How to Become a Realtor
95A Profession Open to Almost Anyone Willing to Work
Realtor's are the people who broker the sale of real estate. In some states they are even called real estate brokers. Their primary function is to bring buyers and sellers together to facilitate the sale of the property. In addition, competition has forced them to provide additional services such as helping to arrange financing, referring home inspectors, assisting with property insurance and other things to make the buyer's purchase and move easier. The increasing number of laws and regulations issued by both the state and federal governments in the area of real estate transactions has greatly increased the amount of paperwork that the real estate agent is expected to complete in order to be in compliance with these laws and regulations. The job has thus become much more than a sales job although sales are still their primary focus since, without sales, they receive no income.
Realtors, like doctors, lawyers, beauticians and other professions are licensed and regulated by their respective states. These professions are closed to all except those who hold a license from the state in which they operate. The licensing process is intended to protect the public by having the state insure that realtor's (as well as doctors, lawyers and other licensed professionals) are competent and trustworthy. However, the real reason for the licensing, which realtor's and other licensed professionals support, is to regulate the number of people entering the profession and thereby ensure a greater volume of business for each individual in the profession.
In most states it is relatively easy to become a Realtor. Most, if not all, states require that a state administered test be taken and passed. The tests generally cover the rules and regulations governing real estate transactions within that state. Upon passing the test and paying the required fee, the person is awarded a license to sell real estate. The license generally has to be renewed at periodical intervals and this usually involves simply paying a fee and filing a renewal application. Many states require that the renewal also show evidence of continuing professional education and will also deny a license renewal if there is evidence of the applicant having engaged in unethical practices. Depending upon the state, unethical practices can be practices that are generally agreed to be unethical in the classic sense in that consumers of real estate services are harmed by the practice, or they can be what are normally considered competitive practices in any other business, such as reducing a commission, but are seen as a threat to the incomes of their fellow realtor's. This is common with government regulations which, while they claim to protect the consumer, actually work to protect members of the profession from competition and result in greater expense for the consumer.
Many states go further in attempting to protect local realtor's. Arizona, for one, requires that, before being allowed to take the real estate exam the applicant must complete an approved training course. This, of course adds to the cost of becoming a Realtor thereby discouraging some potential applicants. It also raises the question of the value of the test since the test is supposed to test the knowledge of the person. Requiring a course for everyone (including those who have had years of experience in another state) is more of a barrier to limit entry rather than professional preparation. But Arizona doesn't stop there, as it has a couple of more rules. The first being the requirement that the school be approved by the state agency that regulates realtor's and, you guessed it, the only approved schools are those physically located in Arizona. The second is the real clincher, in that, not only must the school be located in Arizona, but the student also must attend class physically in Arizona – on line and other forms of self study outside of Arizona are not allowed. There is something about Arizona real estate that knowledge of it can only be obtained if you have passed the sign on the highway that says “Welcome to Arizona”. The obvious intent of this rule is to make it difficult for a Realtor in another state to move to Arizona and immediately enter the profession. By placing these hurdles in the path of out of state real estate professionals we effectively limit the number who decide to come here and add to the competition.
However, despite these obstacles, becoming a Realtor is not that difficult or complicated and it remains a profession that is open to anyone, with or without a college education, who is willing to take the time to learn what is needed to pass the test and is willing to work hard to build their business. Most Realtor's work strictly on commission and are, with few exceptions, independent, self-employed professionals. While the failure rate among Realtor's is high, with a large percent of new Realtor's failing in their first year, it can also be a very rewarding business in terms of both personal satisfaction and financial success.
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I am trying to make money. I am discouraged because I don't make to much money and this form of schooling will come out of almost barren pockets. I feel helpless sometimes. I want to work, but it seems now you need money to make money and whoever does not have will continue to not have.
Tahira - thank you for visiting my HubPage. Selling realestate can be a tough job considering that it is all commission based and you are responsible for most of your own marketing and other business expenses as well as the cost of the mandatory training needed to obtain and maintain your license. It is not the type of business to enter full time if you have no other sources of income and have to support yourself individually or yourself and a family. The present depressed market is also not a good time to enter the field if you need a steady income.
On the other hand, if you are married and have a working spouse or are a young adult still living at home with your parents with few if any financial responsibilities, today's depressed market can be a good time to embark on a career in realestate. The same is true if you are retired and receive a monthly pension check. With sales down and many people exiting the industry, now could be a very good time to learn the ropes and begin building a business for yourself (even though many states require agents to affiliate with existing firms, such agents are still independent business people). Since it is also possible to work part-time in realestate you might consider begining that way while continuing to earn a living from a traditional full time job.
Before you invest any money in training or obtaining a license, I suggest that you give careful thought to why you want to enter this profession. If it is just a job and money you are looking for, you will probably do much better looking for a 9 to 5 job with an hourly wage or salary that is paid regularly. Realestate is pure commission selling which means that you only get paid when you sell a home (or find the right home for a buyer if you work on the buyer's rather than the seller's side of the market). To be successful you will need both a knowledge of real estate as well as a passion for both realestate and for helping people to buy or sell a home. I suggest that you not only study up on what training and knowledge is needed to sell realestate in your state and what the market is like for agents but also talk to agents to get a feel for what the profession is really like.
Unsuccessful agents who are getting ready to leave the industry or who have left recently will almost certainly paint a dark but realistic picture of the difficulties you will face in the industry. Successful agents will paint a very positive picture stressing not only the large amounts of money that a good agent can potentially make, but also the emotional rewards which include the satisfaction that comes from helping people to realize their dreams of homeownership as well as the freedom and independence that comes from being your own boss.
Take both views, but especially the successful agents' views, with a large grain of salt. There are many successful agents so the job and industry is not as bad for everyone as the unsuccessful agents will paint it to be. However, the rosy picture the successful agents will paint will gloss over the failures and other hardships that these agents have to deal with and many will describe their experience in terms of what they are working toward rather than their current circumstances. This is because successful sales people have to be very optmistic or they will fail. So the agent who had only a few listings last month and failed to close on any of them will start this month truly believing that he or she will get at least twice as many listings this month and close all of them. And, no matter how many people they show a home to without any of them buying, the agent will remain convinced that the next person or couple to see the home will buy it. While this mindset is important and necessary, it can often mislead the listener into thinking that success comes easy with the job. The key here is to cultivate a relationship with a successful sales person (but not the top seller in the office) and try to get a realistic impression as to what that person's personal and professional life really is like. Look for clues revealing just how hard that person has to work, how long it takes them to get a listing, how long and how many showings it really takes to make a sale, how heavily they and their household rely on the non-realestate spouse to pay the household bills, how old their car is, how often they wear the same outfit for work, etc. These people will probably be successful personally and professionally in time but, between now and then, they will have to work hard and be able to mentally deal with a lot of failure and rejection. If you still feel passionate about the job and are prepared to deal with the obstacles that must be overcome in the business, then this could be a career for you. If not, then you should save your money and save yourself the agony and find another profession. Good luck.
Chuck, I can tell you it's been very easy to get into the business in Florida however now it's a lot harder to stay in.
working
Rental Property says:
8 months ago
Extremely thought provoking hub page you have here, it does sound like a lot of hard work though. I know because i've been buying rental property for some time now and met many realtors.