Real estate agents shoulder small-business owner's burden - Kansas City Star

But brokers are licensed to manage their own businesses; agents must work with brokers. In return, the broker pays the agent a portion of the commission earned from the agent's sale of a property. It recommends that an agent just starting out "should have enough money to live for about six months, or until commissions increase. If a brokerage has clerical staff, it has to provide medical coverage for those who work 30 hours a week or more. Traditional advertising expenses and signs can cut deeply into commissions. Which means that a Real Estate agent can be "fairly described" as a small businessperson, said Walt Molony, spokesman for the National Association of Realtors. And although there was considerable consolidation in real estate a decade or more ago, with many mom-and-pop offices merged into larger ones, there are still plenty of small brokerages in operation, too. Fixed costs consume most of the money a small broker takes in, he said. According to the Bureau of Labor Statistics, real estate brokers and agents do the same type of work. But brokers are licensed to manage their own businesses; agents must work with brokers. An agent typically provides services to a broker on a contract basis. In return, the broker pays the agent a portion of the commission earned from the agent's sale of a property. The bureau further says that the broker or agent who obtains a listing usually shares the commission with the broker or agent who sells the property, and with the firms that employ each of them. It recommends that an agent just starting out "should have enough money to live for about six months, or until commissions increase. Not only do agents pay for their licenses, which are required before they can sell real estate, but many states - Pennsylvania and New Jersey included - require continuing education as a condition of license renewal periodically, and the costs of those courses are borne by the agent alone. Agents and brokers pay for their own medical coverage, unless a salaried spouse in a different field has a family plan. If a brokerage has clerical staff, it has to provide medical coverage for those who work 30 hours a week or more. For agents who use a broker's office part time, there may be desk fees, copier fees, and shared costs of electricity, he said. Though today's technology means less time in the office, cellphones, keeping a website fresh, and equipment cost money. Traditional advertising expenses and signs can cut deeply into commissions. And agents need reliable cars to get to appointments and transport buyers to listings. Realtors