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Selling real estate seems like the perfect job: flexible hours, the chance for big payouts, limited training to get a license and the opportunity to work with anyone and everyone. These are definitely all excellent reasons to get into real estate sales, but it is not as easy as it appears to achieve success. First and foremost, if you want a career as a real estate broker, you must commit to it full time. Real estate is not a part-time job, and if you approach it as one, you will surely fail. If you view it as starting your own business and you bring an abundance of enthusiasm and dedication, you have a good chance to succeed.
Real estate is strictly commission based, so be prepared to go months without getting paid. When I started in real estate as a new broker, I didn’t receive a real, livable commission check for almost three years. I got by in New York because I was only 21, had a rent-stabilized apartment and was able to make ends meet on the bare minimum. If I’d had the responsibility of a family or a mortgage, I don’t know if I would have been able to stick it out. That is why the dropout rate for new real estate agents making it past five years is estimated to be anywhere between 60% to 80%. One thing they don’t tell you is how important it is to be financially prepared to work without income when starting in this business for at least six months.
Real estate is not going to make you rich unless you are prepared to work hard for years with keen focus and a huge level of patience. According to Payscale.com, the current average yearly income for a real estate broker in the U.S. is $55,098. Of course, the top agents make much more, but so many others make less. Also, you’ll have to decide between commercial real estate (what I do) and residential real estate. Each one has its own pros and cons, but there are certain things that are true for both. Below are some things to consider as you decide if real estate is the career for you.
1. Being a broker means that you’re also a full-time administrative assistant, marketing director, social media coordinator, researcher, quasi-paralegal and top sales agent. A substantial amount of paperwork, legal matters, negotiations, showings or phone calls can hit you at any given minute and you have to respond. You’re constantly keeping contacts updated; contracts moving and organized between buyers, sellers and lawyers; and preparing proposals for new listings. Half of your day will be spent on phone calls with prospective buyers and sellers, and you must keep detailed notes about what is being discussed, as things move very quickly. The other half will be spent on emails, showings and organizing prospects for the next deal.
2. You need to have enough financial resources to carry you through the difficult market times. When we hit a recession, you need to ensure you have savings to get you through, alongside strong relationships with clients. It’s advisable to have at least six months of living expenses saved when you start — and throughout! You’re an independent contractor (remember, it’s exactly like being an entrepreneur), so you must pay for everything from business cards to your collateral production to entertaining clients and conference fees. There are many other costs associated with this career, including covering your own health insurance.
3. Clients, clients, clients! This will be the most important word in your vocabulary in real estate. You need to begin networking the minute you decide you want a career in real estate. Whether it’s on the phone, over email, on social media or in person (personally, this is my preferred way of networking), you must be committed to creating strong professional relationships. This means you must keep your eyes open and be prepared because you never know where your next deal will come from. You may meet someone in line at Starbucks or get a reply from one of the thousands of marketing emails you sent. Keeping a detailed database on a CRM of everyone you meet will keep you ahead of others by leaps and bounds too. This contact list will become your bible.
4. There are no guarantees the deal will close. No one gets paid until the title company is satisfied and the deal is closed and recorded. At times, through no fault of the broker, deals will fall apart at the last minute. It’s frustrating, but if you look at the experience and knowledge you gained, you will be better prepared for next time. I strongly believe you get something out of every deal — but it may not always be a broker fee. You also have to factor in sharing fees with peers and other agents, sometimes having done all of the work and sometimes having put in minimal effort. At the end of the day, it is about building a name for yourself as an honest, dependable team player. Also, working for periods without a paycheck is often the norm, especially in the first few years. These are things to consider when deciding to be a broker.
Challenging, exciting and rewarding are just a few of the words I would use to describe my career in real estate. If you are willing to put in the work and are tenacious and self-motivated, real estate will reward you in many ways. If you are serious, spend some time talking to people in the business and gathering information. Also, make sure you have a realistic business plan and some money saved before you start. If you still want to be a real estate broker after analyzing all of the facts and asking yourself the serious questions, take the leap and join our ranks.