I'm thinking about leaving Keller Williams after one year in the business. Have interviewed with a local brokerage, Exit, and Remax. I have a 64/36 split with KW with an 18k cap. With Remax, I would have a 75/25 split after the first 6 transactions...ie. 70% first deal, 71% second deal, and so on, til I reach 75%. I would have to also pay a $255 franchise fee a month. The broker will provide my signs and I will supply the rider. The office is 5 minutes from my home vs. a 20 minute drive on a good day. I like the feel of the small office atmosphere at Remax also.

What do you all think??? Is there something else I should be considering that I've not thought about??? Your input is greatly appreciated!

Well I am a REMAX guy for 9 years. I am convinced this is the way to go. Financially there is no question, it is the most sound financial option other than opening your own shop. Exit I don't get. The name is terrible for real estate. Branding is crucial and the balloon is one of the most recognized brands out there in any industry, let alone real estate. Your 255 franchise fee is likely also the ad fund for your region which will get you on am radio, tv, billboards. The advertising is well designed, so I think it is very well spent. I could not use it as well on my own. They target real estate shows and there was a piecein the WSJ about how they buy into DVR data and see which shows people who watch real estate shows switch to. So REMAX is able to place their adds where the viewers are in rapid fashion. I think it makes for a wise investment and it is cheaper than anywhere else.

You must be able to produce your own leads. You will get some, but not many. You have to be your own source of business.

Why are you leaving?

I just left Re\Max and joined Keller Williams. Re\Max was just to expensive. I paid a heck of alot more than 255 though. You also have to pay 395/year to Remax international.

I like Re\Max. As mntioned above they do have a great brank. In my area though Keller is catching up with Re\Max and is a very recognizable brand. Exit, I just don't get it either. I still scratch my head.

Leaving KW for a better split! 11% raise!!! Office is really close to home also. I like the idea of being able to get my designations at the office on demand. Feeling a little weird about the $255/month....did I mention that I'm a part-time realtor???

It's interesting the kinds of splits different offices have with the same franchise. I'm considering joining the remax here. they have a 70/30 split up to $16,000 office commissions for $300 a month or a 95/5% for $1000 a month. If I join them I'm going to go for the 95/5 split.

I haven't visited the KW office and don't plan to. They don't have much of a market share at all here and I don't even recognize any of the agents names, but one lady that works there.

The 255 is part of the split in my case, check me on that.
I am grandfathered at 100% and it costs me about 1200 each month (give or take a few bucks).
My split depends on what I produce.
If I bring in 100k it will be a 85/15 split.
If I bring in 75k it is an 80/20 split
If I bring in 125k it is an 89/11 split.
If I bang it out to 400k, then it a 96/4 split.
If I stump it at 45k it a 68/32 split.

It's all up to me. I like it that way. They let me be because I write them a check on the 1st of every month..

ang,

i always say taht numbers don't lie....

for example...

if you are on an 80/20 split and you make 100k gci, you would pay 20k to your broker

if you can get 100% for 10k a month and make the same 100k gci you would increase your salary by 10k per year.


it all comes down to the numbers...numbers don't lie. jsut like any investment...it comes down to the numbers...it's not emotional, its fact!

i pay 250 month and make a 6 fig income...i could not see going to a 50/50 shop as there is no broker out there worth 90k! teh remax offices taht i like (there are 2 in my area) charge 1200 a month and 1700 a month. i would increase my cost by a min of 1k per month and i am not sure that i would get any higher return because of a balloon...don't get me wrong, if i were to leave and hit anotehr brokerage, it would be remax! just not sure if it would be worth it to me at this time.

i had one broker tell me that most agents who come to her office DOUBLE their income wehn they sign up with remax....i told her taht is no suprise...i followed by asking where they were coming from...she stated 3 different office names...all were 50/50 shops! rofl...of course they doubled their income...the real questions was were they doubling their sales numbers...the answer was no...taht being said, imo it comes right back to the numbers....

ang,

how much do you make per year in re? if you like, pm me and i can go over the numbers with you...taht will let you know for FACT...exactly what the numbers are and it will tell you if you will be getting a raise or not....

example...

at kw....if you do 10k in gci at a 64% split to you then you would make

6,400 per year

at remax....if you do 10k in gci at a 75% split you would make

7,500 per year, but you have a 255month fee, so your per year would be

255 a month x 12months = 3,060annual total

take your fee from your commission of 7,500 and you make 4,440 per year


so the fact of you making more money depends not only split, but how much business you actually do...there is a break even point and a come out ahead point that needs to be taken into account to finalize a rational decision.

i'm sure you have thought about this already, but i wanted to put it out there to help anyone who was thinking about moving to "make more money"

I like my independant 100% shop. The only change I would ever make would be to possibly open my own brokerage... I can't even imagine being on a split anymore...it would drive me insane. Signs aren't that expensive - I have yet to see training that I can't get on my own for less than the cost of a split - and I have yet to meet a broker who truly earns their split and goes out of their way to do so. Not that they don't exist...but I haven't met one (Perky has, though - so they do exist!).

That said - I do have a monthly fee to be where I'm at, but it's a pittance ($69/month + $239 from the first deal every month + $40 E&O per deal). If you've been in the biz for a year you're doing better than most new agents and chances are you don't "need" the additional training - not that it doesn't help because you'll get a nugget or two but it's nothing that you can't learn for free by involving yourself in communities like this one.

Do some looking around and see if you can find a 100% shop in your area (not that you should absolutely go that route - but it's always good to know ALL of your options before making a decision - changing brokerages can get expensive!) - the balloon doesn't make you money...YOU make you money. The money you save on the split can pay for an awful lot of signs and training (and personally, I hate having a "brokerage" sign...I want my cell # on everything and my brokerage's number on NOTHING. My listing, my expense, my phone number, my leads.

I am a broker but not a managing broker or a broker owner. The reasoning behind a good broker is shared expenses. Each of us does not need our own copier, scanner, phone system, receptionist. Recently, many of these items has become more affordable to the individual, so it might become more attractive to hang our own shingles, especially if we are not reliant on others for leads.
The one shared expense that is hard to manage on your own without breaking the savings curve is office space. You might consider the value of a meeting room convenitently located in a highly visible setting in town. If this is not part of your business model and you have a place to meet with clients that is suitable then you are a more likely candidate to branch out on your own.
When I look at the 15k I pay to the broker each year, I see about 1/2 of it would follow me to my own shop as expenses. So in reality I would save 7500 to be on my own. That's a lot of cheese and butter. Not sure I want the extra hassle in my life right now, especially when I can justify some of the 7500 with the meeting space at his office and the brand awareness that comes with REMAX.
Lastly I want to get my hall of fame designation before I jump ship. Another couple years and I'll have it, I hope. They don't count bpo income toward that, arrgghh.

Agents don't understand that there are a lot of costs being the principal broker. I have a virtual brokerage and I pump out close to 8k to 10k a year in expenses.

I have many agents that I charge a 300.00 per transaction fee to with no monthly fees. I always tell agents to do the math. To open up even a virtual shop in Ga and pay deposits to join the mls's,office equipment,website,programs you are going to spend about 10k to do it right.

So I tell agents if they became a broker they would have to do about 34 deals on their own to break even in cost from what they pay at being at my brokerage. Most agents won't come close to 3 deals a month on a consistent average.

When they run the numbers most just join my company. There are still some old school agents who like an office to walk into but times are changing with mobile technology. Dinosaur high overhead buildings with costs passed on to agents in the form of monthly fees are no longer needed.

We can look at company number counts on our Georgia Real Estate Commission website. For the first time in years the big boy brick and mortar traditional brokerages are losing agent counts and the 100 percent shops are increasing by leaps and bounds. I truly believe this is where the future of real estate is headed with streamlined brokerages and streamlined agents.

To steal a line from Brian Buffini - "Gross income is gross". In other words, what you gross is only a number. After you pay splits and personal expenses and fees and taxes, you have a NET income. That's the money you use to pay you bills and support your family.

Before you leap from brokerage to brokerage, you need to do a very thorough analysis of your income, including a future projection and your expenses, both brokerage and personal. You need to understand what costs that a 50/50 brokerage picks up will be borne by the agent in a 100% office. Not just hard costs, like MLS fees and board dues, but soft costs like replacement of equipment or better phone service or whatever.

Then you can make an informed decision based on semi-hard numbers.

Too many agents look only at the split without carefully examining the net.

Other brokerages around here charge agents for every little thing:

In addition to their desk fees, they must pay:

Admin fee per transaction to "pay" for the secretary who may have to fax things for them or make phone calls

Per use Paper & Envelope fees
Per use Copier fees
Monthly Telephone & Internet Fees
Per Transaction Brokerage Fee
Pay for own signs, riders, company balloons, car magnets, etc

The "desk fee" is truly only for the desk, I guess.

Here, the "desk fee" does not include the desk. If you want a desk, cube or office, then you have to lease that above and beyond your "desk fee".

Dang!

I know a few agents that pay 1900/month for the honor or 95/100 split. It works for them I guess.

I used to pay $1,400/month for the opportunity to work (also had a 95/100 split). It got me a cubicle and a broker who didn't answer or return phone calls. I don't like cubicles.

While this is a business and our P&L is top priority, we shouldn't ignore the intangibles that go into that bottom line. I've seen any number of agents switch offices or brokers based on 'numbers,' only to discover six months or a year down the road that their business has suffered because they aren't as happy. A good fit with the broker, office staff, and other agents can make the difference between several deals a year, or more. I switched brokers years ago based on what looked on paper to be a deal too good to refuse, and soon found myself miserable in the new environment... with a resulting plummet in my sales. I ended up going back to my previous broker. Lesson learned.

That had nothing to do with a 100 percent company and everything to do with the broker you switched to.

No matter the model you will always find crappy brokers just like crappy agents. I know what these agents go through as I was once in their shoes. I do care about the success of all my agents. Not all want to be superstars. Some just want to sell their personal residence,others sell a few a year for mad money or to take the kids to Disney World, and others buy a few investment deals a year.

I always tell my agents there is no pressure. If you want to do 3 deals a year or 70 a year I will help you get there.

There is no right or wrong way to be an agent. Everyone has different life goals and what I love about my company is I don't stick everyone in a box and say "you have to be this way".

Interview with broker and go with your gut. Not every decision will be the right one but if you live in fear of a mistake and make no decisions (inaction) your life will go nowhere.

I pay $45 per month for office/desk fees. I can also use any of our 10 offices. I do not pay for fax, paper, envelopes, secretary fees, internet, signs (I do pay for name riders, got 2 free open house signs, and arrow signs). My company does pay for open house, just listed, and reduced newspaper ads. My split is 50/50 until i've earned $16K, then moves up to 60%. It moves up a gradual scale. I of course have to pay my own MLS and Board Fees. Also, I have the BEST managing broker. He is always available to answer questions or help out with a client. I think my fees are the cheapest in my area.

holy cow...a 50/50 split is the cheapest in your area? (Super - you need to open up shop there - you'll clean up!)

My broker has always charged for copies, and finally started charging for printing to many agents ire. So now when I need to turn in a 30 page contract, I email the pdf to them. If they want to print it off, so be it, they can do it on their dime.

LOL yes 50/50 is an old horse for sure. The only ones that get away with it now are for new agents who need training for their first 2 to 3 transactions.

People think I am nuts but I train them also for the 100 percent.

i pay 250 a month for 100% and have an office, free printing, fax all that stuff....in reality, i dont use hte office, i buy my own paper and have my own 800 number for incoming faxes...i scan my contracts with a xerox scanner and email them off.

an agent will either produce or not....

if you dont need the hand holding go for the highest split that you can find!

ask yourself this if you are on a split...

lets use and example

60/40 split and i made 100k gci...so 60k to me..40k to broker

could i get what i got from the broker for less than 40k? if hte answer is yes, MOVE...that is really what it comes down to.

high training and crap commission split do not go hand in hand....i have been at traditional shops and gotten no training...now i dont need the training (i actually train agents) and the commission is 100% and the training is better than any crap split shop that i know of.