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The Cost of Being a Real Estate Agent [Infographic]

Date post: 11-Aug-2014
Author: placester
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If you're like most people, deciding on a new career has lots of hidden cost and opportunities, but finding a break down of what is really involved in becoming a successful agent can be a challenge. This infographic is part of a series we are doing on being a real estate agent, what other agents are spending on advertising and marketing, what you can expect to spend yearly and how you might budget. Good luck. Let us know what you think. http://placester.com/academy/
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  • Gas & Maintenance


    AAA estimate for a medium-sized sedan. It may not sound like much, but many Realtors log more than 20,000

    miles a yeamiles a year.

    Auto Insurance

    $1,020 /year

    AAA estimate for full coverage on a AAA estimate for full coverage on a medium-sized sedan. The good news: many auto insurance companies offer

    discounts through the NAR.

    For agents looking to stay relevant and knowledgeable in a changing industry, competition comes at a cost.


    Average vehicle expense for Realtors in 2012, according to the NAR

    $1,790 /year

    Some less obvious expenses can take a significant toll on a real estate agents bottom line.


    Real estate agents put an estimated 3.6 billion miles on their cars each year, previewing properties and shuttling clients from house to house.


    Getting the word out about your real estate business is one of the most difficult aspects of the job. It can also be one of the most expensive, particularly for new agents trying to grow their customer base.

    31%of real estate agents spend over $1000 a year on online marketing efforts.

    17%of agents employ a marketing assistant.


    Real Estate Website

    $100-500 /month

    Whether itWhether its an IDX website with listings, a real estate blog, or both, a marketing website includes many smaller costs, including

    development and design, hosting, and SEhosting, and SEO.

    70% of agents say theyve had a website for at least five years.

    Online Advertising

    $100-500 /month

    PPay-per-click ads, Internet lead generation, social media, premium placement on big real estate sites, and other online sources now make up over 55% of agents total ad spend.total ad spend.


    $100-500 /month

    YYard signs, mailers, billboards, newspapers, and rack publications are just a few of the ways agents use print to get the word out.

    40% of agents still use direct mail marketing.

    Continuing Education

    $50-100 /year

    Each state real estate Each state real estate authority requires agents to take anywhere from 10-30 credit hours of continuing education every licensure cycle (typically 2-4 years).


    $50-1000 /each

    Conferences offer an Conferences offer an opportunity to network with other professionals and keep up with the latest trends in real estate technology.

    Additional Courses & Designations

    $100-500 /courseSupplementary Supplementary coursework adds expertise in niche markets and emerging technologies to raise your profile among local



    $VARIESYYour tax burden will vary based not just on your income, but also your location. Californians, for instance, bear a top

    income tax rate of 13.3%.



    The the NAR offers basic The the NAR offers basic coverage with its Realtors Core Health Insurance program, but those looking for better options to insure their families must contend with expensive individual with expensive individual


    Community Outreach

    $50-100 /course

    13% of agents (20% of 13% of agents (20% of those earning more than $100k) support the community through sponsorships like Little League, high school plays, and their local


    49%of real estate agents spend over $500 a year on education and training.

    16%of agents have worked with a real estate coach.

    Create beautiful real estateWEBSITES THAT WORK


    Built with indexable IDX for better online marketing, local search, and SEO. For expert help, visit placester.com










    Billboard designed by Casey Fluster from the Noun Project (http://thenounproject.com/term/billboard/19719/)

    Book designed by Diego Naive from the Noun Project (http://thenounproject.com/term/book/15474/)

    Building designed by Martin Delin from the Noun Project (http://thenounproject.com/term/building/5747/)

    Building designed by Martin Delin from the Noun Project (http://thenounproject.com/term/building/5747/)

    Car designed by Olivier Guin from the Noun Project (http://thenounproject.com/term/car/4699/)

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    Church designed by Alex Fuller from the Noun Project (http://thenounproject.com/term/church/27686/)

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    Desk Fees


    In eIn exchange for keeping all or most of your sales commission, some brokers charge a flat fee to use their desk space and branding. Some brokers may also charge transaction fees on some or all

    of an agents deals.

    Commission Splits


    While While 50/50 deals are common, commission splits vary widely

    depending on factors like experience and performance.


    $20 /month

    PPaper, ink, and business cards are just a few of the office supplies many agents must furnish.





    Broadband internet and smartphone services are essential for agents--and notoriously expensive.

    From contact management, to market analysis tools, to cloud storage, software costs can pile up for agents.

    Most real estate agents align themselves with a broker or firm, and must pay for the privilege. While brokers have a variety of ways to determine this cost, two compensation models dominate the conversation.


    Brokers cover some office expenses, but agents are often on their own for the rest.. Since many agents work outside the office, personal computers, mobile phones, and home internet services may also be considered business expenses.

    increase in IT budget for small and midsize businesses worldwide, January-June 201319%


    Licenses & Permits

    $100-500 /year

    Initial sales license and renewal fees vary widely from state to state.

    Realtor Association Dues

    +$120 /year

    While NAR membership While NAR membership starts at $120, state and local real estate boards add to this cost.


    $25-$100 /month

    Access to real estate Access to real estate data can come at a high price, and may include a startup fee.

    Like any profession, real estate is highly regulated. There are licenses to earn and renew, organizations to join, and a variety of other official hoops agents must jump through.


    Still, one number cant tell the full story. Thats why weve broken down all the expenses agents face. From ads to auto insurance, conferences to commission splits, here are the true costs of doing business as a real estate agent.

    When people talk about the real estate profession, they tend to focus on how much money agents and brokers can make. But have you ever considered how much it costs?


    Real Estate AgentTHE COST OF BEING A

    Realtors total business expenses

    are increasing rapidly.

    Total Costs 4800







    Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

    2011 2012




    $ $