You’re thinking about getting your Texas real estate license, but you aren’t sure how much it will cost. Let’s break down both pre-license and post-license costs so you know exactly what to expect.
Costs Before You Get Your Texas Real Estate License
Here’s the list of expenses:
Texas Real Estate Exam ($54)
Application for Texas Real Estate License ($205)
Fingerprinting fee ($37)
Background check ($27)
Texas Real Estate Recovery Fund fee ($10)
Online real estate course (around $500, although the cost will vary)
Your total costs will be about $833.
Costs After You Get Your Texas Real Estate License
Once you have met all the requirements and obtained your license, you will incur more expenses. These are a bit more variable, but here is a rough estimate:
Broker sponsorship fee ($20.60 if completed online; $40 if paper)
Real estate association annual dues (around $150)
Continuing education fees (around $350 for your first renewal; around $90 every two years after that)
Multiple listing fees (set-up fee of around $25; monthly fees of around $38 after that)
Internet Data Exchange fees, which allow members to integrate MLS listings onto their own website (set-up fee of around $99; around $50 monthly fees after that)
Marketing materials, including business cards, flyers, signage, and maintaining a professional website (around $1,000 per year)
Errors and Omissions insurance, which covers you in the case of unintentional errors (around $350 per year)
A monthly desk fee, which goes to your sponsoring broker for giving you office space (varies)
Transportation costs (varies)
Client entertainment expenses (varies)
Let’s say you’re an agent in your first two years. That means you have to take the more expensive continuing education, you have to pay the initial MLS and IDX set-up fees, and you have to pay a lot for advertising to get your name out there. You’re looking at an annual cost of at least $2,000.
Keep in Mind
These costs may sound a little scary. However, as a real estate agent, you will likely be an independent contractor. As such, all of the above costs will be deductible on your tax returns as business expenses.
Also, be aware that depending on where you work, your broker may help you with costs such as MLS dues and advertising. Other brokers won’t pay for anything, but will offer you a larger commission split.
In order to offset the expenses, you might:
Make a budget. If you are financially able, put away six months of living expenses prior to becoming an agent. Once you are an agent, save about $700 per month for business expenses.
Join a real estate team. This is a structure in which real estate agents work together rather than individually. You share the costs but also, alas, the commissions. This is a popular option in large franchises.
Become an assistant. This is something to consider before you get your license. If you work as an unlicensed real estate assistant, you can make connections and get a better sense of whether or not you want to commit to this industry. If you do, transitioning to licensed work should be a bit easier.
On the Plus Side, How Much Will You Make?
Now for the fun part – how much money can you make, once you have your Texas real estate license? Check out our blog post here!