REALTOR® income is up for the second year in a row, according to the 2013 National Association of REALTORS® (NAR) Member Profile. The median gross income of a REALTOR® jumped from $34,900 in 2011 to $43,500 in 2012.
You know what that means: A new crop of real estate agents is trickling onto the scene. Cities like Detroit and Jacksonville are already seeing an influx of new real estate agents as the market rebounds and income rises.
Let’s give those folks some pointers, shall we?
Tip #1: Be Kind
Real estate is a service industry. Agents are constantly in service to their buyers, sellers and fellow agents. That means agents must possess the following:
- Good listening skills
- Ability to work well with others
- Solid work ethic
The takeaway? Inconsiderate, antisocial mavericks need not apply. If you’re not prepared to put the needs of others first on frequent occasion (which could mean answering the phone at 2 a.m., helping your clients move or counseling sellers through a tough time), real estate may not be the field for you.
Tip #2: Thrive on Self-Motivation
Agent C.J. Johnson: “Write and follow a business plan. Run your desk like a business. You and only you control your success.”
Teamwork is an important part of life as a real estate agent. Agents are in constant contact with clients, other agents, lenders, title agents and a litany of other professionals.
And while it’s essential to work well on a team, agents must prepare for one harsh reality: The “team” isn’t going to pay your bills.
Agents typically work as independent contractors and are paid by commission. To succeed in this field, agents must be self-motivated.
You can’t expect business to fall in your lap simply because you have a license. Will you make cold calls without being prompted? Are you willing to learn a new skill without it being a requirement? Are you constantly prospecting / networking / researching?
If so, expect your “pipeline” to be properly “stuffed.” Which brings us to Tip #3:
Tip #3: Stuff the Pipeline
Say good-bye to a regular salary. Watch those regular office hours fade into the horizon, and get ready for the unpredictability of life as a real estate agent. Seemingly-perfect deals do fall apart on closing day, and commission checks will slip just out of grasp.
Don’t ever assume a deal is going to go through. Don’t make financial decisions based on an anticipated closing. Assume the worst, hope for the best, and don’t forget tip #4.
Tip #4: Save for the Lean Months
Agent Lori White: “Have 6 months of expenses budgeted, in savings.”
Yet another financial reality of real estate is the lack of benefits.
According to the NAR, only 4 percent of REALTOR® members receive health insurance through their brokerages, and 83 percent are independent contractors. So don’t forget to build up savings to pay for:
- Payroll taxes
- Health/dental/vision insurance (if necessary)
- Advertising materials
- Brokerage / licensure fees
…and perhaps most importantly, save.
Fiscal crises have a way of popping up when you’re least prepared to handle them. Pocket at least 6 months of living expenditures to get through the lean months and any financial emergencies.
Tip #5: Rest
Angie Rogers Nishnick: “Make sure you take a real day off and pick a time to call it a day. It’s easy to get wrapped into working 7 days a week. Your clients will understand because they don’t work 7 days a week either. The business will be there, but if you burn out you won’t be useful to your clients.”
Showings. Open houses. Botched deals. Real estate is a stressful (and busy) industry.
So don’t forget to recharge your batteries regularly. It’s easy for real estate to become a 24/7 gig, especially if you don’t set boundaries. So follow Angie Rogers Nishnick’s advice:
A stressed, harried, exhausted, barely-there real estate agent is of no use to anyone. Not to a client, not to a family member, not to a friend.
So make yourself useful. Go get some rest, would you?
What Advice Do You Have for New Real Estate Agents?
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Photo courtesy rachelvoorhees