How to become a real estate agent

And it’s a career that’s in demand. More than 156,000 people became real estate agents in 2020 and 2021, almost 60% more than joined their ranks in the previous two years, according to the National Association of Realtors (NAR). The U.S. Bureau of Labor Statistics projects that there will be about 51,600 job openings annually for real estate brokers and sales agents between 2022 and 2032.

Julia Hoagland, the founder and principal of JH Advisors LLC Compass in New York, N.Y., and a Counselor of Real Estate, says the benefits of becoming a real estate agent are many. “It’s an opportunity to work for yourself,” Hoagland says. “We’re all independent contractors in this business, so I’m my own boss. That’s really alluring if you’re a self-motivated individual who likes to make their own hours and eat what they kill.”

How to become a real estate agent 

Becoming a real estate agent can be a rewarding career for a driven, independent person. No workday is the same, and agents often feel a thrill from helping people navigate the housing market and make life-changing decisions. Here’s how to become a real estate agent in seven steps.

1. Understand the difference between a real estate agent, Realtor, broker, and counselor 

The first step in entering the world of real estate is understanding the difference between a real estate agent, a Realtor, a broker, and a Counselor.

A real estate agent is a licensed professional who helps people buy and sell real estate. They may represent either the buyer or seller and make a commission when the deal is completed.

A Realtor is a member of the National Association of Realtors (NARs). Sher Powers, a Realtor and broker/owner of Urbane Residential Specialists in Nashville, Tenn., and a member of NAR’s national board of directors, says a Realtor subscribes to a code of ethics, is licensed, submits to professional standards of peers, and gets the benefit of educational resources and other resources at a local, state, and national level.

A real estate broker is an agent who undergoes additional training and state certifications. In contrast with a real estate agent, a broker can work solo, open their own brokerage, and hire other real estate agents.

A real estate Counselor offers additional guidance or insight into real estate decisions. This designation is awarded by the Counselors of Real Estate after a person is invited by their peers and fulfills additional requirements of entry. 

“Counselors can be appraisers or asset managers or professors—anyone who counsels to add value to those transactions,” Hoagland says.

According to the U.S. Bureau of Labor Statistics, the median pay for real estate brokers and sales agents in 2022 was $52,030.

“It’s very clear that it can take the place of a typical entry-level white collar position to maybe mid-level management, but for them to go beyond that takes a lot of work and skill,” Powers says. “A niche makes it easier. It’s hard to be a generalist and be very successful.”

2. Do your research and understand the requirements 

Before getting further along in the process of becoming a real estate agent, Hoagland recommends that aspiring agents network with people already working in the industry. Powers advises trying to shadow an agent for a couple of weeks to better understand what the typical workday requires.

Each state has its own requirements to become a real estate agent. In New York, agents must complete 77 hours of qualifying education, pass a school-administered exam as well as an exam administered by the Department of State. Some states have reciprocity agreements with other states, meaning an agent’s license will work in more than one state without requiring additional exams.

As testing reservations can fill up quickly, Hoagland recommends signing up before taking the coursework.

3. Get schooled  

Aspiring real estate agents have the option of attending courses online or in person. Online courses offer greater flexibility, but in-person classes allow for face-to-face networking opportunities. Sometimes, the teachers of in-person courses are team leaders of brokerage firms, potentially a great connection for an aspiring agent.

“The investment of spending time in the classroom is going to be very powerful for them, because they also meet fellow peers on the same journey, and that can help them when they’re studying for the exams,” Powers says.

4. Take the licensing exams 

While the licensing requirements to become a real estate agent vary from state to state, most require two licensing exams: one for general real estate principles, one related to state-specific real estate laws. For state-specific requirements, visit the directory of Association of Real Estate License Law Officials.

Powers says it’s common for people to fail one or the other if they haven’t done enough of the groundwork in advance. “The online courses are fine. It takes a lot of studying if you don’t have a background in real estate,” Powers says.

5. Activate your real license 

After passing the exams, an aspiring real estate agent must submit documents and fees to their state’s real estate regulatory organization, usually somewhere in the ballpark of $200 to $400. These documents may include fingerprints, background checks, licensing applications and proof of pre-licensing instruction. Once approved, the state will mail the new agent their real estate certification, allowing them to work.

6. Join a brokerage 

Real estate agents must work underneath a broker who is licensed by the state that they’re conducting transactions in.

“Joining a top team as a rookie agent is a win-win, because as a rookie agent you get experience and also have some deal flow if you’re building your own business,” Hoagland says. “Rookie agents can help team leaders be better team leaders by giving them help with things they really shouldn’t be working on.”

She adds that new agents should try to find a team that fits their personality. For people who want to strike out on their own, Hoagland recommends calling the sales managers of large brokerages in their area to see if there’s room for them.

“Some agencies take inexperienced agents and others don’t, so it’s good to familiarize yourself with who’s out there,” Hoagland says.

7. Market yourself 

Ten years ago, Powers would have advised new agents to create a website to market themselves. Now, she says it’s just as effective for agents to market themselves through social media and building one-on-one relationships. Stating that her style of business is more social than transactional, Powers says she sends former clients annual updates on the value of their property as a way to stay in touch.

Hoagland recommends hiring both an assistant and a business manager “before you think you can afford it,” saying it “turbocharged” her growth. She also recommends joining a good networking group of fellow business owners.

The takeaway 

For a self-motivated individual who likes being their own boss, becoming a real estate agent can be rewarding. Still, agents should be prepared to work hard.

 “You have to work on weekends,” Hoagland says. “It’s harder to set specified hours that you work, because transactions unfold on their own schedules, and some of the details are critical and very time sensitive. You need to jump when things happen.”

Hoagland also recommends that fledgling real estate agents join networking groups with other business owners and read Gino Wickman’s book, Traction: Get a Grip on Your Business. Powers stresses keeping in touch with former clients; she often sends them annual property value updates. “It’s really about building relationships,” Powers says.