How Much Do Real Estate Agents Make in Arizona?
How Much Do Real Estate Agents Make in Arizona?
There may be several reasons why you want to enter the real estate industry. You may love architecture and design. Perhaps you want the experience of helping a family find their forever home – or an investment property that could improve their economic future. However, if you are considering going into real estate, you may wonder, “How much do real estate agents make?”
Let’s focus on The Grand Canyon State and find out,
“How much commission does a Realtor® make in Arizona?”
The Average Real Estate Agent Salary in AZ
According to data collected by Colibri Real Estate, the average real estate agent salary in AZ is $115,274.
Compare this to $58,620, which Forbes reports is the average salary of workers in the state.
While we use the word “salary”, please understand that most real estate agents work solely on commission. This commission system has been in place in the U.S. since the 1950s.
How Real Estate Commission Works in Arizona
As a seller’s agent, you will sign a contract with your client that says you will provide services for a specific commission percentage, typically around 5 or 6%. This means that you will earn 5 to 6% of the home’s sale price for providing your services.
The seller’s agent sets the buyer’s agent commission. This means that the real estate agent who brings the buyer to the table will receive a portion of that 6% commission.
Once the transaction is complete, the seller’s agent pays the buyer’s agent. Then, both agents give their brokerages a share of the income they received for their services. The amount depends on the commission split, which is negotiated when a real estate agent starts working with a brokerage. Sometimes, new agents work for a 50/50 split.
Now that you understand the average real estate agent’s salary in Arizona – and how you will get paid
– let’s discuss the average commission rate in AZ.
How Much Commission Does a REALTOR® Make in AZ?
The average real estate commission rate in Arizona is 5.68%, according to a survey conducted by FastExpert. (This is slightly higher than the national average real estate commission rate of 5.57%.)
According to Zillow, the average home value in Arizona is currently $418,836. This means that real estate professionals may earn $23,790 for services related to the average Arizona residential real estate transaction.
$418,836 x 5.68% = $23,790
In Arizona, the seller typically pays the real estate commission. The real estate agents’ fees are deducted from the proceeds the seller makes when the transaction is finalized at closing. Again, it’s important to note that this commission is typically divided between the buyer’s and seller’s agents and their brokerages. The following section details what an average transaction might look like in Arizona.
How is the commission divided between agents?
Here’s an example of how a 5.68% commission may be divided between agents in Arizona.
How Commissions May Be Divided in Arizona – Based on 5.68% Commission
These numbers give you some understanding of how much income you may expect to make working as a real estate
agent in Arizona.
Average Arizona Real Estate Commission Rate by Market
Below is the average home value in Arizona’s ten most populated cities. Based on a 5.68% commission rate, here’s how much real estate professionals may earn by selling an average property.
Average Real Estate Commission for 10 Arizona Cities
| Average Real Estate Commission for 10 Arizona Cities | ||
|---|---|---|
| City | Average Home Value | 5.68% Real Estate Commission |
| Phoenix, AZ | $414,076 | $23,520 |
| Tucson, AZ | $322,244 | $18,303 |
| Mesa, AZ | $426,600 | $24,231 |
| Gilbert, AZ | $563,010 | $31,979 |
| Chandler, AZ | $519,175 | $29,489 |
| Glendale, AZ | $402,880 | $22,884 |
| Scottsdale, AZ | $789,920 | $44,867 |
| Peoria, AZ | $485,136 | $27,556 |
| Tempe, AZ | $467,275 | $26,541 |
| Surprise, AZ | $428,045 | $24,313 |
Source for Average Home Value: Zillow. January 2024
Again, this commission is typically split four ways – among the buyer’s and seller’s agents and their brokerages.
Average Arizona Real Estate Commission for Commercial Properties
When you become a real estate agent, you may focus on commercial real estate. Commercial real estate commissions vary. You might see the same 6% commission rate that you typically find in residential real estate. However, some commercial commissions are graduated (5% up to $1M, 4% of $1M-$5M, for example). Finally, some Arizona commercial real estate agents agree to work on a project for a flat fee.
There is no special license to work as a commercial real estate agent in Arizona. If interested in this niche, take as many continuing education courses as possible to serve this industry segment better.
Arizona School of Real Estate and Business is Arizona’s leading real estate school. We have the highest first-time pass rate compared with other real estate schools in the state and offer self-paced online, live-streamed, or in-person courses. We also provide the classes required for when you are ready to upgrade your license and become a broker.
Learn more about the Arizona real estate pre-licensing process. Then, when you are ready, enroll now in the
90-hour pre-licensing course for Arizona.
Sources:
- Matarazzo, Steph. “Average Real Estate Agent Commissions by State (2023 Survey).” FastExpert. October 26, 2022. https://www.fastexpert.com/blog/real-estate-agent-commissions-by-state/.
- “Arizona Home Prices & Home Values.” January 25, 2024. Zillow. Arizona Home Prices & Home Values | Zillow