Real estate agents help people buy, sell and rent homes, and they’re among contractors’ most valuable referral partners, sending repair, inspection and remodeling work before and after every sale. The Bureau of Labor Statistics reported a median wage of $58,960 for real estate brokers and sales agents in May 2024, though earnings vary widely with sales volume.
The industry changed in 2024: following the National Association of Realtors settlement, offers of buyer-agent compensation were removed from MLS listings from August 17, 2024, and agents working with buyers generally need a written buyer agreement before touring homes. Clear value and clear agreements now matter more than ever.
The workforce
| Occupation | Jobs (2024) | Median pay (May 2024) | Projected growth, 2024 to 2034 |
|---|---|---|---|
| Real estate brokers and sales agents | n/a | $58,960 | n/a |
Source: U.S. Bureau of Labor Statistics, Occupational Outlook Handbook.
Market data
| Measure | Value |
|---|---|
| Buyer-agent compensation offers removed from MLS listings (NAR settlement) | from August 17, 2024 |
Business models compared
The figures below are illustrative months from our step-by-step guides, not industry averages. They show how revenue and costs typically fit together; your market, prices and costs will differ.
| Business model | Startup costs | Example monthly revenue | Costs | Profit before owner pay | Margin |
|---|---|---|---|---|---|
| Solo agent with a brokerage | Low: license, brokerage fees, MLS dues, marketing | $9,000 | $4,400 | $4,600 | 51% |
| Small team (lead agent plus 3 agents) | Moderate: team lead marketing, admin, CRM | $40,000 | $31,600 | $8,400 | 21% |
| Independent boutique brokerage | Moderate: broker license, office, E&O, technology | $60,000 | $49,300 | $10,700 | 18% |
Fixed and variable costs
For projections, the most useful split is between variable costs, which rise and fall with sales (materials, parts, hourly labor), and fixed costs, which you pay every month regardless (rent, salaried staff, insurance, loan payments).
| Business model | Variable costs (% of revenue) | Fixed costs per month | What it means |
|---|---|---|---|
| Solo agent with a brokerage | 30.0% | $1,700 | Low costs overall: time is the main constraint |
| Small team (lead agent plus 3 agents) | 55.0% | $9,600 | Mostly variable: profitable early, but watch cash flow |
| Independent boutique brokerage | 60.0% | $13,300 | Mostly variable: profitable early, but watch cash flow |
What the numbers say
Commission splits are the biggest cost. Agents share commissions with brokerages and teams.
Marketing drives volume. Lead generation and sphere marketing are ongoing costs.
Income is uneven. Closings, not months, determine revenue, so reserves matter.
The three models in brief
Solo agent. Working under a brokerage, building a sphere of clients.
Small team. A lead agent with several agents and an assistant.
Boutique brokerage. An independent broker with agents and office staff. See website design for real estate.
Cost structure: small team (lead agent plus 3 agents)
Each cost as a share of the example month’s revenue ($40,000):
| Cost | Monthly amount | Share of revenue | Type |
|---|---|---|---|
| Agent splits | $18,000 | 45.0% | Variable |
| Brokerage fees | $4,000 | 10.0% | Variable |
| Admin assistant | $4,000 | 10.0% | Fixed |
| Marketing and lead generation | $4,000 | 10.0% | Fixed |
| Office | $1,000 | 2.5% | Fixed |
| CRM and technology | $600 | 1.5% | Fixed |
| Profit before owner pay | $8,400 | 21% |
A first-year projection: small team (lead agent plus 3 agents)
New businesses rarely start at full speed. This projection assumes revenue ramps from 35% of the example month in month 1 to 100% by month 12, variable costs move with revenue, and fixed costs stay the same every month. It’s a planning illustration, not a forecast.
| Month | Revenue | Variable costs | Fixed costs | Profit | Cumulative |
|---|---|---|---|---|---|
| 1 | $14,000 | $7,700 | $9,600 | -$3,300 | -$3,300 |
| 2 | $18,000 | $9,900 | $9,600 | -$1,500 | -$4,800 |
| 3 | $22,000 | $12,100 | $9,600 | $300 | -$4,500 |
| 4 | $24,800 | $13,640 | $9,600 | $1,560 | -$2,940 |
| 5 | $28,000 | $15,400 | $9,600 | $3,000 | $60 |
| 6 | $30,400 | $16,720 | $9,600 | $4,080 | $4,140 |
| 7 | $32,800 | $18,040 | $9,600 | $5,160 | $9,300 |
| 8 | $34,800 | $19,140 | $9,600 | $6,060 | $15,360 |
| 9 | $36,400 | $20,020 | $9,600 | $6,780 | $22,140 |
| 10 | $38,000 | $20,900 | $9,600 | $7,500 | $29,640 |
| 11 | $39,200 | $21,560 | $9,600 | $8,040 | $37,680 |
| 12 | $40,000 | $22,000 | $9,600 | $8,400 | $46,080 |
Year one: revenue $358,400, profit before owner pay $46,080. The first profitable month is month 3. Cumulative results bottom out at -$4,800, which is the minimum cash cushion this plan would need, before any startup costs.
Team costs and marketing come before closings, so this illustration turns profitable in month 3, with a cumulative low of about $4,800. Real results depend heavily on market conditions.
How agents and brokers earn
- Commissions on closed sales, split with brokerages and teams.
- Buyer agreement compensation as negotiated with clients.
- Rental and referral fees where allowed.
A startup checklist
- Complete pre-licensing education and pass your state exam.
- Choose a brokerage and understand its splits and fees.
- Join the MLS and association where required.
- Build your sphere: past colleagues, friends and community.
- Set up a CRM, website and marketing plan.
Where the opportunities are
- Clear buyer representation after the 2024 changes.
- Neighborhood expertise and content.
- Investor and rental services.
- Partnerships with lenders, inspectors and contractors.
Key terms
| Term | Meaning |
|---|---|
| Buyer agreement | A written agreement between buyer and agent |
| Split | How commissions are shared with the brokerage |
| Sphere of influence | People who know you and may refer you |
| MLS | The shared listing database agents use |
Contractors are partners
Reliable inspectors, handymen, painters and roofers help deals close on time. Agents who build these relationships serve clients better.
Marketing a real estate business
Sphere marketing, local content, reviews and a strong website bring clients. See website design for real estate.
Plan for uneven income
Closings arrive irregularly. Keep reserves for slow months and taxes.
How to use these numbers for your own plan
- Start with the closest model above and its cost structure.
- Replace every price and cost with local quotes: insurance, wages, vehicles, materials and your expected prices.
- Estimate your ramp: how many jobs you can realistically win each month in year one.
- Separate fixed and variable costs, then calculate your break-even point with our free break-even calculator.
- Map cash month by month with our cash flow forecast, including equipment and loan payments.
- Build the plan in our free Business Planner.
These figures will also feed a planned Advanton projection tool, so you’ll be able to start from an industry template and adjust it to your situation.
About this data
Workforce figures come from the U.S. Bureau of Labor Statistics (Occupational Outlook Handbook and Occupational Employment and Wage Statistics, May 2024 and the 2024 to 2034 projections). Market figures cite their sources in the list above. Business model figures are illustrative months built from typical prices and costs to show how revenue, fixed costs and variable costs fit together; they are not industry averages or guarantees. We review these profiles when new government data is released, at least once a year. The same figures are available in a structured format for Advanton’s upcoming business projection tool.
Licensing and rules
State real estate salesperson or broker licenses; agents work under a supervising broker; written buyer agreements generally required before touring homes since August 2024; fair housing and advertising rules. Requirements change; confirm with your state and local agencies before you start.
Frequently asked questions
What do real estate agents earn?
BLS reported a median of $58,960 for brokers and sales agents in May 2024.
Do buyers need a written agreement?
Since August 17, 2024, agents working with buyers generally need a written agreement before touring homes.
What’s the biggest cost for agents?
Commission splits, followed by marketing.
How can I use these numbers?
Start with the closest real estate model, then replace every figure with your local prices, commissions, wages and expected volume.
Keep learning
- Solo agent with a brokerage
- Local SEO for contractors
- How to get more contractor leads
- Specialty trades industry data
Sources
- U.S. Bureau of Labor Statistics, Sales occupations (May 2024 median pay)
- National Association of Realtors, practice changes after the settlement
Last reviewed October 30, 2026. Startup costs are estimates; check local prices, licensing and tax rules before you commit money.
