As you consider a career in real estate, you probably have searched for real estate agent salary data. Depending on what websites popped up during your online search, you may have seen a wide range of salaries – from $40,000 to $170,000 (or even up to $250,000).
What factors influence a real estate agent’s income? Let’s take a deep dive into this subject using data gathered by one of the most trusted sources in real estate education.
How is a Real Estate Agent Paid?
Before we show factors that influence real estate agent salary, it’s important to note that your income will be based on your commission. It is unlikely that you will earn a salary.
Commissioned-based pay may thrill or frighten you – or a little of both. You will likely thrive working on commission if you are a go-getter frustrated with receiving the same pay as your less-dedicated co-workers. However, similar to other sales roles, ramping up to a satisfactory salary may take some time.
It’s also important to note that as a real estate salesperson, you are responsible for paying the required taxes on your income, which are typically collected quarterly instead of out of each check. You may also be on your own for retirement, health insurance, and other benefits that usually come with a full-time job.
However, these responsibilities should not dissuade you. Many people thrive in the real estate industry – and you can too.
Factors That Influence the Income of a Real Estate Agent
You may wonder about the key differences between real estate agents earning $40,000 and those earning $170,000. The data shows that it boils down to four factors: experience, hours worked, real estate niche, and level of education.
The data shows that experience significantly affects how much a real estate agent earns. The longer you provide quality service to buyers and sellers in your area, the more likely you will enjoy referrals and repeat business.
According to the Colibri Real Estate 2023-2024 Salary Guide, those with 11 to 25 years of experience in the industry tend to earn the most. However, don’t be disheartened if you are just getting started. Other factors besides experience determine how much you will make.
It’s common for people entering into real estate to start part-time. After all, there are some costs to getting started in the industry (such as pre-licensing courses, licensing fees, background checks, etc.). Also, it’s scary for many to plunge into commissioned-based work, so some hold on to their day jobs as they get more comfortable with their new careers.
However, data supports that the more hours you spend each week on your real estate business, the more likely you will reap financial rewards. Those working 40 to 50 hours per week earn more than triple those working less than 20 hours.
If you’re putting in long hours without seeing an uptick in income, seek the help of a successful mentor to learn more about time-saving tools. Don’t get bogged down on menial tasks that do nothing to grow your business or serve your clients.
You may be entering the real estate industry with a particular niche in mind. If this is the case, we understand your reasoning. Real estate agents focusing on condos, commercial properties, and luxury real estate earn higher average incomes than agents who sell typical residential properties.
However, you can still do well as a real estate agent focusing on average homes in your area. Do you want to do well helping your friends and neighbors buy and sell property? Offer white-glove service and become the expert real estate advisor in your area.
Real Estate Agent vs. Real Estate Broker
In most states, a real estate agent with a good track record and a certain amount of experience can become licensed as a real estate broker. Of course, this requires that you take brokerage pre-licensing classes and pass an additional exam. However, becoming a broker can increase your income potential without working that many extra hours.
As a real estate broker, you can still earn commissions helping people buy and sell homes. However, you also receive a portion of other agents’ commissions by overseeing transactions.
The average full-time broker earns $233,639, while a full-time agent has an average gross income of $156,970.
Colibri Real Estate Can Help You Grow Your Real Estate Agent Salary
Colibri Real Estate (formerly Real Estate Express) will play a crucial role in helping you earn your real estate license. We offer pre-licensing courses for every state – as well as exam prep materials. Colibri Real Estate has helped hundreds of thousands of individuals become licensed real estate agents.
We at Colibri Real Estate are fully immersed in the industry. We help agents stay informed of best practices through our helpful Career Hub.
Finally, when you are ready to upgrade your license to serve your agency as a broker – Colibri Real Estate can help. We offer broker education for agents in California, Florida, Georgia, Illinois, Indiana, Massachusetts, Missouri, New York, and Texas.