Has anyone suggested that you become a real estate agent? The job is great for someone who wants a flexible job – let’s say you hate working behind a desk or are a mother with small children. The job also has the reputation of making a bang for your buck. But actually that depends on you. Some have the knack for making the industry work for them and they haul in loads 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 test and buy the license?
You can do the course in both a conventional classroom or online. Your choice depends on your situation. Go to the website for your state’s Department of Real Estate or Bureau of Real Estate and find a list of approved courses. Either way, be prepared for a schedule that can take anywhere from a few months to a year and can be fascinating or onerous depending on how fast you take to the topic. The test follows next. Make sure you’ve studied hard since the test isn’t cheap. If you want to become a licensed real estate salesperson and you live in California (for example) be ready 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 under brokers who guide them – but you have to pay the broker, too, unless you end up dividing your commission with them. (And, frequently, you have to do both. You’ll have to pay for mentoring and share your proceeds). Brokers are necessary for you since they will offer you marketing support, mentoring, and legal protection. Interview several before you choose. You can go for the big names – the national brands such as Coldwell or Fidelity – in which case you’ll have the prestige but you will receive less attention and time. Or you can go for the local mom-and-pop, boutique stores that give you more flexibility.
- Can you afford the start-up costs?
Think of start-up costs that include gas for car – you’ll be driving around town looking for buyers. Also consider the inevitable marketing costs that include business cards, and common expenses such as sale signs, open house signs, and a basic website. Can you afford these – and more?
The wisest thing to do may be to set aside about $1000 for initial costs and to wait before you invest more as proceeds come in. Other costs that you’ll want to consider in the long-run are the annual real estate association and board dues as well as membership fees for belonging to the local Multiple Listing Service (MLS). These are almost, inevitably, essential.
- Can you do it given your hours?
This kind of job is terrific for a stay-at-home mom or for someone who is unemployed since you can be flexible and work with unusual hours. Here are some questions to consider: Do you have small children? Another job? If so, it may be harder for you to do. Consider that real estate demands come with unusual hours and are largely done on the evenings or at weekends. Atypical hours go with the territory. Visitors may want to see a house at short notice. Set boundaries – and be prepared.
- Can you deal with the predictable feast-and-famine?
Real estate is a commission-based job which is, unavoidably, feast-and-famine. You can go for months without a paycheck. On the other hand, your income can be limitless. Some agents or brokers make millions a year. Then again, you’ll have to split proceeds with your broker and, as beginner, you will likely have to pay more for the training as well. Which means that you can end up with very little in your pocket.
Realtor Sarah Davis estimates that if you want to earn a modest $60,000 a year, you’ll need to sell an average of one $300,000 house every month.
Davis advises that you start off selling part-time and build your way up. In this way, you can supplement your income on the side.
The short of it is this…
Real estate is great if you are a mother of young children, beyond a certain age, are finding it hard to land conventional work (or simply hate conventional work), or are looking for a flexible schedule.
Real estate is “real work” but promises loads of rewards. Get yourself a broker who can help you. Read up all you can about it. Be prepared to make plenty of mistakes in the beginning.
And good luck!