Your courses are offered by Brightwood College | Hammond
Cost of Prelicense Education: $250–$400
The first step you must take to become a real estate salesperson in Pennsylvania is to complete courses in Real Estate Fundamentals and Real Estate Practice. This is a total of 75 hours of education. Over 70 private schools in Pennsylvania, plus many community colleges and public universities, offer these courses in classroom, home study, and online formats. The cost for the two courses, plus examination preparation materials, can run from approximately $250 to over $400, depending on the format.
PSI Exam Provider Fee: $54
The state of Pennsylvania contracts with a test provider, PSI, to create and administer the qualifying exams you must take and pass in order to apply for a real estate salesperson license. There is an 80-question national exam (of which you must get 60 correct) and a 30-question state portion (of which you must get 23 correct). The $54 fee (as of 5/4/17) covers both portions.
Salesperson Standard Initial License Fee: $107
The total fee of $107, which goes to the Pennsylvania Department of State, consists of a $72 license fee, a $25 application fee, and a $10 recovery fund fee (as of 1/2017). The fee covers a period that expires on May 31 of even numbered years.
Background Check: $10 (as of 8/10/2017)
You are required to complete a criminal background check by the state police of every state you have resided in for the five years preceding the date of your salesperson license application. For Pennsylvania residents, background checks may be obtained via the PATCH website.
Local Association of REALTORS™: $535–$575
The above items and costs are mandatory to perform acts for which a real estate license is required. Starting with joining a local association of REALTORS™, the remaining items may be discretionary and will vary depending on the real estate broker you associate with and the marketplace in which you operate. Most real estate brokers belong to local, state, and national associations of REALTORS™. The above annual costs of $535 to $575 include dues in the local, state, and national organizations. Dues are prorated based on what month you join. The broker you associate with will be able to tell you what organizations they belong to and which ones you will have to join.
Multiple Listing Service: $200–$500 per year
In addition to belonging to a local association of REALTORS™, most real estate salespeople also elect to belong to a local multiple listing service (MLS). Some may have a one-time activation fee of up to $250. The MLS provides more information than the public can access online, such as directions for accessing property for a showing, and broker commission sharing agreements. It also provides your listings with maximum exposure to agents and buyers in your marketplace. In addition to membership fees, there are typically also fees for submitting listings. These cost roughly $40 per listing.
Lock Box: $200 per year
The lock box fee is typically paid monthly and can also consist of an activation fee of about $60, as well as optional insurance of approximately $25 to cover lost or damaged keys. Without insurance, replacement of a lock box will cost you roughly $250. Having a lock box key allows agents easier access to property. While it is not required, it is the industry standard.
Increased Auto Insurance Rates: $300 per year (approximately)
Choosing a career in real estate may have an effect on your automobile insurance rates. The national average annual rate for auto insurance for people with careers in sales or real estate is approximately $1,200. This is in the high range of what people pay by career. According to one nationwide study, the average annual auto insurance cost for non-sales types of employment was approximately $900. It is important to contact your insurance broker, tell them that you are getting into the real estate sales profession, and ask them if there will be any insurance ramifications to your new endeavor. You certainly don’t want to have your insurance cancelled because you were in an accident and hadn’t disclosed that you changed your automobile to a commercial use.
The above expenses total roughly $2,000 to $2,500 for a new salesperson’s first year in the real estate profession. Some of these expenses can be paid on a monthly basis, and some are prorated. These figures are estimates only, provided at a specific moment in time, and can change without notice. In addition, you should anticipate additional, variable expenses for the following:
- Continuing education: In Pennsylvania, you are required to complete 14 hours every 2 years, by May 31 of the even numbered years.
- Personal marketing: This can include costs associated with launching and maintaining a personal website, generating leads, promoting your listings on websites like Zillow, and creating a variety of other printed and digital marketing resources.
- Business expenses: You’ll need office supplies, a mobile phone, and internet. You’ll likely also share a number of costs with your broker, such as Errors and Omissions Professional Liability insurance.
- Technology: There will be costs associated with upgrading your computer and mobile phone to business-level. You’ll also need tax recordkeeping software such as Quicken, and customer relationship management (CRM) such as TopProducer.