Thinking About Becoming a Real Estate Agent? Read This First...
A great post from Greg Nino, Houston real estate agent, titled, "An Open Letter to Anyone Wanting to Get Their Real Estate License". Don't get me wrong, I love my job. But like any industry, it has it's challenges. If I had a dollar for every time I heard, "I like people and love looking a homes. I would like to be a real estate agent." Nino's well-written 42-point letter below plus my commentary:
1. Passing the exam is easy. Creating a business with real income is a different story.
So true, the barrier to entry is low. Creating a business with real income is a different story.
2. Now that you have your license, be prepared to lose friends and get your feelings hurt. Most, if not all, of your friends and family will avoid using you the first year or two that you’re licensed. Simply put, you don’t know what the hell you’re doing. Earn your battle scars. Even after you’ve gained experience, you’ll have friends and family who will not work with you because you’re a friend or because you are family. It happens every day to Realtors across the country.
Credibility. It’s not bought or you are born with it. It’s earned.
3. If you don’t spend money, you won’t make money. You need to spend THOUSANDS of dollars to create a business. Most of what you are thinking is a cute and new idea has already been tried a thousand times. You will do what every new agent does: Spend money (A LOT OF IT) on the wrong things. Over and over again. There’s a famous saying in this business: “If you want to get rich in real estate, sell stuff to Realtors.”
Truth: There’s no silver bullet. Takes hard work to build a real estate business. In the meantime, spend money wisely on long term impact and not on gimmicks. Vet technology opportunities too. If the technology doesn’t have an established track record or presence, then don’t waste your time.
4. You and your smartphone will become inseparable. You will have to get up from eating, watching a movie and sleeping to take calls, return emails and respond to text messages. Of course, you don’t have to do this, but you also don’t have to make any real money in this business. You’ll get out of it what you put into it. Ignoring a call could be a $20,000 mistake. Or more.
I’m OK with not picking up the phone when I’m busy. That said, I have lost business because I wasn’t quick enough on picking up the phone, but I’m OK with that.
5. Be prepared to be second-guessed, doubted, questioned, accused and lied to repeatedly. Buyers and sellers have the propensity to lie just like you and the guy next to you at the grocery store. People have perceptions about lawyers, mechanics and police officers. They have them about us, too. Even after years of experience there will be clients who will second-guess your every move. This will never go away.
Buying or selling a home is a big step. And with that there are a lot of emotions involved. Earning clients’ trust is not always easy.
6. You will show thousands of houses. Showing a house isn’t just about unlocking a door. Sometimes you get rained on while showing. Sometimes the house says active on the market when it’s already under contract with another buyer. Sometimes you are late to the appointment because of traffic. Maybe your buyer will be late. The number of things that can go wrong are practically endless.
Just when I think I’ve seen it all, there’s more… I couldn’t make some of the stuff up that I experience even if I wanted to.
7. Almost nobody will respect your time. Almost everyone thinks you are overpaid.
Sadly, this is quite true.
8. Expect people to ask for kickbacks both legally and illegally. Buyers and sellers will often want to haggle with your commission.
It’s unfortunate, but with the Redfins and Zip Realty agents out there, many buyers and sellers try to commoditize real estate agents. Not all agents are the same.
9. You will pay taxes. A lot of taxes. Expect to pay for the gizmo you use to unlock doors. You will pay for this yearly along with dues to three different associations. You’ll pay for signs, lockboxes, tools, equipment, cameras, advertising for both you and your listings, leads, websites, and on and on and on.
Endless fees. And not to mention that there’s only one Multiple Listing Services (MLS) that monopolizes... I mean... covers our area. With no competition, no incentive to innovate = real estate tools that suck.
10. You will pay for your own health and life insurance. There is no 401(k) matching in real estate. You are an independent contractor. In fact, YOU will pay to be at your local real estate office! The broker will take money from you. You will also pay for an office if you want one. Your phone is your cost. Your Internet is also your cost. So are your paper, pens and everything else imaginable. You’re running a small business. It’s ALL your costs. You’ll also pay for errors and omissions insurance. The list is really long. Yay!
A ton of insurance policies to choose from but none or close to what we had when my wife was working a nine-to-five job.
11. You will get screwed in this business. It’s not for the naive, lighthearted, ignorant or thin-skinned. You will work your rear end off and sometimes not make a dime.
But you will earn a valuable experience and hopefully not get screwed again. How does the saying go? "Fool me once, shame on you; fool me twice, shame on me"
12. You will deal with a certain number of psychopaths each year.
Psycho-meter definitely improves over time...
13. You will meet criminals, convicts and felons, especially if you work in the leasing industry.
I remember representing a seller and the buyer’s agent when I looked up the buyer’s agent real estate license number, he had a slew of felonies on his record including ‘assault with a deadly weapon’. Needless to say, I never met the agent in person, but since he was the only buyer, I had to work with him to help my seller sell their house.
14. Strange men and women will ask you to meet them at houses RIGHT NOW.
Some people think that I’m just waiting at home for them to call me.
15. You might get a gun pointed at you while showing a house or two. Sometimes rabid pit bulls will chase you down.
There have been times in which I’ve been concerned with having some of my agents show properties in certain areas. You can never be too careful.
16. Expect to get towed at least once.
Haven’t been towed but have had dozens of parking tickets.
17. Eventually you’ll get in a wreck while showing. You better hope your clients aren’t with you. Is your auto insurance updated correctly?
While on broker tour viewing new listings, got in an accident… with another Realtor on tour viewing homes. What are the chances?
18. There is no disability insurance. So, if you break a leg while playing softball, you’re screwed. It’s going to hurt your business.
Disability insurance is a must.
19. You might get sued even when you aren’t at fault.
Having good legal support is extremely important especially in these cases.
20. When you become successful, your competitors might file complaints on you because they are jealous. You won’t like this.
File complaints, talk badly about you to prospective clients, or write fake negative reviews on Yelp.
21. As you show houses you’ll be in questionable neighborhoods from time to time. You need to learn self-defense, and carry a gun or a can of mace. Everyone should be concerned about their safety.
Letting a co-worker or significant other know where you are is a good rule of thumb.
22. Be prepared to leave a social event early to run and show a house or to get yelled at by one of your clients for something you did not do. It doesn’t matter, you are the chew toy sometimes.
Thick skin. I’ve grown thicker skin.
23. It’s likely you’ll get audited by the IRS. You have too many write-offs and, once again, you make too much money.
Happens all the time.
24. Lawyers are annoyed by Realtors.
And vice versa?
25. Expect to list homes and never sell them. No agent sells every home they list. You will waste time, money, energy and resources.
Nothing is guaranteed.
26. Your signs will be stolen, spray-painted and eventually played with by the local kids.
Graffiti. Or even better… disappearing signs. Now you see it, now you don’t.
27. Your flier box will always be empty because kids, passersby and neighbors will take too many. Sometimes they’ll take all of them in one day. Then you’ll be chastised for not having fliers in the flier box.
Need to have a system to keep the box full.
28. Did I mention you’ll deal with at least two crazy people each year?
Par for the course.
29. EACH real estate transaction you work means you are likely dealing with at least eight different people. You’re responsible for 15-20 things. Right now I am trying to close 11 contracts. I am a little stressed. Sometimes I wake up in the middle of the night thinking about my paperwork, my clients and my business.
Managing the stress is an art...
30. You will become an unlicensed therapist, divorced lawyer and counselor. You aren’t allowed to give legal advice, and you shouldn’t. You aren’t a doctor, but everyone will unload their personal lives with you. You will sometimes live their life.
Quite often we know when a couple is expecting a baby before their family does. Quite an honor I must say. There are definitely negative aspects as well of being so close to clients lives for such a short and intense period of time. And then when the deal is over, it feels like a divorce.
31. Your spouse will at times hate what you do for a living.
Prioritizing priorities. :) Easy to say...
32. Your wife or husband will despise the fact that you are always on your phone.
Sometimes I just have to turn the phone off. Business will still be there in the morning.
33. When you’re sick, you still work. There’s no floating holidays.
No one cares if you’re sick. You still got to get the job done...
34. While on vacation, you still work. You can get an agent to cover your business, but NOBODY will care for your business the way you do.
True.
35. Sometimes when you make mistakes it costs people money. You can’t just apologize.
Taking ownership of your mistakes. And learning to not take ownership of mistakes that are not yours. Everyone wants to point the finger at someone.
36. You have to have a nice car. You must wear nice clothes.
Perception is everything? In Silicon Valley, I drive a Tesla Model-S and like to wear Converse All-Stars to view property. Is there a happy medium?
37. When you first get started everyone will know you don’t know what you’re talking about. It’s a fact. This sucks. But if you stick it out, you’ll be OK. Seventy-five percent of the new agents don’t make it.
I hear that it was only a 5% success rate after 2 years...
38. You get to work with agents! Not all of them are put together correctly. A lot of your problems in this business will be because of the other agent. You will get upset, angry, pissed and offended. Egos are here, too.
Ego vs. humility. My constant struggles. Sometimes agents get in the way of the clients too. Need to constantly check myself by asking… what is best for the client?
39. Wait for it: Friends, neighbors and family will ask you for real estate advice while they are involved in a real estate transaction YOU aren’t.
Quite funny actually. Happens once every other week. Why are you asking me for advice? Why don’t you ask your real estate agent?
40. Other Realtors will give your client advice when they aren’t supposed to. Every buyer and every seller knows an agent somewhere.
Amazing… we have 25,000 real estate agents in our MLS. That’s a lot of licensee giving advice though only a select few are selling most of the real estate in the area.
41. Each market is different. Very different sometimes, but that won’t stop friends and family from influencing your client. Your client will become confused at times.
Confidence and trust. If that’s non-existent, then you’ll be climbing up a very big hill.
42. You have a better chance of meeting E.T. than you do working real estate part time and being successful. It takes time, effort and money to be a part-time Realtor. In fact, being a part-time agent can be even more difficult.
Part-time effort yields part-time results.
So why do agents do this?
You’ll have the amazing opportunity to reap what you sow. You can work when you want. No matter how bad your boss (client) is, you are working for them for only a certain period of time. You get new bosses all the time. You can make a real difference in a lot of people’s lives. You literally help shape dreams. YOU can be the difference in someone’s life as they look to sell and buy a home. And not all clients, buyers and sellers are bad. Most of them get it. It’s awesome when everything works out.
And that’s why I do what I do. Building long term relationships. Helping transforming lives on household at a time.
