If you’ve ever thought about becoming a real estate agent and are curious about how to get started, it’s relatively easy to do.
While many other high-earning-potential careers require a lot of schooling and hands-on experience, real estate has an easier entry level.
While real estate is a career that can be very lucrative, it does require work.
If you’ve seen shows like “Selling Sunset” or “Fix and Flip” and thought it looked like something you’d be interested in, well, the reality is that as a career, real estate isn’t all glamor; there is work that has to be put in.
And like any career, the most important thing to do before you begin is to do some research. I recommend talking to friends and family that may be in the business to get a sense of the ups and downs and what they enjoy and don’t like about the business.
Every state has different requirements for getting your real estate license, so you first should contact your state’s regulatory commission for specific requirements.
Why Become A Real Estate Agent?
There are plenty of reasons to consider a career as a real estate agent.
First, you are in a position to help people achieve their dreams of home ownership. Being able to help someone buy their first home, or sell their home for whatever reason, is one of the greatest joys for you as an agent, so if you like seeing people succeed and enjoy helping others, a career in real estate may be for you.
Another reason to consider becoming a real estate agent is that the career offers more flexibility than most others. As a profession, most real estate agents don’t work a typical 9-to-5 office gig.
You'll be your boss and create your own schedule.
As your own boss, you’ll be acting as an independent contractor and an entrepreneur, so you’ll need to think and act like one. But on the other hand, being a business owner gives you a lot of flexibility and responsibility to grow your brand and business.
Of course, creating your own schedule doesn't mean working less and still seeing results. To succeed as a real estate agent, you'll need to wear many different hats, from marketing to sales and more.
Even though you control the schedule, you’ll need to be available to work to accommodate your client’s agenda, including showings during peak hours like nights and weekends.
Still, as a career, being a real estate agent gives you more control over your scheduling and gives you more room to do things like taking a week off for vacation or spending mornings taking your kids to school.
Another attractive thing about real estate is that you get to choose your type of clients and the niche you want to work in. So, for example, you can focus on working with new homeowners and investors and choose between residential, rental, or commercial real estate.
As a real estate agent, you won’t have any concrete salary limits since your income is based on commission. So, what you put into real estate directly relates to what you can get out of it.
There are a variety of benefits to becoming a real estate agent, which include:
- View a variety of really cool, interesting properties
- Flexible work-from-home schedule
- Lack of a dress code
- You are your own boss
- Won’t need a college degree
- High potential income
- Ability to help others
Like most businesses, success in real estate will depend on an individual's work ethic, ambition, and dedication, so you’re in the driver’s seat when it comes to your business’s success.
It’s easy to get started in real estate, and, like all things, it takes time to master, and to become a real estate expert is a combination of time and education.
To master real estate and be your community’s go-to real estate expert requires constantly being engaged and learning, so you should be prepared to be a lifelong learner.
How To Become a Real Estate Sales Agent
In real estate, there are sales agents and brokers. A sales agent is a person who is licensed by the Real Estate Commission to act as an agent on behalf of a real estate broker and their clients.
In order to be active, an agent must be sponsored (known as “hanging your license”) by a licensed broker to perform any real estate transaction or service.
Again, being a sales agent has a lot of perks, though one drawback is that you’re often on your own as a businessperson, so you’ll need to have systems in place and the disciple to see them through.
Do the research about the career, interview current and former agents, and determine if real estate is a career path for you. Once you settle on becoming a real estate agent, there are some necessary steps you’ll need to take to begin your new career.
To begin, you’ll need to do the following;
- Figure out the licensing requirements for your state
- Take real estate education classes
- Schedule, take, and pass the licensing examination
- Join your State’s real estate and local real estate commissions
- Pay your dues and fees
- Interview and join a brokerage
- Business planning
- Networking
- Marketing
Let’s start in order of what you need to do.
1. Find Your State’s Requirements For Real Estate Agents
You’ll need to get credentialed and licensed to work in real estate. Every state has a governing board that determines the requirements for that state, so contact your state board to determine the specific criteria and conditions that must first be met.
You’ll often need to take a real estate course that covers a wide range of legal and ethical situations, completing 40-140 hours of instruction. In addition, you would be eligible to schedule a licensing exam to get your real estate license upon passing your class.
You may be required to show your age, education level, any criminal history, or other background information for people in a public trust situation.
2. Take An Accredited Licensing Course
Once you have your license, you’ll be required to take continuing education to be in compliance. Still, unless you’re already certified in real estate, you’ll be required to take and complete an accredited licensing course to become fully qualified.
These courses aren’t free, and the prices can vary from a couple of hundred dollars to a thousand dollars. Do your research and take courses offered by reputable organizations with a track record of helping prepare potential real estate agents to pass the exam and offer best practices in the industry.
3. Take And Pass Your State Exam
After successfully completing your credentialing course, you’ll want to schedule your test date with your state real estate department. Your classes would ideally prepare you for taking and passing the exam, so you want to schedule your test date as close to finalizing your courses as possible.
Once you schedule your exam, you’ll need to have a passing grade, usually 70%, in order to be qualified to apply for your license. Most tests have two parts; one focuses on federal laws, and the other focuses on state laws and regulations. If you fail one, or both parts, you’ll need to reschedule to take whatever portion you didn’t complete successfully.
These tests cost money to apply for and take them, so you want to take them as prepared as you can to avoid any additional costs.
4. Apply And Secure Your License
After your coursework and testing and you’ve fulfilled any other requirements set out by your state board of real estate agents, it’s time to apply for and to secure your license.
Every state has its own set of rules and procedures to ensure safety on behalf of both buyers/sellers involved in any transactions, so contact your local government agency to know what you’ll need.
Often, states will require agents to be fingerprinted and have a background check before issuing a license. In addition, there is a fee to apply, so be prepared for that as well.
5. Join The Local Real Estate Board
Once you have your license, you’ll need to join your local real estate board to gain access to the Multiple Listing Service, or MLS. As a new agent, you probably can choose between a couple of different boards, but the MLS is the lifeblood of your business. With access to the MLS, you can see past sales, current and coming soon listings, confidential remarks, and advertise your own listings.
6. Pay Your Dues And Fees
Once you join your regional real estate board and MLS, there will be fees and dues that you’ll need to pay in order to be considered current. These dues can be paid yearly, quarterly, or even monthly but will be required to be regarded as an active agent.
7. Interview And Join A Brokerage
Your local real estate board can offer you a list of brokerages to join, or you can ask around and interview with a brokerage on your own, but it is required to “hang” your license at a brokerage.
To “hang” your license at a brokerage simply means that you are working under and with the permission of a licensed broker and have an agreement with them to work under the terms and conditions they set forth.
Some brokers require in-office work for their agents, while others are more hands-off. Some may provide various education and networking opportunities, and others may only offer a great commission split.
The key is interviewing a few brokers and finding one that fits your comfort level and needs.
As a new agent, you’ll want to ask the potential broker about things such as;
- Commission split
- Support for agents
- Desk fees or other costs to join
- Marketing opportunities and networking events
- Continuing education opportunities
- Preferred Vendors
- Office requirements for agents
For new agents, you should find a smaller boutique brokerage that will allow you to learn under more experienced agents. It is crucial to find the right mentor that can teach you systems that have worked for them and show you how to make your business succeed.
More experienced agents that have a sphere of influence and their systems in place may prefer to work with digital brokers like EXP Realty, which provide limited resources but have lower costs and higher commission splits for agents.
In order to be working as a real estate professional, you’ll need to be under the umbrella of a licensed broker, so take your time and find one that fits your needs and interests.
8. Business Planning
Business planning is crucial for your real estate career to be successful. A business plan is simply an outline for the year of things you will accomplish, how you will implement the systems to achieve them, sources of funding, areas of marketing, and any other aspect that will be part of your plan for the year.
Before we get started on how to write your business plan, decide how you're going to document it.
You could draft it out “old-school” by hand and use a physical notebook. Putting pen to paper can be a powerful motivator, and research shows that your brain is much more engaged by the act of physically writing something out.
An electronic document: One of the benefits of using electronic documents is the ease of editing what you wrote and that you can access it from any device regardless of location. Simply open a blank Google Doc or Word Doc and start typing.
Ready-to-use templates: these can help you organize and guide your planning, and you can find inexpensive business plan templates on Etsy.
There’s really no wrong way to write your business plan, but what you write and how you plan will be crucial for you to be more organized and efficient as you attempt to grow your brand.
Why Create A Real Estate Business Plan?
You may wonder, “is a business plan that important?” The answer is yes! Some studies show creating a real estate business plan can increase your chance of success by over 12%.
Additionally, a business plan can elevate your chances of success by 27% when you commit to writing a real estate business plan and combine it with the other items that need to be accomplished, like meeting prospective clients, making marketing materials, and getting yourself ready for business.
Also, a business plan makes you appear more serious and focused by potential business partners, brokers, and banks when you may need their assistance.
Finally, a business plan gives you a clear direction, outlines goals, and helps you establish the systems and an operational checklist to succeed.
Your business plan should summarize the following;
- What is my annual goal and objective?
- Who is my ideal prospective client?
- How will I market to my ideal client and grow my brand?
- What are my earning goals GCI versus Net take home?
- What will my monthly sales need to look like to reach my ideal income?
- What are my expenses, and how will I cover them?
By writing a business plan, you are by defining your business's mission and vision statement. This becomes the foundation to launch and grow your business.
Growing will be more accessible by clearly detailing your business and the ideals under which your business operates.
Clearly outlining your goals will help you create systems that will help you achieve them. Hiring a professional real estate coach would be a great resource to consider at this point, as they can look at your business plan, help you see any flaws or holes, and help you refine your goals and make adjustments in ways to help you achieve them.
A real estate coach is someone who has a detached view of your business and your goals and can help lay out some systems to help you achieve them.
Professional development and services like business coaching are items that you can budget for but also be listed as deductible expenses at the end-of-year tax period.
Your Business Plan Should Focus On 3 Key Areas
Your business plan should focus on 3 critical areas for success. These areas represent some of your more daunting tasks that will require much work and help from others but are vital to your success.
First, conduct a SWOT analysis; second, create a financial plan; and finally, create a marketing plan.
Using SWOT Analysis
After you’ve created your mission and vision statement, you need to conduct a SWOT analysis. SWOT stands for “Strengths, Weaknesses, Opportunities, and Threats.”
I’ve posted about SWOT analysis for real estate agents before, but a SWOT analysis will help you strategize effective ways to be a better agent.
Your SWOT analysis should detail your business's strengths and weaknesses and those strengths and weaknesses of your competitors.
Ask yourself:
Is customer service number one for you? Are you outperforming your competitors?
What is your ideal niche?
What are your competitors' strengths?
What areas are already saturated, and which ones are underserved? Where can you expand and grow?
Taking a hard look at your strengths and those of your competitors, as well as what could be improved upon, will give you insights into areas where you can target your business.
Create Your Financial Plan
One of the more essential components of writing your business plan will be your finances. Identify and detail your expenses and income, and estimate your sales goals.
Be realistic in this section to better understand what you will need to do to make your plan come together.
When analyzing your expenses, consider that things will change for you on a licensing, personal, and business level.
There will be ongoing education for your licensing, or other things might pop up.
Don’t overlook your personal expenses.
For example, ask yourself if you will need to buy different clothes or electronics like a new smartphone that may be important to your work, and what about inflationary costs impacting things like your cost of gas?
Business expenses to plan for include broker fees, advertising costs, and other items often charged directly from your office.
Create Your Marketing Plan
Your marketing should be a section of your business plan. Consider all the ways you plan to spend on marketing, and there are less-costly forms of marketing, like guerilla marketing or social media, that can help you expand your reach and grow your brand.
As you started, the beginning of your real estate career was about passing your licensing exam, finding a broker, and building your business plan.
Now is the exciting and fun part.
You want to consider all the ways you can get your brand out there and get your name to be the go-to expert for all things real estate.
One of the most important ways you can achieve this is to build your database of people without coming across as “salesy” to friends and family, known as your Sphere of Influence (SOI).
Your SOI will do more for you than any other marketing tactic, so you should focus a lot of time, energy, and resources on interacting and engaging with your SOI.
Train your brain to think strategically about what's happening in your market and be ready to offer value to your SOI.
Ask yourself:
- What is unique to you and your business that you bring to the table for your prospects? For example, maybe you’re highly connected, friendly, and/or knowledgeable about a specific aspect of real estate. How can you highlight those items that set you apart?
- What can you offer that no one else can?
- What are the latest trends in your local market?
- Consider creative ways to discuss these trends (including the numbers) and how best you engage with your prospects?
Most of all, in your marketing, you need to know your ideal client and what they may need.
For example, an excellent real estate agent will listen to their prospects and develop a home search that fits those needs so that when the potential client looks at the list of homes (or how to market a listing best), the client thinks, “This agent gets me, it’s like they’re reading my mind.”
By understanding what the client wants, you’ll position yourself as their resource for their real estate needs and make you more attractive to hire.
Develop Good Time Management Skills
If you’re like me, you think there’s more time in the day than there is, and you find yourself struggling to get things done. That’s because you probably take on too many things and aren’t prioritizing how to accomplish them.
The secret to getting things done isn’t to take on less. As a business owner, you may not have control over how many things get thrown your way in a day, but you can control how you prioritize your day and how you break tasks down into more achievable components.
Look, most agents who start out to build a real estate business have yet to make that into a plan. They end up running around like a chicken without a head from one thing to another and never accomplish much.
Setting up systems that prioritize tasks and break them down into more manageable chunks is a critical component of time management and is crucial for your business's success.
A real estate coach can help teach you time management tactics, including analyzing what tasks to prioritize. Additionally, learning how to break tasks down into more manageable and achievable tasks is crucial when you have a lot going on.
I recommend the Pomodoro Technique, which is a time management skill that works like this;
- Take a timer and set it for 20 minutes
- Work on one task for that 20 minutes
- When the timer goes off, stop working and take a 5-minute break
- At the end of the break, work for another 20 minutes either on the same task or a new one
By utilizing time management strategies, you’ll become more productive and happier as you get more accomplished, and those nagging tasks won’t bleed into other parts of your day.
Becoming a real estate agent is exciting and can offer you and your family an incredible opportunity. However, like any business, it will require a lot of time and energy, especially as you are starting, so be prepared to research and discuss ways to accelerate your growth with others.
But once you decide to dive into a real estate career, there are some crucial steps that you have to take before you can begin, so contact your state’s regulatory board to find out what you need to do to get your license.
Once you have all the information, you can begin to develop a plan on how to get your license and be successful with your real estate business right from the get-go.
Real estate is a great career, but like all new businesses, it will require a lot of work. Therefore, you want to create a plan and get input from people in the industry to help shape your expectations as you build your real estate business.
