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Real estate brokers and sales agents often work evenings and weekends and usually are on call to suit the needs of clients. A license is required in every US State and the District of Columbia. Although gaining a job as a real estate agent or broker may be relatively easy, beginning agents and brokers may face competition from well-established, more experienced agents and brokers in obtaining listings and in closing a sufficient number of sales.
Selling expensive items such as homes requires maturity, tact, and a sense of responsibility. Other sales workers who find these character traits important in their work include insurance sales agents; retail salespersons; sales representatives, wholesale and manufacturing; and securities, commodities, and financial services sales agents. The work of property, real estate, and community association managers, although not involving sales, requires a knowledge of real estate.
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In 2002, real estate brokers held about 99,000 jobs; real estate sales agents held 308,000. Many worked part time, combining their real estate activities with other careers. Almost 6 out of 10 real estate agents and brokers were self-employed. Real estate is sold in all areas, but employment is concentrated in large urban areas and in smaller, but rapidly growing communities.
Most real estate firms are relatively small; indeed, some are one-person businesses. By contrast, some large real estate firms have several hundred agents operating out of numerous branch offices. Many brokers have franchise agreements with national or regional real estate organizations. Under this type of arrangement, the broker pays a fee in exchange for the privilege of using the more widely known name of the parent organization. Although franchised brokers often receive help in training sales staff and running their offices, they bear the ultimate responsibility for the success or failure of their firms.
Real estate brokers and sales agents are older, on average, than most other workers. Historically, many homemakers and retired persons were attracted to real estate sales by the flexible and part-time work schedules characteristic of the field. These individuals could enter, leave, and later reenter the occupation, depending on the strength of the real estate market, their family responsibilities, or other personal circumstances. Recently, however, the attractiveness of part-time real estate work has declined, as increasingly complex legal and technological requirements are raising startup costs associated with becoming an agent.
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The median annual earnings of salaried real estate agents, including commissions, were $30,930 in 2002. The middle 50 percent earned between $21,010 and $52,860 a year. The lowest 10 percent earned less than $15,480, and the highest 10 percent earned more than $83,780.
Median annual earnings of salaried real estate brokers, including commission, were $50,330 in 2002. The middle 50 percent earned between $29,240 and $90,170 a year. The lowest 10 percent earned less than $17,920, and the highest 10 percent earned more than $145,600 a year.
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 usually is higher than the percentage paid for selling a home.
Commissions may be divided among several agents and brokers. The broker or agent who obtained the listing usually shares their commission when the property is sold with the broker or agent who made the sale, and also with the firm that employs them. Although an agent’s 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 ability, 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 beginner’s 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 usual with new employees. The beginner, therefore, should have enough money to live for about 6 months or until commissions increase.
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Advances in telecommunications and the ability to retrieve data about properties over the Internet allow many real estate brokers and sales agents to work out of their homes instead of real estate offices. Even with this convenience, much of the time of these workers is spent away from their desks—showing properties to customers, analyzing properties for sale, meeting with prospective clients, or researching the state of the market.
Agents and brokers often work more than a standard 40-hour week. They usually work evenings and weekends and are always on call to suit the needs of clients. Business usually is slower during the winter season. Although the hours are long and frequently irregular, most agents and brokers have the freedom to determine their own schedule. Consequently, they can arrange their work so that they can have time off when they want it.
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1. Source: U.S. Bureau of Labor Statistics
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