If you’re considering becoming a real estate broker, you’ve got a challenging adventure ahead of you. This career is one of the most fulfilling professions, as you’ll be helping people find dream homes that may become their safe harbor for generations to come.
However, it’s also a profession that many people jump into without being fully prepared. When you become a real estate broker, you’ll be working with countless clients, each one with their vision of a dream home. You’ll have to be versatile, flexible, and ready to learn. Here are some of the critical things you should consider before taking the plunge.
What Is a Real Estate Broker?
Real estate brokers work with prospective homebuyers looking to buy, sell, or lease property. They work with all commercial, industrial, and residential buyers and oversee every real estate process step. While real estate agents can only work for another firm, brokers can start their firm or work as independent contractors. Both can be realtors, a prestigious title that requires a separate professional exam.
Real estate brokers have many duties, including creating property listings and advertising properties, arranging showings and public or private open houses, photographing houses for advertising purposes, and working with clients on finding the right house for their needs and budget. Your state will have licensing requirements to become a real estate agent, and most states require certifications in that field and a separate exam to become a broker.
The Commission Situation
This bonus is one of the most significant selling points of becoming a real estate broker—you’ll be making most of your money off commissions, which means you have a big say in how much you take home. While agents will have a set commission rate based on their agency, brokers can usually set their own within the state’s regulations – but make sure to keep up on your competition, so you’re in line with most charging five to six percent.
While this can be very lucrative, with many brokers who successfully sell one house a month having an annual income of around $75,000, be warned that there can be significant delays in getting that fee into your bank account. The processing of a house sale and the transfer can take months in some cases.
Additional Costs of Being a Broker
While you’ll be your boss as a real estate broker, that also might mean you spend more of your money upfront. You’ll need to build your brand as a broker, which may mean spending more money on marketing. You’ll also need to sign up for real estate agent and broker exams, which may come with fees and associated costs for preparing for the test.
Other costs are incidental and depend on your business model, like gas money to drive to real estate sites. One cost you absolutely shouldn’t cut corners on is professional liability insurance for real estate brokers. As you’re providing a service, you should cover yourself for any liabilities relating to mistakes or omissions you might make.
One of the biggest pluses of being a real estate broker is setting your hours. You won’t be clocking in at a nine to five anymore. However, this can often mean longer hours as you hustle to make those big sales. You’ll be working on your client’s schedule to a large degree, so you’ll need to be flexible to succeed.
This profession is ideal for those with high energy and are comfortable changing their schedule at a moment’s notice. A flexible broker who someone can call with a significant opportunity on short notice is a broker who will remain in many people’s contacts.
What Makes a Good Broker
Before taking the first step to becoming a real estate broker, you’ll want to make sure this field is right for you. You’ll need to understand market trends and care about finding the best house for your client rather than the one that is best for your bottom line.
A real estate broker’s most incredible tool is their reputation. If you build trust with your clients, you will develop momentum that will be hard to lose as long as you keep the quality of your work high. While many reality shows portray the industry as ruthless and dramatic, it’s more about building relationships than anything else.
Broker Your Way to Success
Real estate brokers are one of the fastest-growing fields today. This job will give you freedom and the chance for a hefty income. If this competitive field sounds right for you, you can start down the path to your certification today.