How are real estate agents paid?
Real estate agents are independent contractors, paid per transaction only, not a salary. They are self-employed small business people, working on commission only. Agents only receive a commission when a sale closes. Sometimes real estate agents work can with buyers for months or years and never get paid a dime if the buyer does not purchase a home. The same holds true for listing agents. In slow markets, an agent can hold dozens of open houses, spend money on marketing and show a home hundreds of times. If the home does not sell, they do not get paid. Typically the seller pays the real estate commission, which is split four ways; two agents and two brokerages. Each of the brokerage firms will receive half, and then the brokerage firm and the agent split their share based on that agent’s production.