Every time I speak to someone about my business and career, it always comes up that “they’ve thought about engaging in property” or know someone who has. With so many people considering getting into real estate, and getting into property – why aren’t there more lucrative Realtors on the globe? Well, there’s only so much business to bypass, so there can only just be so many REALTORS in the world. Personally i think, however, that the inherent nature of the business enterprise, and how different it really is from traditional careers, makes it difficult for the average indivdual to successfully make the transition into the Real Estate Business. As a brokerage, I see many new agents make their way into my office – for an interview, and sometimes to begin with their careers. New REALTORS bring lots of great qualities to the table – lots of energy and ambition – but they also make a large amount of common mistakes. Listed below are the 7 top mistakes rookie REALTORS Make.
1) No Business Plan or Business Strategy
So many new agents put almost all their emphasis on which PROPERTY Brokerage they will join when their shiny new license will come in the mail. Why? Because most new REALTORS have never been in business for themselves – they’ve only worked as employees. They, mistakenly, think that getting into the Real Estate business is “obtaining a new job.” What they’re missing is that they’re about to go into business for themselves. If you’ve ever opened the doors to ANY business, you understand that one of the key ingredients is your business plan. Your business plan helps you define where you’re going, how you are getting there, and what it’s going to take for you to make your real estate industry a success. Here are the requirements of worthwhile business plan:
A) Goals – What would you like? Make them clear, concise, measurable, and achievable.
B) Services You Provide – you don’t want to be the “jack of most trades & master of none” – choose residential or commercial, buyers/sellers/renters, and what area(s) you need to specialize in. New residential real estate agents tend to have probably the most success with buyers/renters and move on to listing homes after they’ve completed a few transactions.
C) Market – that are you marketing yourself to?
D) Budget – consider yourself “new real estate agent, inc.” and jot down EVERY expense that you have – gas, groceries, cell phone, etc… Then write down the new expenses you’re taking on – board dues, increased gas, increased cell usage, marketing (very important), etc…
E) Funding – how are you going to pay for your allowance w/ no income for the initial (at least) 60 days? With the goals you’ve set for yourself, when will you break even?
F) Marketing Plan – how are you going to get the word out about your services? The MOST effective way to market yourself would be to your own sphere of influence (people you know). Make sure you do so effectively and systematically.
2) Not Using the GREATEST Closing Team
They say the best businesspeople surround themselves with people who are smarter than themselves. It requires a pretty big team to close a transaction – Buyer’s Agent, Listing Agent, Lender, Insurance Agent, Title Officer, Inspector, Appraiser, and sometimes more! As a Real Estate Agent, you are in the position to refer your client to whoever you select, and you should be certain that anyone you refer in will be an asset to the transaction, not someone who will bring you more headache. And the closing team you refer in, or “put your name to,” is there to make you shine! When they perform well, you can participate of the credit as you referred them into the transaction.
The deadliest duo out there is the New Real Estate Agent & New LARGE FINANCIAL COMPANY. They get together and decide that, through their combined marketing efforts, they are able to take over the world! They’re both focusing on the proper section of their business – marketing – but they’re doing one another no favors by choosing to give each other business. In the event that you refer in a bad insurance agent, it might cause a minor hiccup in the transaction – you make a simple phone call and a new agent can bind the house in less than one hour. However, because it typically takes at least fourteen days to close a loan, if you are using an inexperienced lender, the effect can be disastrous! You may find yourself in a position of “begging for a contract extension,” or worse, being denied a contract extension.
A good closing team will typically learn than their role in the transaction. For this reason, you can turn to them with questions, and they will step in (quietly) when they see a potential mistake – since they want to help you, and in exchange receive more of your business. Using good, experienced players for the closing team can help you infinitely in conducting business worthy of MORE business…and best of all, it’s free!
3) Not Arming Themselves with the required Tools
Getting started as a Real Estate Agent is expensive. In Texas, the license alone is an investment which will cost between $700 and $900 (not considering the volume of time you’ll invest.) However, you’ll come across even more expenses when you go to arm yourself with the necessary tools of the trade. And don’t fool yourself – they are necessary – because your competition are using every tool to greatly help THEM.
A) MLS Access is just about the most expensive necessity you’re going to run into. Joining your neighborhood (and state & national, automagically) Board of Realtors will allow you to pay for MLS access, and in Austin, Texas, will run around $1000. However, don’t skimp in this area. Getting MLS access is among the most important things you can do. It’s what differentiates us from your own average salesman – we don’t sell homes, we present any of the homes that we supply. With MLS Access, you should have 99% of the homes for sale in your area open to present to your clients.
B) CELLULAR PHONE w/ a Beefy Plan – Nowadays, everyone has a cell phone. But not everyone has a plan that will facilitate the amount of use that REALTORS need. offer on getting at least 2000 minutes per month. You want, and need, to be accessible to your clients 24/7 – not just nights and weekends.