THE BEST LAS VEGAS PROPERTIES
What Do Agents Really Do All Day?
Let's pretend you're a new agent and you're interviewing companies
to go to work for. I'll start by describing a typical franchise real estate
office, such as Century 21, Prudential, or Coldwell Banker.
The way you'll get business is by taking turns answering the phone, also known as "Floor Time" or "Opportunity Time". Your job when a prospective buyer calls in is to "convert" them. This means when someone calls to get the address of a property advertised, your goal is to turn him or her into an appointment to see other properties also. If it's a prospective seller that calls in, that becomes your opportunity to get a listing.
You will also attend office meetings and go on "caravan". This is how you learn what's available, even though you have no buyers for the properties you've just seen. It is mandatory to attend all meetings and office caravans. The broker who owns the company will tell you to pick a "farm area" and start soliciting that area by dropping off recipes or other information. This way by repetition, your name will become known as an area expert.
You are paid no salary, you are totally on commission. The broker will pay for the rent, the copy machines, the MLS dues, the receptionist, your signs, and anything else you need. The broker pays for advertising, and he decides what properties will be advertised and how often. In return, you pay the broker a percentage of your commission when you do sell something, typically a 50-50 split for new agents. If you have a few slow months, you don't make anything, but you don't pay anything either.
an independent agent. What you find out is that as an independent agent, you
run your own business, but you'll be setting up shop under a brokerage firm.
It's like opening a store in the mall. The broker is the mall, and you are the
storeowner. So you are independent, but there are some common facilities that
you must contribute towards.
When a call comes in on your listing, you get the call, not someone on "Floor Time" who doesn't know anything about the property. Your time is not wasted with unproductive meetings and caravans. You will pay for rent, all fees and dues, your signs, supplies, promotions, and all advertising. Just like a real business! These expenses add up to about $2,500 per month. In return, you get to keep most of the commission. Now if you were a new agent, or unsure of yourself, which way would you go?
If you did a financial analysis to see which way works out better, you'd see that the "break even" point is about 12 transactions per year. This means that if you do less than that, you are better off by having the broker pay everything, and receiving a split commission. If you expect to do more, paying your own expenses works out better. Keep in mind that the average agent does less than 4 transactions per year!
Since we are independent agents, we must pay our expenses every month, whether we sell anything or not! We must earn over $30,000 a year before we make a dime! It takes very few slow months before we're in a deep hole financially. This is why we are VERY motivated to sell your home...for the absolute highest price the market will bear. We can't afford not to!
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© 2020 Marc Gohres
Revised April 12, 2020 9:57 AM