Real Estate Brokerage Break-Even Analysis: $24K Monthly Revenue

Fixed costs $21.7K Year 1 base

Contribution margin 89.2% After variable costs

Break-even revenue $24.3K Monthly target

Break-even timing Month 1 Launch month

Break-even calculator

Use this calculator to test monthly revenue, variable expenses, and fixed costs against break-even.

Lean Base Full

Monthly revenue Revenue sets the margin available to cover fixed costs. $ Slower month Busy month Variable expenses These rise with deal flow, including marketing, tech, and listing fees. $ Low spend High spend

Money available to cover fixed costs $68,993 $76,833 revenue - $7,840 variable expenses

Margin ratio

90%

Covers fixed costs

Yes

Fixed monthly costs This is the monthly cost base the margin has to cover. $ Small team Bigger team

Break-even chart Revenue Total costs

Which brokerage expenses are fixed, and which move with transaction volume?

Cost classification

Break-even is reliable only when fixed overhead stays out of variable margin and transaction-linked spend stays out of overhead. In the first year, subtract fees like 0.5% processing and 8.0% lead generation from revenue before covering fixed costs.

Expense	Cost	Break-Even Treatment	Common Mistake
Office Rent	Fixed	Include $4,000 per month in fixed overhead for the relevant planning range.	Treating rent as if it rises with each closing.
Brokerage Insurance	Fixed	Include $300 per month as baseline overhead before profit.	Scaling insurance as a percentage of sales.
MLS & CRM Software Subscriptions	Semi-fixed	Start with $1,500 per month, then step it up only when scale or seat needs change.	Modeling the subscription as a fee on every transaction.
Wages	Semi-fixed	Model salary capacity in steps: $170,000 in Year 1, $235,000 in Year 2, and $290,000 by Year 3.	Averaging payroll across all years and hiding the hiring step.
Utilities & Internet	Semi-variable	Use the $500 monthly base in overhead, with usage changes reviewed as office activity grows.	Calling the whole amount variable and overstating margin drag.
Transaction Processing Fees	Variable	Deduct 0.5% of revenue before calculating contribution margin.	Forgetting the fee, which overstates break-even profitability.
MLS Listing Fees per Transaction	Variable	Deduct 0.3% of revenue tied to transaction activity.	Placing listing fees in fixed overhead instead of per-transaction expense.
Marketing & Lead Generation	Variable	Deduct 8.0% of first-year revenue, then use the lower forecast rates in later years.	Adding an agent split rate when the model provides no source for it.

How does break-even change from a lean launch to full scale in this brokerage?

Scenario table

Lean breaks even on the smallest monthly revenue base, but its cushion is the thinnest because fixed costs still matter. Base and full scale add staff, so break-even rises to about $35k a month even as profit grows.

Planning case only: these figures are model assumptions, not a guarantee of future results.

Scenario	Monthly Revenue	Variable Costs	Fixed Costs	CM Ratio	Operating Profit	Break-Even Signal
Lean brokerage launch	$42.5k	$4.6k	$21.7k	89.2%	$16.2k	Break-even is about $24.3k monthly, so downside risk is higher if leads slow.
Base brokerage buildout	$122.4k	$11.7k	$31.7k	90.4%	$79.0k	Break-even is about $35.0k monthly, so the cushion is solid.
Full brokerage scale	$250.6k	$21.1k	$31.7k	91.6%	$197.9k	Break-even stays near $34.6k monthly, so scale widens the cushion fast.

What breaks the break-even plan for this brokerage?

Stress test

The base plan has a wide cushion at about $425,000 in monthly revenue versus $243,000 break-even. The real risk is slower closings plus higher fixed staff or weaker margins, which can close that gap fast.

Stress Case	Changed Assumption	Break-Even Revenue	Revenue Gap	Risk Signal
Current plan	No change in volume, margin, or fixed costs.	$243,000	$182,000 cushion	Strong first-year cushion before any cost drift.
Revenue shortfall	Monthly revenue falls 40% to about $255,000.	$243,000	$12,000 cushion	A small miss in closings nearly erases the cushion.
Fixed cost increase	Monthly fixed costs rise 20% to about $260,000.	$291,000	$134,000 cushion	Higher overhead needs more monthly volume to stay safe.
Margin pressure	Variable expense pressure cuts margin by 5 points to about 84%.	$257,000	$168,000 cushion	Lower margin raises the bar even if revenue holds.
Combined pressure	Revenue drops 30%, margin slips 5 points, and fixed costs rise 20%.	$309,000	$11,000 gap	This mix pushes the plan slightly underwater.

Should you sign the office lease before the brokerage has steady commission volume?

Founder checklist

Do not sign the lease until the $4,000 rent, $44,000 launch build, and $170,000 Year 1 payroll still fit the model’s Month 2 cash low point. The brokerage only stays safe if it can close 4+ transactions a month and hold margin near 89.2%.

1Lease Load$7.5K/mo

Sign the lease only if the $4,000 rent still works inside the $7,500 monthly fixed stack and $170,000 Year 1 payroll, because this overhead lands before commissions.

2Launch Capex$44K

Fund the $44,000 for furniture, hardware, website, deposit, and collateral before opening so setup cash does not squeeze operating runway.

3Payroll Ramp$170K

Cover the $170,000 Year 1 payroll before opening, then add the $65,000 marketing coordinator in Year 2 and the $55,000 transaction coordinator in Year 3 only when deal flow can absorb them.

4Lead Flow4+/mo

Prove the funnel can close at least 4 transactions a month on average before you commit, since volume below that makes the fixed load hard to carry.

5Margin Check89.2% CM

Confirm that 0.8% in transaction fees and 10.0% in variable spend still leave about 89.2% contribution margin to fund payroll and rent.

6Cash Cushion$885K

Keep enough cash to clear the $885,000 minimum cash point in Month 2 and still absorb slower closings, delayed rentals, and higher marketing spend.