How Do Real Estate Agents Make Their Money?

It is quite common to hear these days that just about anyone can become a real estate salesperson with minimum qualification required and knowledge about real estate.

To discuss in simple, you can be a teacher or a worker who is occupied during the day but becoming a real estate agent creates an opportunity to make money in evenings and even in the weekends.

Of course, it is not my intention to discuss something about real estate or real estate agency but, I am keen to push something more important i.e about How do real estate agents make their money.

Let us discuss this!

The first and the most common method that a real estate agent makes money is through the sharing of commission with the broker.

This is one of the finest and the traditional methods of acquiring money as a real estate agent.

To understand this further, the broker is the boss to a real estate agent where a broker is the manager of a real estate office.

So, each real estate agent works for these brokers. An agent can work from home or at the office yet ultimately he/she has to report to these brokers.

Hence, the commission for each agreement or sale shall be shared among the broker and the agent. There exist a couple of factors that shall be considered for the commission sharing.

The rate at which the real estate broker provides the assistance to the agent and the sale that was done by the real estate agent are the major factors that decide the percentage of the split.

The other method through which a real estate agent can make money is that in which 100% commission shall be taken by the agent for each sale made.

But he/she is required to pay something to the office for working under the brand name of an office, according to the agreement they hold together during the hiring process.

This could be a monthly fee or as per the terms. Finally, the most popular ways of getting paid as a real estate agent are through referrals.

For example, if you are serving as a real estate agent in one state where you have to sell a property in a state to which you don’t have a hold.

Hence, you will transfer this sale to another agent who is in the state where the property needs to be sold. In this way, you can get some commission for referring this sale to another agent.

Thereby, if you are really interested in getting educated and working as a real estate agent, a strategic and simple approach can put a good amount of money in your pockets.