5 ms·

I thought most realtors earned commission? Does the company keep the commission here then instead? It's an interesting idea, I think I would trust one of their

I thought most realtors earned commission? Does the company keep the commission here then instead? It's an interesting idea, I think I would trust one of their theoretical agents more since they aren't directly incentivized to get me to buy a more expensive property.

codemac 10y ago
They say in the article around half their yearly pay is in the form of bonuses from completed sales. I'm sure it looks a lot like commission.
- niels_olson 10y ago
  The difference being that would focus more on number of sales if their market doesn't have many high value properties.
- adamqureshi 10y ago
  Redfin agents receive bonuses for completed transactions that typically account for more than half of their annual compensation. Its a commission even when you don't call it that. See what happens to a sales person when she/he don't sell for a month.
  - billmalarky 10y ago
    Right after your quote is pretty relevant info imo: |But a big factor in calculating the bonuses is the agent ratings provided by Redfin customers after they buy or sell a home. Top performers get stock options. |“I’m not going to lie — we’re motivated to sell homes,” Ms. Goetz said. “But it’s always in the context of the client and wanting them to have a good experience.” The model could reward agents who sell less but have higher ratings, since Redfin is concerned with building a brand.
    - adamqureshi 10y ago
      Yeah. I read that too. Uber does the same thing with drivers, When a driver gets a bad rating he gets less calls therefore makes less money. CX is a natural part of the sales process. You only get feedback on the deals you close therefore the more deals you close the more ratings you get. You don't close the deals with bad CX. It is in the best interest of the agent to provide a killer CX. IMO: You can be a nice guy and get great ratings, but if you don't close, you'll be canned quick fast.
imglorp 10y ago
In the US, typically 6% goes to the two realtors, divided 3 and 3. Of that, their office will get roughly half and they get half, so their takehome is around 1.5. I just sold without an agent and discovered that even these are negotiable, when you're talking as a peer with the buyer's agent. I ended up paying 2.5 to the BA and $1300 to an attorney (notably an hourly rate, not a percentage).
- the_watcher 10y ago
  > Of that, their office will get roughly half and they get half, so their takehome is around 1.5. This actually varies wildly by brokerage. The massive ones, such as Remax, often don't make their money on real estate commissions, but on ancillary products that are required for the transaction: title insurance, inspections, mortgages, etc, and because of that, offer as much as 95/5 splits with their agents. My dads brokerage, in contrast, provides their agents with a decent number of services for managing escrows and the like, and have a 75/25 split.

codemac 10y ago

They say in the article around half their yearly pay is in the form of bonuses from completed sales. I'm sure it looks a lot like commission.

niels_olson 10y ago
The difference being that would focus more on number of sales if their market doesn't have many high value properties.
adamqureshi 10y ago
Redfin agents receive bonuses for completed transactions that typically account for more than half of their annual compensation. Its a commission even when you don't call it that. See what happens to a sales person when she/he don't sell for a month.
- billmalarky 10y ago
  Right after your quote is pretty relevant info imo: |But a big factor in calculating the bonuses is the agent ratings provided by Redfin customers after they buy or sell a home. Top performers get stock options. |“I’m not going to lie — we’re motivated to sell homes,” Ms. Goetz said. “But it’s always in the context of the client and wanting them to have a good experience.” The model could reward agents who sell less but have higher ratings, since Redfin is concerned with building a brand.
  - adamqureshi 10y ago
    Yeah. I read that too. Uber does the same thing with drivers, When a driver gets a bad rating he gets less calls therefore makes less money. CX is a natural part of the sales process. You only get feedback on the deals you close therefore the more deals you close the more ratings you get. You don't close the deals with bad CX. It is in the best interest of the agent to provide a killer CX. IMO: You can be a nice guy and get great ratings, but if you don't close, you'll be canned quick fast.

imglorp 10y ago

In the US, typically 6% goes to the two realtors, divided 3 and 3. Of that, their office will get roughly half and they get half, so their takehome is around 1.5. I just sold without an agent and discovered that even these are negotiable, when you're talking as a peer with the buyer's agent. I ended up paying 2.5 to the BA and $1300 to an attorney (notably an hourly rate, not a percentage).

the_watcher 10y ago
> Of that, their office will get roughly half and they get half, so their takehome is around 1.5. This actually varies wildly by brokerage. The massive ones, such as Remax, often don't make their money on real estate commissions, but on ancillary products that are required for the transaction: title insurance, inspections, mortgages, etc, and because of that, offer as much as 95/5 splits with their agents. My dads brokerage, in contrast, provides their agents with a decent number of services for managing escrows and the like, and have a 75/25 split.