Most people don't understand how REALTORS are compensated for their work. We are independent contractors, CEO's of our own business, and we are paid commission for homes we sell. Basically we are what the IRS calls 1099 employees.
The Basic Mandatory Expenses for a REALTOR in Lake Charles, Louisiana are as follows:
- $239.00 Annual License Renewal Fee + Errors & Omission Insurance
- $415.00 Annual Board of Realtor Dues
- $600.00 TOTAL ($50 month) for MLS
That Totals $1,254.00
Then there is mandatory Continuing Education and in Louisiana we are required to have 8 hours.
- The courses are usually $25 so that is a Total of $75.00
If you have a SUPRA Electronic Key you will be charged a yearly fee plus the cost of the SUPRA Key.
- $261.00 TOTAL
With these basics here in Lake Charles, LA, REALTORS incur a Total of $1,590.00 just to be in business.
REALTORS also use their vehicles 100% of the time so there is the cost of the wear and tear on your car and the gas you spend as your drive around showing and listing property year round.
Every REALTOR has a cell phone, add in the cost of the phone and your cell phone service that is another charge. Mine plan is combined with my husbands but let's just say your cell phone is $150.00 a month at the end of the year that is $1,800.00
You probably have some computer and tech gadgets to help you in your real estate business and depending on what brand you accessories choose you will incur expenses for:
- Software, Router etc.
- Digital Camera, Tripod, Attachments Accessories
- Video Camera, Case, Tripod, Microphone
- Mobile Apps
If you are busy with listings and successful you will also have advertising and marketing expenses:
- Signage-Name Riders
- Print Advertising- Postcards, Fliers, Magazines, Business Cards
- Property Domain Sites
Incorporated with your advertising and marketing you will probably subscribe to sites to assist you:
- Photo site
- Real Estate Video Show Software
- ClipArt, Istock
- IDX provider
- Contact Management System
As your desire to grow and become visible on Google you will probably attend real estate learning seminars and training:
- Active Rain Camp
- RE Bar Camp
- Agent Reboot
Then there are the local events you sponsor in your community, and the client gifts you give......
This is just a glimpse of the costs associated with being a REALTOR...It can all add up. So take into consideration that when REALTORS are compensated with an earned commission for a sale, they don't pocket all their earnings! REALTORSl still incur expenses for listing your home....there will be sign and advertising costs that are out of pocket expenses. Remember REALTORS are only paid a commission if a house sells!
I wrote this Blog Post Last Year Entitled "Just Another day in Real Estate: