This article is part of a larger series on How to Become a Real Estate Agent.
To become a real estate agent or associate broker (as they’re called in the Mount Rushmore State), you’ll be required to complete 116 hours of South Dakota Real Estate Commission (SDREC)-approved prelicensing education. In addition, you must get a background check, pass the state exam, find a sponsoring brokerage, acquire errors and omissions insurance, and submit an application. We’ll guide you through the process of getting your South Dakota real estate license.
1. Meet the Legal Requirements for Your South Dakota Real Estate License
The state of South Dakota has a few legal requirements you must meet in order to qualify for licensure. You have to be at least 18 years of age and be a legal citizen of the U.S. or a resident of South Dakota.
Did you know?
South Dakota does not have formal reciprocity agreements with any other state but does issue equivalent licenses to those moving into the area. Agents must submit the Request Form, a certificate of licensure from their prior state showing good standing, a fingerprint background check, pass the state portion of the exam, and submit a Non Resident Application.
Also, South Dakota is a cooperative state in terms of portability. It allows out-of-state real estate agents or brokers to enter the state and conduct real estate business physically. However, for out-of-state agents to work on a real estate transaction, they must have a co-brokerage agreement with a licensee of that state. To learn more about real estate license portability in South Dakota, check out our real estate license reciprocity and portability guide.
If you have a criminal record, you may still be able to become a real estate agent in South Dakota. Determine your eligibility before going through the licensing process by submitting an Application for Predetermination (#3085). This form will outline and include all documentation for any offenses you’ve been convicted of to be reviewed by the SDREC and will result in disqualification or the option to move forward.
Although this is an optional step, it is best to submit this form to make sure you can qualify before expending time and effort on the rest of the licensing process. If you’re approved, you must also submit the Convictions and Pending Charges Form (#2252) with your broker associate application.
2. Complete Required Prelicensing Courses
After you’ve verified you meet the state’s requirements, you’re ready to begin your prelicensing education. The SDREC mandates 116 hours of state-approved coursework from an accredited in-person or online real estate school. Costs range from $699 to $1,250 and will cover the following topics:
- Property ownership
- Land use controls and regulations
- Valuation and market analysis
- General principles of agency
- Property disclosures
- Leasing and property management
- Transfer of title
- Practice of real estate
- Real estate calculations
- Duties and powers of the Real Estate Commission
- Licensing requirements
- Statutory requirements governing the activities of licensees
- Agency relationships and property representations
- Fair housing and other governmental regulations
- Handling money
- Training and supervision of licensees
- Property types (residential, commercial, property management)
To complete your 116 hours of classwork from the comfort of your home, seek an online real estate provider like Professional Real Estate Education (PRO-ED). They combine self-paced, video, and livestream instruction to provide you with learning styles to match your educational needs. They also invite local real estate experts to do class presentations, so you can ask questions and get real-life advice to start a successful career in the real estate industry right away.
3. Take the South Dakota Real Estate Exam
Real estate license candidates are required to pass the national portion, state-specific portion, and simulation portion of the exam to become a real estate agent in South Dakota. All three portions are administered on the computer, and scores are given immediately upon completion of the exam.
While the national and state-specific portions are multiple-choice questions similar to other state licensing exams, the simulation portion is 11 questions and are made up of information gathering (IG) and decision-making (DM) questions. Each problem will have a designated primary issue and property type, where the IG questions test you on gathering all relevant information and the DM questions are for making judgments or decisions based on the issue and property type.
If you pass, you can move forward with the licensure process, but if you fail one or more portions of the exam, you must reschedule an exam retake for those portions. You must keep and submit all score reports with your application within 60 days of the date you passed your last portion of the exam.
South Dakota Real Estate Exam Details
100 nationally focused questions
57 state-specific questions
11 broker simulation exam questions
State multiple-choice: 1.5 hours
National multiple-choice: 2.5 hours
Broker simulation: 3 hours
Items to Bring to the Exam
2 valid forms of identification (ID) with signatures:
75% to pass the South Dakota Real Estate Salesperson Exam
Unfortunately, the SDREC does not provide the average exam pass rate for South Dakota
Schedule Your Exam
The South Dakota real estate exam is provided by the PSI (formerly AMP), a national provider for state licensing exams. To begin scheduling, you’ll be required to create an account on the PSI website, which will then allow access to the scheduling portal.
You will receive a copy of the South Dakota Candidate Information Bulletin for additional testing information. The fee to take the national and state exam is $98, and the simulation exam is $98. You can pay the fee directly on the website using a credit or debit card.
To guarantee you pass your exam on the first attempt, check out an exam prep service like PrepAgent. It offers South Dakota exam preparation and study tools fit for a variety of learners like flashcards, video, audio, and live webinars. Pick the length of time you wish to prepare, from one week to one year, and start the process immediately so you’re ready for test day.
4. Pick a Company to Work For
To hold an active license in South Dakota, you must find a sponsoring brokerage to affiliate your license. To make your choice a little bit easier, check out our in-depth article explaining how to choose a real estate company to work for. Although there are many successful brokerages in the Mount Rushmore state, below you’ll find the top five brokerages reported for 2022:
The Amy Stockberger Team
Amy Stockberger Real Estate
Keller Williams Realty
Tyler Goff Group
Keller Williams Realty
Christians Team Real Estate
Keller Williams Realty
(Source: Real Trends 2022)
South Dakota Cities With Highest Median Sales Price 2022
To stand out from the competition, gather knowledge about the pricing throughout your state. You will be able to provide prospective buyers and sellers with solid advice as well as calculate your earning potential. To get a sense of which cities are bringing in the bucks in South Dakota, check out this sales data from Towncharts.com below:
5. Get Fingerprints & Complete Background
You must submit fingerprint cards with your license application for a state and federal criminal background check. Fingerprint cards are requested at no cost directly from the SDREC using the Request Form. Fingerprints can be obtained at a local law enforcement agency or fingerprint office, which will require a fee specific to the vendor.
You must include the completed cards with your application and a check for $43.25 made payable to the Division of Criminal Investigation (DCI) in order to run your check. Keep in mind that you must sign and date your fingerprint cards for them to be valid.
6. Acquire Errors & Omissions Insurance
To have an active license, all brokers are required to have errors and omissions insurance (E&O). This is used to protect real estate businesses from mistakes made during professional service. SDREC has a group policy available with Rice Insurance Services, LLC to provide affordable options.
If you choose to acquire E&O insurance independently, the provider must be an admitted carrier in South Dakota. Contact the Division of Insurance to verify your carrier is admitted in the state and has the proper liability coverage.
7. Apply for Your South Dakota License
After getting your fingerprints, picking a sponsoring broker, and acquiring E&O insurance, your last step is submitting your South Dakota real estate license application. Your application needs to be submitted within 60 days of your passing exam, so it’s important to move forward with the process right away.
The following items need to be included with the application:
- Non-refundable application fee of $225.00
- Original education certification
- Errors and omissions certificate of coverage
- Original score reports from exam
- Completed SD and FBI fingerprint cards and a separate check for $43.25 made payable to DCI
The Broker Associate Application can be completed via mail or submitted online through the Online Services Portal. For your license to be active, you must have your sponsoring brokerage complete the last page of the application. It will take about two to four weeks to process, and you will receive an email informing you of your application approval.
8. Start Your Real Estate Career
Now that you’ve learned how to become a real estate agent in South Dakota, you’re ready to start your professional real estate journey. For more information, here are some of our articles with content that is perfect for new real estate agents:
- Our article with 14 real estate agent tips covers the basics that every agent should know when they are starting out, including how to write a real estate business plan.
- Learn how to generate real estate buyer leads.
- Get nine strategies to help with real estate seller lead generation.
- Jump-start your career with the top 25 new real estate agent tips from the pros.
- Get the tools you need to build a strong real estate business out of the gate using the best real estate software and tools.