The sales office is generally cheaper than hiring a broker. This is primarily due to the fixed costs associated with maintaining a physical location versus the variable fees paid to a broker.

Sales offices typically incur costs such as rent, utilities, and maintenance, which are spread out over the number of transactions conducted. These costs are often a fixed amount per square foot or per month, regardless of the number of sales. In contrast, brokers are usually paid a commission on each sale, which is a percentage of the sale price. This means that the cost of a broker is directly tied to the number of transactions completed.

According to the National Association of Realtors (NAR), the average commission rate for a real estate sale in the United States is around 5.8% of the sale price. This commission is split between the listing and selling brokers. In comparison, the costs of maintaining a sales office can vary widely but are generally lower than the commission paid to a broker. For instance, a small sales office might cost around $1,000 to $2,000 per month in rent and utilities, while a larger office could cost several thousand dollars more.

Additionally, brokers often have their own business expenses, such as marketing, advertising, and administrative costs, which are not typically covered by the sales office. These costs can further increase the overall expense of hiring a broker.

Data from the NAR also shows that the average real estate agent earns approximately $47,920 per year, which includes both base salary and commission. This figure can be significantly higher for brokers who have multiple agents working under them. In contrast, the costs of maintaining a sales office are usually a one-time or recurring expense that does not depend on the number of agents or transactions.

In conclusion, the sales office is generally cheaper than hiring a broker due to the fixed costs associated with maintaining a physical location and the variable nature of broker commissions. This cost-effectiveness can be particularly beneficial for businesses that conduct a high volume of real estate transactions or for those looking to minimize overhead expenses.