An executive at one of the largest real estate agencies in South Africa has provided some indication of how much money top performing agents can earn annually.
Adrian Goslett, the regional director & CEO at RE/MAX Southern Africa says that top 200 agents in the company averaged 40 sales each in 2023.
He added that these agents averaged R2.7 million for the year, or R225,000 per month.
According to ooba Home Loans, the average national property price in Q4 2023 was approximately R1.41 million.
If an estate agent successfully sold 40 properties, with an average commission rate ranging between 3% and 4%, equating to earnings of R42,000 to R56,000 per sale, their total salary would exceed R1.68 million to R2.24 million.
The average pay and commission structure for real estate agents in South Africa can vary significantly depending on factors such as experience, location, brokerage firm, and the state of the real estate market.
Basic Salary: Many real estate agents in South Africa work on a commission-only basis without a basic salary. However, some larger real estate agencies may offer a base salary or retainer to their agents, particularly to those who are new to the industry or during periods of slow sales.
Commission Structure: Commission rates in South Africa typically range from 5% to 8% of the property's selling price. This commission is split between the buyer's agent and the seller's agent (listing agent), with each typically receiving 2.5% to 4% of the sale price.
Tiered Commission: Some real estate agencies may offer a tiered commission structure, where agents receive higher commission rates for reaching certain sales targets or selling properties above a certain price threshold.
Performance Bonuses: In addition to commission, real estate agents may be eligible for performance bonuses based on factors such as sales volume, customer satisfaction ratings, and achieving sales targets set by the brokerage.
Incentives and Perks: Some real estate agencies offer additional incentives and perks to their agents, such as travel rewards, training and development opportunities, marketing support, and access to exclusive listings.
Independent Contractors: Most real estate agents in South Africa are considered independent contractors rather than employees of the brokerage firm. This means they are responsible for covering their own business expenses, such as marketing materials, transportation, and licensing fees.
Variable Income: It's important to note that real estate agents' income can be highly variable and dependent on market conditions, the number and value of properties sold, and the agent's individual sales skills and networking abilities.
According to Goslett, 3,250 RE/MAX agents sold over 20,000 homes in Southern Africa last year, leading to R27.9 billion in sales.
Crudely that would put the average number of properties sold at six per agent over a year, meaning a salary of between R252 000 and R336 000.
It's essential for individuals considering a career in real estate in South Africa to thoroughly research and understand the compensation structure and potential earnings potential within the industry, as well as the specific requirements for licensing and registration with regulatory authorities.
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