100% commision real estate is a name for a low cost real estate brokerage model for agents. Instead of the traditional percentage fee of a real estate agent’s commission paid to the broker, also known as a commission split, a nominal flat fee or annual fee is paid instead.
As an example, an agent earns a $9,000 commission. In a traditional commission split the agent might pay 30% to the brokerage ($2,700), but in a 100% commission model they would pay a flat fee, such as $600.
To put it a very simple way, a 100% commission real estate brokerage charges agents less of the commission they earn. Agents typically pay a flat fee, sometimes a monthly fee in addition, or sometimes a simple pre-paid annual fee, instead of a broker split.
The 100% commission model has become very popular in the last 10 years, but the concept is actually decades old.
So why has 100% commission real estate become such a mainstream brokerage model?
The answer is technology. Paperwork is done through services like Docusign or, at the very least, scanned and sent through email. In the past, listings weren’t accessible online, whereas now MLS data is accessible from a multitude of websites. Given that all the tools for agents and their clients need are online and can be accessed remotely, there is less of a reason to have an office to go for client meetings. More agents work from home offices and don’t need to contribute a large percentage of commission for office-related overhead that they don’t use.
Find out more about Balboa Real Estate’s 100% Commission Model HERE