How Much Does a Real Estate License Cost

Obtaining a real estate license is a crucial step for those aspiring to start a career in the real estate industry. The cost of acquiring a license varies significantly from state to state, however, and it’s essential to understand the various expenses involved in the process.

This comprehensive Real Estate License Cost guide will break down the costs associated with obtaining a real estate license, including pre-licensing education, exam fees, licensing fees, fingerprinting, and broker fees.

Real Estate License Cost

Obtaining a real estate license involves several costs that can vary significantly, depending on your state. Below you’ll find a breakdown of the primary expenses you can expect to pay.

Pre-Licensing Education

Before you can take the real estate licensing exam, you must complete a pre-licensing education program. The cost of these courses can range from $150 to $1,500, depending on the state and the education provider.

For example, in Texas, the required 180 hours of pre-licensing education can cost between $400 and $600. Online courses tend to be more affordable with some providers offering packages for as low as $99 in certain states.

We recommend spending some time researching your options in order to find the right pre-licensing education provider for you. The right pre-licensing education course will not only help you pass your exam on your first attempt, but also set you up for a successful career in the real estate industry.

Real Estate Exam Fees

The fees for taking the real estate licensing exam also vary by state. Generally, you can expect to pay between $15 and $200 for the exam. Some states may include the exam fee as part of the application fee while others charge it separately.

Example: In Florida, the exam fee is $36.75.

Licensing Fees

Once you pass the exam, you’ll need to pay for your real estate license. Licensing fees can range from $25 to $300, depending on the state. States often require these fees for both your initial license and each renewal, which typically occur every one, two, or four years. In New York, the initial licensing fee is $65.

Fingerprinting and Background Check Fees

Most states require a fingerprint-based background check as part of the licensing process. The cost for these services can range from $50 to $125. This fee is usually separate from the application and exam fees. In Missouri, the cost for fingerprinting is $40.50.

Broker Fees

After obtaining your license, you must work under a licensed broker. Brokers typically charge a fee for their services, which can be a flat monthly fee or a percentage of your commissions.

These fees can vary widely, but, on average, brokers take about 5% to 6% of your commissions.

Ongoing Costs of a Real Estate License

Obtaining a real estate license is just the beginning of the financial commitment for real estate agents.

There are several ongoing costs agents must consider to maintain their licenses and operate their businesses effectively. These costs can vary significantly, depending on the state and the specific brokerage with which an agent is affiliated.

CE Fees

Real estate agents must complete CE courses to maintain their licenses. The specific requirements and costs for these courses vary by state. For example, in New Jersey, agents must complete 12 CE credit hours every two years with costs ranging from $29.95 for individual courses to $119 for course packages.

In California, new CE requirements were established by Senate Bill 263 — effective from Jan. 1, 2023 — while Louisiana agents must complete 12 hours of approved CE coursework annually.

License Renewal Fees

License renewal fees are another recurring expense for real estate agents. These fees also vary by state and can depend on if an agent completes the renewal on time or late. In New York, the renewal fee for a real estate salesperson is $65 with a late fee of $200. Texas agents must renew their licenses every two years — at a cost of $110 — with renewal notices sent out 90 days before the expiration date.

In Florida, renewal fees and processes are managed online through the state’s Department of Business and Professional Regulation.

Marketing Expenses

Marketing is a crucial part of a real estate agent’s business. Common marketing expenses include advertising costs, which can range from online ads to print materials like flyers and business cards.

Agents also may pay fees to marketing firms or consultants to help them with branding and lead generation.

Website development and maintenance also are essential for establishing an agent’s online presence and attracting clients.

Desk Fees

Desk fees, which can vary widely, are payments made to a brokerage firm for providing office space and other resources. RE/MAX offers a 95-5 commission split plan, for example, which includes a hefty monthly desk fee. Coldwell Banker charges a percentage of an agent’s gross commission as a desk fee.

Commission Splits

Commission splits are agreements between agents and their brokerage firms on how to divide commissions from sales. These splits can significantly impact an agent’s income. RE/MAX offers a 95-5 split in which an agent keeps 95% of the commission, but pays a high desk fee.

On the other hand, eXp Realty provides an 80-20 split capped at $16,000 in gross commission paid into the company.

In the general market, commission rates typically range from 5% to 6% of the sale price with the commission split between the listing and buyer’s agents.

Analyzing the ROI of a Real Estate License

Obtaining a real estate license requires a significant investment of time and money, but it can also lead to a rewarding and lucrative career.

Before deciding to pursue a real estate license, it’s essential to consider the potential return on investment (ROI) by examining the earning potential and career growth opportunities in the industry.

Potential Earnings

The earning potential for real estate agents varies widely, depending on factors like their location and experience as well as current market conditions.

According to the US Bureau of Labor Statistics (BLS), the median annual wage for real estate sales agents was $54,300 in May 2023. However, more experienced agents can earn substantially more. In fact, those with more than 16 years of experience report a median income of $92,500 in 2023 — up from $80,700 the previous year.

The real estate industry is constantly evolving, presenting numerous career growth opportunities for agents. The BLS projects a 3% employment growth for real estate agents between 2022 and 2032 with an estimated 516,000 new jobs opening up during this period.