Realtors Are Chasing Bigger Splits, Lower Fees and Better Deals From Brokerages—While Ignoring the One Number That Actually Matters: Production.
Written by Devone Richard
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CONGRATULATIONS. YOU KEEP 100%.
Real estate agents have become obsessed with commission splits.
“I get 100%.”
Okay.
How many deals did you close?
Because keeping 100% sounds fantastic until we discover you’re keeping 100% of three commissions a year.
Meanwhile, another Realtor at an 80/20 brokerage closes 20 transactions.
Who’s running the better business?
THE AGENT MAKING THE MOST MONEY—not necessarily the agent keeping the highest percentage.
Some Realtors spend more time negotiating their commission split than building the business that’s supposed to generate the commission.
That’s backwards.
100% OF ZERO IS STILL ZERO
Let’s make the math simple.
Imagine one agent generates $50,000 in gross commission income and keeps 100%.
That’s $50,000 before their other business expenses.
Another agent generates $250,000 and operates on an 80/20 split.
After the brokerage split, that’s $200,000 before other expenses.
Who won?
THE 80/20 AGENT MADE FOUR TIMES AS MUCH MONEY.
Of course, actual brokerage agreements, caps, fees and expenses vary.
That’s not the point.
The point is that production can matter far more than the percentage printed on your commission agreement.
Stop bragging about your split.
Start bragging about your production.
YOU’RE SOLVING THE WRONG PROBLEM
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If you’re consistently closing 25, 30 or 40 transactions a year, then absolutely examine every expense in your business.
At that level, a few percentage points can represent serious money.
Negotiate.
Compare models.
Understand your cap.
Understand your fees.
Run the numbers.
That’s what a business owner should do.
But if you’re closing two, three or four transactions a year?
YOUR BIGGEST PROBLEM PROBABLY ISN’T YOUR COMMISSION SPLIT.
Your problem is production.
You need more conversations.
More appointments.
More listings.
More buyers.
More follow-up.
More contracts.
More closings.
You’re trying to optimize the distribution of money you haven’t learned to consistently make yet.
WHAT ARE YOU ACTUALLY GETTING FOR THE SPLIT?
Not every brokerage deserves 20%, 30% or any other percentage of your commission.
Let’s make that clear.
If you’re giving up part of your income and receiving virtually nothing of value in return, you should absolutely evaluate your situation.
But don’t judge a brokerage solely by the percentage.
Ask what you’re receiving.
Leadership?
Broker access?
Training?
Compliance support?
Technology?
Marketing resources?
Office space?
Mentorship?
Transaction guidance?
Culture?
Accountability?
Systems that help you produce?
A SPLIT IS A BUSINESS EXPENSE. THE QUESTION IS WHETHER YOU’RE GETTING A RETURN ON IT.
If giving up 20% helps you build a business that produces three times as much income, that 20% might be one of the best investments you make.
If it provides no value whatsoever, that’s a different conversation.
SOME AGENTS NEED AN ENVIRONMENT THAT PUSHES THEM
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There’s another part of this conversation nobody wants to admit.
Not every Realtor is ready to operate completely alone.
Some agents need mentorship.
Some need accountability.
Some need training.
Some need to sit next to experienced agents and hear how deals are actually handled.
Some need a broker they can call when a transaction starts falling apart.
Some need an office where other productive people are working around them.
There’s nothing wrong with that.
What is wrong is choosing the cheapest possible brokerage model, receiving very little support, producing nothing—and then bragging because you get to keep 100%.
KEEP 100% OF WHAT?
Your goal isn’t to win the commission-split competition.
Your goal is to build a profitable real estate business.
THE CHEAPEST BROKERAGE CAN BECOME VERY EXPENSIVE
Suppose Brokerage A costs you practically nothing but provides an environment where you remain stuck at four transactions a year.
Brokerage B costs more but provides the training, accountability, leadership and systems that help you reach 15 transactions.
Which brokerage was actually cheaper?
This is where Realtors need to start thinking like business owners.
PRICE AND VALUE ARE NOT THE SAME THING.
The lowest expense isn’t automatically the smartest expense.
If I spend $1 and it helps me make $5, I don’t hate the dollar.
I want to know how many more dollars I can intelligently invest.
AND BROKERAGES HAVE TO EARN THEIR MONEY TOO
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This isn’t a free pass for brokers.
If you’re taking a percentage of agents’ commissions, provide value.
Answer the phone.
Train your agents.
Help them through difficult transactions.
Create useful systems.
Provide leadership.
Build culture.
Keep agents compliant.
Help them become better businesspeople.
A broker shouldn’t collect money simply because their name appears on the license.
The relationship should make business sense for both sides.
But Realtors also need to stop expecting premium support, premium technology, premium offices, premium training and premium leadership while simultaneously believing the brokerage should receive nothing.
Businesses cost money to operate.
STOP CHASING SPLITS AND START CHASING PRODUCTION
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Imagine putting the same energy into prospecting that agents put into comparing commission plans.
Call your database.
Follow up with leads.
Ask for referrals.
Learn your market.
Attend training.
Improve your listing presentation.
Get better at negotiation.
Build your personal brand.
Talk to homeowners.
Meet buyers.
Create appointments.
CREATE COMMISSIONS FIRST. OPTIMIZE THEM SECOND.
That’s the order.
FINAL THOUGHT
There are excellent 100% commission brokerages.
There are excellent traditional-split brokerages.
There are excellent capped models.
There are terrible versions of all three.
The model alone doesn’t determine whether you’re successful.
YOU DO.
Choose the brokerage where the economics make sense and where you have the best opportunity to build the business you actually want.
Then work.
Because if you’re closing 30 transactions a year, I’ll happily have a serious conversation with you about maximizing your split.
But if you’re closing three?
I’m probably going to have a different conversation with you.
STOP WORRYING ABOUT KEEPING 100% OF THE COMMISSION UNTIL YOU FIGURE OUT HOW TO CREATE THE DAMN COMMISSION.
I’D RATHER HAVE 80% OF A GREAT BUSINESS THAN 100% OF NO BUSINESS.
— Devone Richard
Written by Devone Richard
Broker/Owner | OYT Real Estate
California Broker #01857383
Nevada Broker #1002115
📞 626-500-1212 | 702-941-0202
🌐 OYTRealEstate.com