San Francisco is the worst place in the country to be a real estate agent, according to data and analysis from Clever.
Owning a home is unaffordable on the typical San Francisco agent’s $65,000 salary, plus there is more competition among agents in the Bay Area and fewer sales per agent than in other American cities, the listing leads company said.
The median salary for a full-time agent in San Francisco is on the higher end for agents, given the national median of about $50,000. But because housing costs are so high in the San Francisco Metro—which also includes East Bay markets—it was the second-most unaffordable to agents.
The San Jose Metro was the most unaffordable city out of the 50 studied and the third-worst place to be an agent, according to Clever.
South Bay agents make about the same as San Francisco agents, but because homes in the South Bay are even more expensive, it would take 25 years of the median real estate agent’s salary to afford the median-priced home in the area, compared to 18 years for San Francisco agents. The nationwide average is a little less than 8 years.
Previous studies have shown that it takes a salary of about $400,000 to afford a median-priced home in the South Bay and $300,000 to afford a home in San Francisco.
Affordability was given the most weight in the study because it “makes sense for agents to be able to afford a home themselves on their salary, and that isn’t always the case in many cities,” said Alyssa Evans, a representative for Clever.
Other heavily weighted factors include average salary, the number of agents per 100,000 residents, and the annual home sales per full-time agent. Factors like home values—in the past and forecast in the future—days on market, listing and buyer commission rates, and how difficult it is to get a real estate license contributed to the results as well.
The report did not factor in additional income from other side jobs agents may have because that amount could vary greatly and the intent was to focus on the salaries made selling homes alone to educate those who think it’s easy money, Evans said.
“Many people think becoming an agent is easy and can result in a high salary, when in actuality, it’s very demanding and time-consuming, and agents, especially newer ones, likely aren’t making as much as they expected,” she said. “The most successful ones make high salaries, but it takes a lot of time and effort to get there.”
Detroit was the best city to be an agent, according to the report, in part because of affordability but also because Detroit has the highest sales volume in the country with the lowest competition. Buffalo was second-best for similar reasons.
There were fewer than 20 agents per 100,000 residents for both the top two cities, compared to 63.5 nationwide. In San Francisco, there are about 103 agents per 100,000 residents and in San Jose there are about 74.
Full-time San Francisco and San Jose agents both sold under 10 homes on average in the last year, while full time agents in Detroit sold nearly 90 and Buffalo agents just under 50. The average number of homes sold per agent nationwide in the last year was 18.
“So many people are buying homes in those cities because more people can afford to than, say, San Francisco or San Jose,” Evans said.
Buffalo agents made the second-highest salaries nationwide at about $84,000. New York City agents made by far the most with a median of about $104,000.
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