In recent years, many skeptics have questioned whether making a transition into the real estate profession made any sense after the recession of late 2007 impacted the real estate market the way it did. With decreased market values for properties, increased difficulty for buyers to get qualified for a mortgage, combined with a more competitive landscape as well as increased state requirements and fees, many felt that it would be risky business to transition into the “unstable” waters of becoming a real estate broker.
For the past few years it has been a tough business, even for the seasoned professionals. It meant that anyone who wanted to survive as a real estate professional had to redefine themselves and the way they conducted their business. It meant that in order to make it through the recession, you had to take on and learn the process of selling a short sale or foreclosure property, and you also had to learn creative ways to get fairly qualified buyers financed in an industry that nearly dried up overnight. “Making it” in this dynamic and cyclical business was a challenge for the seasoned veterans, and was nearly impossible for newcomers into the field.
Fortunately, the tides are changing in a favorable way. When you look at key market indicators showing that the mortgage industry requirements are loosening with a plethora of opportunities for buyers to get a mortgage with record low interest rates, combined with property value stabilization and increasing valuations, this is now a better time than ever to enter the lucrative field of real estate. However, there are 4 critical points to consider if you are interested in a career as a real estate broker:
1. Education is Paramount.
No matter how much you think you know, the real estate field is dynamic and ever changing. In order to be the best and establish a career in this field, you have to dedicate time to working “on your business” rather than simply “at your business”. As a real estate broker, your clients expect and the industry demands that you are knowledgeable and educated on the current market conditions. In order to be a trusted professional, you have to continually dedicate time to educating yourself on all things real estate.
2. Partner with a Brokerage that will Position you for Success.
I always tell aspiring as well as experienced brokers that your success early on in your career depends on your choice of brokerage. When considering a real estate firm, many brokers make the mistake of joining a brokerage that offers them the best commission split. Little do they know that many of those brokerages offer them little to no support, training or mentor ship in a time that is critical to their success. Choose a brokerage with the experience, training and mentor ship that will help you hit the ground running.
3. Develop a Realistic Budget and Safety Net – Real Estate is like Starting a Small Business!
Lets face it, becoming a real estate agent isn’t cheap. While it is cheaper than entering many professions, start up fees alone are estimated between $2,000-$3,000. You have to factor in licensing courses, marketing material such as business cards, signs, print and online advertising, association fees, exam fees, etc. Remember – real estate is a commission based business. What many aspiring brokers also fail to factor in is the cost of living expenses while you are building your business. You can realistically expect to work full time for 3 to 6 months before you collect your first commission check.
4. Work on Building Your Portfolio and Referral Base Quickly.
Building your portfolio is critical at the beginning of your real estate career. Many times, the first few clients that a new broker works with is family members or friends. It is also extremely important to work with a mentor in your brokerage; someone with experience who will not only guide you, but also and help you avoid making common mistakes that most brokers make early on in their career. Also, don’t be shy asking your friends and family for referrals of people who are considering buying or selling a home. Someone is always looking to buy or sell real estate, you just have to let people know that you can help them!
Becoming a real estate agent can be a very lucrative and rewarding career as long as you are working with the right company, have a good mentor, and have discipline to work hard and plan adequately and appropriately. Now is a great time to consider a career in real estate and become a broker!