It’s hard to believe that it’s been two years since we said yes to the address and moved into our new home. I was surprised, then, when I recently received a call from a real estate agent asking if we were interested in selling our home. She informed me that a home in our subdivision had just sold for 34K over the asking price. Which caused me to wonder, for a moment, how to start a career in real estate.
How to Start a Career in Real Estate
It’s no secret that homes available on the market are few and far between, hence the cold call from an unknown real estate agent, and that home prices are rising. Although the real estate market has been known for being mercurial in the past, the last two years have seen a time of remarkable sustainability and profitability in the field. This boom shows few signs of slowing down. While the pandemic initially triggered an urban exodus, homeowners are now headed back into the city. This has resulted in homes being bought and sold at a pretty steady rate over the last two years.
Cashing In
In fact, housing prices have skyrocketed by around 20% near the end of 2021, with even homes that were damaged or previously considered low-value selling quickly and for excessive amounts of cash. The real estate market is extremely good for sellers right now, and experts agree that the boom shows no sign of slowing down in 2022. A good friend of ours is a real estate agent. While the market typically has an ebb and flow with seasons, her “down season” was pretty busy, and her “busy season” is ramping up way before it usually does.
All of that to say, if you’ve ever considered a career in real estate, now would be an opportune time to get started. The potential to turn a profit, as a selling agent or with investment properties if you have the capital, is on your side.
Low on capital? You can still set yourself up to enter the field. Here are some essential steps that real estate agents across the US must take.
Earn Your Real Estate License
In order to become a real estate agent, you must first earn your real estate license or your state’s seal of approval for your business. The requirements for earning your license tend to vary state-by-state, affected by multiple factors including
- Age
- Base educational requirements (high school diploma, bachelor’s degree)
- Background checks and criminal history
- Continuing education
- Courses and exams needed
For example, in Missouri (my home state) the Missouri Real Estate Commission (MREC) requires that you be at least 18 years old and that you complete of the following steps in order to receive a Real Estate Salesperson License.
- Complete 72 Hours of Approved Education
- Pass the Course Final Exam
- Pass the Missouri Real Estate Exam
- Submit Fingerprints and a Background Check
- Complete the Licensing Application
Most states require would-be real estate agents to take pre-licensing courses and to pass the course exam as well as a state licensing exam. Some states also require continuing education courses after licensure. Each state varies on the hours of education required prior to licensure, with as few as 63 hours in Florida to as many as 135 hours in California.
Many states also require that you complete a licensing application after you pass the state real estate exam. Of course, there are fees attached to these applications, so be prepared.
Consider Your Options
As a new real estate agent, you’ll need to consider your options. You’ll have to decide whether you want to work independently while partnering with a brokerage, create a new real estate team, or join an existing real estate team.
Going Solo
As a solopreneur, you’re only accountable to the principal broker. Real estate brokers oversee the agents signed on under them, paying them a portion of the commissions for each sale and facilitating the generation of leads and networking. However, what they’re really there for is to make sure all transactions sponsored by the state (i.e., through licensed realtors) are aboveboard. Unless you’re a broker yourself, you must partner with an employing broker.
Create a New Real Estate Team
Essentially a Real Estate team is a group of any two or more licensed real estate agents. Couples often pair up to make a real estate team. You may also partner up with an experienced local agent, or with someone you’ve just graduated with.
Join an Established Real Estate Team
Some real estate teams have four to sixteen team members, with different agents specializing if different things to best meet client needs.
Flipping Property
If you’re going the investment property route, it’s now a matter of investing in your first property. After going through that process to become a licensed agent, you may be limited on capital. With that in mind, you may want to consider contacting a real estate loan provider. Loan providers can offer the capital you need to invest in your first property. They can often work out a payment plan that doesn’t put pressure on your fledgling career.
Once you have the capital to invest in your first home, it’s just a matter of choosing a potentially lucrative property and flipping it! For a quick turnaround, reuse and repurpose what you can of the property’s original assets. Limiting your initial investment into making it livable and attractive to potential buyers and selling for a profit can get you started. You can also consider spending a little extra money to add amenities that are attractive to consumers, like walk-in closets, kitchen islands, smart home automation and smart home security systems.
Careers in real estate can require some investment to get going. However, the payout could be well worth it. In today’s market, it’s certainly worth considering entering the real estate field. That said, I wouldn’t necessarily recommend cold calling people to ask them if they’d like to sell their home. And by all means, don’t be rude and hang up on them when they say that they aren’t selling.
