Ask Brian is a weekly column by Real Estate Expert Brian Kline. If you have questions on real estate investing, DIY, home buying/selling, or other housing inquiries please email your questions to [email protected].
Question from Aurora in GA: Hi Brian, I’m a 23-year-old college graduate with a degree in business. I’m not sure what I want for a career, but I know that I don’t want to be a cog in a corporate machine. I thought that I might want to start my own retail sales business, but I don’t have the capital to get started. That got me thinking that I should look for a low-cost way to work for myself and that brought me to think about becoming a real estate agent. But then I had some doubts because I’m hearing that the real estate market might go soft in 2022 or 2023. What do you think? Is now a good time to become a real estate agent?
Answer: Hi Aurora. I’m pro real estate for the remainder of 2022 and into 2023. However, some economists are predicting that the market will experience a downturn in 2022. But the majority believe that it will remain stable. If you’re thinking about real estate as a career, you should be thinking beyond just the next two years. Real estate has literally been around forever and will still be here when we are gone. Therefore, the career choice of becoming a real estate agent is a good one in 2022 or any other year.
To become a real estate agent, you must take educational courses, pass the real estate exam, apply with the state, pay some fees, and then you will get your license. The exact requirements vary a little from state to state. Aurora, in Georgia the minimum requirements according to the Georgia Real Estate Commission are:
However, it would be wise to think about more than just the minimum requirements before launching your career as a real estate agent. You said that you want to work for yourself and that is an option, but a new agent should consider starting with an established broker. A broker can help you market yourself, find clients, and get valuable real estate experience. A good broker will provide additional education, training materials, marketing materials, office space, and supplies. But you will have to pay fees in return for these.
Most brokers operate by splitting your commissions with you. Don’t go into this thinking that you are going to keep the full 6% commission on a $400,000 house sale. That commission is going to be about $24,000 but it will probably be split 4 ways. The listing agent and broker will get 3% with the selling agent and broker getting the other 3%. The splits can vary but that is typical. You’ll need an agreement with your broker about how that 3% is again split between the broker and you. Common splits are 60/40 or 50/50 but if you become a high-volume agent, you may start getting a larger split — this can depend on company policy.
There are other things that you want to consider before choosing a broker. You might want one that focuses on a niche — a location or a specific category of real estate like commercial retail, single-family homes, or fixer-uppers. If you have a specific interest, you can find a broker who shares that interest. Company culture might also be important to you. If so, get to know what they’re all about, how they work, and what’s important to them. Keep in mind that you have the freedom to choose a brokerage that fits you.
Aurora, you’re thinking about starting a career, not just taking a job. You will need to take full responsibility for growing in your career. Here are a few important things that you need to do to get started:
There is more to becoming a real estate agent than just getting your license. Most states also require continuing your education. If you put in the effort and develop the right skills it will pay off with a worthwhile income and the satisfaction of helping people get into the homes of their dreams.
What can you offer a person considering a career as a real estate agent? Please comment with your thoughts.
Our weekly Ask Brian column welcomes questions from readers of all experience levels with residential real estate. Please email your questions or inquiries to [email protected].