According to the Bureau of Labor Statistics, the top real estate agents in the country earn over $100,000 a year. For many, the profession allows for plenty of independence and a flexible schedule. The most successful real estate agents tend to be self-motivated and have engaging personalities. But what you earn as a real estate agent isn’t all about your skills or your personality. Like real estate itself, location is of paramount importance.
Fit Small Business recently conducted an analysis of the 50 largest metropolitan areas in the country to discover what cities offer the best prospects for real estate agents. Their analysis relies on data from sources including Trulia, Zillow, the United States Census Bureau and the Bureau of Labor Statistics.
To rank the best cities, Fit Small Business took into account eight metrics that influence a real estate agent’s ability to grow their business:
- Days on market
- Median sales price of homes
- Inventory measure
- Mean annual wages
- Location quotient
- Percent of flip
- Percent of listings with price reduction
- Median price cut percentage
Did your city make the top 10?
Number 10: Riverside, CA
Competition for real estate agents is low in Riverside, with a location quotient of 0.63. The national average is 1.00. Inventory is large and only getting larger, but median sales prices are keeping up. At last count, the average home sold for $339,000, 13th among the 50 largest metro areas.
Number 9: San Jose, CA
San Jose is the capital of Silicon Valley, which explains why this relatively small market finished in the top 15 in four categories. San Jose boasts the most expensive housing market in the nation, with a median sales price of $1,165,000. San Jose agents rank 15th in terms of compensation, earning $62,300 annually.
Number 8: Miami - Fort Lauderdale
Second only to New York in terms of inventory, Miami produces an average of 43,531 homes for sale each month. Miami real estate agents enjoy average annual wages of $72,380 per year, to place eighth among all 50 metros. Median sale prices are slightly lower than other markets on this list at $340,000, good for 12th in that category.
Number 7: Denver, CO
Denver real estate agents earn among the most in the nation at $78,630, good for fourth. Although median sale prices are on the higher end at $418,100, they only last on the market an average of 67 days.
Number 6: New York, New York
With four categories in the top 10, the Big Apple is number six on the list. New York City has the best inventory of any of the 50 largest metro areas—with 84,654 homes for sale per month. With all that inventory and seventh ranked median sales price ($419,100) it’s no surprise that New York real estate agents earn the most in the country: $97,610 a year, on average.
Number 5: Washington, D.C.
Washington sits at number five on the list with top 15 rankings in five categories. The combination of high median sales price ($408,500) and abundant inventory (17,315 put up for sale a month) explain why Washington real estate agents earn a healthy $62,320 a year—good for 12th in the category.
Number 4: Chicago, IL
Home supply in the Windy City is among the best in the nation, with an average of 39,950 properties for sale per month, good for third place. Flipping accounts for 7.5 percent of home sales, good for sixth in the country. Homes are snapped up quickly in Chicago as well, sitting on the market for just 60 days—the eighth shortest of the 50 metros examined.
Number 3: San Francisco, CA
With sky-high real estate valuations, it’s no surprise that San Francisco would rank near the top of the list. The median sales price of $900,000 ranks second among the 50 metro areas. With extremely generous commissions earned on home sales, real estate agents in San Francisco earn an average of $96,060 per year to rank second. The one problem in San Francisco? A scarcity of homes. It ranks 46th of 50 in inventory.
Number 2: Boston, MA
Boston ranked in the top 15 in four of the most important metrics. Boston agents earn high commissions per sale. The median sales price is sixth among the 50 metro areas at $464,100. Real estate agents in Boston make $67,400 annually, on average.
Number 1: Los Angeles - Long Beach - Anaheim
With high rankings in all eight metrics examined, the Greater Los Angeles area earned the number one spot. Agents earn considerable commissions per sale on homes. The area has the fourth highest median sales price on the list, at $595,100. Homes only last on the market 64 days despite the large inventory. Agents in Greater LA earn an average of around $63,500 a year.
Want to see where your city ranked in the top 50? Check out the full article on Fit Small Business.
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