Jobs where you’re paid on commission are much different than jobs where you have a salary. There are many benefits and disadvantages to these kinds of jobs; one off the top of my head would be that you have no boss breathing down your neck every day. The main disadvantage Of course would be that if you don’t sell real estate you make no money. Although that is only true to a certain extent because there are many different facets of real estate as a career, some of them bringing you passive income. Now passive income is income that you don’t have to work for more or less.
The IRS ascribes it as income “in which you do not materially participate. “(“Topic 425 – Passive Activities – Losses and Credits. “) That’s why it’s called passive, it works for you. An example of passive income in relation to real estate could be leasing real estate to tenants and hiring a property manager to handle the rest. Now in theory that sounds great, although the disadvantages to that is you need enough money upfront to not only put down the initial payment for the mortgage, but to also hire a property manager if you don’t want to do that work yourself.
Another big topic in researching Real Estate is degrees. Well, the great thing about real estate is you do not need a massive amount of formal education akin to most jobs. Since you’re paid on commission the work you put in is the work you get out of it, which is why there are only three required real estate courses to get your license. (“Requirements to Apply for a Real Estate Salesperson License”). Albeit you still need to pass the real estate examination to actually obtain that license.
That’s for a salesperson license, a broker license on the other hand requires a little more than just three classes. It requires a few years experience as an agent, more classes, and a operate test. Now you may be consanguineously why a broker license takes all this effort compared to an agent license, and the answer is that agents work under brokers. Therefore if your agent screws something up you as the broker could very well be liable. That is why Brokers need to have more education and actual experience before being given a license.
The first thing in anyone’s plan to become a real estate agent should be to pass your required courses. I have already done that so right now I just need to study for my licensing examination. I’ll have to go over everything in real estate principles, as well as al estate practices. Once I pass the examination I will be a full fledged agent and ready for the work force. Which allows me to represent clients who are looking to buy and sell their house, as well as sit in on open houses and other fun things. Now my goal as far as my first job will either be working with my parents or with another firm.
There is a real estate firm called Redefine which teaches new agents who are starting out. Thus working there might be the best choice if decide not to work with my parents. I plan to start out sitting in on open houses and handling paper work until I feel have the skills accessory to start setting up deals, finding buyers or sellers, and buying property myself to lease. Now leasing like said before is another big part of real estate and passive income. And becoming a property manager can be much more stable than relying on just representing buyers or sellers.
So my plan is to first work with my parents right away, apply to Redefine shortly after, as well as manage properties on the side that my parents own to gain some insight into the inner workings of real estate. The ultimate goal is to own my own real estate business and have my own properties to manage. One of my suggest strengths is that I am a good salesman. I can talk people into things, and be Very persuasive when have to be. This is a skill that will without a doubt help me in the negotiating process of real estate, which is a big part of what ultimately determines your commission.
Another strength of mine is that am a people person, and I don’t have much of a problem networking with all kinds of people. I’m easygoing and not hard to talk too, I enjoy listening to what other people have to say and finding out more about them. This skill will be paramount in building a client base and finding people to represent. Real estate can be very fickle at times, and rightly so since a house is usually the biggest investment people make in their life time. As far as barriers I have no real job experience right now.
Some people going into real estate are much older and have already gone through the process of buying and selling real estate, if not with a license, just in their personal life. This gives many new people coming in an edge, which I will not have. There is also an extremely competitive job market in real estate since you only eat if you sell. Therefore the next big barrier would be competition; many agents and rockers have been out there for decades and sometimes you may find yourself in direct competition with them.