Everything You Need to Know About Real Estate Agent Salaries

Everything You Need to Know About Real Estate Agent Salaries

by The CE Shop Team

Learn Real Estate Salaries by Location & How Commission Works

Almost all decisions in life come down to money. The earning potential is one of the main reasons that people become real estate agents. On top of the freedom that comes with being your own boss, the real estate agent salary that comes with it is alluring to many. How much do real estate agents make? There are multiple factors that play into real estate salary, but the most important is location. Where you practice real estate drives how much you can make. This easy to follow guide lays out what you need to know about real estate agent salaries and how much you could make in your state.

How Much Do Real Estate Agents Make In Each State?

How much you make as a real estate agent really does depend on where you live. The hotter the market, the more you can make. According to ZipRecruiter, the national average real estate agent salary is $83k a year. Obviously, those figures will get swayed by the markets on the higher end. How much does a real estate agent make in your state? Here’s a breakdown of each state and how much real estate agents make throughout the country.

States with Real Estate Agent Salaries Between $60,000-$79,999

State Salary
Kentucky $79,502
South Dakota $79,315
New Jersey $79,143
West Virginia $79,047
Pennsylvania $78,665
South Carolina $78,257
Minnesota $78,186
Oregon $77,997
Delaware $77,986
Tennessee $77,931
Colorado $77,882
Montana $77,825
Ohio $77,369
Wisconsin $77,185
Arizona $77,024
Kansas $76,692
Utah $76,658
Indiana $76,530
Oklahoma $76,409
Idaho $76,193
Maine $76,136
Louisiana $75,826
Iowa $75,045
Georgia $74,305
Texas $73,451
New Mexico $73,292
Michigan $73,107
Arkansas $73,053
Illinois $72,655
Alabama $72,566
Mississippi $71,832
Missouri $71,663
Florida $70,034
North Carolina $66,687

States with Real Estate Agent Salaries Between $80,000-$90,000+

State Salary
New York $90,928
Massachusetts $90,068
Washington $89,440
New Hampshire $87,658
Hawaii $86,504
Maryland $83,472
Connecticut $83,446
Rhode Island $82,767
Alaska $82,660
Vermont $82,317
Nebraska $82,213
Nevada $82,011
North Dakota $81,701
Wyoming $81,630
California $81,498
Virginia $81,135

The Top 10 Highest Paying Cities For Real Estate Agents

What about specific cities and how much real estate agents make there? Again, the hotter the market, the higher the real estate agent salary. Here are the top highest paying cities for real estate agents, according to ZipRecruiter. To the surprise of no one, six of the top 10 highest paying cities for real estate agents come from California.

State Salary
San Francisco $97,047
Santa Rosa, Calif. $93,299
Seattle $89,995
Boston $89,553
Washington, DC $89,440
Los Angeles $87,773
Orange County, Calif. $85,166
Chicago $84,862
San Diego $84,724
Sacramento $84,436

Understanding Real Estate Commission

Now that you know much you can make as a real estate agent, you’re probably curious about how real estate commission works. In the most general sense, commission determines your income. That means a “salary,” per se, is rare. How much you make as a real estate agent is determined by the size of transactions you’re involved in. Needless to say, the more transactions you put forth, the more money you’ll make.

The United States Department of Housing and Urban Development (HUD) established a 6 percent commission to sell houses, which is then split between the buyer’s agent and the seller’s agent. That leaves you with roughly 3 percent of the sales price, which, with a median U.S. home price of $227,000, equates to a $6,810 commission before brokerage costs and taxes.

To break that down: if you sell 10 homes at the median home price, you’ll gross $68,810 for the year. The national average real estate agent salary is $83k a year.

How Long Before You Start Making Money As A Real Estate Agent?

In order to make money as a real estate agent, you must first meet all of the requirements in your state. The process varies by where you live, so it’s important to know your specific requirements. After that, you make money as soon as you're fully licensed and working underneath a broker or employing broker. The rest is up to you.

If this is a full-time job, you can devote the hours needed to have more transactions and thus make more money as a real estate agent. If you’re a part-time real estate agent or working real estate as a weekend gig, you can make enough to stow away in your savings. That’s one of the major benefits of the real estate industry: it’s up to you. The flexibility is one of the major reasons people want to become real estate agents. Well, after the salary you can make, of course.