How to Make Millions as a Real Estate Agent

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Making one million dollars in a year seems like an impossible goal for many people. I am a real estate agent and I could not even fathom making that much money five years ago, but now it is one of my goals. One of the great things about being in real estate is there are so many ways to make money and there is no ceiling to how much you can make. As a real estate agent and real estate investor, I run my own business and the amount of money I make depends on how well I plan, the goals I set forth and the work ethic I possess.

The median income for a full-time Realtor is $54,000 a year, but many agents make much more money than that. My real estate team routinely sells over 200 houses, which brings in over $650,000 in real estate commissions from almost 25 million in sales volume. I did not personally make over $600,000, because I had to pay commissions to my team, I had expenses, and had to pay our staff. However, there are many agents all over the United States making at least one million dollars a year as real estate agents. The best part is you do not have to have a college education or even a high school education (depending on the state). You do have to work hard, plan well and be a great networker.

How much money do the best agents make?

Even though I think over $600,000 in gross commissions and 25 million in sales volume was pretty good, it is not even close to what the top agents in the country make. The top agent in the country had over $1,400,000,000 in sales volume in 2016 and the 250th ranked agent had over $60,000,000 in sales volume according to the Wall Street Journal top 1,000 agents. It is important to know the Wall Street Journal does not include all the top agents in their figures. They only count agents that apply to the Wall Street Journal or that they find through their own searches. Many top agents who do not apply or are missed by the publication are left off of the list and some agents ask not to be included as well.

It is not just the top real estate agents in the country that make a lot of money. My office has 45 agents in it and most of them are part-time agents. However, we had four agents who made over $300,000 last year.

How much in sales volume do you need?

Sales volume is the dollar amount of the homes sold by a real estate agent, not the money a real estate agent makes. On my REO listings, I get paid between 1 percent and 3 percent for selling a house and my average commission is about 2.7 percent of the sales price. It is important to remember there is no typical sales commission and all commissions are negotiable. If we use these same numbers as I have for the 250th agent in the country, they would bring in $1.6 million from a sales volume of $60,000,000. There is a good chance a retail agent who is not specializing in REO listings is making more than a 2.7 percent commission on each deal. We will assume they are making 2.7 percent to be on the conservative side.

The top agent in the country may be bringing in over $18 million a year in real estate commissions from 60 million dollars in sales volume. To sell that many homes that agent has to have a large staff and other agents that he is paying out of the 18 million.

Does an agent that sells $60 million worth of homes net over one million dollars?

Even though a real estate agent who sells $60,000,000 worth of homes will most likely make $1.6 million in commissions, they don’t get to keep all that money. A real estate agent has many costs and may have to pay a split to their broker if they do not own their own office.

A real estate agent that sells that many houses will also need help. Unless your average house sale is one million dollars or more, you must have help to complete that many transactions. I have two full-time assistants and I don’t come close to that much sales volume, but I also have a relatively low median price. A real estate agent will have to pay for marketing costs, MLS fees, staff, office fees, licensing fees and more which I discuss here. If you run a real estate team, you will also not earn all the commissions coming in, because you have to pay part of the commissions to agents on your team who are actually selling houses and doing the work.

A general rule of thumb in the real estate world is an agent needs to sell $50 million worth of homes to net one million dollars a year. Net profit is what is left over after all expenses are paid and is what is important to any business owner. Going by that math, there are at least 250 real estate agents in the country making at least one million dollars a year. However, when we consider some other factors, there may be many more agents making over one million dollars a year.

How many real estate agents make one million dollars a year?

It is hard to figure how many agents net one million dollars a year because the Wall Street Journal does not include every agent on their list. The expenses and team structure for every real estate agent is also going to be very different. Some agents may need $1.5 million in commissions to make one million dollars net and others may only need $1.2 million in commissions to net one million dollars. Another consideration is the Wall Street Journal list I have been discussing only includes individual agents. There is also a Wall Street Journal list that includes real estate teams. There are another 250 teams on that list with over $60 million in sales volume.

Even though the agents on a team split commissions, I would bet 95 percent of the team leaders are still making over one million dollars a year after expenses. That means there are at least 500 real estate agents making over one million dollars a year in the United States. The great part about running a team is you can have others do most of the work and make most of the money for you!

If you are interested in taking online classes, Real Estate Express offers very affordable classes in most states.

How many houses does a real estate agent need to sell?

To make one million dollars a year as a real estate agent you have to sell a lot of houses. However, how many houses you have to sell you depends on how expensive the houses you sell are. If your average sales price is one million dollars, you only have to sell 50 houses a year to make one million dollars a year. Most agents are not in an area that will allow them to sell 50 one million dollar houses a year. In my area, there aren’t that many million dollar houses selling in an entire year by every agent combined.

In my area, the average sales price is around $200,000, which would mean I would have I sell 250 houses a year to reach $50,000,000 in sales volume and make one million dollars a year. However, since I sell REOs, my sales price is lower than the median sales price. I would have to sell over 300 homes in a year to make one million dollars net. 300 houses is a lot to sell in one year, but it is possible and one of my goals! The top team in the country in 2013 run by John Murray, sold over 1,200 homes!

For a real estate agent with a median house price sale of $400,000, it gets much easier to make one million dollars a year. That agent would only have to sell 125 houses a year to reach one million dollars in net income. Selling over 125 homes a year is tough, but it is not an impossible task either. You would have to sell just over 10 houses a year to reach 125 sales for the year and two to three houses a week. Selling two to three houses a week takes time as an agent. You have to build relationships, generate leads and take care of your clients. If you do all of those things, it is not difficult to sell that many houses.

How likely is it to make this much?

It takes a lot of work, planning, and some luck to make one million dollars a year. Most agents won’t make $100,000 a year, as the median income is $54,000 for a full-time Realtor, but most agents are not good agents. They don’t take care of their clients, follow up with leads or plan their business. If you use systems, train your team and set goals it is definitely possible to make one million dollars or more a year as a real estate agent. Most real estate agents will never come close to making one million dollars a year, but remember most agents are part-time and most agents do not treat being a real estate agent as a business. I can almost guarantee you are not going to make one million dollars a year in the corporate world unless you become a CEO or get lucky with stock options. How long will it take someone to become a CEO and how much of their path is determined by their hard work or politics within a company? Real estate lets you create your own path to success with no one else to answer to.

How else can you make money?

This article has discussed how to make one million dollars a year from selling houses as a real estate agent, but real estate agents can do much more than sell houses. I fix and flip 10-15 houses a year and I wrote an article about what it takes to make one million dollars a year flipping houses. I also own 11 rental properties and I wrote about how to make one million dollars from rental properties here. I hope to make over one million dollars a year very soon, by using a mix of selling houses, fix and flipping homes, buying rental properties and income from other sources like BPOs and my blog. Even if you never get to a point where you can make one million dollars a year from just selling houses as an agent, simply being an agent opens up doors that will allow you to add income streams and make more money in other businesses.

Why I love the business

One reason I think being a real estate agent is better than working in the corporate world is that there is no ceiling with real estate. There is no limit to the amount of money you can make in real estate as an agent, investor or business owner. In the corporate world, it is going to be tough to ever make one million dollars a year unless you start your own corporation or become a CEO. I learned in college the way to become CEO is to work 80 hours a week for 25 years. I don’t want to work 80 hours one week out of the year, let alone for 25 years. Plus there is no guarantee you will make CEO or even keep your job in the corporate world.

There is no guarantee you will make one million dollars a year as a real estate agent either. I think you have a better chance of becoming wealthy by creating your own business than by working for someone else, and becoming a real estate agent is one of the best ways to start your own business.

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38 thoughts on “How to Make Millions as a Real Estate Agent”

  1. Mark, great post! I’m not a realtor, but I was considering getting my brokers license to get into property management. Maybe I should do real estate instead? I love houses and buildings, and am an investor, but a nice supplement would be RE commissions. Hmmm? Something to ponder. Anyway, nice write up.

    • Hi Marshall,
      You could always do both. Many property managers also sell.

  2. Mark, this is a great article. I’ve been interested in getting into real estate, and this is great motivation. Thanks!

    • Good to hear Michael!

  3. Hello, My name is Elena. I just started to work as a estate agent, Rental team. Everything is new for me.
    It’s a lot of property for rent, but it’s hard to find a client. I’m talking about clients with budget more than 1000 euros. Any suggestions what I can do? I use Google+, twitter, facebook page for now. But still I got only 4 clients with a budget not more than 400 euros.
    P.S. I work only 2 weeks for now, before it was training for 2 weeks.
    I will be happy to hear any suggestions.
    Thanks in advance.

    • Hi Elena,
      It takes a long time to build up business. You will get the best results from talking to friends and relatives and building up business through referrals.

  4. i am 13 yrs old and my dream job is a million dollar real estate agent and this helped so much!

    • That is awesome Sofia! It is funny when I was growing up I wanted nothing to do with real estate. lol

  5. Hi Mark,
    I am an Asian from Phils and have experienced as real state agent for 2 years, now Am here in Canada since July 2014 and not yet a P.R in this country. I have an absolute plan to get involve into real state business. My question for now is, what are the requirements as a part time agent?
    Your response will be very much appreciated.

    Grace

    • Hi Grace, they will depend on your goals, your broker and many other factors. The best thing to do is start talking to real esate offices where you are located

  6. Mark, great article! I am a newly licensed agent in Southern California. I am highly motivated but your article just pushed it up a notch. Thank you!

    • Good to hear!

  7. This was awesome info

    • Looking at the name you put in I would say keep reading the real estate agent articles on the site!

  8. making millions as a real estate agent seems easier than before. I have a friend who sold over 100 houses here in Nigeria in a year worth billions via online marketing. From my chat with him, he only spent few buck on PPC advert. Nice tips, your article is quite insightful. Thanks

  9. Good staff, so helpful

  10. Hi mark excellent
    I am in real estate from 5 year no success
    Money what I should do.
    I need to change company or ???

    • That all depends on what you are doing now, what have you tried, how big is your database, how do you market, etc. What does your company do for you now?

  11. I am going to be starting college soon and I am heavily leaning towards becoming a realtor, but I’m scared that I won’t be successful and that I will regret my decision of studying to become one. I want to be able to have a somewhat stable income, at least enough to where I won’t have to struggle and worry about finances. Do you think I should go for it?

    • I can’t tell you one way or another. I think real estate is an awesome career, but you have to be a bard worker and smart worker.

  12. I truly do enjoy your articles Mark! There is one thing I am a bit confused about though… Why would you so persistently promote an online RE company that is shown to have terrible reviews from all of its users? Do you have an in with Real Estate Express and do they simply pay you to advertise for them? Or do you honestly stand behind their company?

    • Hi Tiffany, I do have agreements with some advertisers and some affiliate agreements as well. I would not say that real estate express has bad reviews from everyone. it is tough to review a real estate school, because people are only going to go to one school in most cases and real estate classes are not exciting by any means. Three of my agents on my team used real estate express and had no problems with them. They were also one of the cheapest options available.

  13. Hi Mark. I’m almost 18 an I want to make a difference in my life. I have a simple life plan of where I want to be in life for the far future, it’s a simple plan but it won’t come easy an I know that, but I’m willing to work for it. I strongly believe that getting into the real estate business is what is going to kick start me off to help me expand an improve in life. I love homes (houses/flats) an I know a good looking home when I see one. All i want to know is simply where do I start? What is the best/most rewarding possible way to get into the real estate business?

    • Do you want to be an agent or investor?

  14. Want to be an agent to help me invest

  15. Hello Mark, Thanks for the write-up. I have been an agent for 10 years now. Working it P/T for 6 years and then switched over to F/T for past 4 years now working with Keller Williams Realty. I have been thinking of getting my Brokers license and only need 3 classes to be able to take the state test. What are your thoughts on venturing out on your own VS. staying with a brokerage after getting my brokers license?

    • It all depends on your goals and the support you need. I don’t want my own office, but I love having my own team

  16. hello my name is Kortu and my goal is to work at least 5 years as a real estate agent after earning my bachelor than start my own business and company. I would love your import on how i will start working as a real estate agent as soon as i graduate and also an email from you on how i could or can start my plan as a business and also achieve it.

    • I would start right away taking real estate classes so when you graduate you can hit the ground running.

  17. Nice post, Mark! I like how thorough you are with your examples. Very helpful.

    • Thank you!

  18. I am getting reading to take my real estate here in Tennessee, and I was wondering if you knew of any good agencies down here. It is really hard to figure out which agency would be the best for me, because I don’t want too large of a group, but ideally I would like to make 200,000 a year a least. The houses near me sell for about 400,000+. I’m just not really sure where to get started to work towards that goal.

    • You need to check with each broker.

  19. Thank you for information into this business. I am willing to do the work. I passed my crash course ( one week) school of RE exam and now scheduled for the Florida RE exam with PearsonVue in May. Your article is very encouraging and what I needed to read more than so many others online. I just don’t want to make others( like CEO’s) rich anymore in their businesses. As a Registered Nurse in a hospital, I have a strong work ethic and very good with people. I believe I can do this. Its time to enrich me now. Something just clicked in me and I am making a change.

    • Good luck!

  20. I’m a middle-class working guy, I’m thinking to invest on real estate. How much % will I invest in real estate? Which type of investments are safe(Land or Houses)

    • What %? I am not sure what you are asking. Usually houses are much better

  21. Hi Mark,
    I really liked your book on Real Estate investing and am almost ready to take my states Real estate Exam. One thing I think about though is how much does the saturation of real estate agaents in certain area ( my area being Southern California) affect a realtors ability to break into the market and continuously grow your business? It is like the “cream rises to the top” no matter the competition or is it like a grocery store which needs an average of 13,000 people of population per store to survive or a combination of the two? I appreciate your help. Thanks Mark.

    • Thanks Taylor, The cream rises to the top! It is tougher in a market with many agents, but most agents are not very good.

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