What To Expect When Starting Work As A Real Estate Agent
by author on Sep.20, 2010, under Main Articles
Most people selling thier homes are overwhelmed by the commisions they have to pay real estate agents. At a six percent commission, it will cost a home seller $12,000 to sell a $200,000 house. These sellers think that real estate agents get rich from doing very little work. They assume that real estate agents get paid a lot of money for doing very little work. For this reason, many people decide that they want to go into real estate themselves.
It is relatively easy to get a Utah real estate license. Only 120 hours of education are required, and college degrees aren’t needed. Because it is so easy to get into the real estate field, it is also very competitive. Most people that get their real estate license, don’t end up renewing it two years later.2005 statistics show that only 7% of real estate agents renew their license at the initial two year expiration. In the current market, these numbers are likely even less.
Actually making a living as a real estate agent isn’t easy, and it requires an investment as well. Here are a few things you should know if you are considering becoming a real estate agent.
There are several upfront costs. While real estate school, and paying for your test and license aren’t too expensive, being able to actually use your license is. Before you can actually start showing homes, you need to sign on with a real estate “broker”.When you sign on with a brokerage, you’ll have to also join the National Association of Realtor’s, the State Association, and a local board, which all require money. ” This can cost close to $1,000 annually. You’ll also have to pay for MLS service, which will cost you about $400 a year. If you actually get a listing, or start working with a buyer, you’ll have to spend money on them. Most Florida Real Estate brokerages will require real estate agents to pay for their own business cards, yard signs, and websites. You’ll have to pay money to advertise your listing, or pay for gas to drive around to show homes.
Most of the time you will be working for free. Occasionally real estate agents to get big commissions, but most of the time is spent on tasks the bring no money. Many buyers decide not to buy, end up using a different real estate agent, or build a home instead. Some listings don’t sell regardless of how much money you spend marketing them. But, most of the time real estate agents aren’t even working with clients. Most of a real estate agents time is spent trying to acquire new clients.
You are responsible for your own insurance and retirement savings. Realtors aren’t employees. They are independent contractors, and essentially owners of their own businesses. There is no group plan for real estate health insurance and know employee matching retirement program. Realtors have to pay for their own health insurance.
It will likely be months before you will get your first paycheck. Most real estate transactions take month before closing. Most buyers spend more than a month looking at homes before they actually make a decision. The average Homes for Sale in Baltimore MD are on the market for about four months before it ever sells. In this “buyers market” some homes will take years before they sell. Almost half of listed homes don’t even sell during their initial list period. After a property finally gets under contract, it will be about a month before the closing actually takes place, and a few weeks after that before your brokerage finally cuts you a check. It could take months just to get your first client, and then it will likely be months after that before you will get paid for working with them.
Many real estate agents are able to overcome all of the obstacles and make a lot of money. But if this is something you think you will want to do, make sure you have plenty of savings before starting, and be prepared to run your own business.