As a newbie I'm trying to find my nitch in real estate. In the mean time I am trying to learn as much as possible so my question if I get my license what are the cost of being a realtor. I understand there is marketing yourself and hopefully houses but what other cost are there and if I get my license in California what would the mls access look like is it just California?
Hi Joshua! I am sure an agent from CA can speak directly to specific costs in CA, but as a general rule of thumb, I would expect to pay a few thousand a year all in, especially the first year. MLS membership is relatively inexpensive (at least in Idaho) but there are association fees, license fees, key fees, brokerage fees, etc. It adds up,
Thank you I am also curious about the marketing cost and maybe what seems to work the best for new agents.
I'm curious if there is any inland empire or san diego county agents that can give me more detailed cost list to the first year of being an agent.
I am licensed in CO, but costs should be relatively similar. I wrote a post for the BP blog about this very topic.
There are lots of little costs you may not think about offhand. I tried to remember them all. Licensed in March 2014.
Hello @Joshua Swanger
I'm an agent in the Inland Empire. The only fee I pay is for access to the MLS. $96 quarterly. If you want to be designated as a Realtor, then you are looking at spending approximately $1000 per year for all necessary costs. Being a Realtor gives you access to online real estate forms which is honestly a must. If you want to market on Zillow you are looking at spending $250-500 per month depending on the area. Mailings might cost you $300 per run and you'll need to do 6-8 runs to start seeing results. I hope that helped!
I'd advise that you don't get ahead of yourself. Are you working as an independent broker, or going to work in an office? If you're going to work for another broker you need to talk to them and find out what is required. Also, are you going to be working strictly listings or showing property too? If you're showing property you need to have a car with good insurance.
As to marketing, if you're in with another broker you'll want to find out what their policy on signage, advertising, Error and Ommissions insurance, etc. Good luck.
@Joshua Swanger All my fees are on auto-pay and I definitely don't remember what my initial costs were to get started but maybe this info will help you.
SRCAR (Southwest Riverside County Association of REALTORS)
is the biggest Realtor Association in your area
Marketing costs to get your business going will be up to you but you can always start with Door Knocking which is free. Call SRCAR and they can inform you of all the fees associated with joining their board and they can let you know about the MLS as well. With the MLS you should be able to access most of the Southern CA markets reciprocally and they can explain to you how to do so. Furthermore, call or go online to the BRE (Bureau of Real Estate) and the CAR (CA Association of Realtors) to find out their fees. That should be a good start. One deal a year should cover all your fees and leave a little money in your pocket. Best of luck.
Cost for start up and then annually can run anywhere from $1500-3000 a year. You need MLS access, local association dues (SRCAR) CAR, NAR dues, E&O insurance, lock boxes, SUPRA key access, signs, cards, desk fees (Varies between brokerages) etc.
Then you will have a brokerage split for each transaction, say 70/30 for an example. You will also pay a transaction fee and use a transaction coordinator that will also charge a fee per transaction. (Recommended when your new)
Once this is done, you will then choose your marketing approach. This is where the sticker shock really comes in as a new agent. You can spend as much or a little as you want. The idea; however, is to try and find something that is effective and "cost effective" at the same time. Every vendor under the sun will try and sell you the latest greatest new mouse trap for realtors. Web sites, IDX, Zillow, Realtor, Trulia etc will come after your "new" dollar as you enter the industry.
Your best bet is to find a brokerage with a great training program, hook up with an agent willing to mentor you and use you as a buyers agent or assistant etc. The faster you get exposed to deals and the contracts the better you will become. A mentoring agent will also steer you clear of the scams and marketing "waste of times" etc.
Before you even think about MLS fees and marketing, you need to get your license. This takes multiple classes. When I got my real estate license, it was 3 classes and about $500. Then you need to take the CA state test which is also pretty expensive. If you pass, you need to get finger printed (more money), and pay BRE, CAR and your local association fees. I pay about $500 yearly. You will also pay an additional ~$500 every 4 years to renew your license. You will need to work under a broker who may have office fees and E and O insurance (each broker operates differently). I pay $152 quarterly for MLS fees. Marketing fees depend on what you want to spend. I pay between $10,000 and $20,000 per year. Once you pay these fees and you close a deal, your broker will take a portion of the sales.
I am not trying to discourage you. I think having your license is a huge benefit. You may even be able to find a broker who will help pay for you to get your license. My first broker reimbursed me for my classes when I started making sales.
I spend a little over $900 a year on the board/MLS access in Orange County. There are also classes for continuing education that you will need to attend to keep your license in good standings. I do believe that if you want to get into investing/real estate access to the MLS has a lot of advantages; however, it is not a must.
Other fees can come along with working at an office as an agent (hanging your license). Some offices charge you a fee and may make sure you are meeting a standard for their office annually. The office may be able to help you with some marketing; however, most of the marketing will have to come out of your pocket, you'll just have to budget a certain amount for the marketing that you want. There is really no limits on how much you can spend on marketing. That is on you to decide.
Good luck and if you have any other questions feel free to send me a PM.
Mls subscription cost
Board of realtors membership
E and o insurance premium through broker.
Percent of commission to broker at every sale
Initial Realtor class cost
Continuing eduction costs.
You said all you pay is $96 quarterly. Is that because you only use the MLS, and did not "hang your license", or show houses and open key boxes like the typical realtor? What about continuing education? Thx.
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