How Much Do Beginner Real Estate Agents Make? A Guide to Income Potential and Factors

Real estate is a popular and rewarding career choice for many people who want to help others buy or sell properties.

But how much do beginner real estate agents make in their first year? And what factors affect their income potential?

AN image of development manager
Development realestate manager [PHOTO COURTESY OF POSTREDI]
In this article, we will explore these questions and provide some tips on how to increase your earnings as a new agent.

Average Income of Beginner Real Estate Agents

According to a 2018 survey by McKissock, the average first-year real estate agent earns approximately $15,000. This goes up to $38,141 between years one and three.

However, these numbers can vary greatly depending on the location, market conditions, experience level, and work ethic of the agent.

For example, according to, the average first-year real estate agent salary per year ranges from $55,300 in West Virginia to $114,976 in Montana.

The national average is $94,586.

These figures are based on skill set, regional opportunities, and commission rates.

Another way to look at the income of beginner real estate agents is by the number of transactions they complete.

According to Zillow Premier Agent, the average commission per sale in the US is $9,169.This means that a beginner agent who sells three homes in their first year would earn $27,507 before taxes and expenses.An intermediate agent who sells seven homes would earn $64,183.

Of course, these are just averages and estimates.

Some beginner agents may earn more or less than these figures depending on various factors.

Factors That Affect the Income of Beginner Real Estate Agents

One of the main factors that affect the income of beginner real estate agents is the commission rate.

Commission rates are typically negotiated between the agent and their broker, and they can vary from 50% to 100% of the total commission earned from a sale.

a real estate agent

The total commission is usually split four ways: between the listing agent, their broker, the buying agent, and the buying agent’s broker.Another factor that affects the income of beginner real estate agents is the number of leads they generate and convert.

Leads are potential clients who are interested in buying or selling a property.

Agents can generate leads from various sources, such as referrals, online platforms, social media, networking events, cold calling, door knocking, etc.

However, generating leads is not enough. Agents also need to follow up with them, build rapport, provide value, and persuade them to work with them.

A third factor that affects the income of beginner real estate agents is the expenses they incur.

Being a real estate agent is not a salaried job, but a business that requires investment and overhead costs. Some of the common expenses that agents have to pay include:

  • Licensing fees
  • Broker fees
  • Association dues
  • Marketing costs
  • Advertising costs
  • Business cards
  • Signs
  • Flyers
  • Website
  • CRM software
  • Lead generation tools
  • Gas
  • Car maintenance
  • Insurance
  • Taxes

These expenses can add up quickly and reduce the net income of beginner real estate agents.

Therefore, it is important for agents to track their expenses and budget accordingly.

Tips on How to Increase Your Income as a Beginner Real Estate Agent


An image of a real estate agent
Real estate agent [photo courtesy of PInterest]
Here are some tips on how to make more money as a new agent:

  • Choose a reputable and supportive broker who can provide you with training, mentoring, resources, leads, and a fair commission split.
  • Build your sphere of influence by telling everyone you know that you are an agent and asking for referrals. Your family, friends, neighbors, acquaintances, associates, and social media contacts can be your best sources of business.
  • Leverage online platforms such as Zillow Premier Agent to get exposure to millions of buyers and sellers who are looking for agents. You can also create your own website and blog to showcase your expertise and listings.
  • Use social media to market yourself and your properties. You can post engaging content such as videos, photos, testimonials, market updates, tips, etc. You can also join groups and communities related to real estate and offer value.
  • Network with other professionals who can refer you business such as lenders, title companies, inspectors, appraisers, attorneys, contractors, etc.
  • Prospect daily by making phone calls, sending emails, texting, mailing letters, etc. to your leads and contacts. Follow up with them until they are ready to buy or sell.
  • Provide excellent customer service to your clients by listening to their needs, communicating effectively, negotiating on their behalf, solving problems, and exceeding their expectations.
  • Ask for reviews and testimonials from your satisfied clients and share them on your website and social media. This will help you build your reputation and credibility.
  • Invest in your education and skills by taking courses, attending webinars, reading books, listening to podcasts, etc. related to real estate. This will help you stay updated on the latest trends, laws, and best practices.
  • Deduct your business expenses from your taxes to reduce your taxable income and save money. Consult with a tax professional to learn more about the deductions you can claim as a real estate agent.


Being a beginner real estate agent can be challenging, but also rewarding.

The income potential is unlimited, but it depends on many factors such as commission rate, number of transactions, lead generation, expenses, etc.

READ MORE : How Long Is Real Estate School? How to Get Your License Faster


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