Getting into Real Estate

[Alex39]

So I was curious if anyone is in real estate? Care to share advice/insight for getting into it?

I am 30, I have a masters degree in business and marketing. I love house hunting, interior design, and marketing. I like a flexible schedule of work, working from home, and constant changing work. 

Currently,  I teach at a community college. It's very much the same, I'm not really using a ton of my business degree. It's a nice pace, not stressful, good benefits, and I do like it. 

I sometimes think that I'd be good at real estate. I have creative ideas, am good at marketing, and like working with people. 

Curious if anyone can offer insight about it?

 

[boltnrun]

My best friend tried real estate sales. I'll tell you up front she did not have a good experience.

She had to complete a lot of schooling despite having a degree. The initial schooling cost her about $1200. Once that was done she signed on with a well known agency. She was required to take a lot of continuing education classes which cost her several hundred more dollars. All in all I think she said she spent about $5k.

One thing she didn't count on was having to work evenings and weekends. Think about it; most people who can afford to buy homes have jobs, and those jobs are usually regular weekday working hours. Which means the only time they have to view homes is evenings and weekends. Her phone rang from mid afternoon to 9:00 pm, every night. She had to do showings evenings and weekends as well. So she literally had almost no time with her husband and kids. And she couldn't just shut off her phone or she would miss calls from potential clients.

Also, she was required to meet a quota of a certain number of sales per month. She never met that quota. Not once. Now, the market is hot right now so you probably wouldn't have trouble meeting a quota as long as you're willing to work evenings and weekends.

She ended up giving up after about six months. All that money spent for nothing, but she decided it wasn't for her.

Another friend of mine sells real estate part time, but she has two other part time jobs plus she's married so her husband is the main wage earner. She said she couldn't make it on real estate alone unless she was willing to work evenings and weekends and she wasn't willing to.

Since the market is hot there is a lot of competition for listings. And things sell so quickly these days. My brother was house shopping and if he didn't make an offer almost before viewing he lost out. So you would need to hustle to get an offer in before someone else grabbed it.

I would say if you find competitive hustling fun and you are willing to put in a lot of hours and give up your evenings and weekends you could give it a shot. Some people do really well, so you may end up being one of them. Just have realistic expectations. Oh, and be able to do with very little or no income for at least a few weeks to a couple of months. If you have solid savings of about three to six months you'll probably be fine.

[Wiseman2]

4 hours ago, Alex39 said:

 I teach at a community college. It's very much the same, I'm not really using a ton of my business degree. It's a nice pace, not stressful, good benefits, and I do like it. 

Why not do it as a side hustle to keep yourself busy? It's sales on commission so you can have fun with it on the side. 

But. Don't quit your day job if you have bills to pay or want benefits, medical insurance, job security,etc. 

Especially since you're bored weekends and enjoy houses why not consider it as a sort of paid hobby.

It would probably entail most weekends, so it could help you get out of over-enmeshed family situations.  At least it would get you out of the house on weekends.

You'll need to pass a real estate license test. Check with their professional organization in your area for the requirements.

[Batya33]

7 hours ago, Alex39 said:

So I was curious if anyone is in real estate? Care to share advice/insight for getting into it?

I am 30, I have a masters degree in business and marketing. I love house hunting, interior design, and marketing. I like a flexible schedule of work, working from home, and constant changing work. 

Currently,  I teach at a community college. It's very much the same, I'm not really using a ton of my business degree. It's a nice pace, not stressful, good benefits, and I do like it. 

I sometimes think that I'd be good at real estate. I have creative ideas, am good at marketing, and like working with people. 

Curious if anyone can offer insight about it?

 

Not firsthand but I have a number of friends who got into it -one was an accountant for many years and got into it when she was a mom of two in the suburbs and one of her children has special needs -she connected with other special needs parents in her area and that's part of the reason for her success - she already had this huge network of people who were buying/selling. 

It's extremely difficult and competitive and takes many many hours and off hours/unpredictable hours to be successful.  My friend is.  I'm not surprised -we met in homeroom in freshman year of high school in 1980 and she is so authentic and personable and charming in the right ways.  And smart and so very hard working.  And detail oriented. 

I have other friends who've dabbled in it over the years, others who keep saying they're going to take the licensing exam.  I have another friend who is into it in a major city-she has a PhD I think in an unrelated field - lberal arts.  She and her husband also own a restaurant.  She pounds the pavement too from all I can see - constantly posting on social media.  Also very very much a people person.  

I would never ever do it because I'm very good at sales, I've done quite a bit of it in my various jobs and careers - but it's not what I enjoy doing and I want and have always wanted a stable paycheck.  Also the way the field is now is not for the fainthearted!  But again I know of people who love it and are so good at it.  

[melancholy123]

I say get your licence and give it a try, it may or may not be for you. You won't know unless you try.  My neighbour is a very successful real estate agent and has made a lot of money over the years as many have.  I say go for it.

[reinventmyself]

I've considered it and haven't followed through for the above mentioned reasons.  Eve's and weekends.  Cut throat competition.

A friend studied, took the test twice, got her license.  She had to work under a seasoned realtor, more or less an apprenticeship.  Had to do the open houses for her at an hourly rate.  She stayed with it for a year and in that year paid out more in dues, advertising, licensing, etc then she took in.  It does pay off for those who have the patience and time to earn your seniority. . .at a price.  But it's certainly not for everyone.   

In my friend's case and probably like many others, she needed to eat and pay rent, therefore walking away from it.

[DancingFool]

If you like interior design, I'd maybe lean more into that specifically.

Being a realtor is all about hustling 24/7, always being on call, and a whole lot of networking. Keeping in mind that wherever you go, there will be 5-10 other realtors doing the same. Also, the only marketing is marketing yourself to gain buyers and sellers. Some people do thrive in that kind of hustling competitive environment, but most do not.

The easy entry into the profession means that the hotter the market, the higher the competition as more people get drawn to what they imagine is easy money. Not easy at all in reality and can be quite costly with a lot of up front out of pocket expenses.

Some practical things to keep in mind is that in addition to licensing costs, you will need to join a brokerage (not optional by law) and they charge you monthly fees regardless of whether you had any commissions or none. Also, brokers will take a large chunk of your commission which can be as high as 50%  and up to 70%  if you are completely new. So if you close on a sale, you'll only get 1.5% commission on a standard 6% fee after all the splits between seller, buyer, and your broker. Don't forget that you'll have to pay taxes on that income as well and insurance and so on. In short, when you start out, you will need to have some hefty savings to cover your living costs, licensing, brokerage fees, etc. until you get established enough to have a fairly reliable stream of income. Even so, the hustle for business never ends.

When looking at which broker to join, look at their results and presence in the market area. Also, talk to realtors who work for them and specifically ask about training. Usually best producing brokers invest a lot into training their realtors on how to sell and network. When you are starting, that's the kind of an active brokerage that you want. They also provide you access to MLS, contracts, software and support with all of that.

Most realtors I know are borderline starving. The few who are really successful seem to have a tireless energy and are living and breathing sales and networking 24/7. They work with every builder and developer, they work with every investor, they know everyone with $$$$ in the city, they are at every event, they are always always always out there advertising themselves. They are the sort of people who can be in three different places at once at all times and love it and never get tired. If that's you, go for it. If that sounds too much and too intense, don't waste your money and time trying.

 

[Batya33]

I’d follow all dancing fool wrote. It made me think of how my successful friend is in a two income family and the other one owns the restaurant so it’s different from relying on it as a sole source of income.  DF makes great points. 

[Cherylyn]

I agree with others.  It's a cutthroat business to be sure.  Whenever I'm driving in my suburban neighborhood, there are hundreds or thousands of houses in my area.  I hardly see any real estate signs on residents' front yards and if I do, there's only one or two at random if that.  Inventory is extremely low. 

Then there are numerous real estate agents clamoring for that one sale.  Competition is very fierce.  I have an endless supply of realtor pads of paper mainly used as my grocery lists.  Over the years, I've accumulated hundreds of realtor paper tablets which are dropped off in my mailbox or on my front porch several times a month.  Unless you've been in the real estate business for a long time with an established clientele with word-of-mouth advertising, it's a tough gig and even then it will always be feast or famine.  Remain realistic. 

You also have to have an outgoing, extroverted "ON" salesperson personality.  You have to sell a good game, think on your feet a lot and become a smooth talker.  Commission is your bread 'n butter and it's a lot of hustle, pressure and stress.  You're on call or standby morning, noon and night 24 / 7. 

My late FIL (father-in-law) was highly successful in sales, he prospered and his career was rewarding.  However, he was honest yet highly driven. 

If you think you can do it, then go for it.  If you need to pay the rent every month, see if you can afford a real estate career.  Figure out how to financially survive every month and go from there.