In the world of real estate, understanding the landscape of commission splits, fees and the value you get from a brokerage is crucial for agents aiming to maximize their earning potential. This article demystifies common myths surrounding commission structures and emphasizes the importance of a value proposition in choosing a brokerage.

Beyond the myth of “keep 100% of your commissions”

The allure of “keeping 100% of your commissions” that many newer or smaller brokerages use is a powerful message that catches many eyes. However, it’s essential to peel back the layers and understand what this really means for you. In reality, the notion of keeping all of your commission often comes with hidden fees or costs that can eat into your profitability in a big way. It’s not only about the percentage you retain but also what you get for the fees you pay in order for you to produce more and ultimately earn more.

The value proposition: What matters most

For experienced agents, we know the decision to switch brokerages is seldom driven by commission splits alone. Instead, agents search for a brokerage that offers them a robust value proposition – support, technology and tools, with brand trust and a community that enhances their business. Royal LePage^® believes in this philosophy wholeheartedly. While we do not prescribe a one-size-fits-all approach to fees, each Royal LePage brokerage prides itself on offering competitive commission plans tailored to support agents in their local markets.

Understanding the landscape of commission models

Royal LePage brokerages are independently owned and operated, each with its own commission models and value propositions. This flexibility is one of our strengths, as brokerages are adaptive to the unique demands of their local markets. It’s crucial for agents to engage in open conversations with potential brokerages about the full spectrum of compensation models available. These discussions should go beyond just the split to include other fees, what tools and services are provided, and what are the costs agents’ may not have to bear.

The reality in Western Canada and urban markets

In many urban markets, especially in Western Canada, the traditional commission split model is becoming less common. Instead, brokerages may offer new or lower-producing agents a split plan initially, transitioning to models primarily based on monthly fees and transaction fees as agents’ gross commission income (GCI) increases. 

Asking the right questions

In navigating the landscape of commission splits and fees, asking the right questions is key. REALTORS^® should inquire about:

Other fees: What are the monthly fees, desk fees, transaction fees, or any other costs associated with the brokerage?

Support and services: What kind of support, training, and tools does the brokerage offer to help grow your business? What types of technology, like a CRM, are offered by the brokerage?

Community and collaboration: How does the brokerage foster community and collaboration among its agents?

By focusing on these key factors, agents can make informed decisions that align with their business goals and values.

The conversation around commission splits and fees is nuanced and complex. At Royal LePage, we encourage a transparent discussion about the value proposition of a Royal LePage brokerage over the simplistic allure of high commission splits. 

Our brokerage owners are committed to providing competitive plans that support the success of their agents in the local market, understanding that true value lies not only in the numbers but in the support, community, and growth opportunities that a top brokerage offers. In the end, it’s about finding a partnership that aligns with your values and ambitions as an agent.

Interested in learning more about Royal LePage? Visit royallepage.ca/joinus to connect with a local broker.