The Future and Growth of 100 Commission Real Estate Agents

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There are changes happening in real estate and in how real estate agents are earning commissions.  One of the more popular trends in California and all around America is the 100 commission real estate sales structure.  In these 100 commission scenarios, the real estate agent receives 100% of the commission for selling a property.  This should give added motivation to real estate agents, and more confidence to sellers that they are going to get the best price, and even buyers should have confidence that the agent is motivated to complete the transaction—thus getting a fair deal completed as fast as possible.  The real estate company receives a monthly fee or an up-front annual fee, but the agent gets far more income than previous and traditional models.

When evaluating the future of selling real estate, and of 100 commission real estate in California, it is possibly easier to determine what likely won’t change in the near future.  According to Patrick van den Bossche, president of an international real estate brokerage in Arizona, consumers and banks can count on information and data that consumers have access to remaining the same.  Consumers have learned that when they make the biggest economic decision of their lives, the more they know the better they are. This data and information were not available in most cases prior to the great recession in 2008.  Now consumers and banks demand that information.  It will not change.

That information and the perceived right of consumers to have that information will, in the future, possibly make realtors more careful about which properties they represent.  Properties with infrastructure or structural issues will have those problems or potential problems exposed—which may make buyers understandably cautious.  Those consumer protections gleaned from that data can make sales harder to achieve.

Fewer Agents?

Other things that brokerages are going to have to contend with is a perceived lesser need for real estate agents in general as much information is available online.  Some think that technology has proven that people involved in the real estate transaction are less necessary because cameras and computers can do many of the same things.  A home buyer can go to a website, fill out their parameters for the kind of home or property they want, and in seconds find pictures not only of the outside of a building but pictures of each room.

Perhaps a result of additional technology in the purchase of real estate is there may be fewer agents in the future.  That can be good for agents who work in 100 commission real estate offices if there are fewer people vying for properties to represent.  However, those agents will need to be good to stick through that transition period, if indeed agents leave the profession in large numbers.

There are also people who believe that there will be no decrease in agents.  Technology may whet the appetite of buyers, but the same number of properties will be sold.  The same number of buyers will be required.  Therefore, the same number of realtors will be needed to answer questions, and to physically show properties.  The change is that more of those realtors will be 100 commission real estate professionals who will have greater opportunity to earn more money with each successful sale.

There will always be people who want to work with third parties—someone other than the property owner--when making the purchase of real estate.  The important thing for the real estate agent to understand is what the buyer wants.  Not just what kind of home or property they seek to purchase, but what information is important to them?  What services are important to them?  What kinds of communication and how often do they want to hear it is important to them?

The Bottom Line

People like to have human interactions, and that is why no matter what technology has to offer, real estate agents will not go away.  When a person spends several hundred thousand dollars—or more—for a property, they want someone to accompany them through the process.  Most often, the person best suited to do that is the real estate agent.

If indeed, there are fewer real estate agents, the 100 commission model will be incredibly beneficial for agents.  This model allows agents to receive more training, the same or improved access to office space, and of course more money.  More agents?  Fewer agents?  The thing that doesn’t take prognostication to determine is that the 100 commission real estate model in California will give many agents opportunities to do well now and in the future.