Every time I talk to someone about my business and career, it always arises that “they’ve thought about engaging in property” or know someone who has. With so many people thinking about getting into property, and getting into real estate – why aren’t there more successful Realtors in the world? Well, there’s only sign panels near me to bypass, so there can only just be so many REALTORS in the world. I feel, however, that the inherent nature of the business enterprise, and how different it really 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 their careers. New REALTORS bring lots of great qualities to the table – plenty of energy and ambition – however they also make a lot of common mistakes. Here are the 7 top mistakes rookie REALTORS Make.
1) No Business Plan or Business Strategy
So many new agents put almost all their emphasis on which Real Estate Brokerage they will join when their shiny new license comes in the mail. Why? Because most new Real Estate Agents have never experienced business for themselves – they’ve only worked as employees. They, mistakenly, think that getting into the Real Estate business is “obtaining a new job.” What they’re missing is that they are about to get into business for themselves. If you’ve ever opened the doors to ANY business, you understand that among the key ingredients can be your business plan. Your business plan can help you define where you’re going, how you are getting there, and what it does take for you to make your real estate industry a success. Here are the essentials of worthwhile business plan:
A) Goals – What do you want? Make them clear, concise, measurable, and achievable.
B) Services You Provide – you do not wish to be the “jack of all trades & master of none” – choose residential or commercial, buyers/sellers/renters, and what area(s) you need to specialize in. New residential real estate agents tend to have probably 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, cell phone, etc… Then write down the new expenses you’re taking on – board dues, increased gas, increased cell usage, marketing (essential), etc…
E) Funding – how will you pay for your allowance w/ no income for the first (at least) 60 days? With the goals you’ve set for yourself, when do you want to break even?
F) Marketing Plan – how will you get the word out about your services? The MOST effective way to market yourself would be to your personal 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 requires a fairly big team to close a transaction – Buyer’s Agent, Listing Agent, Lender, Insurance Agent, Title Officer, Inspector, Appraiser, and sometimes more! As an agent, you are in the position to refer your client to whoever you choose, and you should guarantee that anyone you refer in will be an asset to the transaction, not a person who provides you more headache. And the closing team you refer in, or “put your name to,” are there to make you shine! If they perform well, you can participate of the credit because you referred them into the transaction.
The deadliest duo out there 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 proper section of their business – marketing – but they’re doing each other no favors by choosing to give each other business. If you refer in a bad insurance agent, it might result in a minor hiccup in the transaction – you make a simple phone call and a new agent can bind the house in less than an hour. However, because it typically takes at least two weeks to close a loan, if you are using an inexperienced lender, the effect can be disastrous! You may find yourself in a position of “begging for a contract extension,” or worse, being denied a contract extension.
A good closing team will typically learn than their role in the transaction. Due to this, you can turn in their mind with questions, and they’ll step in (quietly) if they visit a potential mistake – because they want to assist you to, and in return receive more of one’s business. Using good, experienced players for your closing team can help you infinitely in conducting business worth MORE business…and on top of that, 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 that may 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 are necessary – because your competition are definitely using every tool to greatly help THEM.
A) MLS Access is probably the most expensive necessity you’re going to run into. Joining your neighborhood (and state & national, by default) Board of Realtors will help you to purchase MLS access, and in Austin, Texas, will run around $1000. However, don’t skimp of this type. Getting MLS access is probably the most important things you can do. It’s what differentiates us from your own average salesman – we don’t sell homes, we present any of the homes that we have available. With MLS Access, you should have 99% of the homes for sale in your area available to present to your clients.
B) Mobile Phone w/ a Beefy Plan – These days, everyone has a cellular phone. But not everyone has a plan that will facilitate the level of use that Real Estate Agents need. Plan on getting at least 2000 minutes per month. You want, and need, to be accessible to your clients 24/7 – not only nights and weekends.