Every time I speak to someone about my business and career, it always arises that “they’ve thought about getting into real estate” or know anyone who has. With so many people thinking about getting into real estate, and getting into property – why aren’t there more lucrative Realtors on the planet? Well, there’s only so much business to bypass, so there can only be so many REALTORS in the world. I feel, however, that the inherent nature of the business, and how different it is from traditional careers, helps it be difficult for the average person to successfully make the transition in to the Real Estate Business. As a Broker, I see many new agents make their way into my office – for an interview, and sometimes to begin their careers. New Real Estate Agents bring many great qualities to the table – lots of energy and ambition – however 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 all their emphasis on which Real Estate Brokerage they’ll join when their shiny new license comes in the mail. Why? Because jden have never been in business for themselves – they’ve only worked as employees. They, mistakenly, think that getting into the true Estate business is “obtaining a new job.” What they’re missing is that they are about to go into business for themselves. If you have ever opened the doors to ANY business, you understand that one of many key ingredients can be your business plan. Your organization plan helps you define where you’re going, how you’re getting there, and what it does take for you to make your real estate business a success. Here are the requirements of any good business plan:
A) Goals – What would you like? Make sure they are clear, concise, measurable, and achievable.
B) Services You Provide – you do not 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 then move ahead to listing homes after they’ve completed several transactions.
C) Market – who 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 (essential), etc…
E) Funding – how will you pay for your allowance w/ no income for the first (at the very least) 60 days? With the goals you’ve set for yourself, when will you break even?
F) Marketing Plan – how will you get the word out about your services? The MOST effective way to market yourself is to your own sphere of influence (people you know). Make sure you do so effectively and systematically.
2) Not Using the Best Possible Closing Team
They say the best businesspeople surround themselves with people who are smarter than themselves. It takes a pretty big team to close a transaction – Buyer’s Agent, Listing Agent, Lender, INSURANCE PROFESSIONAL, Title Officer, Inspector, Appraiser, and sometimes more! As an agent, you are in the positioning to refer your client to whoever you select, and you should be sure that anyone you refer in will undoubtedly be a secured asset to the transaction, not a person who provides you more headache. And the closing team you refer in, or “put your name to,” are there to make you shine! When they perform well, you can take part of the credit because you referred them into the transaction.
The deadliest duo out there is the New Real Estate Agent & New Mortgage Broker. They get together and decide that, through their combined marketing efforts, they can take over the planet! They’re both focusing on the proper part of their business – marketing – but they’re doing each other no favors by choosing to give each other business. If you refer in a bad insurance professional, it might cause a minor hiccup in the transaction – you create a simple phone call and a new agent can bind the house in less than an 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 might find yourself in a position of “begging for a contract extension,” or worse, being denied a contract extension.
An excellent closing team will typically learn than their role in the transaction. For this reason, you can turn in their mind with questions, and they’ll step in (quietly) if they see a potential mistake – because they want to help you, and in return receive more of one’s business. Using good, experienced players for the closing team will help you infinitely in conducting business worth MORE business…and on top of that, it’s free!
3) Not Arming Themselves with the Necessary Tools
Getting started as a Real Estate Agent is expensive. In Texas, the license alone is an investment that will cost between $700 and $900 (not considering the number 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 do not fool yourself – they are necessary – because your competitors are definitely using every tool to greatly help THEM.
A) MLS Access is probably the most expensive necessity you’re going to run into. Joining your local (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 one of the most important actions you can take. It’s what differentiates us from your average salesman – we don’t sell homes, we present the homes that we have available. With MLS Access, you will 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 cellular phone. But not everyone includes a plan that will facilitate the amount of use that REALTORS need. Plan on getting at least 2000 minutes per month. You need, and need, to be available to your clients 24/7 – not just nights and weekends.