Average Salary: $41,990
Expected Lifetime Earnings: $1,753,000
First, why would you want to be a broker and not just be an agent? As you might guess, it's all about the money. Real estate brokers make more than agents. Agents "eat what they kill" and nothing else; the broker, meanwhile, gets to nibble on every single deal that comes through the office (source).
That said, the actual amount varies depending on a whole bunch of conditions, not the least of which is where you're doing all of your selling.
In some tiny towns far away from The Big City, the local high school rules the roost. We're talking some real Friday Night Lights football-type places.
High school stadiums fill up with 20,000 fans. In that small town, it's likely that you really don't in fact need a college degree to be a player in real estate sales—if you were homecoming queen or class president and just "know everyone," it's likely you'll have an entrée to sell whatever you want to sell. But there's a drawback: the housing-for-sale numbers are small.
In that tiny town, it's likely that you can buy an amazing home for $250,000 (the average home sells for $150,000). Let's do some math.
If you can sell a home per month (which is a pretty fast clip), and total sales amount to $1.8 million...you still won't make that much. It's likely you work for a local real estate firm (source).
You've probably seen signs for these places: Century 21, Coldwell Banker, ReMax (the guys with the hot air balloon). In those cases, somebody else owns the firm and pays royalties to whomever, in return for advertising and other administrative tools they offer.
Say you've sold $1.8 million of property in a given year—a great year for you. In total, the real estate commissions were six percent. So that's $108,000.
And after the Big Guys get theirs, you keep half.
So to regroup, let's say you've just put up a monster year in Podunk City, USA, and you've made a whopping $54,000. Not awful, and still better than the $20,000 you'd make flipping burgers.
Now let's go to Silicon Valley, California. (And we could just as easily do Manhattan or Chicago or Dallas or any other major city in a hot market area.)
A top realtor in Silicon Valley doesn't just sell pricier homes, they can also sell a dozen or more in a given year. But the clientele is radically different from Podunk City. The buyers are Internet moguls who are thirty years old, and two-thirds of them graduated from the engineering department at Stanford University (in the heart of Silicon Valley).
They have the cash, so the homes they want have to be worth it. The numbers are vastly different from dear old Podunk. A decent home in Palo Alto or Atherton or Woodside or Los Altos Hills sells for five million, and there are tons of homes that sell for well above ten million (source).
So wherever you end up, make sure you're aware of what that market's value is and who the buyers are. You can list a property for as much as the seller wants; whether or not it sells all depends on the people in the area having the Benjamins for that kind of deal.