How to Become a Real Estate Agent
If you've watched any of Bravo's Million Dollar Listing shows, it all looks pretty awesome: 20-somethings in Armani suits driving $200,000 sports cars who work for a few hours and then collect six-figure commission checks weekly.
How did they get that gig?
Real Estate sales can be a very exciting (and lucrative) career. What was a slowdown for the overall economy a few years ago was a Great Depression for the real estate sector. Things, however, have come roaring back in a big way over the past few years. Fortune lists Real Estate Agents and Brokers as being sixth on their list of the country's 15 most profitable privately-held businesses, with a jump of 11.6 percent in margins over the previous year.
Want in? The good news is that becoming a real estate agent is relatively easy.
I've always had a passion for real estate and have had success with real estate projects in New York City and the Hamptons. A few years ago, I decided I wanted to learn more and get my real estate license. The barriers to entry are low. It depends on the state, but basically you take a pre-licensing course (offered at a real estate school, community college or an on-line course), pass the state exam, pay a licensing fee, get finger printed and find a broker to hold your license.
Voila! You're a licensed real estate agent. It's not very time- or capital-intensive to get started. Google your state's real estate regulatory office to get your state's specific licensing requirements.
There are some big pluses to being a real estate agent. First, it's your business. You work for you. You are an entrepreneur.
After your broker takes their cut (typically a 50/50 split for new agents), that big commission check is all yours. The more properties you sell, the more money you make. Another bit of good news -- check with your accountant, but as an independent sales professional (that's what you are), you should be able to write off a large chunk of your business-related activities, (e.g., auto milage, E&O insurance premiums, licensing and MLS fees, sales post cards and brochures, cell phone).
The other big plus is that you set your own schedule. No clock punching or office face time with this gig. If you don't have a reason to go into the office, you don't have to go into the office. You spend your time as you see fit -- on those activities that will lead to you closing deals.
There are also some negatives. The biggest is that if you don't close you don't get paid. You eat what you kill. There is no salary, health insurance or 401(k) plan.
Make no mistake about it. You are in sales and if you don't sell -- and have the transaction actually close -- you see no money. The nature of the business is that you can work with a client looking to buy a house for an entire year, show them hundreds of wonderful properties, invest weeks of your time and effort and if they don't buy (or don't buy through you) you don't see a dime.
The flip side is also true. You can show one property, have your client fall in love, and get a very large commission check without too much effort. Usually it's somewhere in between the two scenarios, but that's the nature of the beast.
To be successful, you must build a reputation and be networking constantly to obtain listings from clients looking to sell their homes and for clients looking to buy. Securing listings from sellers is great, since you get paid when the property sells -- regardless of who actually sells the property.
You must know the market and have an innate sense of what your clients are looking for.
The Internet has changed everything in this space. Being visible and building a brand online will be critical to your success. Social media (Facebook, Twitter) and real estate websites ( Trulia, Zillow, Realtor.com) can serve as key tools.
There's a ton of competition out there, but if you have strong sales skills and are willing to work very hard, you can not only help your clients find the home of their dreams, but be cashing those big commission checks like those guys on Million Dollar Listing. Good luck!