Is becoming a part time real estate agent worth it?

30 Replies

@Briana Phelps if you are only going to do it to be a side kick to your investments then no. It costs a lot of time and money to carry your license so in my opinion if your not dedicated to selling real estate it’s not worth having it .

Where are you located @Briana Phelps ? It sounds like you have a job where you may have access to high income folks who may be looking to buy or sell their homes!?  Getting and maintaining a license will cost you a few thousand $$ a year so if you can do a few deals a year, or just one over $100K sales price it would be worth it.  Really depends on your availability , outside income level, location and of course your motivation!  Do you want to be selling RVs for the rest of your life?  I say ‘just do it’!

@Marian Huish I am in San Jose, CA. So houses here are at least 600k and higher! When you say thousands of dollars to keep up a real estate license, what costs are you referring to? I feel that since the housing market is extremely high over here, one or two deals a year would be worth it. But I also know there is a lot of time that goes into it as well..

It's a 'few thousand' @Briana Phelps which includes your pre-licensing classes, registering and taking the exam, finger-printing, signing on with a brokerage (varies), registering with both the National Assoc. of Realtors as well as your local association which charges regular dues (varies but you can check with your local real estate associations), MLS dues, lockbox fees, signs, etc. these are the 'fixed' costs that you should count on and can range between $1500-$3000 annually. This of course does not include any technology, additional training, technology or marketing costs. You can spend as much or as little on this depending on how many sales you would like. Many agents start out part time and, depending on their success/interest, move into a full-time career. There are also additional financial benefits depending on whether you buy/sell your own real estate investments, move into managing rentals (short or long term), property management, and or course different brokerages offer different benefits such as healthcare, stock and revenue share, etc which can further provide financial security for you and your family. You'll need to research & interview with different brokerages as you'll be required to affiliate with one before you can begin actively selling.

Originally posted by @Briana Phelps :

@Marian Huish I am in San Jose, CA. So houses here are at least 600k and higher! When you say thousands of dollars to keep up a real estate license, what costs are you referring to? I feel that since the housing market is extremely high over here, one or two deals a year would be worth it. But I also know there is a lot of time that goes into it as well..

Keep in mind on BP High can mean 500 dollar or it can mean 10k.. in the context of Silicon valley the cost to maintain a license at a brokerage that only charges U if you transact is next to nothing at most 1500 a year .. 500 to 700 to get the license . I think my wife pays about 750 a year in Board fees and MLS maybe 1k but not much more.. and thats it.. so to some thats a lot of money to others that just a nice dinner out.

Huh?  Part-time/on-the-side real estate?  It doesn't exist.  

If you're not all in, don't get in. 87% of all new realtors fail (source: just about everywhere; please do an internet search on the topic).  And, expect to be "income-free" for the first year while you build your business working every single day, full time.  It's building and running a business.  No part-time; no on-the-side...

@Briana Phelps I'm of the mindset almost nothing in the work world is worth doing if you aren't going to be great at it. You are already in sales, so you likely could sell a few houses. The other option is to use that time selling more RV's. What would be your angle to convince buyers and sellers you should be their agent? Would you hire a gc that works at Best Buy, but builds houses on the weekends?

Being a part time real estate agent gets romantisiced a lot! 

Half the time you don't know what the heck you are doing, you might get your clients or yourself in trouble. You have a hard time finding clients, because frankly why would you want to hire someone who does things on the side to handle your (typically) biggest asset?

Every time I have to deal with a part time agent I am prepared for trouble. They don't know how to set expectations for their clients and then you have to deal with unreasonable requests. Or they are not available. Or they are just flat out wrong and you just watch and think: ....what are you doing!!!

As an industry we have a poor reputation. Most new agents give up after one year, almost 90%. And while they are at it they butcher up a few deals. I wish the requirements would be higher. Agents should not be able to practice unsupervised unless they close at least 24 deals a year. And the same for brokers! Don't get me started - single person brokerages can be the worst! I have seen cases where on top of blatent incompetence you get a one up attitude "I am broker, you are just an agent" - yes, but I close 80 deals and I have 3 full time compliance brokers in my office I can consult with on legal stuffand  know what I am talking about and you close 7 and you don't know what the heck you are doing!!

With an agent I can at least call their supervising broker if they start bending the rules. With a single person brokerage you can only call the board, which is irrelevant and takes too long for the transaction on hand - risking my clients get screwed.

So long story short: make a career choice, but if you do, then decide to become a pro and play on the highest level. You can start part time, not everyone can afford to be 6 months without income and another 6 with not much, but ultimatly your goal should be to do it professionally or not at all!

@Briana Phelps you absolutely can be a part time realtor and do great things. Starting out is about learning processes and systems.  Next it comes down to lead generation, selling RV's puts you in contact with a lot of people already in a niche market on a daily basis.  Building relationships with your RV clients will produce results on both RV and real estate side of the business.  I know plenty of agents that are part time or were part time (my self included) doing very well.  

Here is  an analogy I like to give lets say you have a full time job and you take on 1 set of clients per month helping them list and buy, 2 transactions/month 24 per year (awesome chunk of change in many markets).   People will jump the gun and say you cant represent your client properly, you give them a disservice. But lets say you are a full time agent doing 100 transactions per year, most people think "wow that's great"  but in reality the agent working 8 or more transitions per month may be full time but  has very little time to give each client the attention they deserve becuase they have so many clients.  I see this all the time, most recently this week during a final walk through the realtor on the buy side was asking if fixes were complete that didn't exist, he had his clients mixed up meanwhile he could stop telling me about how many closings he has this month.  

Being part time and not being successful as a realtor is a limiting belief if you change your approach and leverage your scenario to fit your life style you absolutely can make it work.  In many cases the negative, a full time job, will actually be flipped upside down and become your greatest source for producing leads.  If you want it and you are committed you will find a way to make it work!

@Marian Huish

Ooh I see, I didn’t realize the additional costs annually. Thank you for that knowledge! I will have to take that into consideration! I do have a friend who is an agent and she said the broker she works for only takes a flat rate from each sale, so I have somewhere to start. I appreciate all the feedback!

@Marian Huish

You are absolutely amazing. You are convincing him to make money and he is making excuses snot to make money. My advise is you don’t know till you try ! If I were him I will absolutely get a license and market to every customer who walk inside the door and let them know I sell homes as well. Go for it !

Yes it is absolutely possible, in fact I would recommend that to start. Having income from a 9-5 is vital in building your business, like anyone else that has ever started. Once you get comfortable, more knowledgeable, then yes dive in full time. 

I myself am "part time", even though I live eat and breath it during the day. I just started end of 2019, and have learned a lot during the path to where I am at now. Yes, there are fees, but you will learn a lot. If you starting out can just one every other month, it will be a great foundation to build upon.

I think being full-time is the only way as a real estate agent professional. 

As a full-time agent in the Greater Boston market, I remember being part-time at the beginning, it was not sustainable in the long term.

Originally posted by @Erik Raftery :

I think being full-time is the only way as a real estate agent professional. 

As a full-time agent in the Greater Boston market, I remember being part-time at the beginning, it was not sustainable in the long term.

Just out of curiosity why do you think that? I found many of the clients I work with are mainly available in the evening, or weekends. 

@Briana Phelps to echo a few people here I think starting in real estate part-time is a very smart idea.

I run a investor focused real estate team out of Greater Boston and many of my agents have 9-5 jobs on the side. The difference between them and “part-time” agents is that real estate is a priority to them. I know many successful agents that work 1-2 clients at a time in 8 hours or less per week. Why does it matter what they spend the rest of their tome doing? On the flip side I know many ”full-time” agents that spend 80+ hours per week in “real estate” who I would not trust to sell a $50k condo to my worst enemy. In fact I run into agents like this every week. In my opinion As long as you’re clients are a priority and your balance the work load appropriately who has the right to tell you how to spend your time? 

In addition, if you’re planning to be a real estate investor as well as an agent it’s almost essential to keep your 9-5 job when you’re starting out for a number of reasons people/brokers “forget to mention”. 

1. It can take 3-6 months to get your first commission. Oh they forgot to tell you this? Well hopefully you have 6 months of reserves so you can still pay your bills and you know eat… 

2. It can take over a year for that income to become steady and predictable.

3. You can't get a mortgage loan for a house without 2 years of "steady" 1099 income. They'll take the average of 2 years of income off your taxes for the Debt To Income (DTI) calculation. I know many real estate agents that can't qualify for a mortgage, how ironic is that?

Unfortunately I know of many agents that were convinced to quit a good paying W2 job and make the plunge Into real estate prematurely. This is why I believe 87% of agents don’t renew their license after the first 2 years. Nothing is more demoralized than jumping in feet first and finding out your weren’t financially ready to take the plunge. In fact I convince many of my agents to keep their W2 jobs longer than they want so they can continue to take out loans with banks to acquire investment properties. What I’ve found is if my agents own a few investment properties before jumping in feet first they’ll not only be financially stable and make good decisions when I’m a pinch but since they also own investment properties they’re able help advise investors in ways that 99% of the agents out there cannot begin to understand.

I can talk about this all day but basically if becoming an agent interests you, then I advise you should try it for at least 6 months before giving up your additional source of income for many reasons.

Best of luck,

Jon

@Briana Phelps , there are not many people that can afford dropping their full time job to switch immediately as a full time RE Agent. They need a steady income to support while building the 2nd job. Therefore some people start as a part time realtor. Yes there are costs associated with getting and maintaining RE Licenses. If you feel that you're passionate on this field and have desire that someday it can be a potential for you to make it as your full time job, then you can try. 

Sometimes you don't know until you try and get your feet wet. Even though I agree that many will drop off, I have known several realtors that started as part time, then once their RE income exceeds their FTE, they become a full time realtor. Just sharing my thoughts. Thank you and I wish you well.