What range of income can I expect from my first year as a real estate agent in a fairly large city?

Question

I'm expecting to put in about 50 hrs per week. Also, how might that income change in year 2 and 3?

Answer 1

It really depends on the average price of the property you are working with and also your ability to acquire listings. In either case, be prepared to be without income for 6 to 8 months. Anyone who tell you otherwise doe not know what they are talking about. Yes there are a few success stories and in the last five years where the market just took off, you didn't need to be good. However, that is over. Only the good and profession one will survive.

The first day you report to work, you have no inventory. So you need to go out and get one. It will take you a little bit, say 2 weeks to 30 days. Now you need to get it sold and it is a buyer's market now. Lets suppose it takes you another 60 days to get it sold. Then you get another 45 to 60 days to get it closed. By the time you are done, 4 to 6 months minimum before you see a pay check.

Now, one listing doe not make you rich and famous. You need a lot of them. Forget about buyers. The biggest earners in this industry make the bulk of their earnings (80%) from other agents selling their inventory. 20% of their earnings comes from selling other agents inventory.

To calculate what kind of income you can generate, you may want to try this.....

Suppose your average price is $200,000 and your firm charges a 6% commission and that your commission split with your broker is 60/40. If someone sells you listing, you would be bringing $6000 as listing commission into the company. You will net out $3600.

Now let suppose the market is half way decent and that you are listing your inventory at plus or minus 5% of markey price. You should should achieve 30% to 50% sales rate, meaning for every 10 listing, 3 to 5 of them sells. So how much you can earn becomes a fucntion of how well you can acquire listing inventory that is priced right. If you do 1 listing a week, that is 50 a year. A 30% sales rate says you will earn 50 listings X 30% sales rate X $200,000X 3% X 60% split = $54,000 less expenses and taxes.

Now for the hard part, you receive a 1099 at the end of the year. While you can deduct legimate business expenses, which are a lot, you also have to make provision for taxes at the end of the year. I suggest for evey commission check you receive, put 10% away as your marketing expenses and 20% on your taxes. Good luck.

Answer 2

It is well to listen to that you've got a target and are operating on a plan to get there. Many folks your age could now not even don't forget this. Your state licensing fee must have a internet web site that lists all of its standards to get a salesman license. I think in Alabama you ought to be a minimum of 19, however it can be 18. Your state will more commonly be the identical. They may even have prelicense guides you'll ought to take earlier than you'll take the examination to get a license, in conjunction with different matters. If your finish target isn't to be an agent however a developer there could also be an simpler technique to gain knowledge of the industry. Try asking probably the most most sensible dealers for your discipline in the event you might paintings for them as an unlicensed assistant. That manner you're nonetheless in a studying atmosphere, gets to understand the method of marketing properties and meet all the essential folks you'll have got to understand with out spending a fortune your self. I could propose you're taking this direction at the same time you're taking your categories although you cross on your license. The extra revel in you'll get the bigger. Good good fortune, and if I can support with whatever shoot me an electronic mail. Josh

Answer 3

It all depends who you are dealing with, and what type of marketing you are going to be doing.

As far as income, the average yearly income for a Realtor in general is only in the $30,000.00 range. Yeah, i know, that sucks. So as far as your first year, you may be looking at a part time job if you don't get out there and do everything you can (legally and ethically) for a deal.