Are real estate agents self-employed?

Real estate agents can help tenants or owners find the right property for them. They can reduce the stress of the property search and buying or letting process. There are plenty of opportunities for real estate agents today. But are real estate agents self-employed? 

This guide will cover the self-employment of real estate agents, including:

• When real estate agents are self-employed 
• Why to consider self-employment as a real estate agent
• How to set yourself up as a self-employed real estate agent

A large number of real estate agents are self-employed workers, and that number is growing. But not all real estate agents are self-employed. So, when are real estate agents self-employed? 

Real estate agents are self-employed when they don’t earn a fixed income from another company. If they work with another real estate agency, they are independent contractors or sole traders working to earn income based on commission, or a set percentage of each sale. 

Some real estate agents work entirely for their own business, finding their own clients and earning their own income. Self-employed real estate agents are also responsible for reporting their income for taxes.

Some real estate agents work full-time for real estate agencies or companies. If they work directly for the agency with a set salary, they are not self-employed. They may be assigned clients and earn a percentage of commission from their sales. 

The difference between being employed by a letting agency and being self-employed comes down to who pays your salary. Either you get paid by the agency, or you get paid by yourself. 

More and more people choose to work as self-employed real estate agents because of the flexibility and opportunities it presents. If you’re wondering whether to pursue a career as a self-employed real estate agent, here are some things to consider. 

Working as a self-employed real estate agent allows you to earn more than if you’re working for an agency. 

Self-employed agents can earn more from their commission. Working for an agency means that agents may not earn a commission on top of their salary. If they do make a commission, the agency takes a higher percentage of those earnings. 

You can also work remotely to help people find the right property for them. Since prices and commissions change depending on location, this flexibility opens opportunities for higher income. 

Today, it’s easier than ever to scan letting and buying websites and apps to find available properties. People often search the internet for properties rather than walking into a real estate office. 

Being self-employed gives you more flexibility to find these clients online and help them with the property search. For example, as a self-employed real estate agent, you can set your own hours instead of following your agency’s schedule.  

As an independent agent, you can work with popular companies like Rightmove, OnTheMarket to help interested clients in different areas. You can also work with companies like PurpleBricks or open your own real estate agency. You’ll need to market yourself to find your client base. 

Working as self-employed also means you’re responsible for all of your earnings. When weighing these options, think about if you could succeed, client wise, if you choose to be self-employed. 

Instead of having clients assigned to you, you will be responsible for bringing in your own clients. You’ll need to market yourself to succeed as a self-employed real estate agent. 

If you’re new to real estate, you may want to look into an apprenticeship as a real estate agent to learn about the business before working entirely on your own. You can also look into working as an independent contractor for a real estate agency.

If you decide that being a self-employed real estate agent is right for you, there are a few things you’ll need to get started. 

As a self-employed real estate agent, you’ll need to register your business to get started. You’ll need to set up your business with Companies House. You’ll also be responsible for paying taxes based on your income. 

You can choose to open a limited company to run your own real estate business, or you can work as a sole trader for another agency. Consider where you want to start your self-employed real estate career as either a sole trader or a limited company. 

To get started as a self-employed real estate agent, you’ll need the knowledge to succeed. In the United Kingdom, you don’t need a license to work as a real estate agent. But you may want to learn a bit about real estate to prepare yourself for this career. 

You may want to look into a degree or certificate in real estate. The NAEA (National Associations of Estate Agents) and INEA (Independent Network of Estate Agents) offer certificate programs. 

You may also want to decide if you’ll focus on buying and selling or letting real estate. Once you decide your focus, you will need real estate agent software. Some options you can look into are Spectre, Rentman, or Alto. 

Aside from the knowledge and software, you’ll also need strong sales and marketing skills. You’ll need to put your business out there to earn good income as a self-employed real estate agent.

Once your self-employed real estate career begins to grow, you’ll need to organise your finances. Financial management can be stressful and time-consuming when you’re self-employed. That’s why thousands of business owners use the Countingup app to make their financial admin easier. 

Countingup is the business current account with built-in accounting software that allows you to manage all your financial data in one place. With features like automatic expense categorisation, invoicing on the go, receipt capture tools, tax estimates, and cash flow insights, you can confidently keep on top of your business finances wherever you are. 

You can also share your bookkeeping with your accountant instantly without worrying about duplication errors, data lags or inaccuracies. Seamless, simple, and straightforward! 

Find out more here.