When deciding on your next career move, numerous factors to consider before leaping. Although location, brand, and benefits are essential factors in the decision-making process, salary is the ultimate deal-breaker. It’s a question that everyone wants to know the answer to but is too afraid to ask: How much can I earn? Keep reading our guide on how much do real estate agents make in UK.
What exactly does an estate agent do?
When renting, selling, or buying a home, these are the first people you meet and deal with. Estate agents serve as ‘go-between’ negotiators for the parties involved. Before attempting to become an real estate agent or letting agent, it is critical to understand the real estate market in the UK and what an agent does daily. An estate agent is in charge of advertising, marketing, selling, and negotiating property sales.
Selling new-build homes for a developer or negotiating the sale of residential properties for private sellers are examples of this. Rental properties will also manage by letting agents. Estate agents in training may earn at least £14,000 per year (Higher with a London-based agency). A typical estate agent’s compensation consists of a base income + commission.
How much do real estate agents earn in the United Kingdom?
If you think an estate agency job is for you, it’s essential to research the qualifications and experience you’ll need, which we summarize in our guide: Is a career in real estate right for you?
Salary of an entry-level estate agent in the United Kingdom
When you start as a commission-based estate agent, you’ll typically receive a guaranteed salary for the first three months to cover you until you start making sales and earning a commission. You can expect to earn between £15,000 and £25,000 in the first three months.
A lower base wage of £12,000 to £15,000 is appropriate after three months of work experience, knowing that the commission you earn will boost your monthly take-home pay.
It’s possible to make between £18,000 and $25,000 in your first year as an estate agent if you’re a good seller, but it depends on how much commission you make.
How does commission work?
Consider a real estate job. You may have an unreasonable expectation of how much commission you would make on each transaction you finish when you are first starting. Commission arrangements vary from one agency to the next. In general, the commission you’ll calculate as a percentage of the sale price of the property you’re selling, plus a portion of the sale price to your brokerage.
In the following scenario: A home is sold for £200,000, and your office obtains a 2 per cent commission on the transaction, the firm for which you work makes a profit of £4,000. In exchange for that 2 per cent charge, you may be eligible to get a personal commission of 10%, which would entail earning £400 in commissions.
Whereas sales commission pays upon the completion of the sale of the property, the process for lettings is different. Instead of a one-time payment, the agency collects approximately 10% (plus Value Added Tax) of the monthly rent, and you receive a percentage based on the commission rate set by your office.
The commission you will earn in lettings will be lower than the commission you will earn in sales. Still, you will expect to let more properties, resulting in a similar commission level regardless of which area of the business you work in.
You’ll expect to meet personal and company targets monthly, quarterly, or yearly, just like in many other sales roles. These are in place so that your employer can monitor your activity and areas of expertise and take home more money in your pay packet.
Targets can be intimidating when you first start. If your annual goal is to earn £200,000 in fees for your company, you will need to sell £10 million in property in a year (because the £200,000 is 2% of everything you sell). That means you’ll earn £20,000 in commission alone per year).
If you reach your £10 million goals at some point during the year, you may be eligible for an instant bonus of £5,000. Any fees you bring in after this may result in an increased 15% personal commission bonus.
Estate agent jobs with experience and opportunities for advancement
According to data from unitedpropertyconnect.com, UK residential estate agents earn an average salary of £41,392, significantly higher than the national average.
Successful and experienced agents can earn anywhere between £50,000 and £100,000 after years of experience. As with most industries, hard work pays off. If you eventually advance to a position such as a branch manager or an area manager, your commission and salary will grow with your experience.
How can a real estate agent earn more than the average?
Your earnings don’t have to be defined by what’s “average” for your niche, level of experience, or amount of time you put into your job. There are always ways to beat the odds and earn more than the average. We’ve discovered that agents who earn more excel at managing their marketing dollars, generating quality leads, winning real estate listings, and staying current on best practices.
There are numerous estate agent jobs available. You can get paid to look around other people’s homes and gain an insider’s view of your area’s new housing developments and properties. If you enjoy interacting with people and negotiating, a career as an estate agent may be ideal for you. The job entails desk-based work and out-of-the-office time spent showing people around properties.
Salaries for estate agents vary depending on where you work and the types of properties you work with. Jobs in London and the South East tend to pay better, and you could earn up to £250k working for a global property company in London, but this is at the upper end of the market. The above is a comprehensive guide to how much do real estate agents make in UK.