How Much Does a Real Estate Broker Earn?
Working as a real estate broker requires a tremendous amount of talent. The profession entails not only practical skills such as documentation, it demands for sales and people skills to improve an agent’s capacity to earn more.
With the booming status of the real estate industry in the country, most people would often wonder:
How much does a real estate broker earn?
There are many ways on how to practice real estate in the Philippines. As a common system, brokers work as freelance agents who establish their own network of clients and gather their own listings of properties. These brokers handle their own time and would schedule their viewings depending on the number and availability of the clients. On the other hand, there are brokers who are employed in reputable brokerage firms who get a monthly basic salary aside from their commissions. These employees are in-house brokers who would go to the office on a daily basis and will follow the regular office hours. Their viewings are also scheduled within office time and clients are usually assigned to them which are gathered from the inquiries.
In a nutshell, brokers will get a 2.5% to 5% commission on every property which will be sold. According to Marie-Jen Chua, a broker for seven years now, handling properties in Makati, Taguig, and Alabang, the specific percentage of the commission would depend on the selling price of the property. If the property is exceptionally high-priced, a 2.5% is a reasonable share on the total amount of the house or condominium. For example, 2.5% of a property worth Php 50,000,000 is Php 1,250,000. That is already more than a million peso worth of commission from one sold property. For the usual transaction involving medium-priced properties, a 5% commission is the usual share of brokers from the sale. For dealings involving the sale of commercial properties for businesses, almost the same percentage of commission will apply, ranging from 3% to 5%.
When it comes to brokers’ fee from both residential and commercial spaces for rent, an equivalent of a one-month rent will be their share for a one-year lease. As a common practice, every subsequent lease or renewal for another year by the same client will give the broker another 50% of the one-month rental. Sometimes, when a contract is good for five years, the broker will get an equivalent of one-month rental per year.
Hence, a freelance real estate agent would mainly depend on the amount of commissions he or she gets from each property sold or rented. Freelance brokers must be diligent enough to save their earnings because there is no assurance when the next commission will materialize. On the other hand, an in-house real estate broker will get their share of monthly commissions on top of their basic salary. According to one of the sales directors of a prestigious in-house brokerage firm, their in-house brokers would get Php 30,000 to Php 35,000 as monthly income and when commissions are included, each agent will get an average of Php 100,000 per month. Brokers who work for brokerage firms do not usually enjoy flexibility in time since they would have to render office duty but they have a fixed salary to expect monthly. However, brokers are given a quota which they must meet in order to keep the job.
Now that you have acquired an idea how much a broker makes whether freelance or employed, it is time for you to decide whether this career path is for you. One thing is for sure, money should never be your topmost motivation in order to be successful in this career. You need passion and perseverance to be triumphant in facing the challenges ahead. Read more of Hoppler’s blog for tips and stories on how to excel in the real estate profession.