Salary Secrets of a Real Estate Agent: How Much Agents Earn & Factors Affecting Their Salary
How much do Real Estate Agents make? What factors affect the salaries of agents? If you’re thinking about becoming a real estate agent, then you need to know how much real estate agents earn and what influences their salaries before deciding if this career path is right for you. This guide on the salary of real estate agents will tell you everything you need to know about the salary and compensation of Real Estate Agents so that you can decide if this career path is right for you.
What real estate agents do
A real estate agent brings people and properties together to sell, purchase, rent, lease, or develop the land. Agents have the important job of negotiating prices and terms with the buyer or seller. They also may supervise some clerical aspects of the transaction, such as taking legal descriptions and measurements.
The median annual salary for agents was $37,000 in 2008. But this can vary greatly depending on experience and geography. The top 10% earned more than $91,000 per year while the bottom 10% earned less than $19,000 annually in 2008.
How long does it take to become a real estate agent?
While the legal requirements vary depending on where you live, it is possible to become a real estate agent with only three months of training. Prospective agents need to take both classroom and field courses that teach how to help clients find their dream homes and explain the home-buying process. Upon completion, aspiring agents must take two state licensing exams before they can get certified in most states. The exams are administered by your state’s Department of Licensing or Board of Realtors in conjunction with the National Association of Realtors and typically cover general business knowledge such as contract law, ethics, negotiation strategies, internet marketing, fair housing laws, and more. Agents who pass are awarded an individual agent license which includes their name and photo for presentation on company websites.
Why get into real estate as a career?
Choosing to pursue a career in real estate, you are likely wondering just how much you can expect to make. As is true for many professions, the sky is truly the limit when it comes to your earning potential as a real estate agent. There are many factors that will affect your salary as an agent, but we’ll discuss some of the most important ones below.
You’ll need to have good business and people skills and an understanding of what is important to clients so they feel confident working with you. You also need an understanding of taxes and insurance, along with knowledge about home values in order to help them find exactly what they’re looking for. Ultimately, this profession can be rewarding if you enjoy interacting with people and working in the property market.
Is there room for advancement in real estate?
For agents who want to stay in real estate, there is room for advancement. Achieving the rank of Salesperson within one company can require 2-3 years and help from an inside contact. Larger companies usually require being in the real estate industry for 5+ years, an additional degree (Realtor or Broker’s license), plus even more time on the front line before advancing.
Successful individuals will be knowledgeable about various home loan programs and should be able to use this knowledge as leverage with clients. This new system has become known as salesmanship and is deeply rooted in customer service skills that are required by anyone serious about their career in sales.
What are the earning potentials?
The salary potentials for real estate agents are often difficult to gauge because earnings differ depending on the type of market (rural, suburban, or urban), the type of job (residential, commercial), and how much time the agent dedicates to their business. The bottom line is that some agents will be able to generate higher income than others. Despite this difference in earning potential, many experts agree that a residential agent’s annual salary may range from $24K to $160K per year. A commercial agent’s salary may range from $150K to $180K per year, while a broker or manager’s annual income can reach as high as $400K per year.
One thing is for sure – success does not come easy.
Are there different ways to get paid for this job?
The commission is the most common method for agents to be paid. The more properties you sell, the more you will earn in commission. However, because commission rates vary from brokerage to brokerage, and are sometimes as low as 4%, this may not be an appealing option for many. While some brokers do charge fees, these fees tend to be significantly higher than other types of compensation such as hourly wages or salary-based pay. Most firms that offer flat fee pricing also have set-up costs which can range from $5,000 to $25,000. Flat fee pricing often takes on the appearance of being more expensive when it comes time to calculate commissions but since there is no fluctuation in what agents are earning over time and the money upfront isn’t required until you have closed deals, it can actually save you money in the long run.
In contrast with commission-based compensation systems where bonuses for achieving certain goals (i.e., breaking records) may only apply at year-end; incentives offered by flat fee agencies come along every month as soon as deals close on your behalf while they are still being processed by your brokerages’ listings department!
The average salary for full-time vs. part-time employment.
The national average salary for a full-time real estate agent is $59,600. Part-time real estate agents will make an average of $29,200 per year. However, it is important to note that how much you can earn as a part-time agent varies based on the hours you work and your sales volume. In fact, research has shown that top-performing agents typically log between 800 and 1,500 leads annually. These high performers are able to take care of most customer needs over the phone without meeting them in person. Therefore they spend less time out in the field and driving around town – where they would lose productive hours – by doing business online or over the phone instead.