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How Do Real Estate Photographers Determine The Value Of Relicensed Photos?

Tony in Kansas City says:

I'm looking for advice on what the value of licensing real estate images to third parties is. Scott Hargis' latest business video was excellent and sparked questions on how I should be valuing images for third parties. I've looked through ASMP's articles on licensing and have looked at a few calculators for licensing but there is a lack of detailed information on how to license images specifically within the real estate photography niche.

For example, let's say I'm charging $250 for a typical 25-photo shoot. The agent gets to use the images for the life of the listing. After the listing sells, the image use expires. The kitchen cabinet company that built the kitchen takes notice of some of the shots and purchases two images for $100 each so they can use the images forever. Different use, different value.

But here's where I get confused. How do you set the value of the images for a large kitchen cabinet maker vs a local home stager or designer? Would each of these parties pay a different rate because of their marketing reach? How many home stagers are going to pay $100 or more per image? Do you set a flat rate for broad usage (this would weed out smaller companies with smaller budgets)? Or do you somehow estimate the company's reach and negotiate a license fee? How is that calculated if so? Also how do licensed images to third parties compare to a commissioned shoot?

I think the reason you can't find a good description of how to do this is that:

  1. The majority of real estate photographers never relicense their photos to 3rd parties. See this poll we did in March. It shows that less than 10% of PFRE readers regularly relicense their real estate photos.
  2. I don't think there is one simple formula. You have to judge and negotiate each situation based on what you know about the client's usage and situation and your status in the marketplace.

Any specific suggestions for Tony?

8 comments on “How Do Real Estate Photographers Determine The Value Of Relicensed Photos?”

  1. I agree Larry that RE shoots don't always lead to image re-licensing opportunities. But mainly because people don't ask! If the owner is there, or the agent is hopefully clued up, it's perhaps worth asking who installed the kitchen/ staircase/ sliding windows/ anything noteworthy: I usually complement people's homes and hope the conversation develops from there! If you're shooting a newish build and the owner is interested in talking about the process, consider also what's NOT on show, ie products used in construction: I have sold images of completed projects which make use of (invisible) insulation types and acoustic absorbing plasterboard which are all useful for companies wanting images for case studies on their websites.. but you need to dig for info (not always practical on a RE shoot!). Then cold contact the marketing departments of the companies involved with some tasty images! Re: deciding how much to charge for different users, I used to use a program called fotoquote which will calculate licensing fees based on format (eg full page brochure cover or just small image on an incidental web page, the former being perceived as much more valuable of course) territory (eg worldwide vs national or planned print run for hard copy uses) and duration among other criteria. It is similar to the costs calculated by a stock library. I host my images with the wonderful Photoshelter and they include the option to integrate a fotoquote-aligned pricing structure to images you wish to sell as stock. (Larry... I hope OK to link to more info here: ) Before you say to a kitchen designer: "Here - have the pictures from my real estate shoot in return for a beer" ... go to a website like Getty/ Alamy and find a similar image and plug in some dummy values : eg "use image on the splash page of a website for two years or as a mailshot postcard print run of 2000" : you may need to open another beer before reading the suggested pricing! To make things a bit simpler all round, fotoquote will calculate licenced usage packages, eg a combination of web and hard copy . Now in reality I have some set rates for similar suppliers (eg building supplies) and I simply sell licences valid for the perpetuity of the company as these companies will probably use images on their sites for a number of years. But for a company looking to make serious commercial use of images (eg kitchen supplier who might advertise in the shelter magazines/ consumer press etc) the rates are considered/ negotiated on an individual basis. I thoroughly recommend taking a look at fotoquote anyway to see the kind of values assigned to licensed images. Whether in this post-film age people are actually securing such rates is open to some question. But before negotiating any usage do consider what it would cost the company requesting images to source a suitable photographer, arrange a shoot, and attend that shoot (their time away from what they usually do costs too!) : don't give away images for beer money! (Sorry post is so alcohol-focussed .. must be the approaching prospect of Christmas!)

  2. There is no pricing standard. Simon's advice on visiting some stock sites and getting some quotes for different usages is a great idea. A local appliance store shouldn't be expected to pay as much for images as the manufacturer of the appliances for images. The larger and more sophisticated the licensee, the more specific your licensing terms can be. The appliance manufacturer's ad department or advertising firm will be able to handle licenses that include expiration dates where the local store isn't equipped to handle that. The local store is going to be using the images on their web site and advertising in the local area. The manufacturer could be using the images world wide in many different types of media. The price for creative work is tied to the usage. You can buy a Rolling Stones CD for $12.99 and get the song "Start Me Up". If you plan to use the song for a worldwide release of a computer operating system the price is 500,000 times more (give or take).

    Don't be afraid to ask for a price that is more inline with what you WANT to be making per hour. RE is a low margin/high volume business. The images are going to be used for a few months in typically low resolution media. If you were hired to make an image of a nice range installed in a home (as opposed to a studio session with a white background), it might take a couple of hours for that one photo including setup/teardown, travel, office time, etc. Asking for at least $100-$300/image or more is not out of line. The value to the local customer could be 10's of thousands of dollars in business each year. They could buy stock photos to hang in their showroom, but professional quality photos of their own work is much better for them since every one is another story.

    Always offer a commission to agents that refer third party sales. I emphasize to agents that they could get their photos for free through commissions. I'm also hoping that planting that idea in their heads will keep them from giving away photos which violates their license.

  3. [Ken: "Always offer a commission to agents that refer third party sales. I emphasize to agents that they could get their photos for free through commissions. I’m also hoping that planting that idea in their heads will keep them from giving away photos which violates their license."]

    That's a good idea! Put others to work for you while giving them an incentive not to violate your license agreement.

  4. I think the answer to this question is "as much as you think you can get." As others have eluded to, the bigger the company the more the fee. It's just going to take experience as to what numbers you should throw out there as a starting point.

    It is very very important to keep in mind the trouble and fees a company may have to go through if they don't use your photos. Think of it that way when you price. For example, maybe a tile company can use many of your images by pasting/transforming their own products into your photos. Imagine all the things they'd have to do if they don't use your photos... 1) hire a photographer, 2) pay the day rate, 3) scout a home out, 4) get a property release for the home, 5) pay for the use of the home for the day, 6) all the manpower used to find these homes and make all these calls, 7) licensing of the photos from the original photographer.

    In other words, you may be saving them a TON of money to license them a single image in perpetuity for a fee you had no idea was possible. And you'll both be thrilled! Start adding those items up that I listed above and you'll quickly realize the per photo cost could easily work it's way into four digits. So, them paying 500 and up for a photo turns into a bargain.

    It's also important to understand our photos are taken during an interim period when the house essentially has no owner. This fact makes it easier to reassure people who buy out photos that they won't face any legal issues with their use in the future. That should be in your terms too by the way - nonexclusive. Get that in there if I try isn't already, because you will get asked about this in my experience. Keep in mind, you have access to hard drives worth of finalized photos and they all have sort of built in property licenses. That's extremely valuable info to keep in the back of your head.

    The last thing I'll say is I very much agree with Simon when he said re photographers don't often license like this, but it's because we're not looking. For sure! The opportunities are out there in abundance. You just gotta get your ducks lined up and have good answers for people with respect to their rights to use your photos in major marketing campaigns. Put a little work in and I feel there is more money in this than the average re photographer may know.

  5. I like how Simon is actively seeking licensing opportunities. I've licensed a decent amount from luxury properties, some at the sub-$100 mark and some that will make you want to throw back a beer like Simon said :). But the middle ground is hard to find which prompted my questions. Good to hear there really is no standard... so I think I've been handling this correctly! I believe if I take a more active role looking for licensing opportunities, even if its a commission thing with your agent or just talking about it, there can be great revenue made in addition to normal work.

  6. "Pricing is higher for the cabinets because it’s not real estate photography, it’s product photography...."

    False! There is no such structure. There are real estate photographers who command much higher rates than product photographers, and vice versa. The industry in which your client works has no bearing whatsoever on the fees associated with the photography. It's all about how good the photos are, and how much value they have to the client -- period. If you want to get high fees for your work, make really good matter what subject you shoot, or for which industry.

    "....ask for a price that is more inline with what you WANT to be making per hour..."

    Terrible idea. Other than a few very specific genres, such as event photography or certain kinds of product work, photographers don't do very well with "by-the-hour" pricing structures. First, what happens when you get really good and/or really efficient at producing the images? You should take a pay cut because of that? And if the fee is based on some sort of hourly calculation, how do you differentiate between an incredibly unique and beautiful photo and a mundane one, in terms of it's value? Photographers tend to either under-value themselves, or just plain get screwed when they think in terms of hourly wages. That stuff is for employees. If you want to make real money, think like a self-employed artist. Your images have value according to how much the client needs and wants them. No other factors matter.

    @ Ken Brown -- " image of a nice range installed in a home (as opposed to a studio session with a white background), it might take a couple of hours for that one photo including setup/teardown, travel, office time, etc. Asking for at least $100-$300/image or more is not out of line...."

    $100 - $300 per image is actually pretty typical for product work on white seamless. Producing work on location, suitable for advertising, you would want to double or triple your numbers and then add a zero.

    All that said, I think it is extremely rare for real estate photography to be licensed as product photography (as in appliances, light fixtures, etc.). The intent of the photos is completely different, so the compositions are unlikely to be suitable for a manufacturer's needs. Licensing opportunities for real estate photography are more typically with builders, stagers and interior designers who use "beauty shots" of whole rooms. If this is something you hope to pursue, you'll want to up your game at every opportunity, because "good enough" photography really isn't! There's a reason you don't see overcooked HDR and converging verticals in the magazines at the checkout stand.

  7. I think Scott probably said most of it already. Some things I'd like to add:

    1. Try asking for their budget. You can sometimes get one and it can be a useful starting point for negotiating;

    2. The broader the usage in terms of the period and territory of usage and the number and type of media, the greater the fee;

    3. Any degree of exclusivity will usually warrant a higher fee;

    4. Consider tailoring the fee for Internet usage on particular Web pages to the amount of potential exposure on those Web pages, which is kind of similar to pricing for usage in publications based on the number of copies of the publication and the geographical distribution;

    5. Consider whether the prospective purchaser has any alternatives to your photo and what the quality of those alternatives might be.

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