Day 2: TREC Licensing + Commission Math
Lesson Overview
| Time | 50 minutes |
| Objectives | Research TREC Sales Agent licensing requirements step by step; calculate commissions at various home prices and sales volumes; compare commission income to a salary equivalent |
| TEKS | d(2)(A) |
| Deliverable | Completed Commission vs. Salary Comparison worksheet (math + reflection) |
| Materials | Chromebooks, TREC website (trec.texas.gov), printed TREC Licensing Requirements handout, printed Commission vs. Salary Comparison worksheet, calculator, projector |
Warm-Up (5 min)
WARM-UP: If you earned 3% of every sale you made, and you sold a $300,000 house, how much would you earn from that one sale? Work it out without a calculator first, then check.
Quick share. Correct answer: $9,000. This is the "wow moment" of the week, one sale is a big check. Bridge: the catch is that agents do not make a sale every week. Today you'll learn what the actual math looks like over a year.
Activity 1: TREC Licensing Research (18 min)
Source: trec.texas.gov
Direct students to the TREC website. Project the home page and walk through the navigation: Education → Sales Agent Licensing → Requirements.
Students fill in the TREC Licensing Requirements handout as they read the TREC website:
| Requirement | Details |
|---|---|
| Minimum age | 18 |
| Citizenship / residency | U.S. citizen or lawfully admitted alien |
| Education requirement | 180 hours of pre-licensing coursework across 6 required subjects |
| The 6 required courses | Principles of Real Estate I & II, Law of Agency, Law of Contracts, Promulgated Contract Forms, Real Estate Finance |
| Background check | Fingerprinting + criminal history check |
| Sponsoring broker | Must have a licensed broker sponsor to activate your license |
| Exam | Texas Real Estate Sales Agent Exam (state + national sections) |
| Cost (approximate) | $200-600 for coursework + $50-150 exam fees + fingerprinting |
Irving ISD connection: MacArthur High School offers Real Estate as part of its Business, Retail Management and Entrepreneurship school. Students interested in real estate careers can pursue the MacArthur Real Estate pathway in high school.
Facilitation Tip
Students often ask "Can I become an agent at 16?" The answer is no. TREC requires a minimum age of 18 to sit for the Sales Agent exam. But students can start building real estate knowledge and coursework at MacArthur so they are ready when they turn 18.
Activity 2: Commission Calculation Activity (20 min)
Source: Commission vs. Salary Comparison worksheet
Project the worksheet and walk through the calculation method with one example. Use $350,000 home × 3% commission = $10,500 per sale. Note that the commission is usually split between the buyer's agent and the seller's agent, so the agent's actual take-home is often half: $5,250.
Students complete the worksheet by calculating:
Section 1: Commission per Sale
| Home Price | Commission (3%) | Agent Take-Home (50% split) |
|---|---|---|
| $200,000 | $6,000 | $3,000 |
| $350,000 | $10,500 | $5,250 |
| $500,000 | $15,000 | $7,500 |
| $750,000 | $22,500 | $11,250 |
Section 2: Annual Income Based on Sales Volume
| Sales per year | Avg home price | Total gross commission | Estimated take-home |
|---|---|---|---|
| 6 | $350,000 | $63,000 | $31,500 |
| 12 | $350,000 | $126,000 | $63,000 |
| 20 | $350,000 | $210,000 | $105,000 |
Section 3: Comparison to Salary-Based Role
A Property Manager in DFW earns a fixed $70,000/year regardless of transaction volume. Which real estate role pays more if you sell 6 houses per year? 12? 20?
Section 4: Reflection
Students answer: "What are the risks of commission-based income? What are the rewards? Would you prefer commission or salary? Explain your choice."
Frame both answers as valid
Before students write, name out loud that neither choice is "better", it depends on the person's financial security, family situation, and tolerance for variability. Commission is not the "right" answer for entrepreneurial students, and salary is not the "safe" answer for cautious ones. Students whose families need predictable income should not feel judged for preferring salary; students drawn to variable earnings should not feel pushed to commit.
DOK 3: What conclusions can you draw about the financial risks and rewards of commission-based income? What kind of person is best suited for this income model?
Exit Ticket (5 min)
EXIT TICKET (Short Constructed Response) · Printable PDF:
- MATH: How many homes at $300,000 would I need to sell PER YEAR to earn $60,000 in GROSS commissions at 3%? Show my work.
My calculation: $60,000 ÷ ($300,000 × 0.03) = $60,000 ÷ $_____
Answer: about _____ homes per year
-
Name TWO of the 6 TREC Sales Agent course requirements (Principles I & II / Law of Agency / Law of Contracts / Promulgated Contract Forms / Real Estate Finance):
-
Course 1: _____
-
Course 2: _____
-
MINIMUM AGE to sit for the TREC Sales Agent exam: _____
-
Do I prefer COMMISSION or SALARY for MY future income? Why in one sentence? (d(2)(A))
My pick: _____
Why: ____________
Differentiation
- Support: Provide a commission calculation example with every step worked out ($250,000 × 0.03 = $7,500). Students replicate the formula for different home prices.
- Extension: Research TREC Broker licensing (the advanced license): what additional requirements exist beyond Sales Agent? How long does it take to qualify?
- ELL: Bilingual TREC Licensing handout. Commission math is number-based and language-accessible. Pre-teach: Commission = Comisión, License = Licencia, Sale = Venta.