Congratulations! You have made the wonderful decision to pursue a career in real estate as a licensed real estate agent. A career as an agent can be one of the most rewarding jobs you ever have — both personally and financially. On the flip side, there are certainly many challenges and obstacles for anyone who wants to become the next great agent.
- Develop your motivation for becoming a real estate agent.
- Know the personal and financial resources you’ll need to succeed.
- Get a mentor, a sponsor and a buddy.
Congratulations! You have made the wonderful decision to pursue a career in real estate as a licensed real estate agent.
A career as an agent can be one of the most rewarding jobs you ever have — both personally and financially. On the flip side, there are certainly many challenges and obstacles for anyone who wants to become the next great agent.
What’ll you find in this post is a timeline and a to-do list wrapped into one. The timeline starts from the moment you make your decision to become a real estate agent.
I’ve divided the timeline into two parts: The time before you pass your real estate exams and the time after. If you handle your business well before you get your license, you will be able to launch into your career faster and more prepared than most agents.
Again, congrats on making the decision to become an agent. Now, let’s make that dream a reality.
Part 1: Before licensing
Step 1: Determine your objectives
As with starting any new job or before doing anything in business, the best question you can ask yourself is: “Why am I doing this?”
Determining your motivation — your reasoning, your why — is the most important thing you can do because it will keep you going from day one to day 10,000.
- Are you looking to get your real estate license to practice part-time and do a few deals every year for a select number of family and friends?
- Are you looking to get your real estate license so you can buy and sell real estate for yourself?
- Or, are you getting your license to practice full-time and make this job your career?
Once you decide why you are getting your real estate license, you’ll be able to make decisions, such as selecting a licensing school and a real estate broker, that make the most sense for you.
Step 2: Understand the job responsibilities
Most people who think about getting their real estate license don’t always understand the full scope of the job. Plus, they always think the job is much easier and more glamorous (as portrayed on TV and in real estate seminars) than it is in real life.
As a licensed real estate agent, whether full-time or part-time, you are always on the clock. Real estate never stops.
Be prepared to put out fires first thing in the morning. Get ready to do deals during lunch and well after sundown. Know that nights and weekends are when most of your clients will want to contact you.
On top of your constant obligations to your clients, know that most your job duties center around prospecting.
You may love looking at houses. You may be the best negotiator in the world. And you may know everything there is to know about financing. But if you don’t have any clients to work for, you won’t be in business for very long.
Other things to consider are all of the benefits that were once provided to you by your previous employer. Things like health care, social security taxes and more are all things real estate agents, as independent contractors, have to provide for themselves.
If you aren’t ready to handle these things yet, you should probably wait to start as an agent until you are ready.
Step 3: Plan your life accordingly
Now that you have an idea of what you’d like to do as a real estate agent and you know some of the real requirements of the job, you’ll want to make sure that everyone who’s depending on you is onboard with your decision.
If you’re the head of your household and you aren’t bringing in a paycheck for the first few months as an agent, will you be able to support your family?
If you have time obligations with friends and family on nights, weekends and holidays, will they be OK with you being on your phone to close a deal at 8 p.m. on the Fourth of July?
Have a real conversation with the people that matter most to you in your life, and make sure they’re on board with your decision, too.
Step 4: Research real estate licensing schools
In most states, there are several different ways to obtain your real estate license. You have to determine which learning style is best for you.
Some schools offer a one-week cram courses so you can learn all of the material and sit for the exam by the end of the week.
Some schools offer online learning programs that allow you to learn at your own pace over the course of 12 months.
Other schools offer a combination of in-person teaching with online resources.
Determine which way you learn best, and then pick the school that offers the best options that match your learning style.
Step 5: Research real estate brokerages
This step in the process might be the most important part on your journey of getting your real estate license. Your broker can help you set a good foundation as you begin your real estate career.
In general, you will want to take a look at six different areas of expertise that a brokerage can provide and compare and contrast them against each other. The six areas of expertise include:
- Education and mentorship
- Branding, advertising and marketing programs
- Technology tools
- Lead generation capabilities
- Company culture
See which brokerage offers the best tools, options and resources for you, and pick one once you get your license.
Step 6: Start grassroots marketing campaigns
One of the most important duties of a real estate agent is to prospect for clients. After all, if you don’t have any clients, you can’t perform any of the other parts of the job.
To help you get clients on day one of being a real estate agent, start laying down some grassroots advertising campaigns with your close friends and family now.
Start telling people that you are studying to become a real estate agent and that when you have your real estate license, you’ll be happy to help them with anything they need when it comes to real estate.
Step 7: Secure funding sources
Most of the people who get their real estate license plan on working as a residential real estate sales agent. These sales agents work as an independent contractor for a real estate brokerage.
As an independent contractor, the best way to think of yourself is as the CEO of your own small business. That small business is you. You are the CEO of the real estate company of you.
As a small business owner — like any business owner in any industry — there are costs associated with starting the business.
Just to get your license and start practicing real estate, you need to spend money. Some people can spend anywhere from $200 to $800 on classes, textbooks, tutors and exam prep.
Once you select your brokerage, you will most likely be required to pay fees to join local associations, get access to the local MLS and even pay your brokerage additional fees. These fees can easily eclipse $1,000 to $2,000 in the first year alone.
Once you begin your career, you’re going to have to advertise yourself and your services. These activities cost money. It is nothing for some agents to spend $500 to $1,000 (or more) per month on these campaigns.
What’s more, you could potentially have no income sources for up to three, six or even 12 months on the job before you close your first sale. The loss of potential revenue (the money you would have made if you stuck with your old job) is a major expense that most agents overlook in their first year.
You need to find a way to secure funding sources for you as a small business owner.
Some agents develop savings over months and years before they go into the career full-time. Some agents get part-time jobs to help pay some bills. And some agents even find loans and investors to help them grow their business.
Whatever way you intend to pay for your business, be sure you have a solid business plan that can keep you afloat for at least the first year of being in business.
Part 2: After Licensing
Step 1: Select a brokerage
When you are doing your research on brokerages, you should ideally interview with at least four different brokerages. The four different types of brokerages include large national franchises, regional franchises, large local brands and small independent brokerages.
Interviewing with at least one brokerage from each of these categories gives you a better understanding of what the tools (and costs) are associated with joining a particular brokerage.
Once you weigh all of the pros and cons, pick the brokerage that best works for you.
Step 2: Determine your business goals
As an independent contractor, you are your own boss. You are the boss of your own small business, and your small business is being a real estate agent.
Like any good small business, you’ll want to create goals for your business. You’ll want to create goals regarding how many homes you want to sell, how much money you want to make by the end of the year and how satisfied your clients are with you.
If you set goals for yourself, you have something to strive for. It gives you that extra motivation whenever things seem dull or when your business seems to be in a rut.
You are more likely to accomplish your goals when you write them down. Plus, if you start telling other people your goals, you are even more likely to accomplish them.
Step 3: Find a mentor, a sponsor and a buddy
The career of a real estate agent, as we think of it today, has been around for nearly 100 years. There have been millions of individuals who have come before you to do the exact same job duties you’re planning on doing in the foreseeable future.
Sometimes you don’t need to reinvent the wheel. Talk to the people who already tried inventing it to see what works and what doesn’t.
This is where finding a mentor is highly recommended.
A good mentor for a first-year real estate agent is typically someone who has been in the real estate industry full-time for at least the past three years or more. Typically, you’d like to see some level of success with this mentor, either through sales or involvement in the community.
A good mentor is one who will listen to your hopes and dreams, your ups and your downs, and your pitfalls and challenges.
Your mentor will then be able to give you the words of encouragement that you need to succeed and let you know when you’re traveling down the wrong path. A good mentor will help you build a framework for your career.
A sponsor is a little different from a mentor in that a sponsor can be someone either in or out of the real estate industry. He or she doesn’t need to be someone with tremendous business success (although the more the successful the better). A sponsor needs to be able to open doors for you that otherwise wouldn’t be opened.
A good sponsor is someone who has your back and will shout your name to everyone he or she knows with a vote of confidence that means business. Finding a good sponsor can be harder than finding a good mentor, but it’s well-worth the effort.
A buddy is a fellow real estate agent, preferably someone who has about the same knowledge, talent and resources as you do.
Your buddy, or accountability partner, is someone who can help keep you on track of your daily goals. Perhaps you and your buddy can prospect together, go to networking events together or even show homes together.
A buddy is someone who will make the doldrums of everyday work life feel better.
Step 4: Create your database of 100
When you first get started as a real estate agent, you may be tempted to launch into several different costly advertising campaigns. I’m here to say that those activities aren’t necessary and can actually do more harm than good.
Instead, for your first few months as a real estate agent, focus on the people that already know, like and trust you. You are significantly more likely to work with a close connection than a random lead on the internet.
Spend your first few weeks as a practicing agent developing your database of 100. This list is a list of the 100 people you know, like and trust best. These are the people who, if you were to call or text today, would respond to you within a few minutes.
Inform the people on your database of 100 that you’re now a practicing real estate agent and that you can help them (and their database of 100) with any real estate services they may need.
Then, spend the rest of your career following up and providing value for the people on your list. A dollar spent advertising to the people on your database is much more effective and efficient than a dollar spent on any other advertising activity.
Step 5: Advertise
Month 6 until forever
There are countless ways in which you can advertise yourself as a real estate agent. In fact, I wrote about 99 different lead generating activities last year.
Lead generation is the lifeblood for any real estate agent. If you are not prospecting today, you will go hungry tomorrow.
You need to spend every day working on your advertising plan. The more time you spend on developing a good prospecting plan, the more you can rely on business down the road.
You don’t need to do every lead generating activity under the sun, and you don’t need to spend a lot of money (if any) doing it either. Like a good exercising and eating habit, you need to spend a little bit of time and effort every day to get the best results.
Step 6: Get educated
Month 7-12 — and beyond
If “location, location, location” are the three most important words in real estate, then “education, education, education” are the three most important words for your real estate career.
First, you are required to take a certain amount of continuing education classes. So, at a minimum, you should be taking classes to learn (or relearn) topics and theories about the real estate industry.
Another reason to focus on education is because all of the great business professionals focus on it. They spend time reading the paper, journals, books and articles on their industries and about business in general. They spend time going to seminars, conferences and trade shows to hone in on the latest and greatest trends.
If you’re not learning and not getting educated, you are falling behind everyone else in the industry who is taking advantage of all of the great educational resources out there.
Step 7: Get involved
Month 10 and beyond
One of the reasons you wanted to start your career as a real estate agent was because you realized that agents have tremendous flexibility with their schedules. They can often work when they want and where they want.
Well, now that you’ve got almost a year under your belt learning about the real estate industry and perhaps even doing a few transactions, you should use your time wisely and get involved.
That means getting involved in your local Realtor association. Spending time with your fellow practitioners to help elevate the standards of the industry as a whole.
That means getting involved with your favorite local charity and community organization. Use some of your flexibility to give back some of your time to those who need it most.
Finally, use your time to get more involved with your family and friends. If your old job was one that had you working long hours and never able to make the kids’ baseball games or dance recitals, now is the time to exert some influence over your life and take control of the things you want to do.
The lifespan of a real estate agent is one that can last three months or 30 years. If you lay a solid foundation before you even get your real estate license, you will be better prepared to make this job a career.
Follow the steps in this timeline of becoming a real estate agent, and you will find this career to be both financially and personally rewarding.
Nico Hohman is the broker-owner at Hohman Homes Real Estate Brokerage & New Home Consultants in Tampa-St. Petersburg, Fla. Connect with him on Facebook or Twitter.