Real Estate Agent Salary and Career Opportunities in Real Estate
A real estate agent salary often relies on commission, or a percentage of the purchase price of the property, so the income of a real estate agent usually depends on their sales ability. Salary ranges vary depending on a variety of factors, including education, certifications, additional skills, and work experience. When interviewing for your next real estate agent job, it can help to understand salary prospects, commissions and splits, and other factors affecting potential salary. In this article, we describe the job commission calculation, average salary trends, how to increase real estate agent salary, and career opportunities in real estate.
What is the average real estate agent salary?
Real estate agents are compensated on a commission basis. The average real estate agent salary in Canada is $106,062. Typically, you'd calculate your commission as a real estate agent as a percentage of the sale price of the property. The average commission percentage is 6%. So, for a $600,000 property, the commission would be $36,000.
Not all transactions are subject to the 6% commission. Real estate agents who specialize in commercial property transactions may charge a commission of up to 10%. While some businesses offer standard commissions as low as 1%.
Understanding commissions and splits
Commissions and splits represent the different ways you will be compensated or paid your salary as a real estate agent. When you sign on with a brokerage, you will usually negotiate your real estate commission split with them. Initially, most brokerages offer a standard commission split to new agents. When you gain some experience or reach a certain level of production, your broker will usually increase your commission split. This is how the commission split works.
For example, assume you're selling a $600,000 home and the average agent commission in your area is 6%. First, the 6% commission is split equally between the buying and selling agents (3 percent for each of you). You get the full 6% if you represent both the buyer and the seller. Assume you are only representing the buying side. That 3% equates to $12,000 in revenue. You must now inform your broker of this. If you split your earnings 60/40, you'll take home $10,800.
Factors affecting the salary of a real estate agent
Your income is highly dependent on a variety of factors. The following are a mix of market conditions and personal decisions that will influence your income range.
Your level of experience can have impact on how much you earn as a real estate agent. This is often caused by the amount of meaningful network you have been able to develop during your career. In the middle of your career, you may earn between $60,000 and $80,000 dollars. This figure is influenced by other factors that affect your average earnings.
Your average salary as a real estate agent varies depending on the niche you are specialized in. A residential real estate agent's salary may be lower than that of a commercial real estate agent. In general, average real estate incomes are in the $70,000 range. Some niches, such as property management or affordable housing, have lower earnings, and others like commercial or relocation have significantly higher earnings.
The amount of commission varies greatly depending on where you live, and the average sales price in your neighbourhood. The commission rates are typically in the 3 percent to 7 percent range. The property location also affects the sale price. As a result, it affects your salary.
When job growth is strong and more people move to your area, home sales increase. Since the amount you get is based on the commissions from property sales, then your salary increases as a result. The general health of the economy affects the price of properties in this regard.
How to increase your real estate agent salary
Here are important tips on how you can increase your earnings as a real estate agent. You can implement all these tips while learning the business and making a name for yourself.
1. Build a unique brand
You can increase your salary by building a unique brand that caters specifically to the core needs of the right customers. It can be important for you to research your target audience and competitors, while also picking your focus and personality. This allows you to offer unique and quality services that'll make you stand out and ultimately increase the price you charge for your services.
The following tips can be beneficial in helping you build a unique brand.
Pay attention to details
Identify and offer clients unique value propositions
Improve your professionalism
Apply your brand across your business
2. Diversify your expertise
You can increase your income by offering multiple services that'll help you increase and diversify your expertise and portfolio. Think about supplementing your real estate income with other sources of income that will provide you with additional industry experience.
The following are a few options for supplemental income sources that will work well with your real estate career:
3. Have a mentor
Find a mentor in a field that you want to learn about. The average age of a real estate agent is between 30 and 65. This range affords you the opportunity to meet colleagues with decades of experience you can learn from. It can be beneficial to have a mentor because they'll provide you with much-needed practical advice, support, and encouragement to increase your income strategically.
4. Actively build a network
Building a network can help you increase your salary because it strengthens your business connections. Having a strong network gives you the opportunity of getting valuable information about important business deals ahead of your competition. Getting fresh ideas, raising your profile, and learning new ways to achieve efficiency are also benefits of networking that help you increase your salary.
You can build your network by joining notable communities of real estate agents and participating in activities your potential clients love.
Read more: Guidelines on How to Network
Career opportunities in real estate and their salaries
The various types of real estate jobs available today, as well as the typical real estate salary or income associated with each, are outlined below.
Commercial real estate broker
A commercial real estate broker is an individual who acts as a middleman for sellers and buyers of commercial real estate, assisting clients in the sale, lease, or purchase of commercial real estate.
In Canada, the average annual salary for a commercial real estate broker is $61,000, but annual incomes in this field can range from $41,000 to several million dollars per year, depending on annual closings. The average annual salary ranges between $41,000 and $120,000.
A commercial real estate appraiser assesses and establishes the monetary value of a commercial real estate and other assets. Commercial appraisers evaluate commercial properties such as office buildings, industrial centres, hotels, malls, retail stores, and parking garages, as opposed to residential appraisers who evaluate homes.
In Canada, an appraiser who works in the commercial sector makes about $59,115 per year.
Community development manager
Community development managers are in charge of expanding and improving community programs. They are aware of their society's interests. This could include requirements for new construction as well as needs for the reconstruction of existing facilities.
The national average salary for a Community Development Manager is $51,086 in Canada.
Commercial real estate loan officer
A commercial loan officer works for a financial institution, such as a bank or mortgage company. They assist businesses with which the bank has relationships to secure funding. They can advise clients on various loan packages and assist them in developing repayment plans.
Compliance Specialists are responsible for ensuring that businesses and other organizations follow all applicable regulations and standards. Because different industries are governed by different laws.
In Canada, the average compliance specialist salary is $63,000 per year or $32.31 per hour. Starting salaries for entry-level positions start at $45,518 per year, with most experienced workers earning up to $74,171 per year.