You might imagine being a real estate agent as a life of leisure, but the reality could not be further from this image. Whether working in residential or commercial real estate, being a real estate agent is a demanding job that often requires being available around the clock. Even in boom years, making money as a real estate agent is not as easy as it might seem. A real estate agent works as a representative of sellers or buyers of real estate. Most often agents work under licensed real estate brokers, who also collect a percentage of any commissions following a sale. Sales in real estate can take a long time and involve a lot of work.
Ask any real estate agent and they’ll tell you that the job requires a lot of hustle and promotion. Many markets are dominated by established brokers, and it can be difficult to break into a crowded field. There are numerous challenges to meeting selling targets. Fortunately, hard work and dedication can pay off. The real estate business is a rewarding business with limitless earnings potential. This list offers the ten best ways if you want to learn how to make money as a real estate agent.
1. Focus on representing buyers
An effective way a real estate agent can make money in the field is by representing real estate buyers, where commissions are larger and more frequent. A buyer’s agent will take clients to sites, show properties, and draft offers on houses. Earnings follow volume, so it is necessary to represent a number of buyers and devote a lot of time to finding suitable properties.
2. Listing properties for sellers
A listing agent is altogether different from a buyer’s agent. A listing agent sets the correct price that is still profitable for a property before listing. Especially in a hot market, most properties that will not sell have been incorrectly priced for the realities of the marketplace. Listing agents study a market to know it inside and out.
A listing agent helps prepare a property for sale and conducts negotiations for sale on behalf of sellers. Listing agents are responsible for negotiating with banks over real estate prices. Again, it is necessary to represent multiple sellers in order to turn a profit.
3. Commercial real estate
The earnings potential in commercial real estate can easily outpace the residential sector. One important advantage is that commercial real estate agents generally draw a monthly salary, instead of working on commission like residential real estate agents.
Commercial real estate agents need to master a comprehensive understanding of how commercial properties are valued in the market, and it is this knowledge of the market that makes a successful commercial real estate agent.
4. Property management
Another service real estate agents can provide is working in property management where they administer everything necessary for a property on behalf of property owners or investors. A property manager is responsible for maintaining, repairing and completely managing the property, which includes everything involved in renting the building from finding tenants to collecting rents and keeping accounts.
A property manager generally earns a percentage (most often 10 per cent) of the monthly rents collected on the property. In this way, property management can be a good way to generate a monthly income from real estate.
5. Gather good leads
Success as a real estate agent means that you have to be able to generate leads. Leads are information about someone who might be interested in buying or selling real estate. Anyone who has ever seen the seminal real-estate David Mamet’s Glengarry Glen Ross knows what it takes to make money selling real estate, but most of Mamet’s story involves real estate agents fighting over leads on perspective buyers or sellers. To be a successful realtor, you need good leads.
6. Build relationships and a public profile
Leads are relationships and the best leads will come from strong connections that you build within a community. A good real estate agent needs to cast a wide net. It is important to network in ways that will bring you into contact with the kind of people who are likely to want to buy or sell real estate. This can include becoming active in local affairs by volunteer, attending chamber of commerce events, and talking to neighbours and people that you meet.
7. Maintain a database
CRM is a short customer relationship management system. CRM is a database of people that you have contacted and when, and the nature of that contact. These CRM databases are very important to maintain and update if you want to make money as a real estate agent.
8. Know the market
Follow existing sales and monitor local real estate trends so that you can anticipate and take advantage of changes in the market. A successful realtor knows and anticipates local market conditions and can bring this knowledge to benefit of their clients.
9. How to target clients
The most efficient way for a real estate agent to find clients is by targeting individuals already interested in buying or listing property. This involves working with good leads. When talking to prospective sellers, it is helpful to know how long they have been in their property and how much it has increased in value in that time.
10. Build a good website
Invest time and even money in designing an effective website that will draw client attention. Showcase local information and tips for buyers and sellers. Also, you should be using all internet contacts to gather information about prospective buyers and sellers, so that you can be in the position to help.