Salary, Wages, Pay: Real Estate Brokers & Sales Agents

The median annual earnings of salaried real estate sales agents, including commissions, were $35,670 in May 2004. The middle 50 percent earned between $23,500 and $58,110 a year. The lowest 10 percent earned less than $17,600, and the highest 10 percent earned more than $92,770. Median hourly earnings in the industries employing the largest number of real estate sales agents in May 2004 were as follows:

Residential building construction $54,770
Offices of real estate agents and brokers 37,970
Activities related to real estate 32,460
Lessors of real estate 25,840

Median annual earnings of salaried real estate brokers, including commission, were $58,720 in May 2004. The middle 50 percent earned between $33,480 and $99,820 a year. Median annual earning of real estate brokers were $61,550 in offices of real estate agents and brokers and $44,920 in activities related to real estate.

Commissions on sales are the main source of earnings of real estate agents and brokers. The rate of commission varies according to whatever the agent and broker agree on, the type of property, and its value. The percentage paid on the sale of farm and commercial properties or unimproved land is typically higher than the percentage paid for selling a home.

Commissions may be divided among several agents and brokers. When the property is sold, the broker or agent who obtained the listing usually shares the commission with the broker or agent who made the sale and with the firm that employs each of them. Although an agentís share varies greatly from one firm to another, often it is about half of the total amount received by the firm. Agents who both list and sell a property maximize their commission.

Income usually increases as an agent gains experience, but individual motivation, economic conditions, and the type and location of the property also affect earnings. Sales workers who are active in community organizations and in local real estate associations can broaden their contacts and increase their earnings. A beginnerís earnings often are irregular, because a few weeks or even months may go by without a sale. Although some brokers allow an agent to draw against future earnings from a special account, the practice is not common with new employees. The beginner, therefore, should have enough money to live for about 6 months or until commissions increase.