It's never easy to make the leap of faith and transition for part time agent to full time. Chance are you have a steady paycheck that you can rely on and it's a scary thing to give up. Being paid solely on a commission basis can be a very different way of life from what you are used to. In order to be successful, many things need to take place in terms of planning prior to making the switch. This comes in the form of business, finances, and life.
First and foremost, prior to beginning a full time career in real estate you need to have a sound business plan. Although it may not seem like it, you are CEO of your own small business – and as the saying goes: fail to plan, plan to fail. The majority of small businesses fail within the first five years of operation, and the same goes for new agents – don’t become a statistic. Plan out exactly what you want to achieve and how you are going to achieve it. Without a plan your goal is just a wish – you need to have a concrete plan for your business going forward.
The basic business plan would include information on your brand; who are you, where do you fit into the market, why are you going into business, and what makes you different? You will also come up with your value proposition – why will someone hire you and what makes you better for the job than your competition? You’re also going to detail your competition, pick your niche, and work on a marketing plan (have to get those leads coming in somehow!). But most importantly, you’re going to detail exactly where and when you’re going to get your business. Plan out how many leads you will be getting each month, how many will be buyers and how many will be sellers, and what your conversion rate is (how many people you are going to convert from leads to actual clients). A good conversion rate for a new agent is around 10% - that means that for every 10 leads you speak to you will convert approximately one into a client. You’re also going to need to know the average sale price of the homes you are going to sell.
Prior to switching over to real estate full time, it is a good rule of thumb to have at least six months of living expenses saved up, in addition to any money you require for your licensing and insurance dues. Even if you land a new client on your first day in real estate, it could take months before you get paid. Agents get paid when the transaction closes which can be 30, 60, or even 90 days out. In addition, there are processing times when it comes to your pay check, it may be a couple of weeks before you actually receive your check. Businesses don’t only fail because they are bad concepts, they can just as easily fail because of cash flow issues.
Managers, coaches, and mentors have many opinions when it comes to being part time in real estate. Many might argue, to be successful in real estate you must commit to it 100%. However, there is value in starting part time while you learn the ropes and master your craft. If you start part time you will be able to learn and work out all the kinks, while still having income generated from a different profession. You can use that time to test out different marketing techniques, and perfect your business plan (plans should never be stagnant, and should always be changing when you learn more about your customer, your business, or even yourself).
Real estate as a full-time career is very different from many other professions. You will spend a lot of time working alone, driving alone, and motivating yourself to get up and go each morning. You will have no one tracking your business spending, your hours worked, or your productivity – this is all up to you. If you want to be successful in this industry you have to be prepared for the lifestyle changes that will inevitably happen. Your phone may ring at 8AM on a Sunday, and working weekend is the norm, and you won’t always be home at night during family dinner. If you’re trying to make it big in your first year as an agent be prepared to work at least 60 hours per week, if not more. Prepare yourself, friends, and family for the transition and ensure you have the support needed to pursue your dreams – and if reading this paragraph turned you off, then it may be time to rethink what you’re getting yourself into.
This profession takes a lot of grit and dedication but, if you’re willing to put in the work it can be highly rewarding. Being an agent can be the hardest or easiest way to increase your income – it’s your choice. Your career is in your hands, just always remember these words: fail to plan, plan to fail.
Nicole is the Founder of [SheSellsToronto.com] and a real estate agent with a keen eye for trends and analytics. She's a former corporate operative with a B.Comm in business and a background in category management. She has also worked for some of Canada’s largest brands in their marketing departments. When she's not helping clients she can be found writing for her blog or hanging out with her two dogs. [www.shesellstoronto.com]
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