(CHEROKEE LAKE REALTY WRITES A WEEKLY COLUMN FOR THE GRAINGER COUNTY JOURNAL NEWSPAPER. THIS WAS A RECENT QUESTION ASKED BY A READER.)
It’s a good career. I have been doing it for a very long time, and it has paid the bills. Now, unlike most jobs, you’re not guaranteed a weekly paycheck. You work on commission. You sell something, you get paid. You don’t, you don’t.
Something to keep in mind. When you have sold a property, a home or land, it’s not really sold. After you have a commitment (contract) from a buyer or a seller, depending on who you are representing, there are a few steps that need to occur before an agent can truly say the property is sold and you can collect a paycheck. Home inspections, site inspections, appraisals, financing, and if the home being sold is under construction it must be completed. Finally, the closing. These steps can take 90 days or more. So, a word of advice which I have given several folks that have asked me about a career in real estate. Make sure you have money in the bank. If you have a spouse that also works that helps. If you don’t, you may have to go months without a check. Can you afford to continue paying your bills until the first check comes in? And that’s if you write a deal on your first day as an agent. You are beginning a career without any experience.
As in any career, there is a learning curve. I have seen agents take months before they write their first contract. And after you have done that remember what I wrote earlier. There are still a few steps that must be completed before you get paid. A suggestion that may help you write business sooner. Tell ALL your friends and family members that you are a real estate agent. In fact, tell everyone that you meet. This way, maybe, just maybe, once you get your license and are ready to do business, you can write up a contract right out of the gate. Also keep in mind that if you work for an agency, which you will always do, there are recurring fees that will come out of that check that will go to the agency. Different agencies have different fees for using their office and hanging your license with them. Desk fees, marketing fees, a percentage of your commission that goes to the house and/or the principal broker. So, your first check may be whittled down a bit. So, let me repeat what I wrote earlier. MAKE SURE YOU HAVE A FINANCIAL CUSHION TO FALL BACK ON, that will help you deal with your personal expenses until you get the ball rolling.
Despite all this, it is a great career. You are working for yourself; you are your own business. You control your hours, and how much money you wish to make. Nobody will cap your income, except you. The harder you work, the more you apply yourself to your new career, the more money you will make. Unlike a salaried career where you make the same amount of money, week in and week out. Some agents are happy to write one deal per month. And this takes care of their financial needs, especially if it is a large sale. Some agents are not happy unless they write one deal a week. You decide what your goals are, apply yourself, and make it happen.
One last word of advice. Real Estate is a cyclical business. There are times during the year when you will sell more properties, and there are times when things slow down. Think Christmas, for example. So, when you first start making the money, don’t go crazy and buy a fancy new car. Always keep some in reserve for the slow time of the year. Remember, there is no guaranteed Friday paycheck, so it is important that you plan a seasonal budget. Here is a sobering statistic… 87% of real estate agents leave the industry within the first five years. Reasons? Financial strain, lack of a plan, intense competition, or underestimating the work required to succeed.
