According to the Bureau of Labor Statistics, the mean annual wage for the average American real estate broker is $81,450. Or, at least, it was as of May 2019, which is when the most recent data was compiled. Since then, housing markets nationwide have seen an increase in buyer activity. This increase is likely the result of:
The increase in buyers and low inventory have driven home prices up in much of the country. And since brokers are paid on commission, the higher prices mean higher commission checks for real estate brokers. So it’s likely that brokers in 2021 are making more money than they did in 2019, despite the struggling economy.
Let’s look at states where real estate brokers are earning the highest incomes, why those states pay better, and how top earners are finding sellers in the current sea of buyers.
Here are the top 10 states where real estate brokers earn the highest incomes. The annual mean wage is listed next to each state.
Source: U.S. Bureau of Labor Statistics
You may be surprised to see New Mexico top the list when it’s not known for high-value real estate. And then there’s high-value Hawaii, which is not in the top 10. The most likely explanation in both cases is the number of real estate brokers working in each state compared to the population of the state. The Bureau of Labor Statistics calls this the location quotient.
A high location quotient — as in Hawaii — means there are more brokers, so there is less business to go around. A low location quotient — as in New Mexico — means there are fewer brokers, so there is more business for each broker. Here's a full map of location quotients across the U.S.
Most of the country is in the grips of a hot seller’s market as we enter the second quarter of 2021. Brokers have buyers, but they’re struggling to get an offer accepted. The money in 2021 is in listings. Here’s how top earners are finding sellers and increasing their income:
Whether your state is among the highest-paying states for real estate brokers or the lowest-paying, you can increase your income by finding motivated sellers with PropStream.