BROKERAGE WARNING LIGHTS

One thing that has always bothered me about real estate brokerage is the unpredictability of sales.

Unlike in the corporate world, where salaries are usually fixed, brokerage income is uneven. In a good month, you can close a large transaction. In a bad stretch, months can pass with no sales at all. That makes planning difficult.

One big sale can make the year look solved. A few quiet months can make it feel like everything is falling apart.

So how should brokers track whether they are falling behind?

For me, two useful metrics are:

1. Trailing Twelve Months Sales

This measures your total sales over the last 12 months.

If it is June 18, 2026 today, you measure total commissions from June 2025 to May 2026.

This is useful because brokerage is seasonal and uneven. A trailing 12-month number smooths out the noise and gives you a better view of the overall health of the business.

But there is one problem: it is slow.

A big sale from months ago can keep the number looking healthy, even if your current momentum is weakening.

That is why I also track a 2nd metric.

2. 6-Month Annualized Sales

This measures your sales over the LAST 6 MONTHS, then multiplies it by 2.

It answers the question: “If the last six months continued for a full year, what kind of year would I be heading toward?”

This reacts faster than trailing twelve-month sales. It can warn you earlier when momentum is slowing.

But it can also overreact.

One big commission can make the number spike. A few quiet months can make it drop sharply. So I do not treat it as a panic button. I treat it as a warning light. If it lights up, I do not automatically cut all spending. I slow down on experimental expenses and focus resources on activities that can directly generate leads, strengthen the pipeline, or move existing deals forward.

The goal is not to predict sales perfectly. The goal is to avoid being fooled by the highs and lows.

Trailing twelve-month sales tells you the health of the business. Six-month annualized sales tells you the current momentum. Pipeline tells you whether you should worry.

Not too complacent after a big sale. Not too panicked after a dry spell.