A real estate license in California typically costs between $1,000 and $2,000. While this might seem like a significant investment, it becomes more reasonable when you consider that the average income of a residential real estate agent in California is $200,000. With potential earnings like that, the initial cost of obtaining your license can be viewed as a smart investment in your future.
Keep reading as we break down the benefits of holding a real estate license, the associated costs, and how you can start the process of becoming licensed.
Key Takeaways: How Much Does a Real Estate License in California Cost?
- The total cost to obtain a real estate license in California typically ranges from $1,000 to $2,000, including pre-licensing education, exam fees, fingerprinting, and membership fees.
- Beyond the initial licensing expenses, new agents should budget for ongoing costs such as marketing, post-licensing education, and Errors & Omissions insurance, which can collectively range from $500 to $2,000 annually.
- Despite the upfront costs, real estate in California offers significant earning potential. The average income of residential agents is around $200,000, making the investment worthwhile.
- Prospective agents can manage expenses by choosing affordable pre-licensing courses, utilizing payment plans, and partnering with brokerages that may cover certain fees.
Benefits of Holding a Real Estate License
Real estate agents in California are authorized to manage the buying, selling, and leasing of properties. You can only work as a real estate agent if you have a real estate license.
There are many benefits of having a real estate license.
First, real estate is an excellent career that offers flexibility in both your schedule and career path. You can choose to specialize in areas like luxury properties, commercial real estate, or condos.
Additionally, you can work in various capacities, such as a real estate wholesaler or leasing agent. After gaining a few years of experience, you’ll also have the option to take broker pre-licensing courses to expand your career even further.
Finally, real estate is about helping people achieve their dreams of home ownership. Many agents feel honored to be able to help clients with this important transaction.
Cost Breakdown
Here’s a closer look at the costs of becoming a licensed real estate agent in California.
Pre-licensing education
Approximate cost: $140-$750
You are required to complete 135 hours of coursework before proceeding with the licensing process. Keep in mind that these are not college credits, so many students can finish the coursework in under a month.
Pre-licensing courses are available in person, online, or via livestream. Most students opt for online courses due to their affordability and flexibility.
Exam & license fees
Cost: $450
After completing your pre-licensing courses, you’ll need to apply for your license and exam using Form RE435. The $450 fee covers $100 for the exam and $350 for the license.
Fingerprinting fees
Cost: $49
Like other states, California requires a background check for all real estate agents. If you’re in-state, you’ll pay the fingerprinting fee directly to a Livescan service provider. Out-of-state residents will pay the fee to the Department of Real Estate.
Exam prep
Approximate cost: $115-$250
Choose your real estate school carefully, as some include exam prep materials in their packages. If not, you might have to pay extra for test preparation resources. A high-quality school can increase your chances of passing the exam on the first try, saving you the cost of test retakes.
Membership fees
Approximate cost: $300-$700
Remember the additional costs you might encounter, such as MLS and professional association fees. Discuss these potential fees with your brokerage to see what they pay for and ensure you budget appropriately.
Additional Costs to Consider When Becoming a California Real Estate Agent
Starting your real estate journey requires work and financial investment. However, if you partner with the right real estate brokerage, the firm may cover some of those costs.
When you meet with brokerages, ask if they help with the following expenses.
Related Article: 10 Tips on How to Choose a Real Estate Brokerage to Work Under
Post-licensing and continuing education
Approximate cost: $200
Once licensed, you’ll need to complete a first-time renewal, 45-hour post-licensing course within 12 months of earning your license.
In addition, you are required to complete 45 hours of continuing education every four years. Some real estate schools offer very affordable CE packages.
While post-license and CE courses are not upfront costs, it’s essential to budget for ongoing education to keep your license active.
Marketing and branding expenses
Approximate cost: $500 – $2,000
Many new agents underestimate the cost of marketing their services. These costs can add up and can include everything from business cards and websites to advertising on platforms like Zillow or social media. Depending on the scope of your marketing strategy, expect to spend $500 to $2,000 in your first year building your brand.
Related Article: Real Estate Branding Guide: Personal Branding for Real Estate Agents
Real estate brokerage fees
Approximate cost: varies greatly
Brokerage fees can range from $50 to $500 per month, depending on the brokerage’s structure and the support it provides. Many brokerages also charge a percentage of commissions, which is another cost to consider.
Errors & Omissions insurance
Approximate cost: $300 – $600
Many brokers require their agents to carry Errors and Omissions (E&O) insurance, which protects agents from legal claims from mistakes made during real estate transactions. E&O insurance typically costs between $300 and $600 annually, depending on your location and coverage needs.
Strategies to Manage California Licensing Costs
While some fees—like the application and exam—are standard for everyone, you can save money by comparing prices for pre-licensing courses and exam prep materials. However, it’s crucial to balance affordability with quality. Retaking the exam can add to your overall costs (and the time it takes to become licensed), so it’s worth investing in a reputable education provider to increase your chances of passing the exam on the first try.
Colibri Real Estate offers affordable, highly-rated pre-licensing courses. Many of our packages also include exam prep materials that will help you pass the exam the first time you take it. Check out our Pass or Don’t Pay Guarantee, which shows our confidence in being able to help you earn your California real estate license.
Frequently Asked Questions About Real Estate License Costs in California
1. How long does it take to get a real estate license in California?
The time it takes varies depending on how quickly you complete the required 135 hours of pre-licensing coursework and pass the exam. On average, it can take anywhere from 3 to 6 months to complete the entire process.
Just think – within a few months, you could be earning your first commission check as a California real estate agent!
2. Can I pay for my pre-licensing education in installments?
Yes! You can finance real estate school with Colibri Real Estate. Colibri partners with Affirm to allow our students to use a payment plan for pre-licensing courses. This option can help manage upfront costs by spreading payments over time.
3. Are there any hidden costs involved in getting a real estate license?
In addition to the standard licensing fees, other expenses such as marketing, association membership fees, E&O insurance, and broker fees may become necessary once you start practicing. Be sure to budget for these as well.
Start your pre-licensing courses today with Colibri Real Estate and take the first step toward a successful career in real estate.
