What Should I Expect in Terms of Income My First Year in Real Estate?
If you're about to get your license or just passed your exam, you're probably asking yourself the same question every new agent asks: "How much money will I actually make my first year?"
Here's the honest answer most people won't tell you: expect a very uneven, low-income first year, with a real possibility of earning little or nothing for the first 6–12 months. That's not meant to scare you away from real estate. It's meant to help you plan realistically so you can survive long enough to build a sustainable business. Most agents who fail don't fail because they lack talent—they fail because they run out of money before their pipeline matures.
This guide will walk you through realistic first-year income expectations, the timeline to your first commission check, how to manage expenses and runway, smart strategies for bridging the income gap, and clear signs for when it might be time to reconsider the business.
The Year-One Income Reality: What the Numbers Actually Show
Most new agents nationwide earn somewhere in the $30,000–$50,000 range in year one, but that average hides a massive spread. Industry surveys consistently show that agents with under two years of experience have a median income around $15,000–$25,000, and many first-year agents fall into the $0–$25,000 category as they work to build a client base from scratch, according to data compiled by US Realty Training.
The truth is that many first-year agents close only 2–4 deals their entire first year. At typical commission rates and splits, that translates to very modest gross commission income. A small minority of new agents hit $75,000–$100,000+ in year one, but those are outliers—usually agents who entered the business with a strong sphere of influence, exceptional activity levels, or support from a high-performing team, as research from InvestFourMore demonstrates.
What Different Deal Counts Look Like
Here's a simple illustration of how deal volume translates to income in your first year:
0–1 closed deals:You're looking at $0–$10,000 in gross commission income before broker splits and expenses. This is common for agents who struggle with lead generation or market during slow seasons.
2–4 closed deals:This typically generates roughly $15,000–$40,000 in gross commission, depending on your local price point and commission split. This is the most common outcome for first-year agents who maintain consistent activity.
5–8 closed deals:This can push you into the $40,000–$75,000+ range, but it requires disciplined lead generation, good market conditions, and the ability to manage multiple transactions simultaneously.
Understanding these benchmarks helps you set realistic goals and build a business plan that accounts for the actual income trajectory most new agents experience. ZipRecruiter's salary data for first-year agents confirms these ranges across different markets.
Timeline to Your First Check and Break-Even Point
One of the hardest adjustments for new agents is the delay between starting work and receiving any income. Most new agents wait 2–6 months for their first commission check, and the timeline typically follows this pattern, according to industry analysis from Aceable Agent:
Months 1–3:You've completed licensing, finished onboarding at your brokerage, and you're learning systems and building your lead generation rhythm. During this period, you'll usually have little to no income. You're investing time in training, setting up your database, reaching out to your sphere, and learning the contracts and processes.
Months 3–6:Your first serious buyer or seller clients begin to appear. You're writing offers, getting contracts accepted, and moving deals into escrow. But you still haven't closed anything yet, so income remains minimal or nonexistent.
Months 4–8:Your first transactions close and your first commission checks finally arrive. This is when most agents experience their first real validation that the business can work—but it's also when many discover just how much of that check gets eaten by broker splits, taxes, and accumulated business expenses.
Most experienced coaches and industry sources suggest planning for at least six months of expenses as financial runway, because many agents will not reliably cover their bills from real estate income alone until somewhere between month 6 and month 12. Break-even—the point where you're covering both business expenses and basic personal living costs from commissions—typically lands in that 6–12 month window for agents who maintain consistent activity.
The key word there is "consistent." Agents who work sporadically, chase shiny objects, or fail to implement a daily lead generation system often see these timelines stretch much longer.
Managing Expenses and Building Your Financial Runway
Before your first commission check arrives, you'll face both business expenses and household bills. Understanding and planning for both categories is critical to your survival as a new agent.
Common First-Year Business Costs
Your business expenses in year one typically include:
Licensing fees, association dues, MLS access, and brokerage fees
Basic marketing materials: yard signs, lockboxes, business cards, simple website or IDX integration, and CRM software
Transportation costs: gas, car maintenance, mileage, parking
Phone service, internet, and basic print materials
Client gifts, closing gifts, and occasional networking events or sponsorships
These costs add up quickly, and they hit before you earn a single dollar. Many new agents underestimate how much it costs just to operate before considering personal expenses.
The Six-Month Rule
Financial advisors in the real estate industry consistently recommend having at least six months of living expenses saved before going all-in on real estate full-time. This isn't conservative advice—it's practical wisdom drawn from watching thousands of talented agents quit simply because they ran out of cash before their pipeline converted.
A useful planning exercise is to track three core numbers:
Your monthly survival number:What do you absolutely need each month to cover housing, food, insurance, and essential bills?
Your monthly business operating cost:What does it cost to keep your real estate business functioning?
Your average expected commission per deal:Based on your market's median price and your broker split, what will you net per closed transaction?
Once you have these numbers, you can reverse-engineer your activity goals. If you need to net $4,000 per month and your average commission check is $8,000 after splits, you need to close at least one deal every two months—which means you need a certain number of appointments, leads, and follow-up conversations happening consistently every single week.
Part-Time Work and Family Financial Planning
Because months 1–3 are often income-free and months 4–6 remain unpredictable, maintaining part-time work or side income during your ramp-up period is often a smart strategic move, not a sign of failure. Industry guidance frequently encourages one of two paths:
Option 1: Keep part-time work while you ramp up your real estate business, being crystal clear about your time blocks for real estate activities. This allows you to cover basic expenses while building your pipeline without the crushing pressure of financial panic.
Option 2: Enter real estate full-time only if you have six or more months of expenses covered and full family buy-in. This approach works when you have significant savings, a working spouse, or alternative income streams that can sustain you during the income drought.
Getting Your Family on the Same Page
One of the top reasons agents quit isn't lack of leads or market knowledge—it's family financial stress. If your spouse, partner, or household doesn't understand the timeline and income reality, the pressure becomes unbearable around month 4 when bills are piling up and no checks have arrived.
Have an honest conversation with your family that covers:
The income gap: Show them the likely 2–6 month delay before any money arrives, and explain that early checks will be smaller than expected after splits and taxes.
The minimum monthly number: Decide together what your household absolutely needs each month and how you'll cover that amount during the ramp-up period.
The reassessment timeline: Agree on a specific time horizon—such as "We'll evaluate progress at 12 months"—and define what success and failure look like in concrete terms.
This conversation transforms real estate from a vague hope into a family business decision with clear expectations, timelines, and exit criteria.
When to Consider Leaving Real Estate
The real estate industry has a notoriously high failure rate. Research from Tom Ferry's coaching organization indicates that roughly 87% of agents exit the business within five years, with many leaving in the first year. Those numbers aren't shared to discourage you—they're shared so you can define clear exit criteria upfront and make rational decisions instead of limping along in financial distress. Additional analysis from Showcase IDX explores the primary reasons agents fail early and strategies to avoid common pitfalls.
Reasonable "It's Time to Reconsider" Triggers
You should seriously evaluate whether to continue in real estate if:
You've given it 12–18 months of consistent effort without covering basic expenses.If you've implemented daily prospecting, attended training, followed up with leads, and maintained activity for over a year without closing enough business to cover your essentials, the market may be telling you something.
You routinely cannot fund even minimal business expenses.If you're unable to pay for MLS access, gas to show homes, or basic marketing without taking on debt, you're operating in an unsustainable position.
The financial stress is damaging your health, relationships, or core responsibilities. No career is worth destroying your marriage, mental health, or ability to care for your family. If the stress has become toxic, it's time to reevaluate.
You discover you genuinely dislike the work itself.Some people enter real estate expecting one type of work and discover the reality—constant rejection, weekend showings, deal stress, client management—isn't what they want, even when they're doing the right activities.
Signs You Should Stay the Course
On the other hand, if by the end of year one you've accomplished the following, the numbers often justify staying in the business:
You've closed a few deals and earned some commission income
You've built a small but growing pipeline of active leads and potential clients
You can see a clear path to covering your monthly expenses within the next 6–12 months through consistent activity
You genuinely enjoy the prospecting, relationship-building, and problem-solving aspects of the business
If those indicators are present, the solution isn't to quit—it's to tighten your expenses, eliminate distractions, and double down on consistent lead generation with a clear 90-day action plan.
The Path Forward: Building a Sustainable First-Year Plan
The difference between agents who survive year one and those who don't usually comes down to three things: realistic expectations, sufficient financial runway, and consistent daily activity.
You now know the income reality: most agents earn $0–$25,000 in year one, with a 2–6 month delay before the first check arrives. You understand the importance of managing both business and household expenses and the value of maintaining part-time income or building a six-month financial cushion. You have clear criteria for when to push forward and when to reconsider.
The next step is to build a first-year business plan that accounts for these realities. That means setting activity-based goals rather than income-based goals, tracking your lead generation numbers weekly, and managing your budget with the assumption that income will be minimal and unpredictable for at least the first two quarters.
Real estate can be an incredibly rewarding career, but only if you survive long enough to build momentum. The agents who make it aren't necessarily the most talented—they're the ones who planned realistically, managed their money wisely, and stayed consistent even when the checks weren't coming in yet.
If you're a new agent or considering entering real estate and want help building a realistic first-year business plan, financial runway strategy, or lead generation system that actually works, let's talk. At The Lesix Agency, we help real estate professionals build sustainable businesses with clear systems, honest expectations, and practical execution plans.
Schedule a free discovery call with Rob at The Lesix Agency by visiting https://lesix.agency/general and let's map out your path to a successful first year.
