How Do Real Estate Agents Get Paid?


Real estate agents are in the business of helping people buy and sell property. In return for their work, they typically earn a commission from each transaction. The more expensive the property, the more money an agent can make. However, it takes a significant amount of time and effort to market properties, negotiate deals and handle paperwork. For this reason, many real estate agents focus on lower- and mid-priced homes. However, those properties also tend to take longer to sell. Therefore, it is important for real estate agents to diversify their portfolio and to focus on both higher- and lower-priced properties.

According to the National Association of Realtors (NAR), the average commission paid to a real estate agent is 6% of the sales price of the home. However, the percentage is often negotiable between a listing agent and the seller. The commission may also be split between two agents or between one agent and their broker. In addition, NAR says that some real estate agents are willing to give discounts to their clients to attract business. Read more

Most real estate agents are independent contractors and receive their commission checks directly from the brokerage for which they work. The brokerage will not withhold taxes from these payments, so it is up to the individual agent to file quarterly estimated tax payments.

In addition, there are a variety of other fees and costs associated with real estate transactions. These can include marketing fees, listing and transaction services fees, referral fees and MLS fees. NAR reports that these fees can cut into an agent’s earnings.

As a result, some real estate agents only make four or six sales a year, while others fail to make any at all. This is why some people choose to become a part-time real estate agent instead of full-time.

For those looking to make a larger living as a real estate agent, it is important to work hard and build up a strong sphere of influence. This is the network of clients who a real estate agent serves. Once an agent has a solid sphere of influence, they can make much more than the national average for a real estate agent.

Real estate agents work hard to make a living, and while some struggle to find success, most do eventually see a payoff for their efforts. In addition to earning a decent income from selling homes, real estate agents can also make an even greater living by working as a real estate investor or by becoming a commercial property manager. Regardless of how an agent makes their living, getting your New York real estate license is a great way to start your career on the right foot. If you’re ready to learn more about earning your real estate license, contact us today. We can help you get started on your path to a successful career in real estate!



Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top