Ranking Agents – Who’s #1 and Does It Matter?

Written by Suze, July 20th, 2017

How do we reconcile the difference between solo agents and teams in the ranking system?

In Real Estate, a lot of importance is put on the ranking of agents within their brokerage, marketplace, board, city and even country.   There seems to be a belief that if you are number one or at least near the top of the pile in terms of productivity, then you must be a better agent and therefore more people should hire you to sell their home.

I think it’s a myth that those who sell more real estate sell real estate for more money but that’s another topic.  Some top producers are great agents and some aren’t but the point is that the public generally wants to work with a REALTOR® who has a proven track record of success and productivity is an easy matrix to communicate. So yes, it matters.

As the team model in real estate evolves, brokerages are having challenges figuring out how to adapt the ranking system.  If an individual agent sells 50 homes and earns GCI of $750,000 how does that compare to a team of 8 agents who does 200 homes and earns GCI of $3,000,000.

One way would be to divide the productivity by 8. That means each agent is allocated 25 ends and $375,000 on GCI.  They clearly rank below the solo agent.

A second way that we see often is that all of the productivity is allocated to the team leader.

In this second method, it becomes impossible for a solo agent to compete in the rankings with teams. Some brokerages have tried to overcome this challenge by having separate ranking systems for both teams and solo agents.  This seems fairer but is confusing to the public which is who all of this is for in the first place.  Or is it?   Are rankings to benefit the public or are they to satisfy the egos of the agents?  Either way, this creates complication in many ways as most solo agents producing at this level have some administrative help and how does that fit into the equation?

A Solution?

What if we allocated the productivity to the team leader based on the percentage of the commission that the team leader receives.  For example, if each deal that happens within the team pays 50% of the commission to the team member then the remaining 50% would be allocated to the team leader for the purposes of ranking.    In the example above, the team leader would be allocated 100 ends and $1,500,000 in GCI if she was taking 50% of her team members commission.

As the team model continues to evolve we may eventually see it replace the current brokerage model.  Team leaders may be forced to pay more of the commission to team members. This would create a fairer way to evaluate productivity.   When I started in Real Estate in 1985, I worked for an office of 20 agents, one manager and we paid the brokerage 50% of our commission.  Sounds remarkably similar to what teams are building now.

I bet there are some disrupters ready to change things.

Your thoughts?

3 Responses to “Ranking Agents – Who’s #1 and Does It Matter?”

  1. Sandra Pare says:

    Interesting Suze, I was thinking the same recently. With many of the bigger teams, the lead agent is paying for everything to keep the newer agents’ expenses down and then offering the old fashioned split of 50/50. It’s tough to make a living in this profession, but having a broker cover all of the expenses makes a lot of sense to help new agents get on their feet.

  2. Sandra says:

    This is a great point. I worked for a team for many years. I felt like I was working double for half the commission. When I branched out on my own, the first year, I made the same as I made the year before on the team but in half amount of time_ more time for family, working on my business and I received a top producer award a couple of times throughout that year. I feel people working on a team should start to think about asking for more commissions. I’m saying this, as a newbie to real estate, starting out on a team was the best way to get my feet wet. I learned a lot.

  3. Tracy Arnett says:

    Having been a single agent at a large Brokerage and now with a successful 12 year Old Team Business under my own banner I have seen both sides of the wall. I have 6 top agents, some millennials and some 45 plus who have spent many years on our team with less % than a single agent at a Bigger Brand. I pay all expenses and direct all marketing and communications. My agents enjoy a very lucrative lifestyle without the ups and downs of income or expenses. In fact three of my agents enjoy their summers with their families at their cottages after a busy spring market. Working on a team allows agents to work together and exchange time off and seamless exchange of clients. A team leade can provide A+ buyers and sellers, due to their past successes it’s like handing candy to a baby and for the most part if you land on a team where the leaders goal is to make his/her agent successful you will have found the right team. Prospecting and marketing are typically not at the forefront of most agents favourite activities and if the Team Leader excels at this so will the Team. Earning a higher percentage at a Big Box Brokerage as a single agent does not necessarily make you more money nor will it give you more time off. Will Teams pay out more money to top agents? It’s a possibility; but then again what would we have to cut from our benefits to do so? I provide healthcare to all agents and employees, full compliment of admins who do all paperwork, feedback, A-Z of all listings while my agents work with another buyer and seller. I for one only want my agents to do what they do best and that is meet people who need to buy and sell. Future of teams and small brokerages I believe will be explosive in years to come.

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