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Referral Agents Make More Money

Wednesday, November 29, 2023

Primary Blog/Real Estate Agent Tips/Referral Agents Make More Money

Referral Agents Make More Money

Referral Agents Got it Going On!

Real estate referral agents definitely fly under the radar, but once you start crunching the numbers, it’s clear they can make more money than active real estate agents. Wait, what? Yes, you read that right! In this blog post, we’ll discuss how referral agents can make a pretty penny, their unique advantages, and why they’re a force to be reckoned with in the real estate industry.


For those who don't know, a real estate referral agent is a licensed agent who acts as the "middle man" between clients and real estate agents. They refer clients to active agents for a fee. This fee is typically 25% of the commission earned by the agent who was referred. Referral agents don't need to worry about selling homes, negotiating deals, or attending inspections. They simply refer clients to qualified agents, leading to many distinct advantages. One advantage is the flexibility of their schedule. Referral agents have the freedom to work from anywhere in the world simply by making phone calls and sending emails, making it a great choice for someone who loves to travel or has other work obligations.

Secondly, referral agents can potentially make more money than active agents because their commissions aren’t subject to any overhead expenses. Active agents have to market themselves through advertising, create promotional materials, and obtain other operational expenses that referral agents don't have. Overhead expenses can sometimes take up to 30% of an agent's commission, which cuts dramatically into profits. These expenses are often out of the agents’ control and add significant pressure to the commission structure.

Thirdly, referral agents usually work on a strict commission-only basis, and they don't have to pay split costs between brokerage firms. Active agents typically split their commission with their brokerage firms, which can eat into their profits. In contrast, referral agents keep the entire 25% referral fee, leading to a more streamlined income.

Fourthly, referral agents can focus solely on growing their referral network, making for a more consistent income stream. Active agents must always be on the lookout for new clients, and in real estate, there can be long stretches of time when they are between deals. Referral agents have a steady stream of income coming in from referral fees, allowing for minimal downtime and reduced anxiety.

Lastly, referral agents offer a unique advantage to clients. They have a wider pool of agents they can recommend, giving clients a more significant chance to find an agent they like that fits their criteria. This can lead to better client satisfaction and trust, which can help referral agents get more business in the future.

Hopefully, you’ve now seen some of the advantages referral agents have over active agents. Certainly, every agent has to make their own choice when it comes to deciding what is best for them, but the potential for greater commission revenue, flexibility, and reduced overhead expenses make referral agent a viable option that shouldn’t be overlooked. For active agents tired of the constant and expensive search for new clients, and for those not interested in taking on the stress of home sales, referral agent could be the ideal fit.


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Hi, I'm Andrew

And YES! I made 6-Figures without running a single transaction.

My time as a Realtor helped me understand the stresses of selling real estate, and allowed me to develop systems and strategies that make being a referral agent a lucrative and stress-free career. I went from never spending any time with my family to working just a few hours a week and taking time off whenever I want, making just as much money as I did as a full-time agent. Now, I’m sharing with you how to make this a reality in your own life.

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