How much does an agent actually make on a sale?

Plohmier,  Depends.  Most agents are indepentant contractors working under a Broker or just an independant Broker.  In the case of an agent, they are paid according to what their contract says.  Here is an example:  $400,000 house that is paying a 6% commission to the listing broker/agent, the first split is with the broker/agent on the buyer's side, so lets assume it is 50/50.  In this case each Broker would get $12,000 (400,000 X 6% = 24,000 / 2 = 12,000).  Now each broker pays the agent on each side, again commonly 50/50 or $6,000.  Some high preforming agents get better splits (I have seen as high as 25/75).  Some agents get most of the Broker's side but then are billed for many expenses.  This is often the case with REMAX.  In the end the math is usually about the same.

An established Re/Max agent can keep as much as 100% of the commission. However they will pay for everything and I mean everything themselves and may have a steep monthly desk fee.

Oh, and don't forget you have to pay taxes...

So really, presume the average agent is getting about .75% commission

6% between selling office & listing office = 3%

Split with broker = 1.5%

Split with uncle sam = .75%

Then there are expenses....

I'm fortunate to have great broker agreements. However, I know a good chunk of agents that have decent sales and may make more working as a barista.

Some Re/max agents can pay a desk fee of $500 - $2000 per month depending on the agreement with their broker..

The 100% is misleading in my opinion.  Esp. if you are paying $1500 / month desk fee on top of paying for every sign, every rider, lockboxes, for secretarial use (and don't forget many office charge buyers and sellers "administrative fees" on top of commissions), for copier use, for paper, postage, letter head....then there is the MLS dues, lock box key fees, NAR dues. website fees, marketing costs...

While an agent may get a check for $6,000 or $10,000, let's not forget that a great deal of that money is going to be eaten up by ALL of their expenses from health care, to vehicle maintenance and fuel, clothing, etc.  And they have to save out money for taxes too.

Fortunately, my office does not charge me for much - no desk fees, they provide signs, lockboxes, some advertising - the trade off however is a lower commission split. 

Not whining at all - this is the career path I've chosen and I love it - but people need to understand when the agent walks away from the closing table with that "big fat check" a big chunk of that check just goes right back into the cost of being in business.  Which is quite expensive.

People think it's easy money until they actually do it.  LOL

I am very big on numbers and keep close tabs on my expenses per cient and I find that if I walk away with a check for 2.5% I am actually, before taxes, only putting 1.7% in my pocket at most.  Insurance, advertising, gas, and a million other intangibles are the things clients forget about when they think we're being greedy.

Though a good portion of my commission (close to 40%) goes to my company, I'm happy with what I receive back from them. A roof, office, sign, website, ongoing training, advertising, the list goes on and on. It is often assumed that agents make a ton of money. Not necessarilly so. My average paycheck is anywhere between $2000-3000. Keep in mind, we only get those checks when a transaction closes. We have to learn to make it last during slow times. But the rewards are nice when it's busy. There are probably cheaper and less stressfull ways to earn more frequent paychecks. I could make a good living with great benefits working for the government, but I'd be bored to death. I love the freedoms, challenges, and the opportunity to help others.

With my company, EXIT, all of the Agents start out on a 70/30 split. So if you sell a $300,000 home and the total commission agreed upon is 6% that equals $18,000. That commission is split between the Listing Agent and the Selling Agent, that gives $9,000 per Agent, Now that goes to your office and with our company you would earn 70% of that $9,000 equaling $6,300. And out of that $6,300 you pay a fee of $235 to EXIT Head Quarters. So all together you would bring home $6,065. Now if you were the Agent on both sides, you would bring home $12,130.  I hope that answers your question. To read more about splits that our company offers you can visit Http://www.Switch2Exit.com

which is why I work for a 100% firm... I pay $300 a deal and thats it, plus $25 a month...

Every deal is different and it really depends on how much you spend, what you have as overhead and how long it takes to go from start to closing. I work with a partner so every client has the benefit of getting 2 agents for the price of one, but then we split all our earnings. It makes it much easier to take a day off and know that someone responsible is minding the store.

Karen had the best qoute of all "People think it's easy money until they actually do it. LOL" 

People walk in the business thinking they will get to make tons of money, only to find out that the money is spilt up many times when (or if) they have a closing.  Even if the agents don't see it right away, they will at the end of the year when they are hit with a "self employment" tax on top of their regular income tax. 

This business is not "get rich quick"...it takes time and a great deal of effort.

-Splits are different with each and every company, talk to your agent for disclosures

However, at times our costs are very high

(marketing, ads, open houses, office space and the fees associated with that,etc.)

Let's not forget that we all get taxed for self-employment as well as the marketing expenses we encumber when we don't have to cut the commission to make the deal work.

It is worth it to help my clients get what they need.

Yes, let's not forget all your expenses...lockboxes, signs, advertising, your car, GAS, website, MLS & Realtor fees, etc.  You can subtract those from your paycheck.  They say before you go into a career in Real Estate you should have a year's salary saved...easier said than done, but good advice.

And taxes, yes!  It's not a get rich quick profession, especially in today's market, its actually quite hard.  I worked 40 hours a week before I was in real estate, now I work about 70 hours a week!