The Truth About Being a Real Estate Agent
So, you're thinking about pursuing a career in Real Estate? You've heard a lot about the flexible schedule, being your own boss and the major commissions. Sounds perfect, right? Well, there is a lot to Real Estate that you must understand before you jump into a career. You may hate your current job or be interested in starting a new chapter in your life, but are you sure it's the Real Estate Industry and not just the luring promises of wealth and flexibility? Because I can tell you right now, flexible schedule means you will make yourself available 24/7, being your own boss can mean the constant stress of hitting your sales goals and as far as the commission goes, I shouldn't even need to mention that the Real Estate market is not in its healthiest state.
You have to think of being a Real Estate Agent as owning your own business. You will hear a lot of agents talk about their "business" and it really is the best way to think of it when you're starting out. You are an Independent Contractor, so you will have to take on managing your own taxes. If you're smart, you should keep receipts for your travel expenses, advertising, and education from the very beginning because these are tax-deductible. You may have to hire an accountant or do some research, but this is your hard earned money and the government wants to encourage small business ownership with these deductions, so take advantage of this as soon as possible.
In order to sell Real Estate you must be listed with a Broker. You can go with a large brand name, which usually have some great tools for new Agents, or you can go with a smaller, boutique Broker. I personally listed with Keller Williams because they have a ton of support and really useful cutting-edge technology. My best advice if you're serious about getting into Real Estate would be to set up a couple informational interviews with different brokers. Let them know ahead of time that you're considering getting your license, so there are no expectations and they don't feel like you've wasted their time. What you need to understand with Brokers is that THEY WANT YOU. You may feel like you're being interviewed but just think about what you're interviewing for; they don't spend any money by listing you, they may offer different tools or a great commission split but they do get a portion of your commissions. Listing you makes them money, so be very careful in choosing your Broker and make sure you have a list of questions that they can answer to help you decide.
Owning a successful business is not something you just stumble into, and the same is true with being a great Real Estate Agent. If you want to be successful, you may have to struggle through the first couple years. As the years pass you will work mostly on the referrals and reputation that you built up in your early years. Your business will be set on cruise control if you can maintain the values that got you there.
Like owning a business, the easiest advertising is word of mouth, which when you're new, may mean a lot of cold calling on expired leads. Keep in mind, you are a Real Estate Salesperson, this job is as much about selling as it is about Real Estate. If picking up the phone and calling strangers isn't for you, then this might not be the job for you. If you can grit your teeth and bear it, then you will do well. You will have to sell yourself to homeowners by setting up Listing Presentations, you have to look at it as an interview to earn their business.
Word of mouth will always be your cheapest and most effective form of Advertising and the more connections you have, the bigger your business will be. TV Shows like Selling New York and Million Dollar Listing have definitely glamorized everything about Real Estate. It seems like they spend a week or two working and wind up with thousands, sometimes hundreds of thousands of dollars for their "hard work". The most important thing to understand is that great commissions do exist, but you will have to work VERY HARD for them. You must grow your business, become knowledgeable, and maintain a great reputation before you stumble yourself into hundred thousand dollar deals. If you already have ridiculous trust-fund, country club connections already, then disregard this whole paragraph and congratulations, you will do well. For the rest of us, we will have to work for those connections and maintain a great relationship with our clients.
This brings me to the next reality of the world of Real Estate; the clients. If you don't enjoy working with people, then Real Estate will be a very bad fit for you and even if you love people, there will be an adjustment. You will not always have the perfect client. So many sellers unrealistically think their house is worth more than it is and the same amount of buyers think their money should be able to buy more house than it will. If you can't level with your clients and curb their expectations then they will think you were the problem in not getting them $30,000 over market value or a 5 bedroom house in a gated community for $100,000. You are the expert and they hired you to guide them, whether they take that guidance or not is up to them.
Handling multiple clients means handling multiple schedules. Sure, you can have a flexible enough schedule to make it all work, but what about your buyers who work 9-5 jobs? Their only option for house shopping is going to be nights and weekends. There isn't too much glamor in being on-call 24/7, but to be a good agent you should always be available to your clients. On that same note, the best Agents I know are in the office at 8:30 Monday-Friday unless they are out showing. They are ready and available if someone happens to wander into the office with a Real Estate need. This is your competition, they take this job seriously and this is how they got to where they are.
Lastly, and most importantly, let's talk about the MONEY. Being your own boss and cashing in on commissions is definitely the most alluring part of the job, but sometimes business just isn't good. Like I said, and don't even need to say, the Real Estate market and the economy are not doing so well right now. You make your money off of SALES and SALES only. If you show a buyer around for 3 months, spending hours a week with them, hundreds of dollars in gas money, finding them a perfect house, writing up the paperwork then at the last minute things fall through or they decide against buying, guess what? You get nothing.
Most people will try to keep you positive and say, well, when they're ready to buy, they will come back to you. This is sometimes true, but it also doesn't put food on your table. My grandmother was a Real Estate Agent her whole life and my dad remembers coming home to the power being shut off on them, on multiple occasions. She was a very hard worker, but there are tons of outside factors with Real Estate. There are a lot of Agents barely making ends meet at various times in their career.
Real Estate can be very rewarding, both professionally and financially, for the right people. You might need to make sacrifices in the beginning but this is a career, not a fly-by-night venture. You now own your own business and your success is completely in your own hands. One of my favorite quotes is that "Entrepreneurship is living a few years of your life like most people won't, so that you can spend the rest of your life like most people can't." This is your business, you have to put your time into it and earn each clients' respect and eventually you will have a very successful career in Real Estate.
Still Interested? Find out about the licensing process and fees here.
And check out my website Find My Perfect Agent to learn about cheap and effective real estate advertising.