Real estate & rental
Real Estate Agent Gross Commission Calculator
Works gross compensation before any deduction, which is the largest figure in the chain.
Result
Paying on revenue rewards volume and quietly rewards discounting; paying on gross profit rewards the jobs that actually earn. The choice changes behaviour more than the rate does.
Get a Free Business AuditHow the calculation works
Sale price times the agreed rate gives the gross figure at the brokerage level, before apportionment between brokerages, before the agent's split, and before fees. It is the number quoted most often and the number furthest from what anyone receives.
What moves the number
- Sale price and the agreed compensation.
- Whether the figure is at transaction or brokerage level.
- What has not yet been deducted.
- Price point, which scales the figure directly.
Where this one goes wrong
Gross compensation is a useful figure for comparing transactions against each other and a misleading one for anything else, since the split, the fees, the business expenses and the tax all still come out. An agent planning from gross is planning with roughly double the money they will have. Keep the gross figure for comparison and the net figure for decisions.
Before you quote
- Use gross only for comparing transactions, not for budgeting.
- Be clear whether the figure is transaction or brokerage level.
- Carry it through to net before making any plan.
Questions
About this calculator
What is gross commission good for?
Comparing transactions against each other, and little else. The split, fees, business expenses and tax all still come out, so an agent planning from gross is planning with substantially more money than they will actually have.
Is gross commission what the brokerage receives?
At brokerage level before apportionment, which is itself before the agent's split. Being clear which level a quoted figure refers to matters, because the same transaction has several gross figures depending on where in the chain you stand.
Does price point change the economics?
It scales the gross figure directly while many of the costs of a transaction do not scale with it, which is why higher price points are generally more efficient per transaction. That is a different matter from whether those transactions are available.
The formula
commission = (revenue or gross profit) x rate
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How to use this calculator
- Sales in the period ($). Enter your own figure; the page starts at $42,000.
- Cost of that work ($). Enter your own figure; the page starts at $24,000.
- Commission is paid on. Enter your own figure; the page starts at Gross profit.
- Commission rate (%). Enter your own figure; the page starts at 10%.
- Base pay for the period ($). Enter your own figure; the page starts at $2,600.
The result updates as you type, so you can try a figure, see what it does to commission earned, and change it back. Nothing you enter is sent anywhere or saved.
A worked example
These are the figures the calculator opens with. Every number in the results column below is produced by the same calculation the page runs, so you can follow it through before putting your own figures in.
What goes in
| Input | Value |
|---|---|
| Sales in the period | $42,000 |
| Cost of that work | $24,000 |
| Commission is paid on | Gross profit |
| Commission rate | 10% |
| Base pay for the period | $2,600 |
What comes out
| Result | Value |
|---|---|
| Commission earned main result | $1,800 |
| Total pay | $4,400 |
| Gross profit on the work | $18,000 |
| Left to the business | $13,600 |
| Pay as a share of sales | 10.5% |
Commission of $1,800 plus base pay makes $4,400, leaving $13,600 of the gross profit for the business.
How sensitive the answer is
Holding everything else steady and changing only sales in the period, this is what happens to commission earned. It is worth knowing which of your inputs the answer actually hinges on, and which barely move it.
| Sales in the period ($) | Commission earned |
|---|---|
| $21,000 | -$300 |
| $31,500 | $750 |
| $42,000 example above | $1,800 |
| $63,000 | $3,900 |
| $84,000 | $6,000 |
Every other input is held at the example value while this one changes, which is not how a real job behaves. Treat it as a guide to which number matters most, not as five separate quotes.
What each figure means
- Sales in the period ($)
- A money amount, starting at $42,000.
- Cost of that work ($)
- A money amount, starting at $24,000.
- Commission is paid on
- Choose from Revenue, Gross profit.
- Commission rate (%)
- A percentage, between 0 and 60, starting at 10%.
- Base pay for the period ($)
- A money amount, starting at $2,600.
What the results tell you
| Result | What it is |
|---|---|
| Commission earned | The headline result. A money figure. |
| Total pay | A money figure. |
| Gross profit on the work | A money figure. |
| Left to the business | A money figure. |
| Pay as a share of sales | A percentage. |
What is not in this number
Property figures here exclude the costs that decide whether a deal works: vacancy, maintenance, management, capital expenditure and the transaction costs at both ends. A return that looks strong before those frequently does not survive them.
Estimating is the easy part
The jobs you never hear about cost more than the ones you mis-measure. BDEVY builds the marketing, systems and automation that bring them in.