Every real estate commission in New York is paid to a brokerage, not to an agent. The split is the share of that commission the brokerage passes to the agent who did the work. Understanding how splits, caps and fees interact is the single most useful thing an agent can do before choosing or changing a brokerage.
What a split actually is
If a home sells for $700,000 with a 2.5% commission to the buyer's side, the brokerage receives $17,500. On an 80% split, the agent is paid $14,000 and the brokerage keeps $3,500. On a 50% split, the agent is paid $8,750. Same work, same deal, a $5,250 difference.
The four common structures
1. Flat split
One percentage for every deal, often 50/50 or 60/40 at traditional brokerages. Simple, and usually expensive for productive agents.
2. Tiered split
The agent's percentage rises with production. This rewards agents who close more without asking new agents to pay for a level they have not reached yet. LJ Realty Team uses this model: 80% at one to two transactions, 85% at three to four, and 90% at five or more.
3. Cap
The agent pays the brokerage a percentage until a yearly dollar cap is reached, then keeps 100% for the rest of the year. Good for high-volume agents; irrelevant for agents who never reach the cap.
4. 100% commission with fees
The agent keeps the whole commission and pays a monthly fee, a per-transaction fee, or both. Attractive on paper; the math depends entirely on how many deals you close and what the fees add up to.
The fees that change the math
- Desk or office fees: a monthly charge regardless of production. LJ charges none.
- Transaction fees or minimums: a set amount per deal. LJ's brokerage portion has a $999 minimum per transaction, which matters on small deals and rentals.
- Technology and E&O fees: some brokerages bill MLS, e-signature and insurance back to the agent. Ask.
- Franchise fees: national brands often take a percentage off the top before the split is calculated.
How to compare two offers
Take your last twelve months of closings, or a realistic projection if you are new, and run every deal through each brokerage's structure including fees. The right answer is the plan that leaves the most in your account for your actual production, not the highest headline percentage.
Rentals and commercial are different
Many brokerages treat rentals as an afterthought. Because rentals are real income in Queens, Brooklyn and the Bronx, LJ pays 80% on City and State voucher rentals and charges a flat $100 brokerage fee on other rentals. Commercial sales and rentals are at 70%.
See LJ Realty Team's full agent commission structure on the Realtor Careers page, or schedule a confidential conversation with the broker.
