Exit Realty opens isle office
The real estate firm is seeking local brokers for franchise offices
Exit Realty, a fast-growing real estate franchise with an unusual commission structure, has crossed the ocean to Hawaii.
Howard and Doredda Richmond, formerly of Palm Beach, Fla., decided to open up Exit's first regional franchise office in Hawaii after they fell in love with the islands during their wedding here 18 months ago.
The couple, who registered their business in April and have become members of the Honolulu Board of Realtors, are seeking local brokers to open franchise offices in the islands as well as agents.
Ontario-based Exit Realty, which is led by Steve Morris, opened its first North American office eight years ago and by year end is projected to have 1,500 offices and 50,000 agents in the United States.
Exit Realty offers a different commission structure than most other real estate companies. Exit associates have an opportunity to earn single-level residual sales bonuses -- up to 10 percent of the gross commissions that their agent recruits make. The company also offers a potential income stream for retirees and for beneficiaries.
"Exit ensures that there is a future in real estate where there was none before," said Howard Richmond, adding that Exit's structure makes it possible for agents to earn higher than industry average commissions and pensions.
Richmond, who has worked in real estate for the past 35 years, said when he left an Orlando, Fla. RE/MAX office to join Exit it was a "no-brainer," because the company offered a more secure environment and larger commissions.
"Most agents are living off present money," Richmond said. "The Exit strategy relieves a lot of pressure by providing the opportunity for a steady income stream."
Richmond saw Exit's Orlando office grow from six to 125 agents and he expects to find the same response in Hawaii, where the real estate market is doing better than that of most mainland cities, he said.
Doredda Richmond, who joined Exit five years ago, said she was drawn to Exit's strategy and training opportunities. She also liked the camaraderie in Exit's offices, where she said real estate agents mentor instead of compete.
A different way
When a $100,000 home is sold in a single-agent transaction, the commission is 6 percent, or $6,000. Under Exit's system, the agent handling the transaction receives 70 percent of the commission, or $4,200, minus Exit's transaction fees ($150 for two-agent deals or $300 for one-agent deals*) -- for a net commission of $3,900. The local Exit broker receives 20 percent or $1,200. The remaining 10 percent** of the gross commission, or $600, goes to the recruiting agent. Conventional brokerages take between 10 and 50 of the commission, but those on the lower end of the scale normally require monthly "desk fees" from agents.
* Maximum of $2,700 per agent per year
** Maximum of $10,000 per agent per year
Source: Exit Realty
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