If you are interested in real estate and are maybe considering how to carve out a career in the property field, there are some essentials to be aware of before you make your final decision. Unlike some of the property shows that you may have seen on TV, a career in real estate is not as glamorous as you may think.
Certainly, it’s true that every day is different, and sometimes there are generous profits to be made. However, bear in mind that your day-to-day experiences may sometimes be quite mundane and that huge profits may be few and far between.
Here are the key elements to kick-starting a real estate career.
Education and training
In order to qualify, you must first undertake a course of study. The state courses vary according to where you are, and there is also a national course that covers you across the whole of the US. There are increasing numbers of online learning options available, as well as opportunities for training in a traditional classroom environment. Each state determines the number of study hours that you will need, and online programs usually provide details on a state-by-state basis.
As soon as you’ve passed the examinations from your course, there will be further state and national exams, which are usually scheduled on the same day and in the same place. If you are successful, you will be licensed to practice, providing that you are accepted as an associate by a brokerage firm, within a certain number of days.
Becoming an associate
While you are studying, make time to do some research into brokerage firms that you would like to partner. You can even make approaches and meet with them before you qualify. It’s important to find a firm that suits you, and one that will offer you a decent package to include training and assistance with managing your business transactions. Online social media platforms and other technological tools are now actively used by real estate agencies and help accessing these via the brokerage would also be useful to you.
Your brokerage firm could charge you for a range of services; however, this differs from company to company. For example, you may be asked to pay:
- Associate fees.
- Desk fees.
- Technology fees.
Sometimes, brokerage firms agree to a commission split where you have fewer expenses to pay upfront in return for the brokerage taking a percentage of any commission that you earn.
The facts about commission
Earning substantial commission on property sales is one of the enticing things about getting into real estate, so it’s worth doing the math to see what this could mean. On an average transaction, the commission will be between 2.5 and 3 percent of the sale price. If you sell a property for $250,000, your commission will be a minimum of $6,250 and possibly as much as $7,500. Sell just one house every month, and after a year, you could have earned up to $90,000. With some hard work, good people skills, smart connections, and thorough knowledge of your local market, you could become as successful as Axel Preuss-Kuhne.
With more than 15 years of experience in real estate development, Axel Preuss-Kuhne is a leader in the real estate industry and serves as a partner at the Miami-based real estate investment firm Robax Investments LLC. He co-founded the company in 2010 and has since supervised the acquisition of many properties in the flourishing market of Miami-Dade County. Preuss-Kuhne has developed a niche market comprising townhouses and single-family homes, using an analysis tool designed in house that can assess about 500 properties every week.
When you are new to the business, it’s important to discuss how commissions work with your broker and to understand how splits in commission make a difference to how many of your hard-earned dollars you actually take home.
Workplace terms and conditions
More experienced real estate agents will tell you about the best ways to use your time productively. Real estate is not a nine-to-five, five-day week job, and you don’t leave work behind at the office when you leave. In most cases, your clients will want your help evenings and weekends, so there are really no set hours, and you should be prepared to work whenever required. In between client contact, there is a lot of marketing, administration, and paperwork to do. Unfortunately, this makes a career in real estate almost an impossibility for people who want to work part-time.
Developing your experience
When you’re new to the property business, you may find that it takes some time to convince people that you’re capable of handling what may just be their most important and largest transaction ever. Making good connections within the industry can be a help, as you will get recommendations and approvals this way. A good brokerage firm will place a newcomer within a more experienced team, so there are professionals with experience to offer assistance and guidance during your initial few months. This can reassure clients and encourage them to trust you. Later, team members may begin to refer clients to you.
It’s a good idea to focus on working with buyers initially, as this enables you to view as many properties as possible, gaining lots of hands-on experience of how property transactions work. It will also help to create a string of property sellers in or near the neighborhood.
As with other businesses, your clients are the key to a successful career. Word of mouth is often the most successful way of growing your client list, and to do that, you have to provide exemplary customer service. This is where your people skills become most valuable. Developing a positive relationship with people with whom you may have contact just for a short time requires patience, skill, and, sometimes, determination.
Finally, remember that your friends and family are a ready-made group of potential clients and that they are also in a position to refer others to you. As long as you are honest with those close to you, and communicate well, your personal relationships should not get in the way of doing business with them.