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  1. #1
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    Apr 2012
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    5

    Lightbulb Interest in becoming Real Estate Broker.

    I am 17 years old, and wondering what I want to make a living off of. Recently I have been debating the idea of becoming a real estate broker. I would like some tips/pointers from some fairly successful or even top earning brokers. I have done extensive research on what exactly brokers do on a day to day basis, and it seems like something I would enjoy doing. I do not want a 9 to 5 job where I have a boss breathing down my neck all the time.
    I was just wondering what type of education I should get to become a broker. I know a college degree is not required to become and agent, but I have heard it is better to have one if you plan on being a broker. I think I would start out as a agent in an office, work up to being a broker/co-broker, then eventually own my own office. My family makes enough that they can support me for however long it takes me to start making some decent money, so that is not a problem. I don't know if I am missing anything, I am typing this fairly fast, but if you have any suggestions, they would be appreciated.
    It is not the most important thing, but I am wondering how much I will expect to make as first off, an agent, then when I am a broker, then if I own my own office. My plans are to make as much as possible, who wouldn't, but I know that will take time. I live at the coast of NC near wilmington, if that matters.
    Thanks to anyone who has pointers .

  2. #2
    Join Date
    Sep 2005
    Location
    Houston, TX
    Posts
    2,132

    Default Re: Interest in becoming Real Estate Broker.

    I've always felt it was best to approach your desire this way:

    Agent > Agent with a Team > Broker

    As an agent, you'll learn the nuts and bolts of the business; what it takes to keep it running like a well oiled machine. Later, a team will help you understand what kind of leadership, administrative, and technical skills are required to manage other agents. Finally, a broker is the final step in growing your business - where your goal is to provide an environment conducive to attracting top producing agents.

    So the first step - become a real estate agent.

    Each state has it's own guidelines, but in a nutshell, you'll attend a specialty school to get the required education (never too late to start, but they increase the requirements yearly it seems). Once you have the required hours and courses, you'll take a state and national test. Finally, you'll need to choose a broker to hang your license with who will also be responsible for you legally. Really, as an agent under a broker, you act as their representative in the field.

    I suggest reading one book that literally changed my life - The Millionaire Real Estate Agent by Gary Keller from Keller Williams Realty. Regardless if you choose KW or not, it's such a great book that really lays the foundation to becoming a successful real estate agent and later, an agent with a team. Pick it up off of Amazon; should be pretty cheap.

    I'm not sure what your average price range is in your market, but it's not uncommon for real estate agents to make quite a sum of money their first years (I've seen six figures in Houston, and our average is mid $100's). It all depends on how well you can generate leads (we're all in the lead generation business), how well your cultivate and farm your network and sphere (and how large it is - if you know a lot of people that will certainly help you get started), and how well you follow up with past clients for referrals.

    Real estate is a great business in that your only limitations are what you impose on yourself. The sky is the limit.
    Steve Castaneda, Realtor
    Keller Williams Realty

    I'm a Realtor in Houston, Texas and in my spare time, I write at this blog dedicated to real estate technology for agents. I originally created this Houston Real Estate site and switched to REW - awesome decision.

  3. #3
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    Apr 2012
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    5

    Default Re: Interest in becoming Real Estate Broker.

    Thank you very much for the in-depth reply. The only question I can think of at the moment is, should I be thinking of going to college if I really want to become a broker? I do not need an immediate source of income, and can live at home for the number of years it would take for me to get off the ground. I know some colleges offer real estate classes, but it is not a requirement by any means. I might go to get an IT degree or something similar to that if being in real estate does not work out, which I would find unlikely, but I don't think unnecessary debt is smart. Did you go to college? And would you say that it made any difference?

    The main reason I am interested in working in real estate is because it is one of those rare jobs that is performance based, and I just love houses and the design of each, it just interest me.

    And finally, what percent commission should I generally be expecting, somewhere from 2-4%? I know you split the commission on both sides of the deal, but does one side make any more than the other? And when working as an agent, I have seen that you either pay a fee, or just split the commission even more. Should I start out just taking away from my percentage until I sell enough houses that paying a fee would be better?

    Either way, I will check that book out, I am sure it will answer a lot of the questions I am asking. Thanks for all the help!

  4. #4
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    Houston, TX
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    Default Re: Interest in becoming Real Estate Broker.

    Quote Originally Posted by HennesseyHPE View Post
    The only question I can think of at the moment is, should I be thinking of going to college if I really want to become a broker?
    That really depends. Here in Houston, our college courses are offered at a local specialty school that only provides education for real estate related fields, including appraisal and inspection licenses. However, I could of chosen to go to the college directly for similar courses that would of sufficed the state requirements, but I would of probably missed out on valuable knowledge provided by the local specialty school teachers. Quite frequently, they're real estate brokers and agents teaching those courses.

    Check around your area and see if there are any smaller, specialized schools that offer state-approved real estate courses and start there. I'm sure they'd be willing to meet with you for free and discuss the curriculum and course outline, plus answer any questions.

    Quote Originally Posted by HennesseyHPE View Post
    Did you go to college? And would you say that it made any difference?
    I started to, but then when I found the local college, I left once my semester ended to get the courses I needed. I personally don't have any degrees, but that hasn't held me back one bit. Not saying that degrees aren't valuable in some sense; I just feel that a majority of the knowledge you'll need to be successful in real estate sales is learned in the field; not a textbook. The courses, however, will certainly keep you and your broker out of trouble.

    Quote Originally Posted by HennesseyHPE View Post
    And finally, what percent commission should I generally be expecting, somewhere from 2-4%? I know you split the commission on both sides of the deal, but does one side make any more than the other?
    Commissions are not set in stone; they're always negotiable. However, you can choose to set a fee based on the level of services you provide. When splitting commissions, how much you'll get is really dependent on what you'll offer the buyers agent. It's not always split down the middle; sometimes it is - it really just depends.

    In Houston, I typically see listing agents charge the seller 6% and split commissions 50/50. I've also seen listings agents charge 4%, take a 1% commission on the sale (give the buyer's agent 3%) as long as they can represent the seller on their next purchase (pick up another 3% probably later). Again, it's all negotiable. When you get your license and get access to your local multiple listing system database, you'll see what's typically advertised and will be able to use that as a starting point, along with the level of services you wish to provide, to derive a fee structure you'll charge your clients. In the end, it's completely up to you. (Though, free doesn't also ring well with your broker).

    Quote Originally Posted by HennesseyHPE View Post
    Should I start out just taking away from my percentage until I sell enough houses that paying a fee would be better?
    I would pick a commission structure you feel comfortable with; whatever makes your work pay off at a level you are satisfied with profits after any broker splits, and stick to it. If you end up chasing a deal making pennies, you'll burn out quickly. You're going to work hard for your clients, and you should be paid well for it. Do a great job, and your commission will never be in question.
    Last edited by RESteve; 04-15-2012 at 06:49 PM.
    Steve Castaneda, Realtor
    Keller Williams Realty

    I'm a Realtor in Houston, Texas and in my spare time, I write at this blog dedicated to real estate technology for agents. I originally created this Houston Real Estate site and switched to REW - awesome decision.

  5. #5
    Join Date
    Mar 2007
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    Las Vegas
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    1,151

    Default Re: Interest in becoming Real Estate Broker.

    Hmmm... I have my degree / worked in another industry real estate related before getting my license. Then worked for a top agent (who was a GF then my wife)... Became a top agent... did some big things with Developers... etc.. etc..

    Long story short...

    If my Daughter was 17 and wanted to go straight to real estate ... I would kick her arse and make her go on to college first and get a business related degree. Preferably in Finance.

    Then she could come work for me...

    Just getting a real estate or even a Broker's license is not going to teach you crap about Economics, Statistics, Marketing or Finance and if you want to know what's really going on out there... you better have an understanding of these disciplines.

    My experience... but the top real estate agents I know still in business have a degree in something. At least the highly respectable ones that I know of.

    Nothing wrong with getting a real estate license and working for a top agent while in college... but I would suggest getting a degree in something business related. I would bet that a high % all of the real estate agents that have dropped out of the business in the past six years never went to college in the first place.

    Just my opinion... No shortage of people's financial lives that were wrecked because their real estate agents had no clue what was going on in the first place.


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  6. #6
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    Apr 2012
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    Default Re: Interest in becoming Real Estate Broker.

    Okay, thanks, I had always been thinking of a some kind of business and accounting combo. I just didn't want to go to college if it was not necessary.

  7. #7
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    Sep 2005
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    Houston, TX
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    Default Re: Interest in becoming Real Estate Broker.

    To each their own, but I normally find my friends who have degrees defend the fact that they have them, and suggest everyone get them. Knock yourself out though - I just don't personally find them useful for selling real estate.
    Steve Castaneda, Realtor
    Keller Williams Realty

    I'm a Realtor in Houston, Texas and in my spare time, I write at this blog dedicated to real estate technology for agents. I originally created this Houston Real Estate site and switched to REW - awesome decision.

  8. #8
    Join Date
    Dec 2008
    Location
    Minneapolis, MN
    Posts
    273

    Default Re: Interest in becoming Real Estate Broker.

    I have a music degree from a 4-year college.

    Never took an economics or business class of any type in high school or college.

    I was Rookie of the Year for my 60-agent Team 4yrs ago and am now consistently in the top 5-10 in Sales Volume and Closed Transactions.


    I have educated myself by reading books, keeping in tune with the news, and most of all learning from other industry professionals.

    I'm sure some sort of formal business education wouldn't have hurt, but I am also proof that it isn't necessary to succeed in this industry.
    Steve Howe - REALTOR - RE/MAX Advantage Plus
    MN First Time Home Buyers
    First Time Home Buyers Class Minnesota
    Minneapolis, MN
    SteveH [at] MNRealEstateTeam [dot] com

  9. #9
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    Apr 2012
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    5

    Default Re: Interest in becoming Real Estate Broker.

    Yeah, I don't think I will go to college if my parents do not mind. I personally think that field experience is better than being book smart when it comes to a business like this. Yes a business degree would be nice, but it is not necessary. Also my dad is a coo/cfo, so I would say he is pretty good at business, so he could teach me some things if needed (not saying that is a replacement for a college class/degree, but it helps). Also, by any reason, would a commission ever drop below 2-3 percent on any side? I am still a little foggy on how much I could be making. I would guess my areas home value is a lot higher than average, just look at a map of coastal NC, there are so many more water/ocean front homes due to how the land is. I could go off and do accounting, but I think selling real estate is a lot less stressful, and overall more enjoyable. Sorry if you find what I am typing hard to understand, I am writing this up at 2 in the morning :-P Thanks!

  10. #10
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    Houston, TX
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    Default Re: Interest in becoming Real Estate Broker.

    Quote Originally Posted by HennesseyHPE View Post
    Also, by any reason, would a commission ever drop below 2-3 percent on any side?
    It's all negotiable. If you decide to drop your fees to nag a huge listing, then by all means, go for it as long as it's still profitable for you and a reflection of the work you'll put in.
    Steve Castaneda, Realtor
    Keller Williams Realty

    I'm a Realtor in Houston, Texas and in my spare time, I write at this blog dedicated to real estate technology for agents. I originally created this Houston Real Estate site and switched to REW - awesome decision.

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