Seems everything has two worlds these days. There is the fact world based on science. And the fiction world of want and desire. Some fear the pandemic. Others fear their “roots”. Each living together in two different worlds.
This is the first year I have missed NAR’s official mid-year conference because of the coronavirus. All the other years, I simply thought it was a waste of time. But this year’s conference slogan: “Home Front: Fighting for the Future of Real Estate” seemed like something I should know. But, after reading several first-hand accounts of the conference; I couldn’t help but wonder; “what world are they in?”
NAR paints a picture so thick with pander you’d think Trump was about to enter the room. Conference attendees were told they were; “essentially the backbone of American life”. Vince Mata, NAR President, piled on, “the role you play, and the role NAR plays on your behalf, is more important now than ever. You are the defenders of the home front. As Americans look to be safe in their homes, what you do is tremendously important”.
Good lord, wheel in Lee Greenwood draped in a flag. Mata, continued; “Realtors play a pivotal role in restoring the economy and establishing a new normal. NAR will continue to be on the front lines with you every step of the way protecting and defending what home means”. “Front lines”? Really?
Fans of irony will enjoy this little nugget from Mata; “NAR is ensuring the entrepreneurial spirit that defines our industry will thrive in the new landscape”. Whaaaa? A 50-year old, forced membership monopoly, dedicated to maintaining the status quo is now selling itself as “entrepreneurial”? In what world are people buying this?
While I have never understood the NAR world, its economics have always been plain to see. For years I have been asked; “on average, how much does a realtor save by affiliating with Wynd Realty”? Sadly, what appears to be a very simple and obvious question has no simple and obvious answer. The real estate industry is loaded with “average stats” that are kind of useless. (The average rent for a 2 bedroom apartment in Atlanta is $1,050. Oh yeah? Try finding it!)
What is the average number of sales per agent? At what price? At what split? Lots of variables tend to water down results, but for the first time we will try to qualify the data in an effort to answer the question of average agent savings.
Average Atlanta Home Sale Price: $275,300 (Per Zillow, Feb-2020)
Average Commission: 6%, Split 50/50
Average Gross Commission: $8,259.00
Average Broker Split: (80/20 most often quoted)
Average Broker Commission: $1,652.00 (Based on 20% of Agent Commission)
Average Agent Net Commission: $6,607.00
Average Number of Sale a Year Per Agent: 6
The average yearly agent Brokerage Cost – Franchise: $10,412.00 (includes NAR membership!)
The average yearly agent Brokerage Cost – Wynd Realty: $1,800 (banned from joining NAR)
What is the average monthly agent fee for agent affiliation? For a franchise agent that is around $80.00 a month. Wynd Realty its $12.95 a month. Unlike franchise brokerages, Wynd Realty never takes no fee from either rentals or referrals.
Given these factors, on average Wynd Realty affiliation saves full time agents over $10,000.00 dollars a year.
It is interesting to note the gross agent commission ($8,259 per sale x 6) does line up with the national yearly salary figures for agents. ($50K per year) Quick question; why would an agent pay $10K to a Brokerage, only to gross $50K in salary? Seems oppressive from the outside. Clearly the Broker is providing its agents with sales leads, technical support and enough value added services to offset what seems to be a rather large percentage of their agent’s income.
Then again, maybe the Broker isn’t providing those services at all and their agents are paying those fees; because. Because, that’s the way it’s always been done. Because, they didn’t know they had options? Because, that’s what they were told to do.
Real estate agents, in Atlanta, have long lived in two worlds. Atlanta is the only market in the United States that has more non-realtors than Realtors. In Atlanta, agents are allowed to choose from the world of NAR, or the Independent world of reasonable.
Sometimes, when you pay a lot for a service, you get a lot of value. Sometimes when you pay lot for a service, you just end up paying a lot.
The obvious question is: what world do you live in? But, the more important question is: what world can you afford?