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Real estate agents and brokers are vital to the process of becoming a homeowner or home-seller. They list and market properties then write valid, enforceable contracts. The profession offers lots of fun, autonomy, independence, and fulfillment when you help a family make the right real estate moves. This page is all about how to become a real estate agent or broker. We discuss real estate school, the daily life of a real estate agent, and possible options for their future.
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What does a Real Estate Agent/Broker Do?
It's important to note that there is a significant difference between real estate brokers and agents. Brokers are real \estate professionals who often act as the head of a real estate office. They typically have more experience and training than the agents who work for them. In fact, each agent is able to work based on their broker agreeing to hold their license.
Brokers also rent office space to agents and even levy fees for an agent to operate under their license. In return, brokers hold ultimate responsibility for every listing and sale that their agents execute. Since brokers have more experience and responsibility, they are often available to consult with their agents when a deal is in trouble.
Real estate agents, on the other hand, are real estate professionals who are licensed to operate as salespersons under a brokerage license. That is, they cannot operate under their own shingle. Agents are typically the ones whom current or prospective homeowners call when they wish to buy or sell real estate. In the case of a home sale, an agent who represents the seller is truly only representing their broker. They are the agent of their broker.
Interestingly, when a person uses an agent to purchase a home that is listed under a different broker, the agent is only operating at the good will of the broker. Then there are cases when an agent is representing both the buyer and the seller in a real estate transaction. In that instance, the agent's ultimate responsibility is to the seller.
Where Do Real Estate Agents/Brokers Work?
Real estate agents and brokers are assumed to spend most of their time driving to see homes with or show homes to prospective buyers. After all, that is when most of us encounter them. They also visit homeowners who are interested in selling their homes. In fact, agents can work from any number of locations, including their own homes. Many do this, in fact. However, some choose to work in their real estate brokerage office.
When an agent, or realtor, works in their real estate brokerage office, they pay fees to rent their space and for other sundry items such as access to a conference room. Some agents feel that this lends them an added air of professionalism and the office atmosphere can provide added motivation to sell more.
As for working hours, an agent is often on-call 24/7. They’ll make appointments to view sellers' homes whenever the seller is available. They also work on the weekends to both preview homes with prospective buyers and to manage open houses for their listed properties. It's not uncommon for agents to receive calls in the evening when their clients decide to write an offer, accept an offer, or to simply chat about the market.
A real estate broker (sometimes referred to as a principal broker) typically works in an office where they oversee their agents. They tend to keep steady office hours but are available to assist when an agent needs help closing a deal, or when a legal issue arises. Brokers can go into the field to sell real estate, but they are often too busy. Furthermore, that would put them in competition with their agents, thus endangering morale.
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Why Become a Real Estate Agent/Broker?
One of the primary motivations for becoming an agent is a love of working with people. It can be fun to help families find a house that they will love. It's also a profession that allows great flexibility and autonomy. Many parents love to work in real estate because they can schedule their work around their child's activities.
This is also a great professional niche for those who have a passion for marketing. After all, the lion's share of an agent's time is concerned with marketing themselves and their book of listings. It's also rather easy to obtain a real estate license and start a business. After all, every realtor is an independent entrepreneur. They may seem to be employees of a real estate brokerage, but they have free agency to join another firm if they choose.
Real estate agents can also work in commercial property if they like. This area is more complicated and many commercial realtors have four-year degrees in business or real estate. Nevertheless, a realtor who specializes in residential real estate can dabble in commercial deals if they like. The profession offers loads of flexibility in terms of schedule, one's business model, and choice of broker. Furthermore, real estate agents can even sell homes on a part-time basis while they work other jobs. It might help if their other job helps them build a network of potential home sellers or buyers so that the two jobs can feed one another.
How to Become a Real Estate Agent/Broker
Associate Degree
If you are interested in becoming a real estate agent and eventually a broker, you can earn an associate degree in real estate. Your local community college may offer a two-year real estate degree and there are also associate degrees in real estate online. When you complete an associate degree in real estate, the curriculum includes the general requirements for a bachelor's degree; this will help if you decide to complete a full undergraduate degree later.
To enroll in a community college real estate degree program, you’ll likely need little more than a high school diploma or the equivalent. Your school may have you take placement tests to determine your overall academic ability, but you should be able to start taking classes in the next available term. Each school will have its own requirements for their real estate degree, possibly including a minimum GPA requirement.
All in all, an associate degree in real estate will likely include around 60 credit hours. These programs are structured so that you can complete them in two years, provided that you attend classes full-time. If your goal is to work in a real estate brokerage, you might seek a part-time job as an assistant for a real estate team or for a broker.
Some classes you might take include, but are not limited to:
- Real Estate Law
- Real Estate Finance
- Property Management
- Real Estate Contracts
- Real Estate Practices (state specific)
- Introduction to Accounting
- College Algebra
- Composition and Rhetoric
- Real Estate Brokerage
- Commercial Real Estate Law
- Introduction to Marketing
Salary and Job Outlook
Since real estate agents work on a commission basis, the earnings potential is truly unlimited. Some agents specialize in high-end properties and take home enormous commissions. Others make their market in lower-end neighborhoods. However, even a real estate broker or agent in a middle- or lower-class area can make a handy salary. According to Payscale.com, agents make an average of around $49,000 per year. The U.S. Bureau of Labor Statistics (BLS) concurs, reporting a median salary of $50,000 for real estate brokers and sales agents.
This career is not one that provides any guarantee of upward mobility. That is, your first year can be more profitable than your fifth. However, if you manage to build your referral network you should start to see revenues build year over year. If you have managerial skills, you can also start a real estate team where you bring a set of agents under your wing as a sort of sub-brokerage. Their earnings will feed into the team's and your revenue stream.
Depending on what agency you work for there may be a variety of ways to increase your salary. For instance, some offer a referral program where you receive a bit of commission if the referred agent completes a transaction with the client you send to them. Agents also tend to dabble in transactions of their own, so you could build a portfolio of properties that generate revenue on the side.
You can also attain a brokerage license and operate your own office with sales agents under you. Brokers are reported to earn a mean annual wage of around $81,000. Brokers can increase their salaries by attracting top-performing agents who have networks in high-dollar properties. They can also advance their earnings by bringing in commercial real estate teams, who tend to generate larger commissions, as well.
Requirements
There are very few requirements for becoming a real estate agent. If you want to become a realtor you will need to pass an examination, however. This test is an in-depth review of real estate law and the real estate practice in general. Once you pass, you can attain your real estate license and become a licensed realtor.
Many local community colleges have courses that teach the required information. You might also find courses through the local offices of the Multiple Listing Service (MLS). There is no degree requirement, but there may be an age limit of 18, but you should check your local laws. To pass the test you will need to have basic high school math skills and a strong memory for facts. There are also online real estate courses. You will need to make sure that your courses are taught by professionals who are licensed to practice real estate in your state.
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Necessary Skills
- Organization Skills:
As a real estate agent or broker you are going to be running your own business. You thus need to be highly organized and efficient so that you are prepared to make a sale at any moment. This goes double if you are juggling other responsibilities, such as parenting. - Creative Problem Solving:
When you're trying to seal a deal with a buyer or seller (or both) you may encounter difficulties that are hard to wrangle. When you can suggest that magical third option that satisfies both parties you can not only seal the deal, but you may gain a referral. - Communication:
Operating a real estate business hinges on your ability to effectively communicate with your clients, other agents, your real estate broker, and various other parties. While most of your skill should be in verbal communication, you should also be an effective written communicator since you'll need to write zippy property descriptions, as well as sharp business emails. - Negotiating Skills:
Keep in mind that you may have to negotiate with all parties in a real estate transaction. Sometimes you'll need to convince your client to take an offer that they likely won't get elsewhere. Other times you'll need to work to get your buyer-side client the gutters their new home deserves.
Real Estate Agent Certification or Diploma
For the most part, real estate agents and real estate brokers don't attend degree granting programs. Rather, they complete courses through state-approved programs. These programs are tailored specifically to help students pass their state real estate examination and are usually taught by licensed realtors.
You might find these courses offered through your local community college or technical school. Often, you'll also find real estate courses available through your local Multiple Listing Service (MLS). If all of the options in your local area are too much and you can't decide, you should discuss the options with a trusted real estate agent or real estate broker. While the material is surely equivalent no matter where you go, you might find that there are better or preferred instructors in some schools as opposed to others. One way to determine if your real estate instructor is of top quality is by reviewing their experience. Often the more experienced realtors and instructors are the best.
There are few, if any, requirements for entering these real estate education programs. You will need to pay their fees, and that's probably the most you'll need to do. Before you start you might make sure that you qualify to hold a real estate license in your state. Some barriers to working as a real estate broker include a criminal record. Please check with your state's Real Estate Board to learn their specific requirements. In many cases if you have a minor infraction on your record, such as a DUI, you can include a letter with your license application that details how you settled your charges with the court.
Keep in mind that these programs are rather bare bones. They are typically around 150 classroom hours and will provide the basics of what is required to become a real estate broker or agent. However, your real estate brokerage will likely provide more training. There you'll learn more about marketing, appraisals, inspections, tips for writing contracts, and more.
Common Coursework
- Real Estate Finance
- How to Calculate Mortgage Payments
- Escrow Payments
- Real Estate Contracts
- Real Estate Marketing Regulations
- Agent Duties and Responsibilities
- Brokerage Duties and Responsibilities
- Tenancy
- Real Estate Law
- Real Estate Board Regulations and Ethics
Real Estate / Broker Licensure
To become a licensed real estate broker with the ability to manage your own brokerage, you'll need to satisfy another set of criteria. First, you'll need to work as an agent for a set period of time. While every state is different, your tenure in real estate should include around three to five years of active, licensed experience. Please check with your state real estate board to learn their specific requirements.
During your time in the field selling real estate, you will be in close contact with your own principal broker. You can learn a lot from them, and you might ask them to mentor you a bit. After all, once you become a licensed broker, able to manage agents and their sales activities, you could partner with your mentor.
Much like your experience becoming a real estate sales agent, the path to achieve the next level of brokerage licensure involves more real estate coursework. Much like the first licensure level, you don't need amass any college credits. While you might be able to take real estate courses through your local community college or trade school, the examination preparation classes should be non-credit and taught by an experienced real estate broker.
To qualify for your brokerage license, you will need to pass a criminal background check or provide a statement that attests to how you settled any misdemeanor or felony matter. Many felonies will probably disqualify you from licensure, but you may be able to plead your case to your state Real Estate Board.
Real Estate Licensure Exam
Every state creates and administers its own real estate licensure examinations in its own way. There are typically two examinations for real estate professionals. The first you take is to become a real estate sales agent, which may be called a broker in some states. The second examination is to become a real estate broker, also known as a principal broker, depending on where you live.
You'll need to qualify to take the examination by completing a state-approved real estate course that leads to the exam of your choice. You'll also need to prove that you have at least a high school diploma, are at least 18 years old, and have a clean criminal record. The examination to become a sales agent you will take a multi-part, multiple choice test that normally takes a few hours to complete. You'll find that it covers the material you learned in your classroom experience. You will typically need to pass with a score of 70% or better in order to receive your license.
Continuing Education
When you become a real estate broker or agent you will probably want to become a licensed Realtor. To achieve this special credential, you must join the National Association of Realtors. This is a common credential that your principal broker surely has. Once you join this association, you can achieve any number of special credentials such as Accredited Buyers Representative, Accredited Land Consultant, or Certified Commercial Investment Member. For each, there are requirements to fulfill that pertain to experience and sales. You will need to pay all applicable fees and satisfy all continuing education standards, as noted by the association.
Since your brokerage profits if you profit, you'll surely find that they offer loads of seminars and lectures that will help you improve your real estate practice. You might also consider taking business or marketing courses from an accredited college or university. This is especially pertinent if you wish to make a career in commercial real estate.
Similar Careers
- Property Manager:
This is often a salaried position where you are charged with overseeing the day-to-day operations of a property. This can involve scheduling maintenance, inspecting the structure, and finding tenants for rental properties. - Real Estate Attorney:
This career requires a law degree. In your position, you will help complete transactions on behalf of the principal buyer, who is actually the mortgage lender. These legal professionals are often known as closing attorneys. They help ensure that the transaction is above board, including conducting the all-important title background check. - Appraiser:
An appraiser is a licensed professional who assesses the value of a house to ensure that it is selling for a fair market value. While every real estate agent is equipped with appraisal skills, a licensed appraisal specialist is required to certify the price on behalf of the lender. - Real Estate Inspector:
The inspector is a contractor who helps a buyer assess their future purchase. They may spend several hours reviewing the foundation and systems in a house. This process can also include ancillary services such as a radon test. The buyer typically pays for their inspection.