless to refer to other people's homes and the expenses involved in those transactions as it would have zero to do with their own. I think I would probably be laughed out the door if I attempted that, LOL!  Thanks for your thoughts!

Gina: Thanks, Gina!  I'll tell you a little secret - I thought the same thing when I first started in this business, but I learned very quickly how things really work! 

Geoff:  Yeah...sometimes...but luckily, not always!

George: Exactly!

Stacey: It sure is and I'm working as hard as I can to make it happen for me!  Not the Gold, just survival! 

Stephen: My silver lining comes about when I have a successful closing - any closing!

Michael & Fernando: I keep telling myself I need to throw in a ball of dough for this post, LOL!

Phil: That does it!  I am off to find a big ole ball of dough to stick on here! 

Lorraine/Loretta: Yep, I'd be one of those that drives my car until it practically falls apart (but not if it turned into a rusty junker, thoguh)!

Claudette:  I am so sorry I missed that!  I would have loved to hear that show! 

Gay: Thanks!  Rightbackatcha!

Navona: I agree!  And...I have learned about the financial aspect of it the hard way (which is probably the best way when I think about it!).  Happy Holidays to you as well!

Barbara-Jo: I don't work without my handy, dandy Buyer Agent Agreement!  And I work very hard to educate those who think that they will steal a house for 2 bucks.  There's a lot of that going around these days!  Excellent points, thank you!

Richie: I understand totally...though I really do try to take at least 10% or preferably 20% of each transaction to put back into my business. 

Brent & Deb: Yes, Yes, YES! 

Bill: Oh yeahhhhhhhhhh........!!!!!!!!

Steven: Oh, I so get you!  After watching for awhile, I did come to the same conclusion regarding loan officers and mortgage brokers.  But in this market lately...I'm seeing a few dings, dents and scratches on Mercedes and BMWs that in a different market would have been taken care of the same day the dinging/denting/scratching occured!

Bryan:  THANK YOU SO MUCH!  You did that guy a real favor!  They don't teach that kind of stuff in Sales Agent class!

Margaret:  One of my favorites: YOU GET WHAT YOU PAY FOR!  Thanks!

Erica: AND with other agents as well!

John: Hey!  Gimme a loan would you?  I don't that much in my wallet today, LOL!

Liz: Feel free to bookmark it and send it whenever you need to!

Marie: I'm sorry, I'm not following you?

Jennifer: That's me...former corporate slave for 18 years and yep, real estate is completely different!  I think the thing I miss most of all is the health insurance.

Lori: I could never be anything that has to deal with blood...I would faint away on the spot!  I am so glad there are others who are happy to do those types of jobs! Yes, you have to be a special kind of person to work in real estate - and stay in real estate even when the market goes poof!

Ernie: You must do an admirable job of explaining to your clients - good for you!  I love hearing success stories!


Dec 06, 2010 06:39 AM
Karen Feltman
Cedar Rapids/Iowa City, IA KW Legacy Group - Cedar Rapids, IA
Relocation Specialist in Cedar Rapids, Iowa

The consumer does not care about how we pay the bills, as buyers, they are not paying for our services.  They just want a quality of service that is expected through previous experiences or as told to them what to expect by others.  In the consultation, it is important to explain some of the realities of our business, but that still will not "buy" us loyalty.  We have to prove our worth!  After all, we are here to serve the customer at whatever cost.  That may mean that we give a discount at the closing table, or we stick to our guns and say no. 

Dec 07, 2010 02:41 PM
Carole L. MacCollum
Broker/Realtor 207-337-4792

Hi Karen!  All good points, thank you!

Dec 08, 2010 05:08 AM