Every real estate brokerage company has their own way of doing things. We are no different.
Agent Split Calculations
Brand new real estate agents who affiliate with DMS Properties, LLC ... Residential Real Estate Services can expect to be on a 50/50 split ... this is our Standard Compensation Plan ... and that will change as an agent's production increases. Unlike many other real estate companies, we use a graduated scale based on production over a "rolling 12-month period" to determine the commission split. What this means is that an agent's production level doesn't go back to $0 at the end of the year. In addition, we include commissions received for property rentals in the overall production statistics ... we base that on a 2% "commission" for that calculation.
Based on some inquiries that we have received, we are also introducing a second Compensation Plan whereby an agent will start at a 65%-35% Split with a monthly "desk" fee of $225. Under this plan, the 65-35 split would apply up to $1,000,000 and increase for each additional $1,000,000 in production.
An experienced agent who decides to affiliate with us may be able to start out at a different split based on their production at their previous company ... as long as it is verifiable. Our agents will be expected to generate annual production of at least $1 million during any 12-month period. As mentioned above, though, that would include rental transactions, too.
DMS Properties, LLC ... Residential Real Estate Services charges a 6% commission (although it is negotiable) on our resale listings for homes and land, but this usually doesn't apply to REO properties. On a 6% listing, a Real Estate Agent will earn 3% per side of the transaction (before the broker "split"), so $1 million in production could generate pre-tax and pre-expense income of $15,000. Once an agent exceeds the $1 million production level, the split will change and will increase at $500,000 increments up to a 90% level at $5 million.
Our Standard Compensation Plan for our agents is, we think, unique. It is based on a "split" system, but is graduated to enable each agent to keep more of the commissions that they earn as they generate more and more business.
Our agent commission split system does not reset every 12 months ... we use a "rolling 12-month" split schedule. As an example, an agent who affiliates with us on January 1, 2017 begins on a 50-50 split. If they exceed $1,000,000 in production in the first 12 months, they will increase to a 55-45 split. The agent's production and split will always be calculated based on the previous 365 days and will change daily ... so on February 1, 2018, the split will be calculated based on production from February 1, 2017 to February 1, 2018, etc.
In addition, as part of calculating the agent split discussed above, we include income from rental transactions in the overall production. An agent who has a rental listing at $2,000 per month will be able to count that towards their production as a $50,000 transaction ($2,000 / 2.5%). While the rental income cannot be used to calculate local Association production awards, it does help with the split progression.
When an agent
affiliates with DMS Properties, LLC ...
Residential Real Estate Services , we will even
give them credit for any production that they did in the
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Properties, LLC ... Residential Real Estate Services.