Pros and Cons of a Real Estate Analysis Career
Real estate analysts are financial analysts who help stabilize the housing market by providing analytical insight for buyers and sellers. If you're interested in becoming a real estate analyst, weigh the pros and cons before making your career decisions.
| Pros of Being a Real Estate Analyst |
|---|
| Favorable job prospects (16% expected growth from 2012-2022)* |
| High earnings (average salary of about $92,250 as of 2014)* |
| Education can apply to other finance careers* |
| Some positions require a master's degree* |
| Cons of Being a Real Estate Analyst |
|---|
| Keen competition for jobs despite job growth* |
| Long hours (over one-third work over 40 hours a week)* |
| Frequent travel to visit clients and properties* |
| Can involve high-stress situations** |
Sources: *U.S. Bureau of Labor Statistics, **O*NET OnLine.
Career Information
A real estate analyst provides financial analysis support in the acquisition, financing, marketing and leasing of properties. In this profession, you'll give real estate advice to real estate companies and other businesses according to your research on market trends, economic conditions and the company's financial situation. This can involve evaluating clients' credit, coordinating loans and helping negotiate mortgage or leasing contracts. For example, you could help a real estate firm determine which markets to advertise property to or if a particular property is worth the investment. You may prepare your findings and proposals in reports and give presentations to possible investors or buyers.
As a financial analyst, you might focus on a specific aspect of real estate. For instance, you might only deal with one region of the world or you might only work with one type of property, like commercial or industrial buildings.
Job Growth and Salary
The U.S. Bureau of Labor Statistics (BLS) does not report earnings specifically for real estate analysts; however, it does report that financial analysts in general earned an average salary of nearly $92,250 as of May 2014. The bottom-earning ten percent of financial analysts earned a salary of $48,170 or less, while the top-earning ten percent earned a salary in excess of $154,680.
The BLS also states that financial analysts were expected to see a growth in employment of 16% between 2012 and 2022. Competition, however, is still expected, since there are more aspiring financial analysts than open positions. Keep in mind that these forecasts include all professions from the broad financial analysis field, and real estate analysts may experience less predictable job outlook.
Education and Training Requirements
The BLS states that most financial analysis occupations require a bachelor's degree. A bachelor's degree economics, business or finance provides the analytical and critical-thinking skills needed for the career. During undergraduate school, you may take electives specific to real estate and investments to better prepare for the career.
What Do Employers Look for?
Employers ask that job candidates in this field have excellent analytical skills and are detail oriented. Many positions also require proficiency with the Microsoft Office suite and financial software. The following job postings for real estate analysts were available in April 2012:
- A Colorado financial company needs a real estate financial analyst to help with industrial real estate acquisitions. The analyst needs to create spreadsheets and database accounts concerning industrial and commercial properties that the company may invest in and then rent to tenant companies. Candidates must have a bachelor's degree and 1-2 years of relevant experience.
- A Chicago real estate company needs an entry-level real estate analyst to evaluate the potential profits of commercial property tenants. The applicant needs a bachelor's degree in business, finance, accounting or economics as well as proficiency in spreadsheets.
- An Idaho commercial property company needs an analyst with a bachelor's degree and 2-5 years of experience who can review the trends of real estate sub-markets. The analyst also helps with the loan process by checking on businesses' backgrounds and financial health to see if they meet lending guidelines.
How Can I Stand Out?
Earn an Advanced Degree
Although the BLS states that a bachelor's degree is sufficient, gaining a higher degree might be beneficial in the competitive job market. Prospective analysts may want to consider earning a master's degree in business or finance or a Master of Business Administration (MBA) with a concentration in finance. In fact, some positions are only open to applicants who hold graduate degrees. Courses in risk management, options pricing and real estate, in particular, may help further prepare you for this career.
Obtain Certification
Another way to stand out from your co-workers, especially for higher-level positions, is to gain certification. The CFA Institute offers the Chartered Financial Analyst (CFA) designation to candidates who have bachelor's degrees or four years of work experience. You may also qualify with a combination of education and experience equal to four years. You'll also have to successfully pass a graduate-level program administered by the organization and three different examinations. According to the CFA Institute, real estate can be studied as an option when learning about alternative forms of investment. This can be helpful in demonstrating your knowledge and scope of realty investments.
Alternative Career Paths
Credit Analysis
If you want a career related to financial analysis but do not want to go to college, you may want to work in credit analysis, which usually requires only a high school diploma. A credit analyst is a type of financial clerk who works for a lending company, reviewing clients' financial records to determine the risk of giving them loans, such as for mortgages. Like a real estate analyst, you must communicate effectively with both potential clients and with supervisors concerning loans as investments. The BLS reports that jobs were expected to grow by five percent between 2010 and 2020, and the median annual salary was about $61,000 as of May 2011.
Personal Financial Advising
If you want to help individual clients rather than companies, then a career as a personal financial advisor may be the right position for you. A personal financial advisor helps clients with investments ranging from stocks and bonds to college funds or retirement plans. Like a real estate analyst, they need to analyze what investments are profitable, and they often work more than 40 hours a week. However, the interpersonal connections are deeper, since you'll help families, parents, spouses and other people deal with investments that may be highly emotional rather than purely economic.
This career usually requires a bachelor's degree in finance or a related field as well as licensure, specifically if you buy or sell assets or insurance directly. The BLS reports that jobs in this field were projected to increase at a much-faster-than-average rate of 32% from 2010-2020, and the median salary was nearly $67,000 as of 2011.
