How to Become a Real Estate Agent
Every month, over 14,000 people Google “how to become a real estate agent,” and consider joining the 2 million real estate licensees in the U.S. And for good reason: helping people buy the perfect home or make tons of money selling their house is exciting! Not to mention the rather enticing fact that real estate can be a lucrative field. According to the Bureau of Labor Statistics, real estate agents make an average of $45,610 per year—and the top 10% tier of agents earned a whopping $166,940 in 2015. Here’s how to start your career in real estate.
1. Consider if becoming a real estate agent right for you.
The first step in this process is making sure that real estate is right for you. As a real estate salesperson, a typical work day includes handling your own office management, paperwork, prospecting leads, developing relationships, managing contacts, and dealing with buyers and sellers. Reach out to local real estate agents and brokers and ask them questions about what the day-to-day work is like. Ask questions about real estate as a long-term career. While it can be lucrative, real estate isn’t as easy as it may look, and it’s a notoriously tough industry for newbies. Some real estate experts like industry vet Tom Ferry estimate that 87% of all new agents fail within the first five years. Starting a career as a real estate agent requires a full commitment.
2. Start training and get licensed.
All states require applicants to take pre-licensing courses from certified institutions, but the specific requirements in different states are greatly different. For instance, all applicants in Virginia must complete 60 hours of training, but California requires 135 hours. The courses can be taken either in classroom settings or online. You will learn real estate principles, practices, and the legal aspects of the business. Check your state’s real estate commission’s website to find the requirements and the list of accredited pre-licensing institutions.
All 50 states require that you pass a real estate exam to be a licensed real estate agent, but there are different requirements and material for the exam. Exams are typically consists of two parts: one on federal real estate laws and principles, and the other on state-specific laws. Each of them has 60 to 100 multiple-choice questions.
3. Prep for your career as a real estate agent.
After passing the licensing exam, there are a few more steps that you should complete before starting your career:
- Activate your license through your state real estate commission’s website. Activation fees vary but typically cost around $200 to $400.
- Pay for membership to the local multiple listing service. Membership in your local MLS is essential, since you must use the system to list properties. The service also enables you to easily pull a property’s tax information, analyze market trends, and see listings before they go on the market. Costs vary greatly depending on state.
- Consider joining the National Association of Realtors. Membership in the NAR offers a number of benefits, including access to real estate market data, discounts on education courses, and transaction management services. And being able to use the title Realtor on your business card and your marketing materials also adds credibility.
4. Find a brokerage.
Working under the supervision of a broker is a requirement to practice as a real estate agent, so you need to find a broker. Brokers are licensed by the state to oversee real estate transactions and real estate agents.
Most brokerages pay their agents only by commission. In other words, you get paid only when you complete a transaction, and you typically won’t receive benefits. Due to this pay structure, brokerages are typically eager to welcome new agents, since it comes at no cost to the company. So be sure to find a brokerage you like, one that is open to taking you on so you can receive some on-the-job training.
With a few years’ of experience as an agent, you can also apply for a broker license.
Ready to see if a career as a real estate agent is right for you? Check out these videos from PathSource to hear what real agents have to say!
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