How Much Does a Real Estate Agent Make?

May 18, 2011

money

Ever wonder how much that real estate agent you constantly see on bus benches and your grocery store receipts makes?

Well, the National Association of Realtors (NAR) released some interesting data regarding just that. And it’s not really good news (surprisingly).

The study, titled “2017 National Association of Realtors Member Profile,” covers the approximately 1.22 million active real estate agents in the United States.

It found that the median income for a “Realtor” was $42,500, up from $39,200 in 2015. That’s a healthy 8.4% year-over-year increase, thanks to a fairly robust housing market (despite limited inventory).

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For NAR members in the game just two years or less, the median income was a paltry $8,930, while of those in the real estate business 16 years or more earned a median $78,850.

Very Few Real Estate Agents Earn Six Figures

  • There seem to be really big winners and equally big losers
  • In the residential real estate business
  • Top producers capable of bringing in $100k+, while many others do $10k or less
  • The typical agent closed 12 transactions throughout the year

But it’s not all bad. Of the real estate agents with 16+ years of experience, 38% earned more than $100,000 in 2016. Unfortunately, the average real estate agent only has 10 years of experience.

Then you’ve got the 56% of members with less than two years of experience who earned under $10,000 throughout the year, which kind of highlights the wide range of possible salaries based on the entrepreneurial nature of the job.

Essentially, you’ve got a large group of real estate agents who don’t close many if any transactions in a given year, then the heavy hitters who close the lion’s share of sales year after year.

That’s evidenced by their work rate, which ranges from 20 hours per week to some throwing down 60 hours per week or more. These top producers are the ones making a life in real estate.

The others might just be dipping their toes in the pool – we also have to consider the individuals who get licensed simply to close their own home, or to help a friend or family member.

This could explain the relatively low 12 transactions per year on average, which is just one per month.

Do Realtors Practice What They Preach?

  • Some 82% of Realtors own their primary residence
  • Which means they practice what they preach
  • This number has fallen in recent years
  • As a result of the massive housing crisis that took place

Largely, yes. Apparently 82% of Realtors are homeowners, and many others own an investment property, or at least one vacation home.

Additionally, a small percentage own at least one commercial property. So they’re aren’t just out there selling real estate, they’re buying real estate as well.

Oh, and the median gross household income for a Realtor was $111,400, which is well above the national median, so I suppose they marry well too!

For the record, 2017 wasn’t a particularly great year in the real estate world, so the numbers could be skewed somewhat.  But then again, real estate is cyclical, so bad years are expected (and should be calculated) along with the good over time.


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