How Much Do Real Estate Agents Make?

There are a lot of questions about how much do real estate agents make. These inquiries come from people who are interested in getting into the business but don’t really know how to go about getting started or those who are interested in selling their home or buying their first home. The first thing that anyone interested in entering the business should do is research how real estate works and the kinds of rates that people make when they buy or sell a house. There is no limit to the amount of money one could earn with this kind of venture, though it is most common for agents to make a comfortable income through a percentage of the sale rather than a fixed rate.

Real Estate Agents Earn Real Estate Commission

The first thing to consider is this: Every real estate agent makes a commission on each home sold. The real estate agent makes more when there are more houses for sale and less when there are fewer houses for sale. The seller pays the real estate commission also but it varies according to the type of contract the seller has with the real estate agent. For instance, if the seller uses a general buyer commission, the amount that the seller pays to his or her real estate agent is different from the amount the agent actually pays the seller.

A Major Calculation of Real Estate Commission is Administrative Fees

There are many different factors that go into calculating how much an agent makes from a home sale. One of the biggest pieces of that calculation is the amount of money the agent makes from administrative fees. Administrative fees are things like property insurance, property management, mortgage, and real estate counseling. All of these costs add up and before you even start looking at the actual costs of a home sale you need to add those costs to the agent’s actual sales price.

The process of collecting buyer information, collecting sales information, and other preparation tasks that must be done before a real estate agent puts a house on the market can cost money. Some of those administrative fees go to the home seller and some are retained by the real estate agent. The seller retains these administrative fees for themselves and then they add that same amount to the final selling price of the house in order to make their commission.

Do Real Estate Agents Get a Portion of the Closing Costs?

While it’s true that most real estate agents get a percentage of the closing cost, there is a catch. Closing costs are not paid by the buyer and they don’t pay to the real estate agent before the deal closes. After the deal closes the real estate agent takes all of the profit from the closing cost and then adds it to the seller’s cut. It’s always good to ask a lot of questions when buying or selling a home so you can understand all of the real estate considerations that come with the home buying or home selling process.


So, when you ask how much real estate agents make in the real estate process, keep in mind that the more hours they work, the more commission they can earn. If you have a strong marketing program and good networking connections, you can also get paid much more than the average real estate agent. There are many ways to become a successful real estate agent. You just need to focus on your program and build your resume.