How to Become a Real Estate Agent: A Step-by-Step Guide

Have you been wondering how to become a real estate agent? You're in good company. As of March 2024, there are over 1.5 million members of the National Association of Realtors^® (NAR). And, since not all real estate agents are NAR members, it's safe to assume that the total number of real estate agents in the U.S. goes beyond the NAR figure.

If helping people buy or sell real estate is work that you'd like to do, then the six steps below can help you get started.

Why Become a Real Estate Agent? 

Flexible Hours

Working as a real estate agent offers a great deal of variety. Agents work with different clients and visit many homes. They set their own work hours, finding the best times to show houses (even on weekends).

You get to be your own boss and enjoy the satisfaction of helping buyers and sellers navigate one of life’s major milestones—achieving homeownership.

Pay

The median pay for a real estate agent was about $49,980 per year in 2022, according to data from the U.S. Bureau of Labor Statistics. Real estate brokers with additional education, testing, and experience averaged $62,190. The highest 10% of agents earned more than $113,000.

Ease of Entry

Getting into the field is relatively easy. There's an upfront investment of money and time, both of which vary depending on where you get your license. But compared to other careers with similar earnings potential (most of which require a college degree), getting your real estate license can be a quick and affordable process.

Though the specific requirements differ by state, here's a general rundown of how to become a real estate agent in six steps.

1. Research Your State’s Requirements

A national real estate license does not exist, so you must meet your state's unique licensing requirements. Research your state's real estate regulatory office website, which you can find by visiting the Association of Real Estate License Law Officials' regulatory agency directory.

Each state has specific requirements for:

• Age
• Education requirements (such as a high school diploma or GED)
• Prelicensing courses and post-licensing requirements
• Exams and exam eligibility
• Application process and fees
• Background checks and fingerprinting
• Continuing education
• Achieving the next level of licensing
• Reporting criminal history

Some states have reciprocal licensing agreements with other states, which means you can get your license in one state and use it in another without taking an additional license examination. Illinois, for example, has reciprocity with many states, including Colorado, Connecticut, Florida, Georgia, Indiana (broker only), Iowa, Kentucky, Nebraska, and Wisconsin.

2. Take a Prelicensing Course

No matter where you live, you are required to take a pre-licensing course at an estimated cost of $350 from an accredited real estate licensing school before you sit for the real estate license exam.

Course requirements vary by state. In California, applicants must take three real estate classes totaling 135 hours. In New York, the courses take 77 hours. In Georgia, they take 75 hours. And in Florida, the course takes 63 hours.

Most states offer online classes, in-person coursework at real estate schools, and classes at community colleges.

3. Take the Licensing Exam

Your instructor should explain scheduling, registering, and paying for the licensing exam. The average cost of the test is $100-$300. Exams are computerized and consist of two parts: a national portion on general real estate principles and practices and a state-specific section that covers your state’s real estate laws.

The exams are in multiple-choice format. The number of questions and time allotted vary by state. Each section is scored separately, and you must receive a passing grade on both sections to pass. If you fail one or both sections, you’ll have the opportunity to retake the exam. Each state has its own rules regarding the number of times you may retake an exam, how long you must wait between exams, and the deadline for completing any retakes.

4. Activate Your Real Estate Agent License

Once you pass the exam, it's time to submit an application for your license to your state's real estate regulatory organization. Include any required documents and fees, usually $200-$400.

When your application is approved, the state will mail your real estate license certificate to you, and your name will be searchable under the licensee section of its website.

Remember that you're not allowed to work as a real estate agent before your license is issued by the state's real estate authority.

5. Join a Real Estate Brokerage

As a real estate agent, you'll work under the umbrella of a supervising broker who is licensed by the state to oversee real estate transactions and make sure that you follow the required legal and ethical standards. In general, you won’t earn an hourly salary. Instead, the brokerage will likely pay you a percentage of the commissions it collects from your real estate transactions.

Depending on the arrangement you have with your brokerage, you may have to pay for desk fees, tech fees, business cards, marketing materials, and other costs of doing business. You’ll also have other one-time and ongoing expenses, such as renewing your license each year, continuing education, lockbox fees, and Multiple Listing Service memberships. The cost of joining a brokerage averages $25-$500 per month.

6. Consider Becoming a Realtor

Many people use the terms real estate agent and realtor interchangeably, but these terms differ. Though both are licensed to help buyers and sellers throughout the real estate transaction process, Realtors are members of the National Association of Realtors (NAR) and subscribe to its strict Code of Ethics.

The NAR is the largest trade association in the U.S., representing over 1.5 million members who are salespeople, brokers, property managers, appraisers, counselors, and other participants in the residential and commercial real estate industries.

Though, as a real estate agent, membership is optional (at a cost of $156 in 2024, plus an assessment), becoming a Realtor can add to your credibility as a real estate agent. You’ll also have access to a variety of benefits, including:

• Business tools
• Real estate market data, research, and statistics
• Educational opportunities
• Discount programs geared toward helping you succeed in business

Realtors have access to Realtors Property Resource (RPR), the largest online real estate database in the U.S., built from public records and assessment information. It includes information on zoning, permits, mortgage and lien data, schools, and a large database of foreclosures.

The Bottom Line

Getting a real estate license takes time and money, but it can help secure a rewarding job in the real estate industry. Plus, a career as a real estate agent can mean flexibility where working hours are concerned.

Though you can work part time as a real estate agent, most treat it as a full-time business, staying available to clients throughout the week and on weekends.

You may also want to consider the variety of available real estate designations and certifications, including those specific to mortgages, appraisals, residential property, commercial property, and property management. These designations can enhance your career and marketability as a real estate professional and increase your earning potential.