What is your company’s policy on paying out leasing commissions?

What is your company’s policy on paying out leasing commissions? I’ll go first: The Leasing Professional that shows the apartment first gets the commission. This must be reflected on the Yardi guest card as “first show” and the associates name as agent. Now I am asking this question because it has become an issue with someone in particular. However, this is how my former employers paid out commissions also. I am curious as to how everyone is handling them these days.

My experience has always been who shows the apartment first. The phone call does generate the traffic, however it is the tour that seals the deal. This comes up from time to time. We always explain to our leasing staff that yes, the commission is nice, but the point of the job is to get them to lease at the property. If there are numerous phone calls first, there is always the option to split the commission.

Typically that's how it goes. Whomever shows and completes the move in. However, I've always offered to split my commissions if I have a particularly difficult move in and my teammate helps me with them.

That’s pretty common. But as an owner I never liked it. My first revision was to assign a goal to each leasing person (“X” new leases at or above market rent and “Y” number of renewals with predetermined increases). Renewal bonus accelerated radically if you got above the predetermined rents.

No commission- it is a team effort. We earn bonuses together!

My first company did this and it was such a good environment. Everyone helped the prospect out out during the application process and gathering everything before move in. It also let the resident feel more welcome and known by the entire staff.

Sounds like old way incentivizes bad behavior and complicates administration. The company wins if the team performs, so compensate accordingly. Can address underperformance on individual level. Sounds like y’all are ahead of the game

The first company I worked for did this and it was the best way I’ve witnessed. Everyone chipped in, there was zero competition, and we found we leased more overall too

Yup! Whoever showed gets it. Of course we always have one or two fought over

Our agents are responsible for their lead from first contact through move in. They get the bonus for their move in.

Always loved when they come back to see another and someone erases the 1st person's tour

Yes. Whoever shows first.

We do first contact, but that doesn't even always mean we were the first to tour. Example: if i spoke to someone and they wanted to tour on my day off it's still my lead because i got them in the door. That being said, we don't fight over leads or bonuses. We are a team and help eachother out because once they move in they become all of our residents anyway. And if someone applies who hadn't toured or called first then we alternate who gets that bonus. I couldn't work with people that wanted to be cut throat over a bonus. It's counterproductive to a team environment.

We have the same policy. My leasing team knows this and we don’t have an issue.

I always strived to build teams that wouldn’t even think about stealing a commission. I always tried to leave it to my people to decide between themselves if the person was truly “theirs”.Sometimes you do the first tour and then are off and the people come in and require a lot.

This won’t be popular but, I don’t understand why leasing bonuses are paid… isn’t that the job and why they receive a paycheck? We pay bonuses on financial performance: if the property meets or exceeds their budgeted NOI, ALL employees get a bonus. Because maintenance, make-ready, grounds, and housekeeping impact prospect and resident experience as well as cost. Everyone is incentivized to perform well and not waste money. And no fights between leasing agents of who talked to them first.

Agree 100%. I prefer my nice salary and full team rewards!!!

And that is why our maintenance team and admin team split the renewal bonuses. It's a team effort to retain!

I have always felt that paying bonuses to do the job that employees signed up for is ridiculous. The bonus should be shared by the entire TEAM. Leasing bonuses create more dissension than it is worth.

If only I got paid for every bank rec or financial statement produced! (Yes, I’m in the corp office). But for another twist… how are corp employees rewarded? They don’t participate in property bonuses because they don’t have a “direct” impact. Would love to see some ideas.

That’s an interesting thought…

This is a question for those in CA. How does your company handle paying leasing bonuses then having to true up overtime by using the bonus amount to calculate “regular rate of pay”, or is this not being done?

We do an average 90 day look back on rates. Some agents have a significantly higher rate of pay with bonuses but that’s the law. Stupid California.

My leasing agents are salaried, everyone works together. I think offering commissions creates a cutthroat environment.

That position is exempt under federal law so I hope you are paying OT for hours over 40. If not you are in danger of a wage claim or potentially a class action lawsuit.

If they are salaried then they don’t get OT which is my understanding. I’m also willing to bet those agents get paid a good salary.

We keep regular business hours of a 40 hour work week, if there is weekend showings or something that requires extra either I do it or I give time off to compensate.

As long as the time off is in the same 168 hour work week (which every company decides) then you are complying with the law. If you don’t give time off until the next work week, that isn’t in compliance.

How are leasing agents considered exempt? They’re not independent contractors. It’s no different than having a PM or maintenance lead onsite

I didn’t say they were exempt. I said unless a position qualified under federal law, then OT must be paid. PM may be exempt, depending on their responsibilities. Maintenance leads would not be exempt either.

All my years in this industry (don’t ask how many) it has been the first showing. The agent however has to see it all way through. If someone else does paperwork then it’s split.

Same as yours

I believe it is on our job description to show apartments to our prospective customers.. we all get a pay check to make contact with customers and show apartments homes and complete administrative duties.. The bonus (bonuses are usually paid for meeting a certain goal or hitting a target and recognition for going above and beyond- commissions are paid as a % or flat rate of an individuals sales) is paid to the agent/whoever can get the customer to commit. Commissions are essentially bonuses for getting a costumer to chose you over the competition. That is how our commission bonus policy works. usually it is the first contact, but if the customer isn’t ready to commit due to their own personal reasons and returns at a later time to place a deposit down and starts the application process with someone else, our team knows that goes to the other person who spent all the time with them and was involved in their commitment. That other agent is just performing their administrative task already in their job description. Our company policy is Commissions are paid to the agent that got the prospective resident to commit to our community. That is really the magical moment when a bonus is earned.

Haven’t received bonuses in years and have gotten use to it. Yes it is our job so why pay for it when we are already getting paid to do it. We all get a year end bonus and it’s very nice.

I’ve been at my community 13 years. We have 336 units with 1 manager 1 AM and 1 leasing. All of us have a hand in every move in and making our team successful so we split all bonuses equally between the 3 of us. I’ve never once had a complaint. It’s a great environment to work in. No one is fighting over leases and everyone helps each other.

We need to do this.

Completely agree, everyone has some dealing with the people we lease and move in. It is a team effort and commissions should be split evenly

I think it actually fosters teamwork! It’s great that you all handle it this way. Wishing you continued success.

thank you!

My property has the same staff setup as Jodi Kissane-Barkley w/ 267 units. PM doesn’t make commission on leases as she primarily just reviews and makes final approval before leases are generated. Currently I (APM) and leasing agent make commission off of first person to enter guest card in Yardi. But this has caused some possessiveness over the leases and has not fostered teamwork rather than hoarding and struggling to process apps in a timely manner. Would not recommend it unless the staff get along very well. 

Exactly this is what I hear from many properties. I’ve never once had anyone fight over a lease or feel resentful about having to do a lease or move in for someone that’s on vacation. It really is a great environment.

That’s how we did it, though I would give my half or all of my commission to a coworker if they did all the work after my tour.

Our commission policy spells out which leasing agent gets the commission. If it first contact unless the agent leaves. Then it depends on how far along in the paperwork is.

Don't get any

If there are 2 of us the mgr gets 60% and assistant gets 40%. The theory is it's a team effort. As manager I would be less likely to have those first contracts nor sign the paperwork but I'm the one responsible for making sure the units are ready, in good condition, etc. So if I wasn't doing my job the person leasing would not have a good product to sell.

Sounds like we are the same, the person that toured the prospect and notes in Yardi gets the lease. We are commissioned and YES it can be a difficult situation for some to accept. I always tell the other LC that it comes full circle because we have return tours ECT. And if this person comes back 3 months down the road and leases it still goes to first toured and there is the payback.

Same

Our company pays based on 1st guest card contact. This is phone email or visit.

I believe in leasing commissions but they are split. When they are given to first person who shows its make the office vibe ugly, not friendly to much competition. One prospect can come back 3 times and not lease til 3rd person and may have auctally leased because of that person.

This probably won’t be a popular stance, but I managed a 220 unit community. We split commission amounts between manager, assistant and part time leasing consultant. My third was then passed to the maintenance staff. I didn’t take my third. Manager and maintenance manager had more than adequate quarterly bonus potential. I felt like everyone on staff ‘leases’ every day.

That’s how we have always paid out commissions. The one who does the show gets the commission.

At my old property, the person who did the tour gets 50%. The person who does the screening and paperwork gets 25%. The person who does the move in inspection gets 25%. It helped to ensure that everyone “took care” of all prospects/residents/move ins.

Just so you all know, first show is our “company policy “. Therefore, it is non-negotiable. So as a manager I don’t get to decide on a split. I feel like a policy is a best practice so there is no confusion. I am just wondering how other companies structure this. As a Senior Manager I am wondering if it’s time to restructure the commission pay outs.

may be unpopular but we do not pay commissions. we pay a higher hourly wage and have great benefits.

I do my job and I continue to get a paycheck. Leasing is part of my job. I cannot do my job without excellent work and support from housekeeping, maintenance, and management. No one person deserves more because an apartment was leased.

My experience has always been whoever did the tour (and it was documented) got the lease. However I have run into a problem in past where 1 leasing agent would tour and get them to apply but rarely ever completed all the paperwork. And she ALWAYS scheduled their move in on her day off so the other 2 leasing agents had to do the lease move in inspections, but leasing agent #1 got paid. Once a pattern was discovered those commissions were paid to the other 2 agents because they had done 90% of the work.

Who ever does the complete process.

We’ve always done first show… doesn’t matter if they talked on the phone to everyone for 2 hours each.. first show!!! It’s the only way to keep it kinda fair… the agent should make sure to make an appointment with the customer when they know they can be there if they felt the phone conversations make that customer their rental!!

My company no longer does commissions and it seems the “bonuses” keep getting smaller with each new regional. The max right now for manager is $1000 and assistant is $500. Also my company doesn’t do leasing agents.

We are who ever shows first but the last company was who ever did the most work... so if you showed butbdid no work after then you did not get the commission. But I do think it unfair that if they come back for a 2nd or 3rd tour and the 1st person doest offer to split.... I always offer my team a visa gift card of some increment if they helped me but that is just my mind set...

Usually it is the person that showed however if the agent does not follow through with all that comes with leasing the unit I would forfeit it and give it to the person that did do all the work and follow ups. This of course after a counseling was done

We don't have commissions

I agree who shows the unit IF they also close the deal. If they don’t do the work to close the deal then it should go to the person that does. It’s easy to show a unit but takes more effort to get the deal done. Just my two cents.

I agree that it is the person that closes the deal! Not necessarily the first to show. I once had a property where the LC spent more time reviewing the traffic cards than working on follow up!

As a Manager, I once was moving in a client that I had shown maybe 4 or 5 homes to, found the one they wanted, worked with them through the application process.... took their phone calls with questions for the next few weeks.....when they came to move in, they asked for me. THEN, when I was going through the move-in paperwork the LC came out and asked them what their names were. When they told her she said "Oh your my lease, I showed your husband an apartment a few weeks ago!" They looked at her like she was crazy! LOL. They had not had any additional contact with her since she showed the husband several weeks prior and she thought that should be her lease! Since, then I have always said it's the person that "closes" the sale. If more than one consultant spends ample time with a client then split is in order. My two cents.