Residential estate agents are the lowest-paid professionals in the real estate industry with base salaries almost £30,000 below the wider industry average, according to analysis by Nested.
The data shows that the nationwide average base salary for residential sales agents in the UK, including those on both the agency side and development side, is £32,050. This is 44.3% below the overall median salary in the wider UK real estate industry, which is currently £57,500.
Compared to agent base salaries in other parts of the world, this means UK agents are better off than those in Asia, who earn 53.3% less than the continent’s wider industry average. But it also means that UK agents are, relatively speaking, worse paid than their counterparts in South Africa (-33.3%), Europe (-23.5%) and the Middle East (-2.8%).
Back in the UK, residential sales agents who work on the agency side are the worst paid of all property industry professionals, with base salaries averaging just £30,100.
This puts them behind agents working residential sales from a development side (£34,000), support & administration staff (£34,000), and residential lettings agents (£35,000). It puts them even further behind the likes of facilities managers (£45,000), quantity surveyors (£55,000) and human resources staff (£83,300).
Alice Bullard, managing director at Nested, commented: “The obvious incentive for agents in both sales and lettings is commission – this is why they’re willing to accept such low base salaries. But if commission is the most important thing, why do so many agents still value working within the traditional agency model in which the agency brand they work for takes such a significant slice of their commission?
“The probable answer is security and market exposure. You might earn more by being self-employed and keeping 100% of the commission, but the base salary offered by big agencies removes some of the pressures that come with being a sole trader, while the brand exposure they provide, in theory, makes it easier to win new business.
“But it’s a costly trade-off: employed agents typically retain only 5-15% of their exchanged commission versus 75-100% on the best self-employed models.”
Comments (7)
Agency is not a “professional” job
I would question the relevance of the compatible property-related and other jobs mentioned.
Residential estate agency has near-zero educational entry. The majority of the other roles mentioned require a degree level or similar. It’s not unreasonable to assume that a university-supported profession comes with a higher salary. A fairer comparison would be found with retail and/or non-specialist sales roles.
Traditionally, a basic salary is 50% of OTE. Where commissions are uncapped, there is no upper limit. Not everybody wants a job with an element of risk associated with earnings. For others, the opportunity to have effort linked to reward works.
It depends on which side of the fence you’re on. If you’re employed then I suspect you prefer being employed and if you’re self-employed then that is your preference. Most independent estate agency owners are “self-employed” anyway. i.e. no commissions equals no salary.
Where did this ‘data’ come from?
As a Recruitment Firm in this sector, moving hundreds of Estate Agents around every year, I can safely say that these supposed average salaries are wrong.
Just looking at the quoted UK number of £30,100pa for Residential Sales Agents for example, I would be confident in saying that this is too high….
Illogical thinking and poor use of comparison here.
Comparing salaries of H.R and Quantity Surveyors to any sales role is a red-herring. So too the comment that “it’s a costly trade-off”. One might argue that it is a costly trade-off going from any salary to no salary.
Bear in mind also that salaries are paid throughout the sales process but self-employed agents are paid nothing until they complete.
I have no issue with either business model but the self-employed model seems obsessed with money and the opportunity to earn it. How much money is earned results from doing a great job for the client whether employed or self-employed.
Person trying to sell self employed jobs makes startling claim that self employed people earn more
Self employment CAN be financially beneficial of course, but there are also a lot of risks. The narrative is always to push how big a slice the employer takes but it’s rarely mentioned about all the huge overheads they also incur. Self employment is right for some people but not for all.
Advertorial!
Wrong Certus. Property Industry Eye never runs advertorials. It is not possible to buy editorial space on the publication.