Though I live in Los Angeles, I came across a Craigslist ad for Coldwell Banker real estate office in St. Louis Missouri that said the following.

“A Real Estate Career is not a job. It is a business. You become a licensed professional that is in control of your own inventory and business plan. A real estate professional is an independent contractor who has high goals for a high income. Many of our professionals are currently earning over $100,000 in annual income. You can achieve the very same result.”

Does this sound too good to be true in today’s national real estate market? Keep in mind, I do not have a real estate agent license at all.

Wilson

I would ask them to number 1, define "many"..... number 2, how long have they been in the business, number 3, how many hours do they spend a day working their business, and number 4, how much money do they spend per year to make that income (fees, marketing, etc.)

I know two very good agents in my area who do indeed make six figures...but they also spend close ts $30,000 in marketing, and they've been in the business 8 - 10 years at least and one of them has a degree in marketing from her previous career.

That said, I made a LOT of money last year, (I got licensed in 2007) not six figures, and not even close (though closer to six figures than I ever made in my LIFE...so I guess for me by my standards, I made "close" to 100,000....in a market where the average sales price is often under 200,000. I was lucky to close a few big ones...and have a few good referrals that closed)

It is hard work. Long hours. Constant being on call and being able to think on your feet. It's not easy.

The ad is somewhat correct but I think they made it sound easier than it is...though it may be easier there than here due to property values being so much higher....depending on what part of St Louis you're in...

Believe me, it's not easy but I certainly think it can be done. I may not do it this year but I'm sure I'll break six figures next year.

Coldwell Banker Gundaker has over 2000 agents in the St. Louis area and there are bunches of agents there that make WAY more than 100k a year...I've had several referrals from them over the years and a great group of people.
100k as a brand new agent might be a little difficult to obtain...OK maybe slightly harder than a little difficult but I am sure there are some that will accomplish this.

In my opinion, how much a new agent makes really depends on what they bring to the table in terms of there pre-existing circle of influence (COI).

If several of your best friends are always investing in Real Estate then your going to do significantly better then if everybody you know cannot afford to move out of there parents basement.

It's unlikely a brand new agent is going to make $100k their first year. Sure, a few will, but the vast majority won't; in fact, the vast majority will quit before that year is up.

But can a 2nd, 3rd or 4th year agent make $100k? Of course. Again, most won't, but it's 100% doable.

Very few agents make that kind of money. But, it is because they do not treat their business as a business. Too many agents who say they are "full time" really work part time hours and most agents who say they are "part time" don't work at all. You get out of it what you put into it.

A part time agent in my office covered for one of my closings three weeks ago. I left some cash and a giant box of gourment nuts(as she requested)on her desk. AS of this morning both items are still there. She has not set foot in the office in three weeks.
There is another part timer who has not been in since before thanksgiving.
Neither agent has a made a sale since last summer. You get from this business what you invest. Best wishes!

Around here, without a reasonable explanation, those Licenses would be mailed back to the State Real Estate Commission as abandoned property after 30 days.

That should be a nationwide rule IMO...It will give much more weight to a license..

Vermont,
The sad part is folks still call for her. Guess how easy it is to get her to answer the phone?

Hello Everyone. I greatly appreciate your comments, input, and suggestions about my question here. I opted to use the online email system at this particular Coldwell Banker real estate office to inquire about their local real estate market (in this poor economy), along with how much can a brand new Real Estate Agent could expect to make in their first year working under them. But so far, after waiting about 48 hours, I have not heard anything from them. If I get some worthwhile information from them in the upcoming days, I will report back to this forum.

Thanks a MILLION Everyone!!!

Wilson

I'd like to continue on with another question if that's okay.. :)

I live in Seattle, where the median price is 400k (according to a seattle statistics website)

with that said, in your opinions, how much is reasonable for a 1st year agent to make? what i mean by reasonable is working full time, valid full time, and all. what do you think is a realistic number?

ASSUMING a broker split of 50/50
ASSUMING a co-broke of 3%
ASSUMING there is no desk fee or technology fee or other fee:
ASSUMING there is no franchise fee:

If you sold 12 homes @ 350,000 = 63,000. Then you need to deduct your fees... MLS dues, NAR & state association dues, gas expenses, electronic lockbox key fees, cell phone charges, internet charges, cost of operating a website, business cards, printer ink & paper..... and let's not forget Uncle Sam.

In my opinion, a rookie doing 12 deals in his/her first year is awesome...my first year I think I only got 3 sales under my belt!

A rookie doing 12 deals @ $350k each is also ASSUMING a great deal!

BTW, Perky--I think I also did three deals in my first year. To add more perspective to this, though, I think it was my third year before I made enough money to have to start paying quarterly self employment taxes.

If you were to do the Mike Ferry coaching I think he guarantees it.

Thanks Everyone for your input, comments, and suggestions:-)

Wilson

OK - you need to know YOUR market. In my market I can think of not ONE person who has cracked $100k in less than about 7 years. I'm in my 5th year and GROSSED roughly $70k during the last fiscal year. In NY that's not a lot of money. There are probably about 3-4 others who in their 4th year did the same or somewhat better last year - but hundreds tried.

Now, my neck of the woods is so fiercely competative that Manhattan agents try it here and go back to Manhattan - so this might be the exception. But earning $100k in your first year would be a fantasy in this location.

In reference to the original question, I think it all depends on the agent. Experienced agents still quit in this market all the time because they cannot get it done for a variety of reasons. So, it really depends on the agent. Newer agents will have a tougher time no doubt, but one never knows... Perhaps that new agent has a large following of friends who are looking to buy!

We had one like that in our office. Of course, the people who still called for her months later were bill collectors.

My first two years I had about 4 deals per year, but I was with a smaller agency and didn't get much training. I'm doing much better now with some experience under my belt and recently I joined a new office. I made the move for a better commission split, but more importantly the weekly training and coaching classes they provide. My new local broker is a national real estate coach (lucky me)!

As others have mentioned, I agree that the location of the market is a big factor. Boston has some affluent areas with high median prices even in this market and 3% commissions are out there. I don't know Los Angeles very well, but if you could list some movie star's homes you could probably do really well!

Seriously though, if you decide to get into the business, be realistic the first year and try to partner up with an agency that offers lots of training and mentoring programs. Also, keep in mind that it takes time to fill your pipeline and to get established.

Thanks so very much [b]AmberEyez[/b], [b]RallyRE[/b], [b]LizL[/b], and [b]Chris Lefebvre[/b] for your help, comments, and additional suggestions:-)

Thanks so very, very much you all!

Wilson : - )

It can be done. My first full year of Real Estate, I made 102K. You just have to be hungry and not be afraid of rejection or let it stop you.

I think it's wrong to assume that just because someone hasn't been in the office in three weeks, they aren't working. I do all of my work from home and only go in the office to pick up my checks and drop off paperwork - and I'm a full-time agent.

Cchamberland, can you elaborate a bit on your reply? Do you work for a company or are you self-employed as a Real Estate agent?

Wilson

all real estate agents are self employed - we are independent contractors.

Well, I'm sure that "many" of their agents ARE earning over $100K. In Los Angeles that's not hard to imagine. Real estate, like any business, is about getting customers. Do you have a large social network to tap? If not, I'd be asking Coldwell Banker what resources and/training they provide in this regard.

Thanks [b]Perky Realtor[/b], I appreciate your answer.

Thank you very much Amasters. If I end up becoming a Real Estate, I will be starting at ground zero. I do not have a network to tap into. [b]FROWN!!![/b] Yet when I go out to a few of the real estate offices for their recruitment events, I will be sure to inquire about what resources and training they provide.

Wilson

Good luck, Wilson. Please keep in touch!

Would a better question be, can I sell X number of houses as a brand new agent?
Average home prices vary greatly. Average home prices in North Jersey area are >$500k compared to <$200k nationwide.

Wilson- you can do it...It doesn't matter what everyone else has done, what the averages are, etc. etc... Here is what I have found is important-
Do a check up from the neck up- ask yourself-

Are you less likely to fear failure than the average person?

Do you take the easy path or do you face things head on?

Will you ask advice and questions from successful people and learn from them, or pose like you know everything because of your Ego?

Do you dwell on how things can go wrong, or do you think of how to improve and succeed?

Are you a problem solver, can you bounce back from adversity?

Did I make 100k my first year - it doesn't really matter.

Thanks LizL, I appreciate your vote of confidence. :)

Thanks so very much Pbraun2011 and Hankthetank, your input and comments provide me with food for thought. Yet I will continue to explore this website and read and try to learn for the wealth of information posted here, before making any hasty decisions about all of this. :)

Wilson

as I recall ... I did 19 transaction sides my first year ...

but then again dumber then a box of pop rocks

hahaha....see if BoneFish can do it, anyone can! lol (joking).

There is really no key secret to making a ton of money in real estate sales other than hard work, setting up all your revenue avenues, being creative and constantly hustling to get the job done (but of course some can and do it much more efficiently than others). Work hard and you will prevail!

I think being a new agent and making a 100K in St. Louis is possible but not probable. It took me three years to break the 100K mark and this year I will not even be close. These past couple of months have been the toughest I have had since being in the business.

It is possible in any real estate market, but don't expect it in your first year. It takes time to build up your client list and generate business. Now, after two years in the business, you can be making that if you follow a proven business model. Treat real estate as a business and you will be making more money than you ever could at a 'regular' job.

It does mean 24 hour on call and ALWAYS working (this will drive your loved ones insane), but it is definitely attainable for a new agent, however 1 year is unlikely. I'd say 3-5 years. I might add that luck may be involved as well.

Well Wilson I don't know if your still out there and tried to get your license or not. But even in this market you can make $100k in the Los Angeles area as a new agent. It depends on where you fish, how you fish, and what you are fishing for.

In general you will produce a return of 1% of taxable income on your total volume for sales activity so if you want to net $100k in LA you will need $10 million in volume or 20 deals at $500k.

Yes, it can be done, I know of many cases but there is an old real estate saying that 1/3 are coming, and 1/3 are going, and 1/3 are making the money.

Becoming part of the last group is goal #1, and getting into the top half of that group is goal #2, and getting there in one year is highly unlikely unless you add another element to your activities which I won't cover here.

As a matter of fact, I know a way to make a couple of million dollars a year in LA for the next several years but you would need to be a broker, and I'm contemplating moving there and doing it myself if my health stays the same so I'll keep it a secret for now.