Pros and Cons of Becoming a Realtor
The title 'Realtor' is a registered membership mark that designates real estate agents and brokers who are members of the National Association of Realtors (NAR). Read on to learn about some of the pros and cons of becoming a Realtor to see if it might be a good career fit.
| Pros of a Career as a Realtor |
|---|
| Unlimited earning potential (commission-based salary dependent on your selling skills)* |
| Satisfaction of helping people achieve their dreams** |
| No college degree required* |
| Large prospective client pool (most people hire real estate salespeople when buying or selling homes)* |
| Chance to be your own boss as a broker* |
| Cons of a Career as a Realtor |
|---|
| Keen competition for entry-level brokers* |
| Often work overtime, evenings and weekends* |
| Usually requires travel* |
| Requires licensure and association membership* |
| Must take pre-licensing and continuing education courses * |
| Generally no health benefits** |
Sources: *U.S. Bureau of Labor Statistics, **Wall Street Journal Online
Career Information
Job Description
Since real estate transactions can be complex, many people involved in property transactions seek the services of a Realtor. Realtors can represent the buyer or seller of a property. Most sell residential properties; however, you might also work with commercial, agricultural, industrial or other types of property. Additionally, these professionals can serve as either real estate agents or brokers. Brokers are licensed to manage their own agencies. Real estate agents, while licensed to handle real estate transactions, are not eligible to run their own agencies and therefore work with and under the supervision of a broker.
As a Realtor, you'll often work more than 40 hours a week. The job usually calls for you to be available weekends and evenings, since those are the times when potential buyers are most available. Though you'll spend time researching potential listings over the Internet and communicating with clients by phone, you'll spend a fair amount of time away from your office, traveling to properties and conducting open house events. According to the U.S. Bureau of Labor Statistics (BLS), most real estate professionals are self-employed, while others work in brokerage firms or leasing offices.
Job Duties
As a Realtor, you'll match home sellers with buyers. When working with buyers, you'll meet with clients to determine their housing needs and financial resources, seek out properties that meet those needs and take buyers to see the properties. When working with sellers, you'll interview clients to learn about the property and find out how much they want to sell for, and then you'll promote the property through advertisements and open houses.
These professionals also mediate negotiations between buyers and sellers, prepare rental or purchasing agreements and ensure that all terms of purchase contracts are met. If you're dealing with a rental situation, even though there's no exchange of real property, you may make sure that the terms of a lease agreement are understood by both parties. You might also ensure that property is in good condition, set up appointments between buyers and sellers at their convenience and advise clients on housing market issues. In addition to sales duties, Realtors who serve as brokers also oversee a staff of agents and handle the business aspects of running a real estate office.
Job Growth and Salary Information
Employment in the real estate field is linked strongly to the economy. According to the BLS, opportunities for real estate agents and brokers were expected to increase 11% from 2012-2022. Growth was projected to be higher for real estate agents than for brokers; however, entry-level agents were expected face the keenest competition, while brokers should have the best job prospects and higher salaries due to their greater client bases.
Realtors bring in most of their earnings from commissions. There's no official industry standard, but Realtors commonly take 5%-6% of properties' sales prices, though this amount may be split with other agents who contributed to the transaction and real estate agencies. The BLS doesn't report earnings for those who are members of the NRA specifically, but it does report that sales agents in general earned a median salary of about $40,990 as of May 2014, while brokers earned a median salary of about $57,360.
What Are the Requirements?
Licensing and Education
All states and the District of Columbia require you to be licensed as a sales agent or broker to practice as a Realtor. Licensure requirements differ from state to state and between brokers and agents. However, these requirements typically include being at least 18 years of age and holding a high school diploma or its equivalent. You'll also have to pass a licensure examination administered by your state's real estate board or division of licensing services. Brokers and sales agents are also required to complete state-accredited courses before qualifying for licensure. These courses might cover topics like real estate finance and law, appraisals, mortgages and escrow.
Brokers also have additional licensing requirements. To obtain a broker's license, you must hold a sales agent's license and have been practicing as such for a period of 1-3 years. You also have to complete additional real estate courses and sit for a broker's examination. According to the BLS, some states allow you to substitute a bachelor's degree in place of a certain amount of training or work experience. Licenses must be renewed every 2-4 years.
To use the Realtor title, you must join the NAR and adhere to its code of ethics. Keep in mind, however, that it is not necessary to be registered with the NAR to practice as a licensed real estate sales agent or broker.
Skills and Other Qualifications
To operate successfully as a Realtor, you must be detail-oriented and have a high tolerance for stress. Since the job can involve soliciting business, you should be self-motivated and persistent. Communication skills are essential, since you must correspond with clients and other realty professionals face-to-face and by telephone in an effective and friendly manner. In order to instill confidence in your clients, you should give off an impression of honesty, integrity, cooperation, compassion and professional competence. Additionally, Realtors must be familiar with all aspects of the community and property in question, including proximity to schools and shopping districts, tax rates, crime rates and the value of comparable properties in the area.
Job Postings from Real Employers
While licensure is required to work as a Realtor, many employers will hire unlicensed Realtors and provide them with the training and resources needed to become licensed. This is meant to open the door to applicants who are qualified in other ways. Employers also tend to look for applicants who are sociable, communicate well, exhibit self-discipline and present a respectable, pleasant demeanor. Below are some examples of job postings from March 2012.
- An agency in Missouri is interviewing both licensed and aspiring real estate agents. If you're sincere and passionate about helping people achieve the dream of owning their own homes, the company will train you to become a licensed professional.
- A company in Rhode Island is looking for Realtors who have a background in an area such as hospitality, food service or retail sales. Though the company expresses a need for individuals who already hold a real estate license in either Connecticut or Rhode Island, the ad states that in-house training and licensure training reimbursement may be available to non-experienced personnel.
- A California firm is looking for licensed real estate agents who hold a bachelor's degree. Applicants should have a professional appearance, positive attitude and a proven successful track record in the field. Once you're hired, the company expects you to participate in continuing education for professional development.
- A Florida firm is looking for full-time real estate agents who hold at least a high school diploma and a year or less of experience in the business.
- A real estate owned/foreclosure company in South Carolina is seeking licensed Realtors to sell properties that have been foreclosed or are owned by a bank or another agency. Applicants should be computer literate and display initiative, and the company welcomes those with military experience.
How Can I Get an Edge in the Field?
Get Formal Training
While a college degree is not mandatory for this career, the BLS reports that, due to the increasingly complicated and competitive nature of the field, many employers favor Realtors who've completed undergraduate coursework or hold degrees. You might, for example, pursue an associate's or bachelor's degree in real estate studies or a related major, such as finance, business administration or law.
Take Professional Development Courses
Renewal of your license requires you to earn continuing education credits, but you can fine tune your skills and further develop expertise by pursuing personal development or specialization courses. Community colleges, technical schools and for-profit companies present stand-alone courses in areas such as appraisals, home inspection, finance, commercial real estate and property management. Professional organizations such as the NAR also offer online courses and webinars that can enhance your knowledge in real estate.
Alternative Career Paths
Appraiser or Assessor
If you're interested in working with properties, but don't want your earnings to be based on commission, consider becoming an appraiser or assessor. Appraisers determine the value of specific properties for owners or prospective buyers, whereas assessors determine values for entire neighborhoods of homes for tax purposes and usually work for local governments. Most appraisers hold a bachelor's degree, and all states require appraisers to be licensed. Assessor's requirements are less strict and may include only a high school diploma, depending on your location. According to the BLS, these professionals earned a median salary of over $49,000 as of May 2011.
Loan Officer
You might also be interested in becoming a loan officer, who authorizes a lending institution to grant a loan to a business or individual. You can enter this career with as little as a high school diploma; however, to authorize mortgage loans, you'll need to become licensed by completing at least 20 hours of specialized coursework as well as passing a background check, a credit check and the mortgage loan originator licensing exam. The BLS reports that loan officers earned a median salary of around $58,000 as of May 2011. Some are paid on commission, while others are paid flat salaries.
