Updated almost 6 years ago on . Most recent reply
Real Estate Agent startup costs
Hello! I am in the process of getting my real estate license. I am looking to work in NorthEast Ohio. I was wondering roughly how much money should I expect to spend to get my new business off the ground? I want to make sure I am prepared so I can be as successful as I possibly can. Thanks for any input!
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From a pure agent position: There will be your exam fee and state license fee. Once you find a place to hang your license, they will probably have some basic monthly fees for technology. A desk fee if you want a desk. You'll have to pay the local Board of Realtors to gain access to the Multilisting Service (your biggest fee). You'll need some basic business cards - sometimes the office can print you a small batch to start. At some point, you'll need to do some continuing education, but sometimes you can get it free or cheaply. Vendors sometimes pay for the training classes.
After that, you will have to figure out how you want to generate business. If you talk to your family and friends and old co-workers, you can tell them that you are in the business now and ask if there is anything you can do for them. Very simple conversation. Get their email addresses if you don't already have them. You can send out a very simple weekly newsletter (1 page max with some links to articles or featured listings) talking about the area. And make sure to talk to them again once every 3-4 months, or else they will forget that you're in real estate.
The next best thing to do is talk to a busy agent in your office and ask them if they need help with open houses. You can get buyer leads there and it won't cost you anything other than time. You have to be very clear with the agents on how you will split potential leads. Some agents will mistreat you and not let you have any leads, claiming it's training. So, you have to get the agreement up front. The next best thing would be to talk to a busy agent with slow moving inventory and ask to hold the open house on your own (or with another new agent). You get to keep all the potential leads and hopefully, the house will find a buyer.
After that, you can go door knocking and have the same conversation - what can you do to help them in real estate...
None of the above has cost you extra money beyond the startup costs.
After that, you can buy expired listings, FSBO and neighborhood data. This way you can call expired listing home owners and FSBOs. The neighborhood data comes in handy to call around listings to invite people to your open houses coming up. Once you have listings, you can call around your just listed homes, and eventually your just sold homes. And, if you are out of homes to call, you can just cold call neighborhoods. It's an easier conversation if you already have a listing to talk about. You can always just find one that your office has in the area and call around that - hi, we just listed a home in your area...
So far, only $200-$300 per month with tech fees and phone number data.
Next steps ($$$$) would be to buy leads like Realtor.com or Homes.com or Zillow.com, but those can be expensive and pull through rates are very low with overall negative ROI. They are a waste of money. So, don't do it. Concentrate on getting listings and the occasional buyer.