For most real-estate agents, salaries are tied to sales. But for agents of a new real-estate agency in Alexandria, sales are only part of the equation. Exit Realty offers its agents a cut from all sales made by new agents they bring into the company. Known as "residual sales," the concept gives an incentive to agents to recruit for the company and share a higher percentage of the commission.
"It’s a wonderful way to be motivated," said Mark Flores, a former Weichert Realtor. "We work as a team."
The Canadian-based Exit Realty corporate office recently celebrated its 10th anniversary and has 1,107 franchises and 34,812 agents. Since 2000, Exit corporate has paid out $100 million in single-level residual bonuses to its agents — income that is earned through the sponsored agent's sales. The concept of agents earning residual income sets Exit apart from other real-estate companies in the area — giving agents a cut of all future commissions earned by their recruits.
"It’s a different philosophy," said Jacquelyn Nunez, another former Weichert Realtor who has now moved to Exit. "This is a company that gives back, and that’s what won me over."
SHAWN HARRIS is the owner of the area’s two new Exit brokerages, one on Pitt Street and the other on Richmond Highway. A native of Adrian, Mich., Harris has lived in Alexandria since 1982. From 1984 to 2004, she owned Shawn Harris Interiors — a company that designed Tip O’Neil’s Watergate condominium and renovated Washington’s renowned Occidental Grill. Part of her interior design business included selling real estate, an aspect of the business she came to love. Slowly, over the course of years, she grew to love the real-estate business more than the interior-design business.
In 2004, she decided to close her interior design business and open a brokerage. But what kind?
"I see real estate as becoming very global," said Harris after a recent ribbon-cutting ceremony at her new Pitt Street office. "And I felt it was important to have an international business."
Harris said that she spent years researching the industry, eventually deciding on Exit. She described the company’s philosophy as "agent-centered" model, which offered higher commissions and residual benefits that were impossible to find elsewhere. She said that her agents will benefit from recruiting new hires, but they won’t be forced to do so. Responding to a question about how Exit will compete with well-known agencies, Harris was confident that her business would succeed.
"I think the better question is how these other companies are going to compete with our business model," she said.
EVEN THOUGH THE real-estate market has cooled considerably in the past several months, Harris said that the time is right for opening a new brokerage. She said that she’s not concerned about market trends having a detrimental effect on her business.
"I see us as being at the beginning of a normal market," said Harris. "We won’t have escalation clauses and all those crazy things that were a part of the sellers’ market. And we are not going to see sellers giving subsidies to the extent that you saw last year."
Instead, Harris said, the real-estate market has achieved a level of sanity that was absent for the past few years when the red-hot market caused homes to remain on the market for small amounts of time and sell at inflated prices.
"In Alexandria, if a home is the right price it’s going to sell," she said.