Increase Your Commission
in a Changing Market

Home Being Hit by Giant Wave
Written by Josh Harley
Fathom Founder
Josh Harley

Inflation is at a 40-year high, new home sales were down 7% in 2021, home prices are ballooning, and interest rates are increasing monthly. As a result, many analysts believe we could see fewer homes sold in 2022.

If that wasn’t enough, the National Association of REALTORS® grew its membership from 1.4 million to around 1.6 million last year, a 14% increase. In essence, more agents are fighting over a potentially smaller pie. While this may sound like a lot of doom and gloom, there is a solution for agents to net more income than they did in 2021.

There are only three ways for an agent to net more income. Increase their revenue by closing more sales, selling higher-priced properties, or decreasing expenses. What if an agent could do all three? What could that mean for their net income? That’s what I’d like to explore here.

For most real estate agents, their most significant expense is not their marketing. Instead, it is the splits they pay their brokerage. This could be anywhere between $15,000 and $30,000 per year or more for most agents. For decades, we were programmed to believe these large percentage splits were there to cover the offices, training, technology, and support. But does it really cost that much?

I was once told that splits only matter in the absence of value. I couldn't agree more, but what if all things were equal? What if an agent could get all of the technology, training, resources, and support they are used to for a small flat fee per transaction?

What if an agent could get all of the technology, training, resources, and support they are used to for a small flat fee per transaction?

What if they could earn an extra $15,000 more income each year, not by selling more homes, but by simply reducing expenses?

Let me go back to my initial statement and pose the question differently. Even if the number of homes remains steady for 2022, we still have 14% more agents. That means fewer sales opportunities for each agent. So, if an agent sells 14% fewer homes, how does that agent make up for the loss in sales commissions?

The solution is quite simple. Moving from a brokerage that charges a large percentage split of 20% or more to a brokerage that charges a flat fee of $500 could mean additional income of $1,500 or more on just one sale. Now, multiply that across multiple sales.

If all things are equal between your current brokerage and Fathom Realty, which charges a small flat fee, what could you do with that extra income? You could spend more on marketing to drive sales, save for retirement, pay down debt, or fund your child’s education. The sky's the limit, and it simply takes a step of faith. Do not wait until the market shifts to get ahead of the curve.

Article originally published in RIS Media Real Estate Magazine and Online.
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