The Reality of Working in the Real Estate Industry
Becoming a real estate agent is like starting your own business.
Think of it being like two familiar franchises such as Mary Kay® or Avon®. They have built the brand and the products for you to sell. You are a compensated salesperson for their product. You use their brand-name, but you must bring your own:
- • Clientele
- • Organizational and sales skills
- • Drive and desire to be successful
In real estate, the real estate brokerage companies have established a brand name, a product which consists of brand awareness, marketing, sales techniques, market shared, forms, and more. They will share these things with you. It will be up to you to use these tools and build a business clientele of your own.
Typically, in real estate sales you are an independent contractor (self-employed) and only get paid when you sell and close a deal. With that in mind, can you financially wait for your first paycheck? Plan on at least the first 6 months without a closed deal, so be sure to establish a sufficient nest egg in order to exclusively work full time in real estate. Carefully establish and enact a transition plan from current full time employment to becoming your own business owner. Doesn’t sound like “getting rich quick”, does it? Can you weather the slow times?
Do you think working in real estate means you can work only whenever you want? Keep in mind you MUST work when your clients NEED you to work, which often means evenings, nights, and especially weekends!
Ask yourself how many hours in a day or week you would work if you were working for yourself - more than 8, more than 40? Remember the old saying “you get out what you put in.” Are you willing to work nights and weekends when the buyers or sellers are available as this is typical for real estate? If you like the consistency of a 9 to 5 job where the pay is set by someone else and you are ok with someone else deciding what you are worth, then real estate is not for you.
Next, ask yourself if you have the skills to budget your money and your time? When your sales are slow, did you set aside money to get you through? How will you spend your time now that you don’t punch a clock? How will you get buyers and sellers? This is probably the most critical piece to becoming successful in real estate: prospecting, asking people for business. If you don’t like to do this, plan on hiring someone to do it for you-it’s a MUST.
Real estate is easy to get into but expensive to stay in if you are not successful.
Licensing is only the first step. You must continue your education to become proficient at the art of prospecting, selling, sales, and negotiating. Picking the right company to work with will be extremely important. Remember, you will be creating your business under their banner and will not want to restart with another company, so choose wisely. You are interviewing THEM more than they are interviewing you!
Here are some questions to ask when you’re interviewing with a real estate company:
- • What support will I receive as a new agent?
- • What prospecting tools are available to me?
- • What is your company’s market share?
- • Do you provide professional development education?
- • Does the sales manager-broker also sell or are they dedicated to supporting the agents?
- • Does the company provide graphics and technology support to its agents?
- • What fees can I expect for which I am responsible?
- • What is the commission split, how does it increase, and does it reset each year?
- • What training do they provide?
- • Do they provide your initial business cards?
- • Do they provide signs to put up at the properties and/or name riders?
- • What marketing/advertising is included?
- • What about Errors and Omissions insurance?
- • What else do you get from them for the percentage share of the money they keep from the transactions?
- • On average, how long have the salespersons been there?
- • What support staff do they have and how long have they worked there? Longevity is an important factor.
Here’s the good news: only you decide your paycheck amount. Your income potential is unlimited! You “reap what you sow.”