There is a direct correlation between a real estate agent’s salary and his or her experience. According to a 2014 survey conducted by the National Association of REALTORS® (NAR), new real estate agents made $40K less than agents with more than 15 years of experience, averaging around $30K per year.
Meanwhile, as you are making less money on fewer transactions than your more seasoned competitors, you are likely working without any extras and benefits that other professionals have. According to the same NAR survey, just 5 percent of real estate agents receive health coverage from their brokerage and only 33 percent are provided with errors and omissions insurance.
While being a real estate agent is continuously ranked one of the best jobs to have, the first year working as a professional can be rough for some. Making top wages in the real estate industry can often take a few years to master.
So what are you to do in the meantime? We put together our top 5 tips for how new real estate agents can boost their salaries during the first crucial years – all while learning the business and making a name for yourself.
#1: Increase your earning sources
As of September 27, 2017, the median annual real estate agent salary is $40,333, with a range that usually falls between $39,402 and $51,303, according to Salary.com. According to the National Association of REALTORS 2015 Member Profile, agents with 15 years of experience average substantially more, at $70,000 per year. If you have money in the bank it is much easier to get through those first few years.
Experienced agents will tell you that the best advice you can get to increase your salary is to start saving now. Being an agent gives you the freedom of being your own boss for the most part, but that also often means you are responsible for paying out of pocket for things like advertising, website management, transportation, and healthcare.
Secondly, you may want to consider supplementing your real estate income with other income sources that will bring you additional experience in the industry. The list below offers a few choices for supplementary income sources that will blend perfectly with your real estate profession:
- Property Inspections
- Providing BPOs
- Writing Contracts
- Apartment Manager
- Market Evaluations
Not only are these all good side businesses to bring in extra income for new real estate agents, but the experience you amass will put you on track to becoming a specialist in the field. It will help you build connections on the lending side of the equation and you will learn different facets of the real estate industry.
#2: Broaden your experience
More than 70 percent of real estate agents polled by the NAR had a specialty in a secondary real estate market. The majority of those specialists were brokers in residential real estate. Others included property managers, relocation specialists, and commercial brokers. If you are able to broaden your experience to include even more niche areas like real estate consultant, land development, or appraiser, you can boost your income.
#3: Earn your degree
A great number of real estate agents typically hold a degree in some area of business, sales, or marketing. Analysis from the NAR shows that real estate agents with a Bachelor’s degree or higher earned 5 percent more money than those without degrees and more degree holders made over $100K than those without a degree. Graduate degree holders made even more money than all others by more than 20 percent.
#4: Study under a seasoned mentor
The majority of real estate agents are between the ages of 30 and 65. Their experience as agents can help first-year agents get a head start on their counterparts by mentoring under an agent with decades of experience. Maybe even find a mentor in a specialty that you wish to acquire like a broker to start building your career for the future.
Many new agents also choose to join a team of agents where earnings are distributed among the group and it becomes a team effort to market and sell properties. This can be greatly beneficial for new agents looking to have a bit more stability.
It’s also important that you do your homework and find the right brokerage to work with. Look for one that will help you meet your goals as an agent.
#5: Continue your education
Besides having a Bachelor’s degree, continuing your education in the real estate field also equates to a higher salary, even for new real estate agents. By now, you likely know that you’re required to attend additional continuing education classes to maintain your license. However, you can also earn specialist designations in desired niches that can help you market yourself as an expert even when you’re new to the industry.
If you are looking for ways to push your new real estate career forward, start by checking out these and other ways to acquire licensing and professional certifications that will boost new real estate agent incomes.
Take your real estate salary to the next level
These are just a few of the many ways that new real estate agents can increase their salary with just a little bit of effort and time. We encourage you to tour the courses available via our website and welcome you to contact us with any questions you may have.