The Truth About Being a Real Estate Agent

Many people consider working as a real estate agent as a possible career choice at some point in their life. One might imagine big deals, big money, fancy cars, working your own schedule, and being your own boss. Real estate is exactly like that, minus the most of the good stuff. The truth is selling real estate can be very difficult to do successfully and consistently. If you have ever considered investing the time and money necessary to become a licensed real estate agent, here are some of the most important things you should consider when making your decision.

1. It costs time and money to get licensed. The initial licensure process varies by state, but you can expect to pay for: classes, testing, fingerprinting, and licensing. If you plan on joining the National Association of Realtors, you should also expect to pay initial dues to join at the national, state, and local level. You may also be required to obtain a state and/or local business license to work as an independent contractor under a real estate broker. Although when compared to starting other types of businesses, these costs can seem small, you should budget for a minimum of $2000 to get you started.

2. It costs time and money to stay licensed. Periodically you will need to renew your real estate license. This is normally every year or two. As part of this renewal, you will generally be required to have completed a certain number of hours of continuing education classes. These classes will usually have a fee to attend, although you may be able to pick up a few hours for free during the year through local title or escrow companies. The real estate company you are currently working for may also offer CE classes for you to attend. In addition, if your state or local governing entity requires you to have your own business license, this will also need to be renewed, typically every year. If you are part of the Realtors Association, you can expect monthly, quarterly, and/or yearly dues as well. You should budget for a bare minimum of $1000 to keep you going each year. This does not include any actual advertising you choose do to.

3. Working with buyers and sellers can be difficult. So you are a "people person" you say? Even the most pleasant, patient, and gentle creatures can turn down right nasty when it comes to the sale or purchase of their home. Real estate transactions usually involve a great deal of money and when issues arise that interfere with people's money, look out! This is generally one of the most stressful times of your clients' lives, and you will need to be on the top of your customer service game. You may indeed need to become best friend, confidant, peace maker, butt kisser, scapegoat, adversary, and even worst nightmare to those you work with during each transaction. It is not for the faint of heart. You will need to be confident in your abilities and be able to say the hard things to clients and other vendors, contractors, and customers.

4. A flexible schedule does not mean what you think it means. One of the reasons real estate was appealing to me as a career choice is that imagined having more control over my schedule than working a typical 8 to 5 job. This can be true, on occasion. If I have something very important to do, I schedule it in my appointment book, period. Things get a little fuzzy, however, when you have a client who just called and will be in town tomorrow to look at homes with you. Are you going to skip junior's baseball game? My heart says "No, I won't. I have that scheduled." But if I don't meet with that buyer, then I might not have a client. They will look at homes with someone else, and now that "someone else" has a client, and likely a paycheck. And I don't. You will need to be very realistic regarding when it is your time, and when you are working. Can you drop everything and spend the next 8 hours driving around town? This happens more often than you think it would. Having a "flexible schedule" actually means you have to BE flexible for your clients needs.

5. Most new real estate agents are starving. The best way to start out in real estate is to not need the money. It could take months before you actually receive your first paycheck. Also, it is not unheard of to wait much longer than that. If real estate will be your only source of income, I hope you have a big nest egg somewhere. You will make money, no doubt. But when? The work you do today, the contacts you make this week, the money you spend on advertising this month will inevitably generate revenue for you - in the future. Even if you have a buyer who finds a home quickly, most escrows will close at least 30 days out, and some much longer than that. Meanwhile, you need to eat and pay your mortgage.

6. You can make good money. Yes, this can be very well be an accurate statement. Broker contracts vary, but generally you will receive a percentage of the sales commission for each transaction you successfully close. Some larger, national franchises actually require that you pay the company for the privilege of working for them. You read that correctly. You may pay a monthly fee for franchising, advertising, and office space costs. Then they will usually get a percentage of your sales commission on top of that. You will need to generate a high-volume of sales to make this type of arrangement worthwhile. However, you will also be more likely to have new clients "appear" for you if you choose to work with one of these larger firms due to their national advertising campaigns.

7. Real estate is a great business. This article is not meant to scare you out of the idea of becoming a real estate agent. On the contrary, if you are a hard-working, self-motivated, honest individual, the industry could use more people like you. But you need to go in with your eyes wide open. You will also be more likely to stick it out through the post-honeymoon-disillusioning phase and become a quality real estate professional for life.