A real estate team leader breaks down their commission structure: agents get 27% to 54% depending on lead source, with a 10% deduction for ReMax and team fees. The strategy targets 35-40% blended average pay by steering recruits toward the highest-paying buckets, where the team provides leads or agents use their own sphere.
Questions this video answers
35–40%.
10% off the top: 5% to ReMax and 5% team admin fee.
Nominal tiers: 30%, 40%, 50%, 60%. Effective payouts after 10% off the top: 27%, 36%, 45%, 54%.
So what is the quote unquote, best compensation structure? And I can only tell you what I do and the rationale behind what I do. So let me run through it here. And all of this is in your OSA position agreement. And basically the way that I laid out the OSA position agreement is I have two, I think, let's see here. I think I have two Schedule Bs. So if you look at our 2014, I think I laid it out where I have two Schedule Bs. So I have the comp. Yeah. So schedule B, buyer, OSA performance requirements and commission. So this is schedule B for buyer outside sales. And then we have a schedule B for listing outside sales associate and what they make. So I'll run through this entire agreement, but you have access to that as well here. So let me run through what I do and the rationale for what I do and some of the. You know, you're going to get really queasy when I start to talk about 30 and 40%. And let me explain to you how I got buy in on those and how I played it at first. If you're just starting to recruit into your team, let me. I'm going to explain how I went through that process because your first reaction is like, there's no way people are going to buy into 30 or 40%. But I'll show you a way to do that. So here's what I do. My goal is to keep the blended average agent pay in the 35 to 40% range. So I'm going to show you my actual gross margin on each side of my business. But I'll get there in a second. Let me finish this, this one out for you. First, buyer agent compensation. You'll see it's listed in the position agreement. And I'll go through what each means, but basically it depends on the source of the lead. So it's 30, 40, 50, 60%, but there's 10% off the top. And I started this structure when I was at another ReMax franchise. I bought my own franchise. I don't run any independent agents in my franchise. It's just my. So I take 10% off the top. I say there's 5% for ReMax and 5% for team admin fees. So that leaves to the team 27%, 36%, 45% and 54%. So basically 90% of 30, 90% of 40. 90% of 50 is 45 and 90% of 60 is 54. So 27. So here's how I explain it. So When I'm talking to an agent, I'll say, you know, basically the splits are the same as any other team. So we take ReMax and team admin fee off the top and then it's 50% for a team lead. So we give you lead, but you convert it so it's either Internet lead, Zillow lead, you know, Commissions Inc, whatever you're running, or a yard sign call. So we put the effort into getting that sign in the yard. You answer the phone, you convert them, it's basically 50% after the, after the team admin and ReMax. And then for your sphere, we pay more. So we pay 60% and we take the ReMax and team admin off the top, but we pay 60%. My focus when I talk to a recruit, it's on those two buckets. So the majority of your business will be on those two buckets. There are instances where if you don't have a buyer isa, you could say where I personally set the appointments, so I'm prospecting in Boomtown or Commission Zone, or I answer a yard sign call and I set an appointment and those are paid out at a slightly lower split. And you know, it's just based on the value that, you know, if you answer the phone, you get paid more. If I answer the phone or the ISA that we may have in the future, you know, you're paid slightly less. But it's not a focus of your business. It's not, you know, it's not the majority of your business. And then there may be instances where I have a seller, you know, who's going to buy, or a personal sphere of mine who's going to that ready to go. You may have to go out two or three times where we'll pay 30%. So we take the 10% off the top and we pay out 30%. And those are typically your most profitable deals. So when you explain those two lower buckets, you really explain them as benefits for having those deals. You know you're going to want those. Trust me when I tell you you're going to want those 30% deals because they're literally gimme type deals. But you're focusing on 50 and 60 and most teams pay everything out at 50% or more. I've seen 50, I've seen 60% for everything. If you pay everything out at 60%, your gross margin on the buy side is 40%, like 18% less than what my team generates. And the sacrifice there is productivity. So your agents will sell more homes because they're getting paid more for each transaction.
