In the bustling and dynamic world of New York’s property market, you may wonder: “How much does a real estate agent make in New York?”
This guide delves into the factors that can impact a real estate agent’s income — from market conditions and commission structures to variable expenses. As it examines an agent’s potential earnings and costs, you’ll get a realistic perspective on what to expect, financially, in New York’s competitive real estate industry.
Read on to learn more about the average real estate agent salary in New York.
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Real Estate Agent Salary New York
Several factors can influence a real estate agent’s salary in New York — as well as in other states. Here are some common examples:
- Experience: In New York, real estate agents make an average base salary of $93,951 per year. More experienced agents usually earn higher commissions
- Market Conditions: In a strong market with many buyers and sellers, an agent has more opportunities to make sales. Because the number of transactions may decrease in a weaker market, this can reduce an agent’s income
- Location: Even within the state of New York, an agent’s income can vary based on their location. In Manhattan, for example, New York City (NYC) real estate agents earn more because the city’s higher property values lead to larger commissions
- Work Hours: Real estate can provide a flexible profession. Agents willing to work longer hours, including nights and weekends, may have more opportunities to close deals and therefore earn more
- Specialization: Some niche markets or specialty areas within the real estate industry may have a higher earning potential. For example, agents who specialize in luxury properties may earn higher commissions
Remember, real estate agents are generally independent contractors and earn a commission on each sale they make. As a result, their income can fluctuate and isn’t typically a fixed average salary. They must continually work to attract new clients and close deals.
Interested in becoming a real estate agent? Check out our How to Get Your New York Real Estate License guide.
Real estate commissions in New York typically ranges from 5% to 6% of a property’s selling price, but it can vary based on several factors. The buyer agent and the seller agent (also called the listing agent) will, typically, co-broke a sale and split the commission.
Let’s say you’re a real estate agent selling a property priced at $1,000,000 with an agreed-upon commission rate of 6%. The commission from this transaction would then total $60,000. Because the listing and buyer’s agents typically split the commission, each would receive $30,000 from this sale.
However, most agents work under a brokerage company that also takes a share of an agent’s commissions. The exact ratio of their split agreement can vary widely, depending on an agent’s arrangement with their broker. A common split ratio might be 70-30 in favor of the agent.
If the listing agent in the example above has a 70-30 split with their broker, they’d keep $21,000 of their $30,000 commission earnings and pay the remaining $9,000 to their broker.
Note that real estate agents also have other expenses like licensing fees, association dues, and marketing costs — all of which can impact their net income.
Real estate agents must cover several variable expenses as part of their business, and these can have a significant impact on their take-home pay. Some common variable expenses include:
- Licensing and Association Fees: Real estate agents must pay to renew their license and also may have to pay membership dues for local, state, and national real estate associations
- Marketing and Advertising Expenses: These costs can vary significantly, depending on an agent’s marketing strategy. They could include costs for print advertising, online ads, direct mail campaigns, signage, promotional materials, and professional photography for listings
- Technology Costs: This category may include expenses for maintaining a professional website, licensing customer relationship management (CRM) software, accessing listing services, or purchasing other technologies to support an agent’s business
- Office Expenses: Some agents may need to pay for office space — either a home office or a shared office. These expenses can also include costs for office supplies, utilities, and office equipment
Each agent’s business model, work style, and local market conditions can cause these costs to vary significantly. It’s important for agents to track their expenses carefully because many can be tax-deductible business costs.
How to Become a Real Estate Agent in New York
The process of becoming a real estate agent in New York requires you to take several steps, including applying for a real estate license. Here are the key steps:
- Complete your educational requirements. In order to become a real estate salesperson in New York, you must be at least 18 years old and complete a 75-hour, pre-licensing course. This course covers all aspects of real estate practice and gives you the knowledge you’ll need to pass the licensing exam. If you took any college-level courses in real estate, some of that coursework may count toward your pre-licensing education requirements.
- Pass the New York real estate salesperson exam. Once you complete the pre-licensing course, you’ll need to pass the state licensing exam. Administered by the New York State Department of State, this multiple-choice exam will test your knowledge of the principles of real estate and the laws governing the industry in New York. You’ll need to schedule and pay for the exam online.
- Find a sponsoring broker. Before you can apply for your license, you’ll need to find a real estate broker who’s willing to sponsor your application. This broker will act as your mentor and provide you with on-the-job training.
- Apply for your real estate salesperson license. Once you pass the exam and find a sponsoring broker, you can apply for your real estate salesperson license. You’ll need to submit an application form, pay the required fee, and provide your exam “pass” slip along with proof of your completed pre-licensing education.
Obtaining a real estate license in New York allows you to legally facilitate real estate transactions and represent buyers and sellers in the state, thus enabling you to earn commissions.
For New York real estate pre-licensing education classes, StateRequirement recommends:
Real Estate Agent Salary New York FAQ
How much does a new real estate agent make in New York?
A new real estate agent in New York might earn $89,370 in their first year. This can vary, though, due to factors like commission rates, market conditions, an agent’s skills, and the volume of transactions they close in a year. For more information on real estate agent salaries, see our How Much Does a Real Estate Agent Make article.
Is it good to be a real estate agent in New York?
Working as a real estate agent in New York can be rewarding due to the state’s high property prices, which can potentially lead to sizable commissions. However, it’s also a competitive industry with variable income. Success depends on an agent’s market knowledge, client service skills, and commitment to networking and marketing. Learn the licensing requirements by visiting our Real Estate Salesperson Licensing page.
How can I succeed in real estate in New York?
To succeed in New York state’s real estate market, you must develop robust market knowledge and negotiation skills. In addition, you’ll need to build a strong network, work diligently to generate leads, and offer excellent customer service. Be ready for flexible hours, and consider specializing in a niche market. You also must stay updated on the latest technology and trends. Overall, persistence and hard work are key.
How do I start a real estate career in New York?
You can start your real estate career in New York by completing a 75-hour, pre-licensing course, passing the state real estate salesperson exam, and finding a sponsoring broker. You’ll also need to familiarize yourself with the local market as well as develop strong sales skills and a customer base. Becoming an experienced buyer’s agent or listing agent can enhance your chances of securing higher earnings.
Is it easy to become a real estate agent in New York?
Becoming a real estate agent in New York involves completing a pre-licensing course, passing a state exam, and finding a sponsoring broker. While the process is straightforward, succeeding in the competitive New York real estate market requires commitment, hard work, and excellent customer service skills.