The Average Canadian Realtor Earns?
Why Should You Care?
I believe it goes without saying that all small business people want to be above average in their chosen industry. Realtors are definitely small business owners. In fact, if you think about it, realtors are one of the purest forms of capitalism there is. If you don’t produce, you don’t eat, and there is no one to blame but yourself.
The beauty of this industry is that there is a relatively low cost of entry, which is a big reason why so many people give this opportunity a shot. There is no inventory to purchase or manufacture, and no space to build out.
Getting started in real estate, like in many service industries, is generally not a huge challenge.
Yes, one has to study a little and pass the real estate exam, but certainly there are no huge hurdles to overcome in order to get started. In a few short months . . . “poof” . . . one becomes a professional, and is ready to get out there and strive to become an “above average” earner.
So what is an “above average” earner in this industry? Let me share a few facts.
Below are some results based on the most accurate data that is available. I say it’s accurate because these numbers are from tax returns reported by the Canada Revenue Agency. Here is how the “average” results stacked up for 37,746 unincorporated real estate agents in Canada in 2013.
I’ll get to why I believe this is important in a moment.
Average Total Revenue (Commissions) $105,100
Average Net Profit (Income) $ 57,100
Okay, so we see that the “average” realtor in Canada made about $57,000 in 2013. I assume you are a realtor or are thinking of becoming one, or you wouldn’t likely be reading this blog. Is this what you expected? Is this helpful, or just interesting? Are you beating this average? If not, why not? Perhaps, performing around the average is satisfactory to you and you are now patting yourself on the back.
Let’s assume you wish to become above-average. What would that look like? Below are the average results of the top quartile (25%) of all tax-paying unincorporated realtors in Canada.
Average Total Revenue (Commissions) of top 25% $224,100
Net Profit (Income) of top 25% $126,700
Now, let’s talk briefly about why this data should be important to anyone with an interest in this industry. It should, in fact, be interesting to any small business owner.
Obviously, the group producing the above-average results are doing something that the average producers are not. One could argue that “someone has to be average in order to have an average in the first place”. Of course this is true, however this is more of an excuse than an argument, don’t you think?
In the few minutes it took to read this article, you have learned some interesting facts about the business of being a real estate agent in Canada. This is kinda nice and somewhat helpful to some, I trust. However the more important benefits to readers, should include:
- If you are considering becoming a realtor, you now have some facts to support or curb your interest, depending on your income goals.
- If you are currently in this industry, you now have results to compare your performance against. Perhaps these facts will motivate you to do better or provide confirmation that what you are doing is working.
- If your results are average and you are not satisfied with meritocracy, you should be motivated to determine what the above-average performers are doing, and do the same. This is one of the easiest, fastest, and most cost effective ways to become an industry leader.
- It is true what they say: "If You Don't Know Where You're Going, Any Road Will Get You There.” All industry leaders have specific goals, and if you haven’t got any, you must establish them, right now.
There are all types of goals one can, and should, create in order to help grow their businesses. Profitability goals are one of the most important objectives one should develop and strive for, yet I am often amazed at how few entrepreneurs have a handle on this most basic business benchmarking parameter.
To learn more about how industry leaders become industry leaders, and to request your “free” benchmark statement for your industry, visit my site at www.howmuchmoneycanimake.com