3 Hurdles You’ll Probably Face as You Start Your Real Estate Career
You’ve probably heard a lot about the success of real estate, particularly with the popularity of HGTV and similar media outlets. There’s no denying that people in real estate often bank high returns, but that’s not the case for everyone. There’s a much darker side of real estate that success stories often don’t mention, which makes prosperity more challenging.
Like any business move, starting a career in real estate will take time, dedication, and patience. Here are a few things you’ll want to know before diving in.
- You need money, even if it’s not your own.
If you’re beginning your career as a realtor, don’t expect the process to be free and easy. There are several expenses you’ll need to cover, including realty school. You must take courses and pass an exam in order to become certified in real estate, which could cost thousands depending on your location.
There are also the costs of running your own business, which include, but aren’t limited to:
- Office supplies
- Business cards
- Work phone (preferably a smart phone for texting and internet on the go)
- Signage and other forms of physical advertising
- Online ads and other forms of digital advertising
- Website creation and maintenance
- Real estate license
- Multiple Listing Service (MLS) access
- Board of Realtor dues
- Computer, printer, fax machine, copier, and similar tech
- Professional dress
- Travel costs
- Taxes for the self employed
The costs of being an agent are expensive, and they become even more costly if you become an investor. A home is considered the most expensive asset for most people, so don’t be surprised at the amount of capital you’ll need. You’ll need funds to cover the initial purchase of the home, listing services, marketing, advertising, and other costs associated with starting and running an investment venture.
Though fronting the down payment for a home yourself will lower costs in the long run, you can invest in properties even when you’re broke. Through wholesaling, working with an investment partner, taking out a high-interest no-money-down loan, or leasing, you can invest in a property and collect the returns.
- Your personality needs to fit the bill.
There are a lot of people attracted by the success of real estate, but not everyone is cut out for the job. It takes a certain personality to build clients and sell properties, particularly in regions where competition is fierce.
Rather than focusing on the high returns, think of the job in smaller terms. It’s kind of like the decision to do summer sales to help pay for college. Some people are fantastic at sales. They get people to listen to their pitches and point out the positives of a product in such a way that people can’t refuse.
Real estate is similar. If you’re not good at sales, you probably won’t be good at real estate. The entire process involves making sales, but these sales are a lot bigger than selling pest control or a new security system. You have to use the client’s desire for a new home to accelerate their decision and move properties. Sometimes that means removing the niceties and resorting to cutthroat salesmanship.
- Most of the marketing is now done digitally.
A couple of decades ago, a real estate agent’s advertising was primarily done through signage, Thrifty Nickel ads, and cold calls. Now, thriving realtors do the majority of their marketing through a website, online listing services, digital ads, and social media. If you’re not comfortable with this, you’ll have a hard time moving properties.
Like selling real estate, marketing takes a certain personality. You have to be willing and able to put yourself out there on social media and your advertisements. Your professional life will become very public, and you’ll need to focus on constant engagement to drive clientele.
There are many factors that go into successful real estate businesses. Don’t be taken by surprise with things you hadn’t thought of beforehand. Be ready to handle the costs and knowledge necessary to stay competitive and strong in a difficult market.