What Is a Cap in Real Estate? How Caps Save Agents Thousands

What Is a Cap?

A cap (short for "annual cap") is the maximum amount of commission you'll pay your brokerage in a given year through your commission split. Once you've paid that amount, you keep 100% of your commission on every remaining deal for the rest of your cap year.

Think of it as a ceiling on your brokerage costs. Without a cap, every deal you close costs you the same percentage. With a cap, your per-deal cost effectively drops to zero once you've paid enough.

How Caps Work in Practice

Here's a simplified example. Say your brokerage has an 80/20 split with a $16,000 cap:

• Deal 1: You earn $10,000 GCI. Brokerage takes 20% ($2,000). Total paid toward cap: $2,000.
• Deal 5: You've earned $50,000 GCI total. Brokerage has taken $10,000. $6,000 left to cap.
• Deal 8: You've paid $16,000. Cap reached.
• Deals 9-15: You keep 100% of your commission (minus any transaction fees).

The faster you hit cap, the more of the year you spend at 100%. This is why a lower cap is so valuable for producing agents.

Cap Anniversary vs Calendar Year

Not all brokerages calculate caps the same way:

• Calendar Year: Your cap resets on January 1st every year. Simple and predictable.
• Anniversary Year: Your cap resets on the anniversary of when you joined. Every agent has a different cap year.

LPT Realty uses an anniversary-based cap year. If you join in June, your first cap year runs June to June - not June to December. You get a full 12 months to hit your cap regardless of when you start.

Cap Comparison Across Major Brokerages

Here's how annual caps compare across every major brokerage in 2026:

What Happens After You Cap?

Once you cap, you keep 100% of your commission for the rest of your cap year. But watch for these details:

Post-cap transaction fees

Some brokerages charge additional per-deal fees even after cap. At eXp, there's a $250 post-cap transaction fee on every deal (reducing to $75 after $5,000 in post-cap fees). At LPT, the $195 processing fee continues - but there's no additional post-cap split charge.

Monthly fees don't stop

If your brokerage charges monthly fees (eXp's $85/month, RE/MAX desk fees), those continue year-round regardless of cap status. LPT charges no monthly fees.

Franchise fees may not cap

At Keller Williams, Century 21, and Coldwell Banker, franchise royalty fees often continue after cap. You're still paying 3-8% on every deal even after you've "capped out." [VERIFY]

Why a Lower Cap Means More Money

Let's see how cap differences affect take-home at three production levels:

The pattern is clear: LPT's $5,000 cap saves you $11,000+ every year compared to eXp - and the gap grows even larger against traditional brokerages with no cap.

The $5,000 Cap: Why LPT's Business Builder Stands Alone

LPT Realty's Business Builder plan works differently from a traditional split + cap model. Instead of paying a percentage of your GCI, you pay a flat $500 per transaction. Once you've paid $5,000 (10 transactions), your cap is reached and you pay $0 in splits for the rest of your cap year.

This structure is unique in the industry:

• Predictable costs: You know exactly what each deal costs - $500, period.
• Low cap ceiling: $5,000 is the lowest annual cap offered by any major brokerage.
• No monthly fees: Unlike eXp's $85/month or RE/MAX's desk fees, LPT has zero recurring monthly charges.
• Quick cap: Most producing agents cap by mid-year, giving them months of 100% commission.

LPT Realty is the brokerage. TPL Collective is the community, coaching, and AI infrastructure layer built on top. When you join through TPL, you get LPT's industry-leading economics plus accountability, marketing support, and tools like Dezzy.ai and RecruitAssist.