It is very common to hear success stories about people in various fields of real estate and mortgage refinance, and all the money they made last year. Naturally, you think to yourself that you could do that too, be your own boss, set your own hours, and make a pile of money, all the while not having to race with the other rats. If that sounds attractive to you, read on!
First of all, the term "real estate" is really large and encompasses numerous industries and specializations. You have residential real estate (and its sub-categories), commercial real estate (and its sub-categories), investment, residential or commercial appraisal, mortgage lending and banking, construction, management, auctions, leasing, and so forth. So the first choice you must make is which of these fields will be your specialty?
For simplicity's sake, let's suppose you choose residential brokerage, the most popular of these specialties. That means you want to sell real estate, since that is what brokerage is all about. Here is the secret: to be good at sales you must possess two personality traits. The first is empathy and the second is ego-drive. Without these two traits you cannot succeed (in the long run) in sales.
Empathy is the ability to feel with someone. When a prospective purchaser says, "I just can't afford that house", your empathy says, "You know, I understand where you're coming from 'cause I've been there." Now your ego-drive must kick in. Ego-drive is defined as the need to persuade. So your ego-drive kicks in and you say, "I know you think you can't afford this house, but let me show you how you really can." In other words, you can't let the prospect fail to buy something because then you feel unfulfilled.
Empathy and ego-drive are learned traits, but they are a part of your personality which is pretty much formed by the time you are five or six years old. If you don't have these traits by that age, the shrinks tell us that your chances of "learning" them are very low. And if you don't have these, you need to go into another facet of real estate.
But assuming you have them, you must first get a real estate license. This requires a long class (the length of the class varies by state) and a difficult exam (with extensive - though not really hard - math). Assuming you pass the class and the state exam, now you must find a licensed broker to sponsor you. If you have a lot of sales experience (in any field), this will likely be simple. If not, it will be more challenging.
Now you must get listings, the lifeblood of the successful real estate sales person. The competition is cutthroat since there are always more agents vying for the listings than there are listings. You say, "that's OK, I'll be a buyer's broker". Remember, even the National Association of Realtors (c) says its most successful associates, as a trend, concentrate on listings far more than sales.
Another choice is the time you are willing to invest in learning your trade. Real estate is not "part-time". Would you want the health of your children in the hands of a part-time doctor? Would you want your defense against a charge of white-collar crime in the hands of a part-time lawyer? Do you want somebody who teaches dance classes three days a week repairing the brakes on your car? If you will sit down with the really successful real estate sales people, you'll find that they work at it 50 to 60 hours per week, and that's not always between 9AM to 5PM, either.
And then there is the pay. Yes, you can make a truckload of money. But you don't get paid if the deal does not close, no matter how much work you put into the transaction. Let's suppose you sell three one-million dollar houses this year. That means you'll have only three paydays this year, too (albeit large ones). There are no benefits, no 401(k) plans, no year-end bonuses, no paid insurance, no paid vacations, no car allowances, and no signing bonuses. You get a portion of the commission your office charges. This is not meant to scare you; it is meant to open your eyes and your mind.
Remember, for some, real estate brokerage can be a great career, but look into all of real estate's facets before you make a decision.
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