Real estate agents need to be prepared to work hard and adapt quickly
if they want to survive in an ever-changing market.
"People typically enter the residential real estate field when the economy
slows down and/or home prices rapidly rise," says Scott Kucirek. He is the
executive vice-president of new market development for a residential real
The low cost and the fairly simple process of obtaining a license also
enables people to make an easy transition into real estate careers, Kucirek
"Real estate is an exciting field that offers a variety of activities and
experiences in any given day," says Arthur Cox. He is the director of the
real estate education program at the University of Northern Iowa at Cedar
"Many people like this sort of independence and freedom to control their
own destiny. Many would say real estate as a career is very rewarding because
of the 'people' aspect of the business, and the ability to create real value
for people, businesses and the community."
"Most people like the idea of being in control of their income stream,
and believe they can make more money selling real estate than they were making
at their previous position," Kucirek says.
"They also want to have more flexibility in their schedules, enjoy helping
people and have a keen interest in homes."
But most new real estate agents underestimate the effort and resources
required to succeed in this business, Kucirek says. "The majority of new agents
struggle to obtain clients and earn an income in their first year."
Indeed, research from the National Association of Realtors shows 85 percent
of new agents call it quits after one year. The problem may lie in unrealistic
"In my opinion, most new agents believe they will work 40 or so hours a
week and earn $100,000, but in reality the first year ends up being more of
a 70-hour-a-week job with an income of $30,000, with virtually no money earned
in the first six months," Kucirek says.
That causes many agents to run out of money or lose motivation to continue,
"One of my first hurdles to overcome was finding out the phones at the
real estate companies didn't just ring off the hook with people looking to
buy or sell a home," says realtor Don Sutton.
"I learned to look for clients because they sure weren't looking for me."
Another drawback is that real estate agents work hours others normally
have off -- evenings and weekends. "You have to have an understanding family,"
And there's another drawback: agents pay their broker a portion of income
"Most do not understand that the brokerage fee is split many ways and the
bottom line going to the individual agent is considerably less than the first
figure," says Kenneth Edwards. He is a real estate broker in Oregon.
"Then, of course, you have to deduct the cost of doing business."
In doing research for his book on real estate careers, Edwards found the
number one factor for a high dropout rate was "lack of self-starter and self-motivator
"Although that's not the most accurate description in some aspects, it
does identify a major element of the business," Edwards says.
"You will fail or succeed based almost entirely upon your own efforts.
If you are the type of person who needs constant reassurance, guidance and
supervision from others to succeed, real estate is not the profession for
"Many companies have outstanding training programs, but in the final analysis
the buck stops with the individual."
Other daunting challenges are the competitiveness of the field, and the
ups and downs of changes in the market's cycles.
"A challenge for those in real estate is dealing with the sometimes volatile
cycles in the industry," Cox says.
Keeping on Track
A file bulging with names of satisfied clients is the single most effective
insurance policy against the perils generated by market fluctuations, Edwards
"At some point, assuming the agent has an effective and aggressive client
follow-up program -- and did a good job the first time around -- most of her
or his business will be with former customers and referrals made by them,"
"That way, no matter what the market is doing, there will always be a steady
flow of people anxious to do business with a true professional. You can never
have too many ready, willing and able buyers and sellers."
Los Angeles realtor Sarah Benson says she depends on her "sphere of influence"
to survive the competition. People that know and trust you are the best sources
of business in a competitive market, she says.
"Successful real estate professionals understand that each time the real
estate market changes, it presents unique opportunities," Edwards says.
"The challenge is to be able to recognize, or better yet anticipate, those
changes and be ready to take advantage of them."
Agents must know the intricacies of various mortgages, owner
financing and government finance programs. They must be connected with mortgage
brokers and other lenders who can serve their clients' needs.
Solid training in these areas and others keep realtors successful and resilient
to changes in markets and competition.
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