How much should a real estate agent spend on marketing?

The 10% rule is lore, not data

Coaches and brokerages often say to put 10% of your gross commission income into marketing. It’s a rule of thumb. No survey or study stands behind it, and no authoritative benchmark exists.

Test it against real figures. Ten percent of the $59,200 median income in NAR’s 2026 Member Profile is $5,920 a year, about $493 a month. The same report puts the median member’s business expenses at $9,530, and that covers every expense, not only marketing. A 10% marketing budget would be well over half of what the median agent spends to run the whole business.

What agents actually spend

There is no good public figure for marketing alone. The closest is NAR’s 2026 Member Profile, which puts the typical member’s total business expenses at $9,530 for the year. That covers dues, licensing, vehicle costs, technology and everything else as well as marketing, so the typical marketing budget is some fraction of it.

The Member Profile adds some context. Repeat clients were 28% of business and referrals 22%, so about half of the typical member’s business came from people who already knew them. The typical member closed 9 transaction sides.

Budget from cost per closing, not a percent

A percent of income says nothing about whether the money works. Cost per closing does.

• Cost per closing: what you spent on a channel, divided by the closings that came from it.
• What a closing pays you: your commission after the brokerage split.
• Your ceiling: the most you’ll pay to get one closing. A channel under the ceiling stays. A channel over it gets fixed or cut.

One way to set the ceiling is the referral fee. Agents often pay around 25% of a commission to the agent who referred the client, so a quarter of the commission is a price many already accept for a closing. To see how many closings and leads your income goal needs, use the commission goal planner.

A worked example in dollars

Take a $420,000 sale at a 2.5% fee. (That rate is only an example. Commissions are negotiable, and Redfin put the average buyer’s agent commission at 2.42% in Q3 2025.) The gross commission is $10,500. On a 70/30 split with your brokerage, you keep $7,350.

You put $400 a month into one channel, which is $4,800 a year.

• No closings: you’re out $4,800.
• One closing: cost per closing is $4,800. You’re left with $2,550 of the $7,350.
• Two closings: $2,400 each. You’re left with $9,900 of $14,700.
• Three closings: $1,600 each. You’re left with $17,250 of $22,050.

Now the ceiling. A 25% referral fee on $10,500 is $2,625. It comes off before the split, so it costs you about $1,838 of your $7,350. In this example, the channel is cheaper than a referral only at three closings a year or more.

New agents and established agents

These are planning guidelines, not statistics.

• New agents: you have little income to take a percent of and no past clients yet. Marketing will be a bigger share of a small income. Keep the dollars low and spend time instead (see 40 marketing ideas for a small budget). Commit to one paid channel at most, and hold back cash, because a first closing can be months away.
• Established agents: repeat and referral business carries more of the load, so the share can fall as income grows. Spend first on staying in touch with past clients. Treat paid lead generation as a bet on growth and hold it to your ceiling.

How to split the budget

1. People who know you: fund this first. A newsletter, anniversary letters, a client event, closing gifts.
2. Local presence: one area you can afford to stay in all year. That can be a farm mailing, signs, a community sponsorship, or a sponsored ad in a ZIP code on OfferBacked (from $10 a month per ZIP code, a flat fee that buys visibility, not leads).
3. Online lead generation: Facebook, Google or portal advertising. Fund it last and track it hardest, because the bill comes every month whether or not anyone closes.

A rule for cutting what doesn’t produce

1. Before you start, write down the monthly spend, the length of the test and your ceiling cost per closing.
2. Give it a fair test. Buyers found online often take months to transact. Farming, by practitioner convention, takes 6 to 12 months or more.
3. Track every month: leads, appointments and closings, by source.
4. Decide on the date you set. Under the ceiling: keep it. Over the ceiling but producing appointments: change one thing and test again. No appointments: cut it and move the money.

Next, put the number into a one-page plan with how to write a real estate marketing plan, and see what each source charges in what real estate leads cost in 2026.

Common questions

Updated October 2026. General information for real estate professionals, not legal, tax or financial advice. Prices, platform rules and program terms change, so confirm them at the source.