The ACTUAL Cost of Becoming a Real Estate Agent

So, you’re thinking about getting into real estate to make a quick buck? Maybe sell a house or two a year just to fund a nice vacation? Sounds easy, right? Well, let’s break down some potential expenses and my actual expenses from last year so you can get a clearer picture of what it really takes to be in this business.

Potential Expenses for Getting Started as a Real Estate Agent

• Pre-licensing course: $398

• Real Estate Exam: $100

• Real Estate License Application: $350

• LiveScan Fingerprinting: $49

• National Association of Realtors (NAR) Membership: $972

• Brokerage Agent Business Service Fee: $2,600

• Bareis MLS Access: $554

• Supra eKey (to access lockboxes): $236

• Lockbox: $130

• Google Suite (business email, storage, etc.): $86.40

• Website Hosting & Maintenance: $145

• Email Marketing Software: $209

• Business Cards: $35 for 100

• Professional Headshots: $250

• Custom Open House Signs with Name Riders: $125/each (need 3-4) = $375

Potential Getting Started Expense Total: $5,916.40

And here’s the kicker- some of these expenses must be paid upfront in full, while others can be spread out monthly. Either way, this isn’t a career where you can just dip your toes in without financial commitment.

Potential Transaction Fees

These fees are most likely costs you’ll incur as a listing agent when you are trying to sell a house. There are a lot of things involved in marketing a property and these are some of those costs:

• Photography - $200 to $1,000

• Matterport or 3D Walk Thru - $300 - $600

• Live Video - $500+

• Property Website - $50+

• Property Brochures $40+

• Property URL Rider - $25

• Postcards - $200+

• Listing Launch Support $150 - $300

• Transaction Coordinator $450 - $550

Potential Transaction Expense Total: $1,915 on the lower end

Brokerage Fees & Splits

In California you’re required to join a brokerage when you first get started. After you take your exam, you essentially don’t know much about the day to day operations of being a real estate agent. Enter the brokerage you chose. If you pick the right one, they will help you get your business off the ground by providing you with tons of training and support. Each brokerage has their own unique fees and splits will vary based off your sales. Here is an example of my brokerage fees:

• Commission split: 70/30% (this varies but if you’re brand new this will most likely be where you’ll start)

• Administrative/franchise fee on each transaction: 6% (which makes your split closer to 60/40 to start)

• Business Services Fee: $2,400, paid annually or add $200 to pay monthly. Includes:

  • individual agent website, powered by Moxi

  • custom brokerage email address with Gsuite

  • 250 business cards

  • training & support

Total: Varies

My Personal Expenses as a New Real Estate Agent in 2024

You’ll see that some of the expenses from above are things I have yet to purchase. I’ve been lucky enough to borrow fellow realtors open house signs and other items. Please note that that there are certain things I chose to pay for like my own website, gsuite, and coaching.

• National Association of Realtors (NAR) Membership: $972

• Brokerage Agent Business Service Fee: $2,600

• Bareis MLS Access: $554

• Supra eKey (to access lockboxes): $236

• Lockbox: $130 (*not necessary to start)

• Google Suite (business email, storage, etc.): $86.40 (*not necessary)

• Website Hosting & Maintenance: $145 (*not necessary)

• Email Marketing Software: $209 (*not necessary)

• Business Cards: $35 for 100 (*brokerage paid for)

• Professional Headshots: $250 (*I already had headshots)

• Custom Open House Signs with Name Riders: $125/each (need 3-4) = $375 (*not necessary to start)

• 1:1 Business Strategy Intensive: $250 (*not necessary)

• Group Coaching for Realtors: $1260 (*not necessary)

My Total Annual Expenses: $6,312.40 {monthly breakdown: $526.03}

If you can afford to drop around $500 per month on your business without seeing immediate returns, then maybe just maybe you’re ready to jump into this easy cash cow career. But if you were hoping to sell one house a year and call it a day, you might want to rethink your strategy. Real estate can be rewarding, but it’s a business that requires investment both in time and money long before you see the big commission checks.