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 real estate – why aren’t there more successful Realtors in the world? Well, there’s only so much business to bypass, so there can only be so many REALTORS in the world. Personally i think, however, that the inherent nature of the business enterprise, and how different it is from traditional careers, makes it 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 with their careers. New REALTORS bring many great qualities to the table – lots of energy and ambition – but they also make a large amount of common mistakes. Listed below 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 Real Estate Brokerage they will join when their shiny new license comes in the mail. Why? Because most new Real Estate Agents have never been in 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 are about to get into business for themselves. If you have ever opened the doors to ANY business, you know that one of many key ingredients is your business plan. Your business plan can help you define where you’re going, how you are getting there, and what it’s going to take for you to make your real estate industry a success. Here are the requirements of any good business plan:
A) Goals – What do you want? Make them clear, concise, measurable, and achievable.
B) Services You Provide – you do not want to be the “jack of most 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 probably the most success with buyers/renters and move ahead to listing homes after they’ve completed several transactions.
C) Market – who are you marketing yourself to?
D) Budget – consider yourself “new agent, inc.” and write down EVERY expense you have – gas, groceries, cell phone, etc… Then write down the brand new expenses you’re dealing with – board dues, increased gas, increased cell usage, marketing (essential), etc…
E) Funding – how are you going to pay for your budget w/ no income for the first (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 obtain the word out about your services? The MOST effective way to market yourself would be to your own sphere of influence (people you know). Make sure you do so effectively and systematically.
2) Not Using the GREATEST Closing Team
They say the greatest businesspeople surround themselves with people that are smarter than themselves. It takes a fairly 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 make certain that anyone you refer in will undoubtedly be a secured asset to the transaction, not someone who will bring 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 in to the transaction.
The deadliest duo on the market is the New Real Estate Agent & New Mortgage Broker. They gather and decide that, through their combined marketing efforts, they can 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 professional, it might cause a minor hiccup in the transaction – you make a simple phone call and a new agent can bind the house in less than one hour. However, because it normally takes at least fourteen days 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 know more than their role in the transaction. Because of this, you can turn in their mind with questions, and they’ll step in (quietly) when they see a potential mistake – because they want to help you, and in return receive more of your business. Using good, experienced players for your closing team will assist you to 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 which will cost between $700 and $900 (not taking into account how much time you’ll invest.) However, you’ll run into even more expenses when you go to arm yourself with the necessary tools of the trade. And don’t fool yourself – they are necessary – because your competition are definitely using every tool to help THEM.
A) MLS Access is probably the most expensive necessity you are going to run into. Joining your local (and state & national, by default) Board of Realtors will allow you to pay for MLS access, and in Austin, Texas, will run around $1000. However, don’t skimp of this type. Getting MLS access is one of 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 available to present to your clients.
B) CELLULAR 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 REALTORS need. yoursite.com on getting at the very least 2000 minutes per month. You need, and need, to be available to your clients 24/7 – not only nights and weekends.