If you’re looking to start your dream career in real estate, this is probably one of the questions you want an answer to.
While it’s important to know whether real estate agents get paid hourly or in some ways, you must also understand the different factors affecting the realtors’ compensation plans.
Truth is, real estate professionals are usually middle-class individuals who don’t make a lot of money but dream of living in a nice, comfortable home one day.
Well, the good news is that this dream can come true, and as a realtor, you don’t have to be a millionaire to purchase a home.
Often, small loans and even second mortgages are available for those who wish to buy homes but don’t have enough money saved up.
In essence, people want to know how much real estate agents make per hour and if they can afford a home this way.
The answer is that although some real estate agents are paid hourly, most of them do not work for an hourly salary. Most of the time, they receive either a flat rate or commission for selling homes.
I have prepared this blog post to exhaustively tackle this question and respond to other queries relating to how real estate agents are paid. This article covers the following areas:
- How Much Do Real Estate Agents Make a Year?
- What Is the Average Commission for a Sale in the United States?
- How Much Money Can You Make as a Real Estate Agent?
- Do Most Real Estate Agents Get Paid Hourly, Flat Rate, or Commission Only?
- Can Real Estate Agents Make Big Bucks Any Other Way?
- How Long Does It Usually Take to Become a Real Estate Agent?
- Is the Job of a Real Estate Agent Secure or Will It Be Phased Out?
- Conclusion
How Much Do Real Estate Agents Make a Year?
The salary of a real estate agent can vary depending on how successful they are and which state they work in.
According to the Bureau of Labor Statistics, the average annual salary for entry-level agents is around $45,990 per year, while experienced agents can make up to six figures.
In general, it’s safe to say that a real estate agent’ salary is not a constant figure as it varies from one agent to another.
The variation is due to several factors that make different realtors unique. For example, some real estate agents receive specific bonuses for selling homes, which can be a large part of their earnings for the year.
What Is the Average Commission for a Sale in the United States?
The average commission paid out to licensed realtors in the United States is 6% of the home’s total sale price. This means that if a house were sold for $250,000, the realtor would receive around $15,000.
This figure is taken from the total amount paid to the seller, including closing costs and other fees.
However, commissions can be as high as 8% or even 10% of the sale price in some states. Aside from the commission price, additional charges can be brought forward.
For example, any additional fees required by the state where a home is being sold would be passed on to a realtor if they were the one responsible for them.
How Much Money Can You Make as a Real Estate Agent?
The salaries for real estate agents can vary greatly depending on their career status, how much experience they have, and if they can secure any bonuses.
There are also other ways to make money as a realtor aside from commissions or flat rates.
As stated earlier in this article, the average salary for entry-level realtors is around $45,990 per year, while experienced agents can make up to six figures.
Naturally, anyone who makes six figures in the United States is doing well financially. However, some realtors might not make as much money as those at the top end of their field.
Do Most Real Estate Agents Get Paid Hourly, Flat Rate, or Commission Only?
In general, most real estate agents start off working on a commission-only basis, and many continue to do so for the duration of their careers.
However, there was a time in history when most realtors were paid hourly before commissions were introduced.
The truth is that it’s up to the individual realtor to decide how they want to be paid.
This could be through commissions only, flat rates only, an hourly rate, or some combination of all three payment types depending on what kind of business transaction is being done.
Can Real Estate Agents Make Big Bucks Any Other Way?
Yes, real estate agents can make big bucks even if they don’t receive commissions or flat rates for their work. Fortunately, there are several ways that a realtor can increase their earnings without selling any homes at all.
The three biggest ways to become a high earner as a real estate agent come from the sale of properties, outside contracts that may be available, and referrals.
For instance, a property manager needs to buy or sell homes. What they would likely do is turn to a real estate agent first.
Some real estate agents might end up working on referral bases where they would receive a commission from other agents.
Finally, some people who don’t use the services of an agent may see them as someone competent enough to refer others.
How Long Does It Take to Become a Real Estate Agent?
It takes around eight weeks to become a real estate agent in the United States. But this is just an estimate as some states can take longer for no apparent reason.
For example, New Jersey mandates at least one year of education before taking their license exam, while Louisiana requires three years.
Becoming a realtor is not an easy job since it requires both knowledge and experience before anyone can be called one.
To acquire this knowledge, would-be agents must first go through training, depending on where they live in the United States.
With that said, it’s crucial for anyone who wants to become a realtor to do their due research and find out what kind of training and licensing they will need to prepare themselves for this occupation.
Once you know all the requirements needed to work as a real estate agent in your area, the next step would be to find an agent willing to supervise you.
The learning curve for realtors who want to work as independent contractors is steep as they must learn how to list properties, advertise themselves online and offline, deal with property inspectors, and more.
This means that most people choose an agent over going down this route.
What Is My Real Estate Career Outlook?
Becoming a real estate agent can be a rewarding job. To be a successful realtor, you have to work hard, stay on top of your game by keeping yourself updated with the latest technology and methods, and network with other people.
Is the Job of a Real Estate Agent Secure or Will It Be Phased Out?
To answer this question, it’s important to note that people are still buying homes despite the adverse current economic state. Many families would like to own their own homes, and many individuals desire the same thing.
What’s more, there are always new developments taking place worldwide where people can buy homes to either live or rent them out.
These point towards a promising future for real estate agents as long as they continue to adapt to changes in this industry.
Conclusion
By looking at all the factors discussed above, you can easily know whether real estate agents are paid hourly, on commission, or at a flat rate.
Although most commissions are set in stone, it’s not truly unusual to find agents receiving hourly wages. This only means some get paid one way or another depending on the job they perform for their clients.
Anyone who wishes to become a real estate agent should note that this position requires a lot of hard work and dedication since many aspects are involved in selling homes.
Also, agents must learn many different skills to be considered competent in the eyes of potential buyers or sellers because, without experience, nothing else will matter.
