Expense Ratio
How much of every commission dollar goes to running your business, and the target Agent Runway measures it against.
What is expense ratio?
Expense ratio is your total business expenses expressed as a percentage of your gross commission income (GCI). It tells you how much of every commission dollar you earn is consumed by the cost of running your practice before income tax is applied.
A low expense ratio means a higher proportion of GCI flows through to net income. A high ratio — particularly one driven by fixed costs rather than revenue-generating activities — is a warning sign for long-term profitability.
What counts as a business expense?
For real estate agents, common deductible business expenses include:
Note: Brokerage commission splits and per-transaction fees are typically excluded from the expense ratio and treated separately as commission adjustments.
What is a healthy expense ratio?
Agent Runway measures the ratio against a target of 35% of GCI or less. It is Agent Runway's own target, not an industry statistic. The app reads every ratio in one of four bands, and shows it in that band's colour on the dashboard, the Expenses page and your reports.
The top band. The Expenses part of the Runway Score is at its highest here.
At or under the target.
Past the target. The dashboard starts to flag the ratio here.
The last band. The Expenses part of the Runway Score is at its lowest here.
The bands are the same for every agent. A new agent building a client base may run a higher ratio for a while, and a very low ratio can also mean some expenses have not been recorded yet.
Worked example
How Agent Runway tracks expense ratio
Agent Runway tracks all business expenses by category and automatically calculates your expense ratio against your year-to-date GCI. The ratio is shown against the target of 35% of GCI or less, in the same band and colour on the dashboard, the Expenses page and your reports, beside the expense categories that make up the number.
Track your expense ratio in Agent Runway
Categorise expenses, see your ratio vs benchmark, and understand exactly what is consuming your commission income.