Some people get into real estate thinking it’s an easy road to riches without much work. Actually, that kind of thinking is more likely a road to quick disillusionment. While real estate can pay well and be rewarding, it takes more work than most people realize.
“A lot of people have a misconception of what selling real estate is all about,” said Jerry Brewer, owner of Brewer Realty and Appraisals, Senatobia. “Most people’s only experience comes from buying a home themselves. They see the Realtor walking them through the house, and then might not see them again until the closing when the real estate agent gets a $3,000 to $6,000 check. What they don’t see is all the behind-the-scenes work.”
Brewer has been in the real estate business since 1970, and for many years has taught the entry level courses that are necessary to get a license to sell real estate. From his experience as an instructor, he has found it is almost impossible to guess who is going to be successful in real estate.
“I have had some students I thought no way would make it, and they did,” Brewer said. “Others I thought couldn’t miss, and about time their license comes up for renewal they are out of it. I’ve found out if they can make it to the first renewal of their license in two years, they will probably make it.”
There is a big turnover in real estate. As Brewer puts it, for every person coming in the front door there seems to be one going out the back door. Some people go in and out of the profession depending on the local market. When sales are up, they get in the business. When it becomes more challenging, they leave.
The on-and-off again agents have a disadvantage in today’s competitive marketplace.
“I have found the public is demanding more and more professionalism out of their Realtors,” Brewer said. “Purchasing a home is usually the biggest financial investment most families will ever make. So it is critically important when they make that kind of decision to get good professional, knowledgeable advice. The public is looking for someone with experience.”
It takes time to build a solid foundation as a real estate agent. Ultimately agents have to build their reputation in order earn referrals.
“When you build a foundation of integrity, honesty and good knowledge, your business will be solid even when hard times blow in,” Brewer said. “That is ultimately what the goal should be. Most agents realize the success of their career is going to be based on referrals.”
Jo Usry, director of education, Mississippi Association of Realtors (MAR), fields calls from prospective real estate agents on a near-daily basis.
“Generally people who call us have no idea what the industry is about,” she said.
“The highs are most obvious. One is flexibility. You aren’t tied to a desk from eight to five. However, you will be spending those same hours prospecting from somewhere. The potential for unlimited earnings is another big draw.”
The career is popular with parents who want the flexibility of working part time so they can stay at home with their children. But part time means lower income, and some brokers won’t hire part-time brokers.
Usry said the downside to the business is the time it takes to build it. From the time a person obtains a license until the first commission check is deposited in the bank no income is earned. It can take months to get a buyer to the closing table, and there is no income until that happens.
But compared to getting a four-year degree, it is relatively inexpensive to get a real estate license. The two-week introductory courses offered by MAR throughout the state cost $600 to $635. Upon completion students have to take a $125 licensing exam from the Mississippi Real Estate Commission. Agents are also required to have 16 hours of continuing education every two years.
What does it pay?
Usry tells potential real estate agents that the potential for income is tremendous, but depends on their ability to work. An often-asked question is, “What does the average real estate agent make?” That is impossible to say because it depends on a range of factors from hard work to luck to the individual’s personality type.
“I always try to tell people this is a commission sales industry, and a person has to be willing to ask for business,” Usry said. “If they are shy and don’t want to ask for business, this is not where they need to be.”
One big disappointment can be sales that fall through because of the buyers’ inability to meet lending requirements. Usry said a lot of that can be avoided if the agent knows steps to take on the front end.
Real estate agents should get potential buyers qualified for a loan before spending a lot of time showing them properties.
“The more education a real estate agent has, the less likely sales are going to fall through,” Usry said. “Getting people qualified is a service to the consumer, too. It keeps the consumer from being disappointed, and it keeps the agent from losing a sale.
“If you get them to a lender first, then they know exactly what they can afford, and there is no disappointment down the line.”
Technology has changed the real estate business for the better, Usry said. E-mail makes it easier for agents and customers to communicate and transfer documents.
“That has drastically cut down the amount of time in a transaction for both the agent and consumer,” she said. “Also, buyers can literally find the house of their dreams on the Internet before they make contact with an agent for the first time.”
Pam Beard, brokerowner, BrokerSouth GMAC Real Estate, Vicksburg, said technology has not only made the paperwork side of business much easier to handle. It has also broadened the net for potential customers.
“The Internet has made our world so small that people from all over the world can discover us,” Beard said. “Many people we work with would never have picked a home here, but they have moved and started new lives here because they found us on the Internet.”
A recent example was a client who called about a mansion for sale in Vicksburg. The client called and said, “I’m just curious about the price listed on the home. Did you leave a one off the front of it?”
When Beard said the price was correct, the client then asked, “What is wrong with Vicksburg?” When Beard said nothing is wrong with Vicksburg, a great river town with lots to commend it, the client asked, “Well, then what is wrong with where this house is in Vicksburg?” Beard explained the home was located in a fine neighborhood.
“They flew here the next weekend, and bought the house,” Beard said. “They would never have thought of Mississippi, much less Vicksburg.
They just saw the house in the DuPont Registry.”
Another example is a couple in Hawaii currently looking at a bed and breakfast in Vicksburg. The couple wanted to relocate somewhere in the Southeast, and chose Vicksburg after doing some research on the Internet.
“The thing I like the most about real estate is getting to work with people from all over the country and the world, and introducing them to our area because I love where we live,” Beard said. “I think it is wonderful. It is really fun to introduce someone to Mississippi, and also bring good people into our community who will be an asset.”
Contact MBJ contributing writer Becky Gillette at firstname.lastname@example.org or (228) 872-3457.