What's the Cost of a Real Estate License in California?

Looking to start your real estate career, and wondering how much it costs? Here is a guide to help you navigate the expense of getting your California real estate license!

There are a few hoops you’ll need to jump through first, like taking a pre-licensing course and passing the state licensing exam. And all of those things cost money, unfortunately. There are also application fees, exam fees, and background checks you’ll need to budget for.

So, let’s walk you through how much a California real estate license costs and how much you’ll need to budget to be successful as an agent.

Cost #1: Pre-License Real Estate School Courses: $179 - $700

The very first step in your journey to a real estate license is to take the state-required pre-license courses. The California Department of Real Estate (DRE) requires that applicants take three college-level courses for a total of 135 hours before applying for a license. The course you will take include:

• Real Estate Principles - 45 hours
• Real Estate Practices - 45 hours
• An elective an approved list of courses - 45 hours

The cost of these courses can vary significantly, depending on the provider. State universities tend to be the most expensive, while courses taken via an online education provider or a private real estate school are usually more cost-effective options. AceableAgent offers payment plans for your real estate course through Affirm and Klarna. These Buy Now/Pay Later programs can help break up the cost of your pre-licensing course into monthly payments to help ease the financial responsibility of the upfront cost.

As you look at state-approved real estate schools, pay special attention to:

• Access to the course materials. Do you have to attend courses on campus? Can you access the coursework from your cell or tablet?
• Student support. Will there be real estate professionals available to answer your questions?
• Price. How much is your real estate school? Will your student experience be worth the expense?

Cost #2: Exam Fee: $60 per attempt

Once your coursework is complete, you can apply to take your DRE real estate exam and get your real estate license. The current exam fee for the sales agent license is $60 per attempt. It’s a difficult test, and many people need two or even three attempts to pass it. You’ll want to choose an education provider who offers test prep tools in order to give yourself the best possible chance of passing on your first try. Passing on the first try will save you time and money.

Cost #3: Application Fee: $245 for a four-year real estate license

The sales agent application fee for a real estate license is currently $245. Fortunately, it’s good for four years

Cost #4: Fingerprinting Fee: $60

In addition to the application fee, you’ll need to pay a Live Scan fingerprinting fee of up to $60. Anyone applying for a real estate license must have a background check completed before a license will be granted. This fee is paid directly to the Live Scan service provider, not DRE.

The Total Texas Real Estate License Cost - $544 - $1,065

Adding all these costs together, you should expect to pay somewhere around $544 to $1,065 total to get your real estate license in California, with the biggest expense variable being which real estate school you choose.

Other Costs to Become a Real Estate Agent

Next, let’s take a look at some of the costs associated with being a new agent.

Brokerage Desk Fees

Brokerage desk fees vary but can be up to $500 a month. New agents must work under a broker, and some brokerages charge monthly fees to agents in exchange for office space, mentoring programs, and training — in addition to the commission split the new agent shares with their sponsoring broker.

Membership Dues

This can range from $150 to $600 per year. You’ll want to join professional associations like the National Association of REALTORS® ($150), the California Association of REALTORS® ($184), and your local real estate board membership (dues will vary). These organizations offer tools and resources that can help you succeed as an agent.

Multiple Listing Service (MLS)

An MLS subscription is critical to your success as an agent. A subscription fee may be part of your local board of REALTORS® membership, or you may pay it separately. Prices vary, but a subscription to the local MLS could be as much as $300 to $500 per year.

Marketing Expenses

Your marketing efforts will cost you anywhere from $200 to $3,000 per year. Of course, you can start marketing for free on social media, but you will need to budget some money for your print needs like business cards, property flyers, signs, and mailers to advertise both you and your properties. You’ll also likely need a website and may want to spring for paid advertising in local newspapers and magazines.

Start-up Cushion

Real estate is different from many other career paths. Real estate agents are typically not employees; they’re independent contractors. This means you’ll probably work on commission instead of receiving a predetermined salary. You’ll probably have to pay for your own insurance and fund your own retirement. And it can take time to close your first deal. You’ll need to find your first clients and see that deal through to close before you collect a paycheck. This whole process can take two to six months. That means two to six months without an income, so you’ll want to have a nest egg or cushion to rely on as you start your new career.

Is a California Real Estate License Worth the Cost?

With all these upfront fees, and the slow start to your new income, you may be wondering: Is a California real estate license worth it?

As long as you’re a hard-working self-starter, the answer is a resounding YES! According to Indeed.com, the average salary of a real estate agent in California is $91,363, which makes getting a real estate license absolutely worth considering.

And one of the best things about real estate is the unlimited income potential! If you can hustle to land lots of clients, and provide top-quality service, you can potentially make six figures every year!

The Bottom Line

A career in real estate is exciting, fulfilling, and flexible. And it’s also high-paying if you’re willing to work hard and stick with it!

It all starts with getting your real estate license. The upfront cost and time spent studying require some effort and planning on your part, but the rewards will be well worth your investment.

Ready to take the next step toward becoming an agent? You can learn more about how much it costs to get your license and even sign up to take a pre-licensing course today!