Are real estate agents overpaid? I can’t tell you how often I have read comments and articles about how real estate agents are overpaid.
First of all, I think people are asking the wrong question. People who use the services of real estate agents should be more concerned about paying too much for the services they are receiving.
We don’t know how much money a real estate agent makes after expenses and after the broker gets his cut.
Most real estate agents I know are not wealthy. Those who are often have spouses who have jobs that provide health insurance.
The Internet is supposed to make buying and selling real estate less expensive. I can not think of anything that has become less expensive because of the internet. The internet has eliminated some jobs but the costs of goods and services keep going up.
Consumers should be asking if they are paying too much for real estate services. In some cases, people are paying too much. Experience is the most important thing real estate agents are selling. New agents usually charge as much as experienced agents charge and people pay it.
Using the services of a real estate agent is optional. All Commissions are negotiable. Don’t hire an agent who is overpaid and don’t overpay real estate agents.
As for real estate agent pay, most are independent contractors who work on a 100% commission basis and only get paid after a sale closes. As someone who has recruited real estate agents, I can tell you that most people will not work on a 100% commission basis. It is considered too risky.
My advice is to work with a real estate agent if you believe you need one. Choose an agent with experience and negotiate the commission.
