What does a real estate agent do?

What the daily work looks like

An agent's week splits between finding business and working the deals already in hand. On the listing side, you meet sellers, compare recent sales to set an asking price, write up the property's details, and market it through ads, open houses and the listing service. On the buyer side, you find out what the client wants and can afford, line up showings, and drive people from house to house.

Once a buyer picks a property, you present the offer to the seller, negotiate between the two sides, and track the purchase contract until every term is met. You also handle paperwork such as purchase agreements, leases and closing statements. Some agents work leasing for tenants. Most sell homes, and a smaller group works commercial property.

The hours follow the client. Evenings and weekends are normal because that is when buyers can see homes. Most agents work full time and many put in more than 40 hours a week, though they set much of their own schedule.

Working under a broker as an independent contractor

A sales agent cannot run a business alone. You hang your license with a broker, who supervises your work and takes legal responsibility for it. In Texas, for example, the sponsoring broker must review your advertising, and both of you can be disciplined if it breaks the rules. Referral fees earned by a Texas agent are paid to the sponsoring broker, not directly to the agent.

Most agents are not employees. Federal tax law treats a licensed real estate agent as self-employed when nearly all pay is tied to sales rather than hours worked and a written contract says the agent is not an employee. That means no paycheck, no withholding, and you cover your own self-employment tax, marketing, fees and car costs.

How commission splits and lead generation drive income

Agents earn mostly from commissions. A commission on a sale is usually divided several ways among the buyer's agent, the listing agent, and the brokers and firms involved. Your agreement with your broker sets what share of your side you keep. The size of the check depends on the property type and price.

No leads means no income, so prospecting takes up a large share of the job. You network, attend community events, and keep in touch with past clients. That effort pays off later. In NAR's 2026 Member Profile, the typical Realtor got 28% of business from repeat clients and another 22% from referrals by past clients. New agents have neither, so they start from zero.

The real income swing in the first years

Expect thin, uneven income at the start. BLS notes that beginners' earnings are often irregular, and agents can go weeks or months without closing a sale. NAR's survey of its members shows how wide the gap is. Realtors with two years of experience or less earned a median gross income of $8,000 in 2025. Members with 16 years or more earned a median of $88,500.

Gross income is measured before brokerage fees and business expenses, so take-home pay is lower. Plan to have savings or a second income while you build a client base. The typical Realtor closed nine transaction sides in 2025, a pace that takes years of relationships to reach.

Pay

USD a year, before tax. BLS OEWS May 2025 figures for real estate sales agents, moved to 2026 with the Employment Cost Index. The U.S. median is $54,500. BLS counts employees only, so most self-employed agents fall outside these figures. Real commission income swings widely with experience, deal count and the local market. Refer to the Real Estate Sales & Brokerage salary guide for figures from live adverts.

What you need

• State real estate licenseEvery state requires real estate agents to hold a license. Each state sets its own education and exam rules.
• EducationA high school diploma or equivalent is the typical entry requirement before prelicense coursework.
• A sponsoring brokerSales agents must work with a licensed broker who supervises their work. You cannot practice independently on a sales agent license.
• Independent contractor agreementMost agents sign a written contract stating they are not employees. Federal tax rules treat them as self-employed when pay is tied to sales.
• Market knowledgeYou need to know local neighborhoods, financing options, mortgage types, and real estate, zoning and fair housing laws.
• Business and people skillsYou run your own book of business, including advertising and billing, while dealing with clients and contractors every day.

State by state

How to get there

1. Months 0-6Complete prelicense education and pass the state examEvery state requires a license. Course hours and exam rules vary by state.
2. At licensingJoin a brokeragePick a broker for training, supervision and the commission split you will work under. Some states require sponsorship while you are getting licensed.
3. Years 1-2Build a pipelineProspect, work open houses, and partner with senior agents. Income is often irregular and low in this stage.
4. Years 3-5Grow repeat and referral businessPast clients and their referrals become a large share of deals, which steadies income.
5. Year 2 and laterMove up to a broker license or lead a teamMost states require experience as a licensed sales agent before you can get a broker license. How much experience varies by state.

Sources

1. U.S. Bureau of Labor Statistics: Real Estate Brokers and Sales Agents, Occupational Outlook Handbook
2. IRS: Statutory nonemployees
3. Texas Real Estate Commission: Become a Real Estate Sales Agent
4. National Association of REALTORS: The Feature Sheet, 2026 Member Profile
5. National Association of REALTORS: Income Steady, Even as Market Slows, 2025 Member Trends