New Brokerage Firm Launches 100% Commission Model

Ten-X Realty is a new brokerage firm with a unique business model: 100% broker commissions. The San Diego firm launched in November of last year and has already grown to an impressive 100 agents. It is serving as an example of the new brokerage concepts emerging in the wake of real estate technology, which in some ways threatens the brokerage business.

“We felt that in order for us to really grow in the luxury market, we needed a brand that was independent and could really grow on its own,” Burke Smith, founder of Ten-X Realty, tells GlobeSt.com. “We needed a brand that was not associated with any other previous business model and to establish ourselves as a full service brokerage firm. The impetus was that we wanted the ability to grow without restrictions that are put on a firm when it is franchised.” Smith is the former chief strategy officer at Realty One Group, and left the position to launch this firm.

Smith launched the company to have the flexibility to serve clients in new geographic markets and create a new business model. “We created a fee structure that under the franchise model would not have been allowed,” he says. “We had the flexibility to do that as an independent. The response has been very good. We have had more than 100 agents join the firm since we launched in November.”

According the Smith, the rapid success of the firm has underscored the demand for strong agents. “More and more buyers are seeing that the real estate agent is valuable, but technology companies like Redfin are putting downward pressure on commissions,” says Smith. “It has become increasingly important for agents to retain as much of their hard-earned commissions as possible.”

While the model was designed to target the luxury market, Smith says the model would work in any segment of the market. “We knew there was a void for the 100% commission model in the high-end markets, but this model would work for the average transaction,” he says. “This really was designed for every agent at every level. We aren’t exclusively targeting the high-end market.”

Ten-X is currently based in San Diego, but serves the major markets in Southern California. “We expect to double our agent count by the end of the year,” says Smith. “We are pretty confident that we will be able to cover Santa Barbara to the border of Mexico and out to the desert markets in Palm Springs by the end of the year.”