Real Estate Agent and Trainer, Robert Rico, explains the different types of expenses a Real Estate Agent can expect. Do you want to see more video blogs? Subscribe here!


Welcome back to the CA Realty Training blog – your guide to everything real estate to steer you into the best career possible! This week we’re covering one of the most common questions for people looking at a new career – what is the payout and what are the costs?

Like any other self-employment, there are definitely some costs associated with being a real estate agent, and you are going to have to promote yourself as your brand to gain recognition and business. However, with the payouts and commissions, it’s definitely worth it to spend the money to make more money! There are a few mandatory costs, and a few optional costs – but the options are how you set yourself apart from the rest of the agents in the market.

Try not to worry too much about the startup costs, since these will basically all be repaid within your first deal. However, it’s good to get an idea of what they are:

  1. School Fee: $155-1,000
  2. School fees range anywhere from $155 to $1,000, more or less. CA Realty Training provides a super-quality education at a very competitive price. They are determined to help you pass the state exam on the first try!

  3. Livescan Fee: $80-100
  4. The state requires you to get a background check prior to taking the state exam. Livescan fingerprinting services range anywhere from $80-100.

  5. Exam Fee: $60
  6. The cost of the California Real Estate License State Exam is $60.

  7. License Fee: $245
  8. The cost of the actual Real Estate License is $245. This payment, along with the Exam Fee payment of $60 is given to the state as part of your application.

    Yay! Now you have your license! This is just the beginning of your journey…

  9. Brokerage Fees & Board Membership Fee: $300-600/year
  10. All brokerages take part of your commission once you close a deal. The best way to know how much your brokerage will take is by asking them!

    Most brokerages will want you to join the local Real Estate board, so you’ll have the fees from that, which will include memberships to CAR (California Association of Realtors) and NAR (National Association of Realtors). These costs usually total to around $300-600/year and is definitely worth the spend!

      • With NAR, you’re not just an agent, you’re a REALTOR! Look it up, it’s actually much better to have the REALTOR designation than just to be an agent.

      • CAR provides legal protections for CA cases. In addition, it provides access to Zipforms – this is where all your blank contracts, purchase agreements, and other forms will live! This is incredibly helpful for anyone trying to do their forms electronically.

  11. MLS Fee: $200/6 months, or $400/year
  12. The MLS stands for Multiple Listing Service. This is how you find houses for sales and post your listings, so this is a non-negotiable, Mr/Ms Real Estate Agent! The cost for this service is about $200/6 months, or $400/year. These fees are often included in NAR/CAR dues.

Everything we have listed above are your tools to make money, so they are definitely worth the initial outlay to ensure you have a full set of forms, legal protection, and associations that have your back. Even if you add every fee up, and add a couple extra for insurance etc., your total outlay is about $3,000-5,000/year – well worth it for a 6-figure income!

real estate agent expenses

The next class of fees is technically optional – or, we should say, more discretionary than the fees listed above. Though you don’t have to spend the money on these services, they are what set you apart from the pack as a good agent. As Head Trainer Robert Rico says, these expenditures are what separate a successful agent from one who’s just getting by – and you definitely want to be successful!

  1. Advertising/Marketing

  2. This is how you will promote yourself and your brand – definitely worth the spend. Stuff like this is what makes your business grow, so it’s always a good idea to get them now and get them nice!

      • Whether you choose postcards, mailers, business cards, or more, it’s worth the extra spend to get a set of nice paper goods – people will remember how your card feels in their hand, and will remember the paper quality if it’s exceptional.

      • A name-tag is a little dated nowadays, but it’s a great conversation starter since people don’t have them anymore – in Rico’s day, all agents used to wear them!

  3. Attire

  4. You will definitely want nice, professional-looking clothes as an agent. Yes, this costs money, but it’s also worth it. It’s an unspoken rule of real estate not to wear jeans to a client meeting, so upgrade that wardrobe if need be!

  5. A Motor Vehicle

  6. The car you’re driving is important – plus gas, mileage, and maintenance. You’re going to be driving to a lot of client meetings, possibly driving clients around town, and generally making an impression with your vehicle (it is your “outfit” until you step out of it). Just like your clothes, you’re going to want to fit in with your clients, seem professional, but not overly ostentatious. Also, you have to keep your car running smoothly – no weird noises when you arrive or leave a client’s home!

  7. Cell Phone/Internet

  8. Cell phone/internet/connectivity are very important! There are a lot of different companies that want to take your money every month to keep you connected. Unfortunately, you do have to pay at least one of them – and make sure it’s a good one! Your cell phone and internet connectivity (tablet/laptop/hotspot) are going to be crucial to your ability to contact leads, connect with clients, and facilitate deals. Don’t scrimp here! You must be reachable.

The last “cost” or, really, investment, is your time. This is the only thing that you cannot earn back, so make sure you’re spending your time wisely! It’s time away from your family, your friends, and other avenues you could possibly be pursuing to earn money. Are you going to make real estate worth it? Are you going to read this blog, follow our advice, and prime yourself for the best possible career in real estate? We certainly hope so!

Whether it takes time-blocking, scheduling, or even an assistant to keep you on task, it’s crucial to utilize your day efficiently so that you don’t get bogged down in the little things. It’s also very important to focus on new leads, since they are your future income – you can consider hiring a Transaction Coordinator if you really need one for your existing deals.

Hope you learned a lot this week, and make sure to check in next week for our next installment!


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