Has anyone suggested that you become a real estate agent? The job is great for someone who wants flexible work; Let’s say you hate working behind a desk or you’re a mom with young kids. The work also has a reputation for bang for your buck. But really that’s up to you. Some have the ability to make the industry work for them and make a lot of money; others find it a step in the wrong direction.
Here are some questions to consider so you can decide whether or not the real estate industry is right for you.
- Do you have the time and money to sign up for the trial and purchase the license?
You can take the course both in a conventional classroom and online. Your choice depends on your situation. Go to the website of your state Department of Real Estate or Office of Real Estate and find a list of approved courses. Either way, be prepared for a timeline that can take anywhere from a few months to a year and can be fascinating or onerous depending on how quickly you pick up the subject. The proof follows below. Make sure you have studied hard as the test is not cheap. If you want to become a licensed real estate salesperson and you live in California (for example), be prepared to pay $60 for the test and $245 for the license. Costs in other states orbit that amount.
- Where will you work?
Agents start out working with brokers who guide them, but you also have to pay the broker, unless you end up splitting your commission with them. (And, often, he has to do both. He will have to pay for the tutoring and share in his earnings.) Brokers are necessary for you as they will offer you marketing support, mentorship and legal protection. Interview several before choosing. You can go with the big names, the national brands like Coldwell or Fidelity, in which case you’ll have the prestige but get less attention and time. Or you can go to local mom and pop boutiques which give you more flexibility.
- Can you afford the start-up costs?
Think of the start-up costs that include gas for the car – you’ll be driving around town looking for buyers. Also consider the unavoidable marketing costs that include business cards and common expenses like sale signs, open house signs, and a basic website. Can you afford these and more?
The smart thing to do may be to set aside around $1,000 for start-up costs and wait before investing more as income comes in. Other costs you’ll want to consider in the long run are the annual real estate association and board of directors, as well as membership dues for belonging to the local Multiple Listing Service (MLS). These are almost, inevitably, essential.
- Can you do it given your schedule?
This type of job is great for a stay-at-home mom or someone who is unemployed, as you can be flexible and work unusual hours. Here are some questions to consider: Do you have young children? Another job? If so, it may be more difficult for you to do so. Consider that real estate lawsuits come with unusual hours and are largely done at night or on weekends. Atypical hours go with the territory. Visitors may want to see a house on a short-term basis. Set limits and be prepared.
- Can you deal with the predictable feast and famine?
Real estate is a commission-based job that is inevitably a feast and a famine. You can go months without a paycheck. On the other hand, your income can be unlimited. Some agents or brokers make millions a year. On the other hand, you will have to split the profits with your broker and, as a beginner, you will probably also have to pay more for training. Which means you can end up with very little in your pocket.
Real estate agent Sarah Davis estimates that if you want to earn a modest $60,000 a year, you’ll need to sell an average of a $300,000 home each month.
Davis advises that you start by selling part-time and work your way up. In this way, he can supplement his income on the side.
The summary is this…
Real estate is great if you’re a parent of young children, past a certain age, find it hard to get a conventional job (or just hate conventional work), or are looking for flexible hours.
Real estate is a “real job,” but it promises many rewards. Find a broker who can help you. Read everything you can about it. Prepare to make a lot of mistakes at first.
And good luck!