Real estate

How Much Does a Real Estate Agent Earn? Salary Insights in Italy

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How Much Does a Real Estate Agent Earn in Italy?

At least once in their lives, everyone has wondered how much a real estate agent earns.
This profession often appears to be quite fascinating from an outsider’s perspective.

And in many ways, it is.
Skills such as negotiation, deep technical knowledge, business acumen, and, importantly, interpersonal skills are essential traits for a competent real estate agent.

However, what kind of financial rewards can one expect from such a professional background? The pandemic that began in 2020 has significantly transformed this profession along with the entire market.
Below, we’ll explore salary expectations for real estate agents in Italy.

Average Salary of a Real Estate Agent in Italy

On average, a real estate agent in Italy makes around €2,500 per month.
However, this figure can fluctuate based on several factors, including the agent’s experience level and the agency they work for.

Franchise agencies typically offer different remuneration structures than independent agencies.
Usually, franchisees provide a fixed monthly salary along with commission percentages.

This setup can lead to much higher earnings in the long run, although it often sacrifices the security of a fixed salary.
Entry-level agents, or those just starting their careers, generally earn an entry-level gross annual salary of €24,000.
Some internships may even offer a monthly reimbursement of €1,000 during the initial period.

Conversely, a real estate agent with over 10 years of experience can earn close to €50,000 annually.
Earnings depend significantly on their sales skills and the portfolio of properties they manage.

A higher number of successful transactions leads to increased commission potential.
This is why many real estate professionals choose to operate as freelancers with a VAT number.

Regarding contracts, it is essential to note the difference between agents and agency owners.
While agency owners can make around €35,000 to €40,000 a year tax-free, agents working under them make less.

Components of a Real Estate Agent’s Salary

The salary of a real estate agent is not solely a single figure; it must be broken down into its components.
It typically includes: monthly salary or expense reimbursement, commissions, and performance bonuses.

To accurately gauge an agent’s compensation, one must consider commissions and bonuses alongside the fixed salary.
Commissions earned by real estate agencies are regulated by law.

A ruling from January 26, 2023 (sentence no.
2385) stipulates that a mediator is entitled to their commission only upon successful transaction closure.
This right kicks in with established legal obligations, like purchase proposals and successful negotiations.

Commissions are calculated based on the property’s sale price, usually ranging from 2% to 5%, depending on the agency’s discretion.
If we’re discussing rentals, the agency typically receives a commission equal to the first month’s rent or 15% of the annual rent (excluding VAT).

It’s important to note that the agent does not receive a commission if the deal falls through.
Bonuses may be granted for achieving specific production targets, incentivizing agents to enhance overall performance.

How Does Billing Work for a Real Estate Agent?

While having a VAT number is not mandatory for real estate agents, issuing invoices and declaring income is.
This requirement effectively forces most agents into self-employment.

Those looking to establish a VAT number as a real estate agent need to be aware that the relevant ATECO code is 68.31.00, which stands for “real estate brokerage activities.”

Beginning agents can opt for a flat-rate tax regime.
Electronic invoicing has also become mandatory as of January 1 for all incomes, even those below €25,000 annually.

For those exceeding the flat-rate threshold of €85,000, simplified accounting applies.
This means taxes are calculated solely on the difference between income and expenses, allowing for deductions.

Additionally, real estate agents must register with the INPS management system, contributing €900 quarterly for incomes between €0 and €15,000 annually.

How to Become a Real Estate Agent

Despite the satisfying nature of this profession, candidates must meet specific and highly specialized requirements.

The real estate agent’s role is a hybrid one, necessitating comprehensive knowledge of economic and legal concepts as agents deal with legal matters almost daily.

Many agencies favor candidates holding a bachelor’s degree in economics or law, ensuring they possess a solid academic background ahead of time.

However, the basic requirement is a high school diploma.
Afterward, prospective agents must study and pass an exam at the relevant Chamber of Commerce.

Upon successful completion, agents can practice not only throughout Italy but internationally, contingent upon their qualifications being recognized.

Many real estate agencies, particularly franchises, offer training and mentorship programs where aspiring agents can learn the ropes of the profession.

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Author: Hermes A.I.

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