What Do Real Estate Agents Actually Pay Their Brokerage?
Split, cap, franchise royalty, desk fees: here's what agents really hand over to their brokerage each year, and how to run the math before you switch.
Most agents give up somewhere between 15% and 40% of every commission check to their brokerage once you add up the split, the franchise royalty, and the monthly or per-transaction fees — and that total rarely matches the headline number a recruiter quotes on day one. The split gets top billing in every recruiting conversation, but it's only one line of a bill that also includes franchise fees, desk fees, tech fees, and transaction fees, and those extras can swing your real take-home by ten points or more.
The three places your commission check gets touched
Every brokerage collects its share through some combination of three mechanisms, and most traditional firms use all three at once.
The split. This is the percentage of each closed transaction the brokerage keeps before you see a check. According to the 2025 NAR Member Profile, most Realtors work under a fixed commission split with their broker, while roughly a fifth work under a graduated split and another fifth under a capped split. A 60/40 or 70/30 split (agent/broker) is a common starting point for newer agents at traditional firms, with experienced, high-producing agents negotiating up toward 80/20 or 90/10.
The cap. In a capped structure, you pay the split percentage until your year-to-date contribution to the brokerage hits a set dollar amount, then you keep 100% of commission for the rest of your anniversary year. Inman reports that 18% of Realtors work under a capped split model. Cap-based brokerages have become one of the fastest-growing structures in the industry precisely because they reward high-volume agents with a real ceiling on what they hand over, rather than an indefinite percentage cut.
The fees. This is where headline splits get misleading. On top of the split or cap, many franchise brokerages layer a franchise royalty fee (commonly 3% to 8% of gross commission, sometimes capped annually), a monthly desk or technology fee (commonly ranging from under $100 to well over $1,000 a month depending on the brokerage and market), and per-transaction fees for compliance review, risk management, or transaction coordination. None of these show up in the split number a recruiter leads with.
What a typical franchise brokerage costs an agent
Franchise and traditional brokerage structures vary by company and market center, but the general shape is consistent across the industry: a percentage split, plus a franchise royalty, plus recurring fees.
| Cost component | Typical range across franchise brokerages |
|---|---|
| Starting split (agent/broker) | 60/40 to 80/20, improving with production |
| Franchise royalty fee | 3% to 8% of gross commission, often capped annually |
| Monthly desk or tech fee | Roughly $75 to $1,500+, depending on brokerage and market |
| Per-transaction fee | Often $100 to $500 per closing |
| Annual cap (if capped model) | Commonly $15,000 to $35,000+ at the market-center level |
These figures reflect industry-wide reporting from sources like RealTrends and agent-facing comparison sites, not any single company's own numbers — actual fees vary by market center, franchise agreement, and negotiated terms, so always get the exact structure in writing before you sign.
The trend line matters here too. RealTrends' brokerage rankings show flat-fee and low-split-plus-fee models now hold multiple spots among the top 20 firms by transaction volume, a sign that agents are increasingly choosing structures that trade a lower theoretical split for a hard, predictable ceiling on what they pay.
How the cap changes the math more than the split does
A high split number sounds better than it performs if the cap is high or non-existent. An agent on an 80/20 split with a $30,000 cap pays the brokerage 20% of every commission until their contributions to the brokerage hit $30,000 for the year — for many agents, that's most or all of a full year's production. An agent on an 85/15 split with a $12,000 cap reaches full retention much faster, because the cap is the number that actually determines how much you keep, not the split percentage alone.
This is also where franchise royalty fees compound the picture: a royalty fee that's separately capped at, say, $3,000 a year adds another few thousand dollars on top of the market-center cap before an agent is truly done contributing for the year.
What Grey Square agents actually pay
Grey Square runs an 85/15 split across all four agent paths, with a $12,000 annual cap (the Team Member path has a reduced $6,000 cap). After the cap, agents pay a flat $150 post-cap fee per transaction and keep everything else. There are no franchise fees and no desk fees. Monthly fees run $49 to $149 depending on path, and there's a $750 annual resource fee, billed $250 per quarter. Agents on the Team Agent GS path also get Follow Up Boss CRM, a RealScout buyer portal, Sweet Assist transaction management, lead nurture, and team coaching built into that structure.
Grey Square also runs a personal deals program — three personal transactions a year at a flat $150 each, outside the standard split — and a revenue share program paying 5%, 4%, and 3% of company dollar across three sponsor tiers for agents who bring others into the brokerage. None of these numbers are averages or estimates; they're the actual structure agents sign up for.
See the full breakdown and apply for a path →
The math to run before you compare two offers
A split percentage by itself tells you almost nothing. Before comparing brokerages, run each offer through the same four questions:
- What's the real split, including any graduated tiers? Ask what the split looks like in your first year versus after you hit a production threshold.
- Is there a cap, and how is it calculated? A cap based on gross commission paid to the brokerage behaves very differently than one based on gross commission income before the split.
- What recurring fees exist outside the split? Add up franchise royalty, monthly desk or tech fees, transaction fees, and any mandatory marketing or E&O fees — then annualize them.
- What do you get for the fees? A brokerage charging more in exchange for a CRM, lead flow, and coaching is a different value proposition than one charging fees for nothing beyond a license to hang.
Multiply your average annual transaction count by the true all-in cost per transaction, add the fixed annual fees, and compare that single number across brokerages. That's the number that actually predicts your take-home, not the split percentage on the recruiting flyer.
Frequently Asked Questions
What's a normal commission split for a real estate agent?
Splits vary widely by brokerage and experience level. Newer agents at traditional firms often start around 60/40 or 70/30 (agent/broker), while experienced, high-producing agents commonly negotiate toward 80/20 or 90/10, according to industry-wide reporting from sources like the NAR Member Profile and Inman.
What is a commission cap, and why does it matter more than the split?
A cap is the dollar amount an agent pays the brokerage in a given year before they start keeping 100% of commission for the rest of that year. It matters more than the raw split percentage because it sets a hard ceiling on what you pay annually, while an uncapped split keeps taking a cut indefinitely, no matter how much you produce.
Do franchise fees apply on top of the commission split?
At many franchise brokerages, yes. A separate franchise royalty fee, commonly in the 3% to 8% range and sometimes capped annually, is charged on top of the local split, along with monthly desk or technology fees and per-transaction fees. Non-franchise and cloud-based brokerages often skip the royalty fee entirely.
What does Grey Square charge agents?
Grey Square uses an 85/15 split across all four agent paths, a $12,000 annual cap ($6,000 on the Team Member path), a $150 post-cap fee per transaction, monthly fees of $49 to $149 depending on path, and a $750 annual resource fee — with zero franchise fees and zero desk fees.
How do I compare two brokerage offers fairly?
Don't compare split percentages alone. Add the franchise royalty, monthly fees, and per-transaction fees to get your true annual cost, then divide that by your expected transaction volume to get a real cost-per-deal you can compare across offers.
Paul Blair is the founder and broker of Grey Square, a virtual real estate brokerage operating across Dallas, Los Angeles, and Houston. TX TREC #9011505 · CA DRE #01792671.