Real estate agents can make a decent living, but there is no one set formula for how much they make. There are a lot of factors that come into play and the amount they make in any given market, region, and property type depends on many different things. As with most jobs, the compensation of real estate agents is influenced greatly by their level of experience, education, and willingness to specialize in a particular subcategory such as commercial real estate or residential leasing.
The median annual wage for real estate brokers and agents was $56,240 in 2021. Keep reading to learn more about what that equates to on a monthly basis and what factors influence how much real estate agents Hall Green can make.
How Much Does a Real Estate Agent Make Annually?
The two primary factors that will determine how much you can make as a real estate agent in Hall Green are the type of property you work with (single-family vs. commercial) and the volume of clients you work with. With single-family homes, the average sales price was $319,100 in 2018, which represents an average commission of about 3.5%.
For condos or townhouses, the average sales price was $284,100 and the average commission was about 3.5%. For commercial properties, average sales prices can vary widely depending on the type of property and the location. As mentioned above, the way commission is calculated can vary depending on whether you are a full-time or part-time agent. Part-time agents often get a fixed rate per sale while full-time agents get paid a percentage of the total sale price.
Mergers and Acquisitions
As with any business, the real estate industry is cyclical and experiences cycles of growth and contraction. In times of high growth, real estate agents can be at the forefront of change and see a lot of upward mobility due to the sheer volume of transactions. When periods of growth subside, competition can be fierce in a market where deals and transactions are fewer and farther between.
Agents who are able to specialize in particular areas and expand their network of clients during times of growth can often sustain themselves during times of contraction by keeping their base of clients intact and providing them with continued services.
Licensing and Accreditation
Different states have different requirements for licensing and accreditation of real estate agents. The National Association of Realtors offers a search tool to help agents find out what their licensing requirements are, as well as what is needed for particular states.
Aside from licensing, agents who have completed higher education and training in real estate can also expect to earn a higher wage than those who have not. Some colleges offer online degrees for real estate agents in partnership with the National Association of Realtors, which can be a great option for working professionals who want to earn a higher wage.
Networking and Advertising
Advertising and marketing are two of the biggest expenses that real estate agents face on a regular basis. Agents who can develop a strong social media presence and network with other real estate agents in their area can often grow their client base organically and at little to no cost.
Advertising can come in many forms, from print media like flyers and newspapers to online media like Facebook ads. All advertisements should include the benefits of working with the agent, their contact information, and any credentials or accreditation that they might have.
Rent, Commissions and Marketing Costs
Many real estate agents in Hall Green opt to rent an office space to conduct their business rather than work from home. While this can be an initial financial expense, it can also provide a professional office environment that can be conducive to growing a thriving business. Agents who are able to grow their client base while keeping expenses low can often find a sustainable way to make a living as a real estate agent.
Most real estate agents get a commission when they close a sale, but some agents also get commissions on the monthly rent that the property owner is paying. This is called a property management commission and can be a great source of secondary income for real estate agents who have the expertise to manage properties for clients.
Summing up
Real estate agents have many different factors that go into determining how much they can earn, but with hard work and a focus on providing high value to clients, agents can earn a good living with relatively low barriers to entry. Real estate agents can make a great amount of money, especially in the short term.
