Every time I talk to someone about my business and career, it always comes up that “they’ve thought about engaging in property” or know someone who has. With so many people considering getting into property, and getting into property – why aren’t there more lucrative Realtors on earth? Well, there’s only so much business to go around, so there can only be so many Real Estate Agents in the world. I feel, however, that the inherent nature of the business, and how different it really is from traditional careers, helps it be difficult for the average person to successfully make the transition into the Real Estate Business. As a brokerage, I see many new agents make their way into my office – for an interview, and sometimes to begin their careers. New REALTORS bring plenty of great qualities to the table – plenty of energy and ambition – however 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 almost all their emphasis on which PROPERTY Brokerage they’ll join when their shiny new license comes in the mail. Why? Because most new REALTORS have never experienced 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’re about to get into business for themselves. If you’ve ever opened the doors to ANY business, you understand that among the key ingredients is your business plan. Your business plan can help you define where you’re going, how you’re getting there, and what it’s going to take for you to make your real estate business a success. Here are the essentials of worthwhile business plan:
A) Goals – What do you want? Make Watten House , concise, measurable, and achievable.
B) Services You Provide – you don’t want to be the “jack of most trades & master of none” – choose residential or commercial, buyers/sellers/renters, and what area(s) you need to specialize in. New residential realtors tend to have the most success with buyers/renters and move ahead to listing homes after they’ve completed several transactions.
C) Market – that are you marketing yourself to?
D) Budget – consider yourself “new agent, inc.” and jot down EVERY expense which you have – gas, groceries, cellular phone, etc… Then write down the new expenses you’re dealing with – board dues, increased gas, increased cell usage, marketing (very important), etc…
E) Funding – how will you pay for your allowance w/ no income for the initial (at least) 60 days? With the goals you’ve set on your own, when do you want to break even?
F) Marketing Plan – how will you get the word out about your services? The simplest way to market yourself is to your own sphere of influence (people you understand). Make sure you do so effectively and systematically.
2) Not Using the GREATEST Closing Team
They say the best businesspeople surround themselves with people that are smarter than themselves. It requires a pretty big team to close a transaction – Buyer’s Agent, Listing Agent, Lender, INSURANCE PROFESSIONAL, Title Officer, Inspector, Appraiser, and sometimes more! As a Real Estate Agent, you are in the position to refer your client to whoever you select, and you should ensure that anyone you refer in will undoubtedly be an asset to the transaction, not somebody who will bring you more headache. And the closing team you refer in, or “put your name to,” is there to make you shine! When they perform well, you can take part of the credit because you referred them in to the transaction.
The deadliest duo on the market is the New AGENT & New Mortgage Broker. They get together and decide that, through their combined marketing efforts, they are able to take over the world! They’re both focusing on the right part of their business – marketing – but they’re doing each other no favors by choosing to give each other business. In the event that you refer in a bad insurance agent, it might result in a minor hiccup in the transaction – you create a simple phone call and a new agent can bind the property in less than an hour. However, because it normally takes at least two weeks to close a loan, if you are using an inexperienced lender, the result can be disastrous! You might find yourself ready of “begging for a contract extension,” or worse, being denied a contract extension.
A good closing team will typically know more than their role in the transaction. Due to this, you can turn to them with questions, and they’ll step in (quietly) if they visit a potential mistake – because they want to assist you to, and in exchange receive more of one’s business. Using good, experienced players for the closing team can help you infinitely in conducting business worth MORE business…and best of all, it’s free!
3) Not Arming Themselves with the required Tools
Getting started as a Real Estate Agent is expensive. In Texas, the license alone is an investment which will cost between $700 and $900 (not considering the volume of time you’ll invest.) However, you’ll come across even more expenses when you go to arm yourself with the necessary tools of the trade. And do not fool yourself – they’re necessary – because your competitors are using every tool to greatly help THEM.
A) MLS Access is probably the most expensive necessity you’re going to run into. Joining your local (and state & national, by default) Board of Realtors will allow you to purchase MLS access, and in Austin, Texas, will run around $1000. However, don’t skimp in this area. Getting MLS access is probably the most important actions you can take. It’s what differentiates us from your own average salesman – we don’t sell homes, we present the homes that we have available. With MLS Access, you should have 99% of the virginia homes in your area available to present to your clients.
B) CELLULAR PHONE w/ a Beefy Plan – Nowadays, everyone has a cellular phone. But not everyone includes a plan that will facilitate the level of use that REALTORS need. Plan on getting at the very least 2000 minutes per month. You want, and need, to be available to your clients 24/7 – not only nights and weekends.