Do Realtors Make A Lot Of Money?


How do realtors earn income and whether that amount is a good amount of money that can be trusted is always in demand. Well, most buyers and sellers who decide to buy and sell their property can for once involve real estate agents in closing the deal. The real estate agent will help close the deal and earn their money from a commission based on the percentage of the home’s sale price. In this article, we’ve analyzed the numbers and determined whether real estate agents are making a good amount of money.

For a real estate agent, there are two methods of profiting from the sale of a home.

A real estate agent has a two-way contract with a client under which the agent has a fiduciary duty to meet the needs of the client in return for a commission from the client. The real estate agent can potentially profit from selling their own home. Well, it might not look like it when you’re at the closing table and watching your agent collect a big check for what seems like very little work. However, trust me on this. Behind the scenes, a lot of effort is being made. It is a very competitive industry. At the very least, the 80/20 rule applies in every given market. Eighty percent of agents fail or live on a subsistence level. Many, like aspiring artists, have part-time or full-time jobs to supplement their income while trying to be successful in real estate. So, on average, 20% of agents are successful.

There are also more reasons why real estate brokers don’t make a good living. In the United States, there are far too many licensed real estate agents. Many people are licensed only to transact or work part-time in industry.

A large majority of licensees carry out an average of only one or two transactions per year. This drastically reduces the average salary. Most successful full-time agents that I know of earn multiple times the average pay you listed, and they handle at least 10-12 transactions every year or more. To achieve and maintain this level of sales, an agent must rank in the top 10-15% in the profession. The best agents work hard and long hours, and it’s estimated that they can’t earn more than $ 40,000 a year.

Related: full-time or part-time real estate agents


The amount of money agents earn each year is determined by various factors including the number of trades they complete, the commissions they earn, and the agent’s allocation with their sponsoring broker. Below is how real estate brokers are paid and how much they earn.

Sources – Miggins Real Estate in New Jersey and John Kinnunen of Join eXp Realty


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