Every time I talk to someone about my business and career, it always comes up that “they’ve thought about getting into real estate” or know anyone who has. With so many people thinking about getting into property, and getting into property – why aren’t there more successful Realtors on the planet? Well, there’s only so much business to go around, so there can only be so many Real Estate Agents in the world. Personally i think, however, that the inherent nature of the business enterprise, and how different it is from traditional careers, makes it difficult for the average indivdual to successfully make the transition in to the Real Estate Business. As a brokerage, I see many new agents make their way into my office – for an interview, and sometimes to begin with their careers. New REALTORS bring a lot of great qualities to the table – plenty of energy and ambition – however they also make a lot of common mistakes. Listed below are the 7 top mistakes rookie REALTORS Make.
1) No Business Plan or Business Strategy
So many new agents put all their emphasis on which PROPERTY Brokerage they will join when their shiny new license comes in the mail. Why? Because most new Real Estate Agents have never experienced business for themselves – they’ve only worked as employees. They, mistakenly, believe that getting into the true Estate business is “obtaining a new job.” What they’re missing is that they’re about to go into business for themselves. If you’ve ever opened the doors to ANY business, you know that among the key ingredients can be your business plan. Your organization plan can help you define where you’re going, how you are getting there, and what it does take for you to make your real estate business a success. Here are the essentials of any good business plan:
A) Goals – What do you want? Make them clear, concise, measurable, and achievable.
B) Services You Provide – you do not desire to be the “jack of most trades & master of none” – choose residential or commercial, buyers/sellers/renters, and what area(s) you need to specialize in. New residential real estate agents tend to have the Best Properties for Rent and Sale in Washington D.C. most success with buyers/renters and then move ahead to listing homes after they’ve completed a few transactions.
C) Market – who are you marketing yourself to?
D) Budget – consider yourself “new real estate agent, inc.” and write down EVERY expense you have – gas, groceries, cellular phone, etc… Then write down the new expenses you’re dealing with – board dues, increased gas, increased cell usage, marketing (very important), etc…
E) Funding – how are you going to pay for your allowance w/ no income for the initial (at least) 60 days? With the goals you’ve set on your own, when will you break even?
F) Marketing Plan – how are you going to obtain the word out about your services? The simplest way to market yourself would be to your personal sphere of influence (people you understand). Make sure you achieve this effectively and systematically.
2) Not Using the GREATEST Closing Team
They say the best businesspeople surround themselves with people who are smarter than themselves. It takes a pretty big team to close a transaction – Buyer’s Agent, Listing Agent, Lender, INSURANCE PROFESSIONAL, Title Officer, Inspector, Appraiser, and sometimes more! As an agent, you are in the positioning to refer your client to whoever you select, and you should ensure that anyone you refer in will undoubtedly be a secured asset to the transaction, not a person who will bring you more headache. And the closing team you refer in, or “put your name to,” are there to make you shine! When they perform well, you get to take part of the credit because you referred them in to the transaction.
The deadliest duo out there is the New Real Estate Agent & New LARGE FINANCIAL COMPANY. They get together and decide that, through their combined marketing efforts, they are able to take over the world! They’re both focusing on the right section of their business – marketing – but they’re doing one another no favors by choosing to provide each other business. If you refer in a bad insurance professional, it might result in a minor hiccup in the transaction – you create a simple phone call and a new agent can bind the property in less than one hour. However, because it normally takes at least two weeks to close a loan, if you use an inexperienced lender, the result can be disastrous! You might find yourself in a position of “begging for a contract extension,” or worse, being denied a contract extension.
An excellent closing team will typically learn than their role in the transaction. Due to this, you can turn in their mind with questions, and they will step in (quietly) when they see a potential mistake – because they want to assist you to, and in return receive more of one’s business. Using good, experienced players for the closing team will allow you to infinitely in conducting business worth MORE business…and best of all, it’s free!
3) Not Arming Themselves with the Necessary Tools
Getting started as an agent is expensive. In Texas, the license alone can be an investment that will cost between $700 and $900 (not considering the volume of time you’ll invest.) However, you’ll run into even more expenses when you attend arm yourself with the necessary tools of the trade. And don’t fool yourself – they are necessary – because your competition are using every tool to help THEM.
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