Compensation Structures

Once you know who you want to hire as your assistant, you must determine how you’ll pay that person. According to the 2012 NATIONAL ASSOCIATION OF REALTORS Member Profile, real estate practitioners compensate their personal assistants in a variety of ways:

  • 38 percent are paid hourly
  • 20 percent receive a salary
  • 13 percent receive a cut of the commission
  • 12 percent get paid per task
  • 18 percent have other arrangements

The best way to determine the prevailing wage in your area is to contact your local chamber of commerce, employment agency, state employment office, and other salespeople in the area who’ve hired assistants. And before you hire an assistant, consult your accountant to discuss the compensation method and tax ramifications.

How much you pay an assistant is inherently linked to the tasks the person will perform. If you need a secretary, hire a temp or a student and pay the prevailing hourly wage. But if you want the person to work with clients and customers, you may be better served by a salary and bonus structure.

Here are some of the ways you can structure your assistant’s compensation plan:

  • Salary plus bonus. This is the most common way of paying assistants, says real estate trainer Ed Hatch, CRS®, of Ed Hatch Seminars in Greenbelt, Md. The salary could be structured as a fixed rate or an hourly wage. To determine the wage, find out what a good secretary makes by the hour in your area. On top of that, you also can pay a bonus for any additional business that the assistant helps to generate, which gives the person unlimited earning potential. “If you make $100,000 in a year that you wouldn’t otherwise have made without the assistant, wouldn’t you pay $35,000 in bonuses on top of a salary?” Hatch says. You also could pay a bonus based on every transaction you close if the assistant isn’t doing lead generation.
  • Straight salary. This structure provides the assistant with more security than commission alone, but no incentive to develop more deals. And if your income ebbs, you’ll still have to pay that salary. For an assistant on straight salary, you can offer a percentage of each sale that gets to closing or a flat fee, such as $200. In addition, you can pay for the assistant’s licensing, MLS and board dues, and even the desk fee if you want the assistant to have his or her own office space at your brokerage. In addition, let good candidates know that they’ll be in an ideal position to learn the business. They can move up from an administrative role to buyer’s assistant or eventually to an independent salesperson.
  • A commission arrangement. In this scenario, you pay your assistant a portion of everything you close. The assistant must be licensed. In addition, check with your state regulatory body to find out whether the commission must be paid through your broker or if you can pay the assistant directly. The advantage to a commission structure is that the person has incentive to increase your production and work hard for your clients and customers. The disadvantage is that you’re compensating and training someone as a salesperson, which means the assistant could turn into your competition.

Note: This information provides general legal information and should not be relied upon as legal guidance. Before acting, both the relevant laws and legal counsel should be consulted. This information should not be construed as specific legal advice nor as an opinion on particular facts, cases, or situations.

Notice: The information on this page may not be current. The archive is a collection of content previously published on one or more NAR web properties. Archive pages are not updated and may no longer be accurate. Users must independently verify the accuracy and currency of the information found here. The National Association of REALTORS® disclaims all liability for any loss or injury resulting from the use of the information or data found on this page.