Every time I speak to someone about my business and career, it always arises that “they’ve thought about engaging in real estate” or know anyone who has. With so many people thinking about getting into property, and getting into real estate – why aren’t there more lucrative Realtors in the world? Well, there’s only so much business to go around, so there can only be so many REALTORS in the world. I feel, however, that the inherent nature of the business enterprise, and how different it is from traditional careers, makes it 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 with their careers. New REALTORS bring a lot of great qualities to the table – plenty of energy and ambition – but they also make a large amount of common mistakes. Here are the 7 top mistakes rookie Real Estate Agents 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 most new REALTORS have never been in business for themselves – they’ve only worked as employees. They, mistakenly, believe that getting into the true Estate business is “getting a new job.” What they’re missing is that they are about to go into business for themselves. If you’ve ever opened the doors to ANY business, you understand that one of many key ingredients is your business plan. Your business plan helps you define where you’re going, how you are getting there, and what it does take for you yourself to make your real estate industry 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 most trades & master of none” – choose residential or commercial, buyers/sellers/renters, and what area(s) you want to specialize in. New residential realtors tend to have probably the most success with buyers/renters and then move ahead to listing homes after they’ve completed a few transactions.
C) Market – who are you marketing yourself to?
D) Budget – consider yourself “new real estate agent, inc.” and jot down EVERY expense you have – gas, groceries, cellular 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 on your own, when will you break even?
F) Marketing Plan – how are you going to obtain the word out about your services? The MOST effective way to market yourself would be to your own 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 Agent, Title Officer, Inspector, Appraiser, and sometimes more! As an agent, you are in the position 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! If they perform well, you can take part of the credit as you referred them into the transaction.
The deadliest duo on the market is the New AGENT & New LARGE FINANCIAL COMPANY. They get together and decide that, through their combined marketing efforts, they can take over the planet! They’re both focusing on the right part of their business – marketing – but they’re doing each other no favors by choosing to provide each other business. If you refer in a bad insurance agent, it might result in a minor hiccup in the transaction – you make 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 result can be disastrous! You may find yourself ready of “begging for a contract extension,” or worse, being denied a contract extension.
An excellent closing team will typically know more than their role in the transaction. Due to this, you can turn in their mind with questions, and they’ll step in (quietly) if they visit a potential mistake – because they want to assist you to, and in return receive more of your business. Using good, experienced players for the closing team will assist you to infinitely in conducting business worth MORE business…and on top of that, it’s free!
3) Not Arming Themselves with the required Tools
Getting started as an agent is expensive. In Texas, the license alone is an investment that will cost between $700 and $900 (not considering the amount of time you’ll invest.) However, Real Estate Port Orchard ‘ll come across even more expenses when you attend arm yourself with the required 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 just about the most expensive necessity you’re going to run into. Joining your local (and state & national, automagically) Board of Realtors will help you to pay for MLS access, and in Austin, Texas, will run around $1000. However, don’t skimp of this type. Getting MLS access is among the most important actions you can take. 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 homes for sale in your area open to present to your clients.
B) Mobile Phone w/ a Beefy Plan – These days, everyone has a cell 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 want, and need, to be available to your clients 24/7 – not just nights and weekends.