What Do Agents Value?
The competition for recruiting and retaining real estate agents is as intense today as it has ever been. Many argue that the industry has never been more competitive.
Since RE/MAX introduced the 100% commission model to the national market, brokerage firms have continuously devised new and innovative ways to attract agents. Higher commission splits led to capped company dollar plans, which evolved into profit-sharing, revenue-sharing, stock and equity incentives, and beyond.
For over 45 years, this has been the dominant narrative in the brokerage industry. The recent rise of low-cost, flat-fee brokerage models has only added to the complexity. Additionally, the explosive growth of real estate teams has further intensified the challenges faced by brokerages of all kinds.
Key Observations
Despite the proliferation of lower-cost brokerage models, top-producing agents and teams continue to affiliate overwhelmingly with the largest and most well-known brands. In fact, approximately 95% or more of these agents are not affiliated with the lowest-cost national real estate firms.
While major national brands—such as Coldwell Banker, Compass, Keller Williams, and RE/MAX—still dominate agent and team rankings, the ability of these firms (aside from Compass) to grow through recruitment and retention has become increasingly difficult.
Our valuation data, derived from hundreds of brokerage assessments each year, reveals that the industry’s average Gross Margin (what remains after paying agents) has declined to approximately 10%—a drop of more than 50% since 2012. Yet, despite this margin compression and industry downturns, most brokerage firms remain profitable.
What Agents Value
In our 2006 report, People Still Matter, we interviewed 170 productive agents affiliated with top-performing brokerages. When asked why they chose and remained with their firms, the most common words we heard were:
- Vision
- Community
- Accountability (behavioral)
- Discipline
- Communication (both vertical and horizontal)
- Transparency
- Empowerment
We believe these fundamental values remain unchanged today.
However, what agents value is:
A) Different for each individual agent
B) Evolves over time as their careers progress
While this may seem obvious, consider the following:
- If commission splits and monetary incentives were the only factors that mattered, most incumbent brokerages would have gone out of business by now.
- If technology were the primary driver, then leading firms would have adoption rates exceeding 80%. Yet, even among companies that promote their technology as a differentiator, adoption rates remain significantly lower. Moreover, firms with the “most” technology do not necessarily have the highest productivity.
- If company size were the most critical factor, then why have so many leading brokerage firms lost market share over the past decade?
Our Conclusion
What agents truly value is being valued by leadership. The findings from People Still Matter, published 18 years ago, are just as relevant today. While financial incentives play a role, they are not the sole determinant (see point #1 above).
Culture matters more than metrics. When agents believe leadership prioritizes numbers over people, the outcome is rarely positive.
Ultimately, successful recruitment and retention are not just about financial incentives or technology. They are about fostering an environment where agents feel valued, supported, and empowered to succeed.
