New views on real estate compensation

Going beyond commission

By Buz Hurley, Pooja Kumar, and Gilbert Mohtes-Chan

The debate just won't go away.

Do mainstream compensation practices in the real estate industry benefit consumers? Do consumers know enough to care? And should they care?

Will the real estate industry overhaul its traditional compensation structure, which is based on a percentage of a home's selling price?

Is this percentage-based compensation structure equitable to both consumers and real estate professionals, considering the wide variance of home prices in markets across the country?

Should brokers representing buyers be paid directly by buyers, rather than the dominant system of the listing broker offering compensation to the buyer's broker?

This month, Inman News is focusing coverage on compensation issues in the real estate industry.

In this Special Report, we share some examples of outside-the-box ideas for real estate compensation.

A Seattle-based brokerage company offers an hourly fee structure for its real estate services, for example. And a real estate professional in Georgia proposes a hybrid compensation model that eliminates the independent contractor system: a base-salary-plus-commission model that he says could ensure more quality in the real estate profession.

The final story in the report delves into the latest real estate commission-rate trends in California.

We welcome you to join the discussion and share you views about what changes are needed to make the industry's compensation structure more transparent and fair to all parties involved. Send your comments, suggestions, letters and essays to Inman News to share your views with other readers.

INSIDE

Part 1 End of the independent contractor

Part 2 A pay-as-you-go real estate model

Part 3 Real estate: Location, location, commission

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