How Much Does a Real Estate Agent Make Monthly or Annually

– How Much Does a Real Estate Agent Make –

Are you considering a career in real estate and you might be wondering, “how much does a real estate agent make?”. Planning ahead and knowing how much you can earn before starting a new career helps. You will understand how much to save and adjust during the career transition period.

In this life, we have contacted an agent for one thing or the other and wondered how much the agent makes. Because of the many steps to complete a real estate transaction, licensed agents are valued members of the field.

In this article, we discuss how much money real estate agents make and how they earn it, plus provide tips for pursuing a career as a real estate agent.

Moreso, we surveyed real estate agents across the country to learn what their annual earnings are, and what factors impact how much money they make.

How to Become a Real Estate Agent

In general, to become a real estate agent, you’ll need to become licensed in your state. If you live near a border, you’ll probably want to become licensed in a few states.

The requirements for licensure vary by state, but you’ll generally need to pass a test and be at least 18 years old. The test will cover a few topics including real estate laws specific to the state where you’ll be licensed.

Aside from your state licensure, you don’t need any other certifications. Continuing to learn about your field is important to growing as a real estate agent, but actually earning the certificate isn’t likely to bring you any new business.

How Real Estate Agents Make Money

Most people know that real estate agents make most of their money from commissions. The commission is a percentage of each home sold, typically 6-7%.

Some agents that work for brokerages earn a base salary plus a percentage of the commission.

1. Real Estate Agent Commissions

The average commission rate is 6% but can vary from 3% to 7%.

For example, if you sell a house listed for $350,000 with a commission of 6%. Does that mean you just earned $21,000 for one transaction? Unlikely.

To figure out exactly what a real estate agent makes we have to understand how the commission is determined.

Nearly every home sale involves two agents, sometimes more. The first is the listing agent, representing the homeowner selling the home. The buyer’s agent represents the people who wish to buy the home for sale.

The listing agent and buyer’s agent split the 6% commission, typically evenly, but not always. Sometimes one agent will take a little more of the commission.

For this example, the agents split the commission 50/50. You still walk away from the closing with $10,500. Pretty good income right!

2. Working For A Real Estate Broker

Nearly all new agents work for a real estate broker when they’re starting out. The broker will take a percentage of that $10,500 commission you just closed. An average cut is around 30% but depends on where you work.

Some brokers pay a small monthly salary or hourly wage to their real estate agents, but most of the income boils down to how much did you sell? The more involved you are with buying and selling homes the more you’ll earn.

What Does a Real Estate Agent Make in their First Year?

You just passed your state real estate exam and you’re ready to get your new career launched, congratulations! So what kind of money can you expect to make your first year?

The only correct answer is… it’s hard to say. Multiple factors determine the income from real estate.

What is the commission percentage in your area, what cut does the real estate agent take, what is the state of the market, what level of competition are you up against? All these will play a role in determining how much money you make in your first year.

What Does a Real Estate Agent Make an Average?

The question we all want to know is, just how much does the average real estate agents make per year? Based purely on average commissions, about $36,000 – $40,000 per year. The better agents annually earn more than $100,000 – especially in a thriving market.

However, it’s very unlikely that you begin anywhere near the 6 figures per year you’re hoping for. If you put in the right time and effort you can increase your potential for a higher salary pretty quickly.

Average Real Estate Commission

The national average salary for a broker is $70,215 per year plus a $42,000 commission. For the most up-to-date broker salary information, keep reading.

Broker requirements vary by state, so it’s important to research what you’ll need to do in order to obtain your real estate broker license.

How Much Do Real Estate Agents Make?

The average annual salary for a real estate agent in the United States is $94,031. Per month, they earn $6,658, on average.

Real estate agents receive income through commissions paid directly to brokers upon successful completion of home sales.

The typical commission is 5% to 6% of the home’s listing price, though this number can sometimes vary from 1% to 10% depending on the specific agreement.

Best Paying Jobs in Real Estate

Being a real estate agent is like owning a small business, it’s important to make smart choices that generate a lucrative income.

Here are some other best-paying jobs as a Real Estate Agent.

1. Broker Price Opinion (BPO) Maker

Completing additional paperwork like the BPO report is another way for licensed agents to make money.

This report, prepared by licensed appraisers to value homes, compares several home prices with relevant statistics and other information for sellers.

2. Property Manager

Oftentimes landlords cannot stay on top of the administrative duties that come with owning a property and decide to hire property managers.

Real estate agents can earn additional income by managing these properties for them. This can involve performing maintenance on buildings and collecting rent.

3. Commercial Real Estate Agent

Being a commercial real estate agent can prove to be more beneficial financially due to the consistent monthly income that comes from a lease.

Leasing is essentially renting, which means you’ll continue to get paid on a consistent basis instead of solely on commission.

Do the research necessary to understand the commercial sector before reaching out to potential clients, and update your website and business cards to advertise your specialization.

4. Become a Realtor

A Realtor is a licensed real estate agent who adheres to a high standard of ethics and may improve your credibility and networking within your market, which can help you earn more sales.

Also, talk to other Realtors for insight into the benefits of joining a local chapter of the National Association of Realtors.

5. Become a Broker

Brokers have many advantages over individual real estate agents. For instance, they manage the agents associated with their firm and earn a percentage of agents’ commissions in addition to other administrative fees.

6. Short Sales Agent

Many homeowners have issues selling their homes because they receive offers that aren’t enough to pay off the bank loan. Listing agents can work with homeowners to negotiate with the bank to take a lesser amount.

Once an amount becomes accepted, the agent will relist the property as a short sale. This can take weeks or months to get a decision from the bank as the agent works to complete the legal steps of a short sale price process.

How Does a Real Estate Agent Increase their Income?

The first year working as a real estate agent will be your hardest. This will be the time that you will lay the foundation for your future success.

Successful real estate agents continually ask themselves “how can I make more?”.

The ticket to being successful is to stop seeing yourself as an individual. You are now a business entity and you will need to work so your sales funnel grows, which will increase your income.

Okay, so how does a real estate agent earn more? Here are a few things to keep in mind.

1. Build Your Reputation & Grow Your Network

Your first few years are the building blocks for your future success. While it may not be a tangible asset, your honesty and integrity are more important than any other investment you make in your career.

For the vast majority of Americans, their home is their largest investment and asset. They want someone they trust to help them buy & sell.

Your reputation will help you build a network of professionals that can make or break you as a real estate agent. You’ll work with mortgage brokers, contractors, landscapers, photographers, even drone pilots.

However, you’ll need them to help your clients get financing on time, update homes you’re selling, and more.

2. Understand Your Market

Learning to research marketing listings and understand the market is an essential skill. It can help you learn about available properties, understand if a home is priced properly, and identify up-and-coming neighbourhoods where good values can be found.

3. Invest in Your Career

Real estate agents that find success regularly understand they’re a business. Their name is their brand, and a vital part of branding is reaching people.

Investing in marketing, building an online presence, and growing your reputation will have a huge impact on how high your income is.

It will take some time and it won’t be easy, but if you work hard and invest in yourself it won’t take before you begin to see the rewards. You’ll be a successful real estate agent earning a great living.

It’s important to understand how real estate agents are compensated when considering the field. If you look at every real estate license, the average home sale per license is one every two years.

That means many agents aren’t making much money.

As a consumer, when you hire an agent, you want one that it’s the top 10% of earners. This proves they have a track record of selling homes in your area.

You probably don’t want one that only sells 1-2 homes per year, even if they give you a good break on commissions.

Frequently Asked Questions

1. How much does a real estate agent earn in the USA?

In 2020, the median pay for real estate agents in the U.S. was roughly $49,000.

2. How much does a real estate agent earn in the US?

The average salary for a Real Estate Agent is $94500 per year in United States.

3. Can you make money in real estate on a part-time basis?

A part time agent will earn as much as a full time agent, zero. Agent are not paid employees.

4. How much do the top 10% of real estate agents make per year?

The could earn as low as 100k (if you’re working in a lower priced area selling low priced property) to over a million.

5. How do real estate agents get paid, and how much exactly?

Real estate agents are paid on commission. The average salary for a Real Estate Agent is $94500 per year

6. What commission percentage do real estate agents get?

Between 4.53% to 6.48% of a home’s final sales price. Nationwide this average is about 5%.

7. Do commercial real estate agents/brokers get paid a salary?

The salaries of Commercial Real Estate Brokers in the US range from $23,400 to $795,620.

8. How much do real estate agents make?

The average annual salary for a real estate agent in the United States is $94,031.

9. How much does a realtor earn from a sold house?

Most agents make money only after a home has sold.

10. How much do real estate agents make per hour?

The average hourly pay for a Real Estate Agent Job in the US is $39.85 an hour.

You can easily share the images if you wish. Just press the share button on every image and select your platform and share it on, boom!

Thank you for reading How Much Does a Real Estate Agent Make and reaching to the last section of this article. I hope you enjoyed these and found all that you were looking for.

CSN Teams.