Every time I speak to someone about my business and career, it always comes up that “they’ve thought about getting into property” or know anyone who has. With so many people considering getting into real estate, and getting into property – why aren’t there more successful 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 is from traditional careers, helps it be difficult for the average indivdual to successfully make the transition into the Real Estate Business. As a Broker, I see many new agents make their way into my office – for an interview, and sometimes to begin with their careers. New REALTORS bring plenty of great qualities to the table – plenty of energy and ambition – but they also make a large amount of common mistakes. Listed below are the 7 top mistakes rookie REALTORS Make.
1) No Business Plan or Business Strategy
So many new agents put all their emphasis on which PROPERTY Brokerage they’ll join when their shiny new license will come in the mail. Why? Because most new Real Estate Agents have never experienced business for themselves – they’ve only worked as employees. They, mistakenly, believe that getting into the true Estate business is “obtaining 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 one of the key ingredients can be your business plan. Your organization plan helps you define where you’re going, how you’re getting there, and what it does take for you yourself to make your real estate industry a success. Here are the requirements of any good business plan:
A) Goals – What do you want? Make sure they are clear, concise, measurable, and achievable.
B) Services You Provide – you do not desire to be the “jack of all trades & master of none” – choose residential or commercial, buyers/sellers/renters, and what area(s) you would like to specialize in. New residential real estate agents tend to have the most success with buyers/renters and then move on to listing homes after they’ve completed several transactions.
C) Market – that are you marketing yourself to?
D) Budget – consider yourself “new real estate agent, inc.” and jot down EVERY expense you have – gas, groceries, cellular phone, etc… Then write down the new expenses you’re taking on – 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 the very least) 60 days? With the goals you’ve set for yourself, when will you 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 know). Make sure you do so effectively and systematically.
2) Not Using the Best Possible Closing Team
They say the greatest businesspeople surround themselves with people that are smarter than themselves. It takes a pretty big team to close a transaction – Buyer’s Agent, Listing Agent, Lender, INSURANCE PROFESSIONAL, Title Officer, Inspector, Appraiser, and sometimes more! As private loans , you are in the positioning to refer your client to whoever you choose, and you should guarantee that anyone you refer in will undoubtedly be an asset to the transaction, not someone 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 get to take part of the credit because you referred them in to the transaction.
The deadliest duo on the market is the New Real Estate 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 proper section of their business – marketing – but they’re doing each other no favors by choosing to provide each other business. In the event that you refer in a bad insurance agent, it might cause a minor hiccup in the transaction – you create a simple phone call and a new agent can bind the house in less than one hour. However, because it normally takes at least two weeks to close a loan, if you use an inexperienced lender, the result can be disastrous! You may find yourself ready of “begging for a contract extension,” or worse, being denied a contract extension.
An excellent closing team will typically learn than their role in the transaction. Because of this, you can turn in their mind with questions, and they will step in (quietly) when they visit a potential mistake – because they want to assist you to, and in return receive more of your business. Using good, experienced players for the closing team will let 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 can be an investment that will cost between $700 and $900 (not taking into account the volume of time you’ll invest.) However, you’ll come across even more expenses when you attend arm yourself with the required tools of the trade. And do not fool yourself – they’re necessary – because your competitors are definitely using every tool to greatly help THEM.
A) MLS Access is just about the most expensive necessity you are going to run into. Joining your neighborhood (and state & national, automagically) Board of Realtors will help you to purchase MLS access, and in Austin, Texas, will run around $1000. However, don’t skimp in this area. Getting MLS access is among the most important actions you can take. It’s what differentiates us from your 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 open to present to your clients.
B) Mobile Phone w/ a Beefy Plan – Nowadays, everyone has a cellular phone. But not everyone includes a plan that will facilitate the amount of use that REALTORS need. Plan on getting at least 2000 minutes per month. You need, and need, to be accessible to your clients 24/7 – not only nights and weekends.