Marketing Materials - What's the Norm?

[Jennifer Katherine De Loughy]

My broker takes 46% of my commission: 40% in general and then an additional 6% that was explained to me as being for "advertising, office materials/use, etc." I've been using office materials accordingly. I recently found out that my broker does not give out envelopes. They don't even want us using their paper with the company letterhead - we have to buy and print our own. Is this the norm? What's the norm when it comes to marketing materials provided by the broker?

[Tim Johnson]

Hi Jennifer, there is no "standard" for how splits happen in real estate brokerages, or for teams within those brokerages. 

Are you an independent agent working within a brokerage? If so, you should have a clear contract signed with your brokerage stating all the splits and expenses that are yours. Ideally this would be clearly explained to you prior to joining the brokerage.... but often is not.

Are you on a real estate team that functions within that brokerage? If so, you should also have a contract signed with your managing broker stating the exact splits.... the contract usually spells out the benefits you receive (training & leads being the most common), as well as expenses that you need to cover (postage, possibly supplies, folders, etc.)

Many beginners are unaware of "how things work" and so just feel grateful to have anybody "take them on" and show them the ropes. It's usually not until you're a few contracts in that you begin to realize how much of your check is going to "team" or "brokerage". For many, the trade-off is fair at first because beginners need a lot of help getting through their first few deals.

Some brokerages have a sliding scale with their splits - 60/40, 70/30, 80/20 - depending on how much volume you do. Other brokerages have a straight rate (e.g., 70% to you, 30% to company dollar) with a yearly cap (e.g., mine at Keller Williams is 18K, meaning that if I pay off the cap I can keep all the commission.... until the year is over, and the cap starts over again). 

Demand clarity from your brokerage.... understand the trade offs... and in the end interview with a few different brokerages until you find one that seems best for you. 46% split to company dollar is HIGH.... no matter what firm you're with. You better be getting some serious training, tools, and leads to make that number work.....