100% Commission – Is It Too Good To Be True?

by | Oct 15, 2021 | Uncategorized

8Too many times in business and investments the old saying “It was too good to be true” becomes a reality. That’s why our post: “100% Commission – Is It Too Good To Be True?” is important.

Let’s explore the history and evolvement of 100 percent real estate commissions to put perspective on this unique commission model.

History of the 100% Real Estate Commissions

A Google book titled “History of Real Estate 100 Percent Commissions” explained its origin. Back in 1965, R. Dale Rector created a brokerage called Realty Executives in Phoenix, Arizona.

Realty Executives hired agents to work as independent contractors and charged them a “management fee and a share of office expenses”. It grew so fast that Realty Executives soon became the top-selling residential brokerage in metropolitan Phoenix.

In 1973, Realty Executives began franchising and eventually grew into 224 franchises with 3,600 agents across the U.S.

As they say in business; “The rest is history”.

How Successful are 100% Commission Brokerages?

100% Commission – Is It Too Good To Be True?

Let’s start with the current housing market in the U.S.

Across the U.S., real estate agents are earning higher fees from more expensive deals.

The Real Deal in July of 2021 published an article titled: “Broker commissions could surge 16% this year”. The article claims that a report by “the property tech company Knock and Bloomberg News” supports this assertion.

In July 2021 Bloomberg News published a news story titled: “Real Estate Agents Target Record $100 Billion as Home Sales Boom”. It explains how increased sales prices are creating a real estate boom across America.

Which real estate agents are going to earn higher commissions in 2021? The traditional 60/40 percent split brokerages or the 100% commission agents?

Not All 100% Commission Brokerages Are The Same

Sure, many real estate brokerages claim they offer 100 percent commissions. But, are they too good to be true? Most have a catch or two, or more. Some charge fees for every service needed to conduct business like:

  • Franchise fee;
  • Monthly administrative fee;
  • Additional desk fee;
  • Private office fee;
  • Quality office furniture fees;
  • Copying and fax equipment usage fees;
  • Training fees;
  • E&O insurance;
  • Attorney support fee;
  • Janitorial services fee;
  • Private parking spot fee;
  • Transaction coordination fee;
  • Meeting or conference room usage fees;
  • Marketing and promotion fees;
  • Transaction administration fee;
  • Bookkeeping fees; and
  • Other fees.

By the time your broker adds up all these fees, you may end up with less than a traditional commission split!

Is that real estate brokerage a 100% Commission – Is It Too Good To Be True?

Are There Any Real 100% Commission Brokerages?

Yes, the “Too good to be true” irony exists amongst the 100 percent commission brokerages. However, a few exceptions exist.

Big Block Realty is one of these exceptions. Since we are transparent about our fees, we charge two types of fees: Annual Fees and Per Transaction Fees.

Here is a breakdown of the types of fees under our 100% Commission Plans.

Annual Fee

Every Realtor pays $3,600 per year (or less) for maintaining your agency license under our brokerage. However, we offer three ways to pay this fee:

  • $50 per month where you pay $1,200 on your first 3 closings per year; or
  • $300 per month where you keep 100% of commissions on all transactions; or
  • $3,000 one-time payment per year (that’s a savings of 16.7%)

Per Transaction Fees

That’s right, you get to keep your 100% commission on every transaction except for these two small fees:

  • Errors & Omissions Insurance (E&O) per transaction fee of $185; and
  • Administrative fee per transaction of $125.

Here’s how it works. No matter what size transaction you always pay these two small fees.

 $310 per transaction no matter how big!

For example, you list and sell a $1 million home yourself earning a 5% commission. That means you can keep the $50,000 commission minus $310 for the $185 (E&O) and $125 (Administrative) fees. That leaves you with $49,690. No additional or hidden fees!

What Support Do You Get with Big Block Realty?

Here we stand out amongst other 100 percent commission brokerages.

Big Block Realty provides all our Realtors with the following Free Support:

Agent Concierge

Our staff is available to help you in many ways like answering quick questions or making lunch reservations. We are dedicated to making your life easier. Just call us to let us know how you need help.

Broker Support

Our broker is always willing to help your business succeed. Your success is ours too!

Our broker support includes answering all questions during your transactions. This includes help with filling out legal contracts to collecting your 100% commission check.

View and listen to our broker of record, Kim McKeag (who is also a licensed attorney) explains how she can help you. You can contact our broker support 24/7 by email or by calling our Broker Help Hotline.

Real Estate Attorney Support

Kim McKeag, our broker of record is also a licensed real estate attorney who can answer your legal questions and provide legal advice and consultations.

Real Estate Training

We provide Free training including internet marketing, sales training, and legal contracts. These courses include:

  • Contracts;
  • Legal topics;
  • Marketing;
  • Sales Skills;
  • Social Media; and
  • Team Building.

We maintain a library of video training sessions led by some of the top experts in our area to give you useful tips and suggestions.

How Strong is the San Diego Housing Market?

Check out recent news media stories about San Diego (and California’s) housing markets:

Fox 5 News in San Diego reported on September 17, 2021: “Governor Newsom signs bills allowing multi-family housing in single-family zones”. This means homes on single-family lots can now have up to four units and the lots can split allowing units sold separately. In a follow-up story, Fox 5 News reported this can “increase the number of units for sale in San Diego making it more affordable down the road.”

The San Diego Union-Tribune newspaper reported on July 20, 2021, that San Diego’s median home price reaches $750,000 in June, another record high”. Higher sales prices mean higher 100% commissions!

Channel 8 (CBS8 San Diego) reported: San Diego County home prices rise slightly, setting a new record for median home prices. San Diego County median home prices in June rose to $865,000 up from $851,000 in May.

100% Commission – Is It Too Good to Be True? – Conclusion

To answer the question: “100% Commission – Is It Too Good to Be True?”, no it is not too good to be true. It’s really true!

Not every 100 percent commission real estate brokerage offers totally transparent fees. Avoid the ones with hidden fees.

Now is a great time to relocate to San Diego or change brokerages in San Diego County. Especially, since U.S. real estate agents are earning higher fees from more expensive deals.

If Bloomberg News and the Real Deal forecasts are correct take advantage of the 16% surge in real estate commissions and the record $100 Billion in home sales. Don’t stick with traditional commission split brokerages. Move up to 100% commission brokerages. Level up!

But, not all 100% commission brokerages are equal. Avoid the ones with hidden fees. Hook up with a brokerage offering real 100% commissions with upfront totally transparent fees.

If you live in an area with a slow economy and a weak housing market, consider relocating to San Diego. As you read above, the San Diego housing market is getting hot and will remain that way when multiple units get built on single-family lots.

Join Us at Big Block Realty along with 985+ Realtors in San Diego County all looking forward to the booming housing market in San Diego.

We offer complete transparent 100% Commission Plans with no hidden fees.

We also include Free:

Contact us today if you live outside of San Diego County to see what relocation options exist. If you already live in the greater San Diego area, consider transferring your agent license to Big Block Realty.

Steven Rich, MBA – Guest Blogger

HAVE ANY QUESTIONS?

Let us know, we love to help:

Call: (800) 550-3209

or Click: https://100commissionrealestate.com/contact

Big Block Realty – 100% Commission Real Estate Brokerage

 

 

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