Every time I speak to someone about my business and career, it always arises that “they’ve thought about getting into property” or know anyone who has. With so many people considering getting into real estate, and getting into real estate – why aren’t there more successful Realtors on the globe? Well, there’s only so much business to go around, so there can only just be so many REALTORS in the world. I feel, 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 Broker, I see many new agents make their way into my office – for an interview, and sometimes to begin their careers. New REALTORS bring lots of great qualities to the table – lots of energy and ambition – but they also make a lot 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 comes 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 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 know that one of the key ingredients can be your business plan. Your organization plan helps you define where you’re going, how you are getting there, and what it’s going to take for you yourself to make your real estate business a success. Here are the essentials of worthwhile business plan:
A) Goals – What do you want? Make sure they are clear, concise, measurable, and achievable.
B) Services You Provide – you do not desire to be the “jack of all trades & master of none” – choose residential or commercial, buyers/sellers/renters, and what area(s) you wish to specialize in. New residential realtors tend to have 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 agent, inc.” and jot down EVERY expense which you have – gas, groceries, cell phone, etc… Then write down the brand new expenses you’re taking on – board dues, increased gas, increased cell usage, marketing (essential), etc…
E) Funding – how are you going to pay for your budget 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 obtain the word out about your services? The MOST effective way to market yourself is to your personal sphere of influence (people you understand). Make sure you achieve this effectively and systematically.
2) Not Using the Best Possible Closing Team
They say the best businesspeople surround themselves with people that are smarter than themselves. It takes a fairly big team to close a transaction – Buyer’s Agent, Listing Agent, Lender, INSURANCE PROFESSIONAL, Title Officer, Inspector, Appraiser, and sometimes more! As a Real Estate Agent, you are in the positioning to refer your client to whoever you select, and you should ensure that anyone you refer in will undoubtedly be an asset to the transaction, not a person who will bring 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 get to participate of the credit as you referred them in to the transaction.
The deadliest duo on the market is the New AGENT & New LARGE FINANCIAL COMPANY. They gather and decide that, through their combined marketing efforts, they are able to take over the planet! They’re both focusing on the proper section of their business – marketing – but they’re doing one another no favors by choosing to provide each other business. If you refer in a bad insurance professional, it might result in a minor hiccup in the transaction – you make a simple phone call and a fresh agent can bind the property in less than an hour. However, because it typically takes at least two weeks to close a loan, if you are using an inexperienced lender, the result can be disastrous! You may 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. Due to this, 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 return receive more of one’s business. Using good, experienced players for the closing team will allow you to infinitely in conducting business worthy of MORE business…and on top of that, it’s free!
3) Not Arming Themselves with the Necessary Tools
Getting started as an agent is expensive. In Central Florida commercial real estate , the license alone is an investment that may cost between $700 and $900 (not taking into account the number of time you’ll invest.) However, you’ll run into even more expenses when you attend arm yourself with the required tools of the trade. And don’t fool yourself – they’re necessary – because your competition are definitely using every tool to help THEM.
A) MLS Access is probably the most expensive necessity you are going to run into. Joining your neighborhood (and state & national, by default) Board of Realtors will allow you to purchase MLS access, and in Austin, Texas, will run around $1000. However, don’t skimp of this type. Getting MLS access is one of the most important things you can do. It’s what differentiates us from your average salesman – we don’t sell homes, we present any of the homes that we have available. With MLS Access, you should have 99% of the virginia homes in your area available to present to your clients.
B) CELLULAR PHONE w/ a Beefy Plan – Nowadays, everyone has a cellular phone. But not everyone has a plan that will facilitate the amount of use that REALTORS need. Plan on getting at the very least 2000 minutes per month. You need, and need, to be accessible to your clients 24/7 – not only nights and weekends.