Finding your niche in the real estate industry is tough, no matter when you do it. But what about when the market is surging, like it is now, and seemingly every agent is doing record volume with no end in sight?
This must be the perfect time to launch your career as a real estate agent, before this two-year wave of soaring home values eases, right? Not necessarily, say Seattle’s real estate industry leaders.
Seattle Agent spoke with four of the Puget Sound region’s leading real estate executives to get their advice for new agents trying to break into this red-hot market.
The experts — David Monroe, real estate productivity coach for Keller Williams Eastside; Compass Northwest Regional Vice President Cris Nelson; Eric Shull, office leader and business coach for John L. Scott; and Laurie Way, principal managing broker for Coldwell Banker Bain — shared these tips:
Know what you’re getting into
It’s true that homes and condos are selling for more than ever, and that means larger commissions for agents, but given the extreme shortage in housing inventory, the competition for listings is fierce.
And virtually every listing evolves into a bidding war, a tricky challenge for any agent, let alone one short on experience.
“You’re competing with 39,000 other licensed brokers in the state,” Shull said. “You’re really going to have to have strategies to win the market.”
For starters, recognize this for what it is: a job. If you want to succeed, you will have to be fully invested and willing to do the hard work, and some of it isn’t glamorous. You may need to do some cold calling, for example.
Monroe suggested dividing up time between what he calls the work and the playtime of the job.
“If you’re coming in as a new agent in this business, you need to treat it like it’s a job,” Monroe said. “It will eventually become a viable business, but it’s a job. Work is lead generation, lead followup … playtime is working on a logo, going on social media, improving your website.”
Way, from Coldwell Banker Bain, said if you’re in it for the money, that’s the wrong approach. It can take months before you even get a commission.
“You must love it or it’s not worth it,” she said. “You work weekends, you work nights, at least the first few years. You must work with all sort of people to get the job done, and sometimes some of them, well, can be not so pleasant, but you keep plugging along. Your family and friends must be supportive. Yes, the money can be rewarding, but you really need to want to help your clients first.”
Think long term
To build a business and sustain it, you need a plan that goes beyond knowing one or two friends or relatives who are willing to have you represent them in a housing transaction.
A couple willing buyers is a good start, but you need to look at yourself as a business, and that includes marketing, promotion, training, education, shrewd decision-making and work.
“Do the training and gain the knowledge,” said Shull, who talked to Seattle Agent on a recent weekday immediately after finishing a training session with some of his John L. Scott colleagues. “For every five years, only 10 to 20% (of agents) are still there. It’s hard if you don’t know what to do. Lots of new people see the market is frenzied and hot and think it should be easy to get checks … but it’s just not a simple business.”
No one knows everything from the start, so education is crucial. Training is available, but you have to know where to look. And some brokerages are better about offering training than others.
“Be patient in this kind of market,” Shull said. “We have a lot of top producers that do mentoring. We do accountability groups … It’s important to understand it can take time to learn the skill sets that it takes to do these types of things to win.”
Choose the right firm
Perhaps the most important decision a new agent will face is which brokerage to hang their license. Too often, agents will make this choice based mostly on commission splits, but that’s short-sighted, the experts said.
“When you are deciding on your brokerage, ask about their training; talk to other agents in the company; visit their office meetings, trainings,” Way said. “The culture of an office is so important, and you need to get the feel of it. Don’t base your choice solely on commission structure. It doesn’t matter if you have a better one at an office that offers no training or support.”
Knowing that you have support and backing from your brokerage can be the difference in a hyper-competitive market, Nelson said. In the Seattle market, hard conversations with clients about why their offer needs to be higher than the listing price or why they may need to waive a final inspection to make their offer stand out are essential.
“Go to a mentor or a manager to get advice,” Nelson said. “The earlier we have those conversations, the better. If this (complex situation) happens, what will you do? If there’s a worst-case scenario, do we have a plan in place?”
Consider a mentor
Your brokerage manager will, hopefully, help with your training and be a resource for questions and help. But that manager is likely doing the same for lots of agents while juggling other responsibilities and won’t be freely available to you all the time.
A good mentor can help fill those gaps.
“No. 1, in my opinion, is get a coach or a mentor,” Monroe said. “I am a coach because I believe there is a massive need for this in this industry. And we’ve done really well because there is a massive need.”
Monroe said a good mentor is so important, he’s seen some new agents split their commissions with the right coach, at least to start, until they gain some experience and perspective.
“Surround yourself with successful agents,” Way said. “Offer to help them with showings, inspections, etc. This is so important. Think of the time as an investment in the continuation of learning which is a never-ending process in real estate.”
Way also recommended reading “Every Day Agent: Straight Talk & Proven Methods to Grow Your Real Estate Business” by Whitney Ellis and also “Launching Right in Real Estate: What They Won’t Teach You in Pre-License School” by Carla Cross.
Build your network
As much as any industry, real estate is a relationship business, and building your sphere of influence is how you succeed. Those are cliches in real estate, but they’re also true.
Be social and talk real estate so people know you are their go-to person for their real estate questions. Join young professionals groups and network. Plant the seed now so down the road when someone is looking to buy or sell a home, they think of you as their personal real estate expert.
“Rely on your network,” Nelson said. “Make sure you have a CRM (customer relationship management system) that works on your behalf. The business is built on relationships, and (new agents) need to lean not only on their personal relationships but their professional relationships.”
Monroe said it can be a challenge for new or inexperienced agents to be upfront about what they want and to spend their networking time wisely.
“There’s a big missing link in this industry of people not asking for what they want … and not wasting time with people who aren’t going to work with you,” Monroe said. “If someone already has an agent or family member who is an agent who they will work with, move on.”
Way recommended volunteering somewhere to open up another avenue of networking while doing something positive and useful with your time. Keep a detailed spreadsheet of everyone you know, and then be in contact with them at least once a month so you become that real estate expert they turn to when it’s time to buy or sell.
You will have to spend some money at the outset to market yourself, but be careful about that, too, Way said.
“You definitely must spend money to make money, but there are so many things people will try to sell you that you don’t need,” she said. “Check it out with someone else first, and you’ll save a lot of money.”
Don’t give up
If you’re truly serious about making a career in real estate, don’t get discouraged if you hit a snag or pitfall at the outset. Those who stick it out and do the work often find a successful, rewarding career on the other side of those early struggles, the experts said.
“Keep plugging away,” Way said. “Don’t do a mailer or social media post and get disappointed when you don’t get a call. Put your head down and just push through. It’s proven you need to make monthly contact (mail, call, email, social post) for many months to a year and beyond before it pays off. Your manager, the training department, the marketing department will all have lots of ideas on how to do this for the least amount of money for you in the beginning.”