Starting a career in real estate is challenging at best. Many enter the field in middle age when the "kids are grown," or when they have retired or abandoned other careers. Some people get licensed hoping to "dabble" in real estate while they continue other interests. Others enter the profession fresh out of school, or they by-pass a university education in favor of community college real estate courses to get quickly into a career. Some of these folks may do very well if they have the determination, financial cushion and skills to make a go of it. Most, however, fail, with as many as 85 percent dropping out of the business the first year. Fifteen of remaining agents don't renew their licenses. Where will you end up? As a wash-out? Or, will you be a high-steppin' multi-million dollar producer?

What You're Up Against

Because entry into the real estate field is somewhat easy by most professional certification standards, and the fact that the profession is characterized as a sales occupation, the job attracts many people who are truly unprepared and unsuited to be successful at it.

To really excel at real estate, you must be a self-starter, someone who doesn't have to be prodded to make cold calls and who is resilient when faced with setbacks. You have to be able to take rejection - you will hear "no" a lot more often than "yes." You also have to be able to balance the right-brain creative, "show-time!" side of sales, with the left-brain number-crunching accountability in running your own business. As a real estate agent you are more than a salesperson who points out the lovely features of a home. You are a financial advisor of sorts, helping people with the most expensive transaction of their lives. That means you have to be adept at numbers, negotiation (ironically not sales), time management, balancing books, sales projections, cost accounting, advertising and marketing and a wide assortment of other skills besides the ability to sell.

You may be beginning to see why many traditional agents haven't gotten to the Internet. They don't have the time! But you're smarter than that. So add Internet readiness and maintenance to all your other skills and tasks.

Selling real estate is and should be considered a full-time profession. The real estate transaction has become more complex over the years, and veteran agents have the advantage. Competition is fierce from these pros, and new agents find that financial rewards are commiserate with experience in the minds of many consumers. Some buyers and sellers question why they should pay comparable commissions to a rookie, and will either ask the rookie to take a discount on their commissions or they may refuse to hire them at all.

With traditional agency under siege from discounters, consumer advocate groups and others, the large franchisers, trade associations and independent brokers are being pressured to raise standards of professionalism among their associates. New and untried business models are being introduced to gain consumer acceptance and a niche market share, which poses more risk (and in some cases, new opportunity) for the new or the dabbling agent. That means you must be up to snuff on the latest ethics, legalities and commercial practices in your new field.

Brokers have higher office costs, included increasing costs due to litigation and arbitration. Competing with well-funded large franchise groups is more difficult. Consolidation among brokers is more common, leaving less room at the top for executive managers. Narrowing margins are causing some brokers to rethink their open door policy of holding as many licenses as possible, and they are beginning to refuse to hire part-time associates. Overall, the current consumer and economic climate is forcing brokers to cut down on the "swinging door" and work harder to reward and retain productive agents.

The overall business climate points to more expense and difficulty for new agents to be successful. So the question boils down to how dedicated are you? How willing are you to overcome these hurdles to forge a career in real estate. How high do you want to go? Do you want to become a broker, own your own franchise, start your own franchise organization? The sky's the limit but you have to start with the basics.

Published: April 14, 2000

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