You have all sorts of ideas as to what you want to do when you are starting in real estate. Since you likely don’t know much about the business, your ideas have no practical validation yet. You are likely building an ideal dream scenario in your head, based on how lucrative you think a specific category of business is or what status badge it will allow you to carry among your peers. Let’s draw a distinction between what you want to do and what you can do.
When you were a 5 year old and did not yet show a prodigious talent for anything, your parents have likely tried signing you up for all sorts of sports and arts classes. This was done so that not only you could develop a collection of new skills, but also to see, if there is any special talent you have. As you got older, your parents could weed out the things that don’t work and stick to the ones you are predisposed to and have the patience for.
When you are starting in real estate, it makes sense for you to take a similar approach. Without the parents though. Yes, real estate skills are learned, at the same time the level you might reach will be determined by you liking a particular business direction and having a predisposition for it. Choose carefully.
Agents generally agree, that the role of a listing agent sits on top of the hierarchy. It requires the highest level of sales skill, discipline and organization. It also brings you the most money.
Most people that start in this business are aiming for the role of a listing agent, but not everyone gets there. If you have been dreaming of becoming a basketball player as a teenager, but you are 5 foot 1 and have a body of a wrestler, it is time to re-orient your dreams and get more practical about it.
Practicality must be at the core of your decision making in real estate. Whenever you are planning, you need to look at a few variables. Current market conditions, your experience in the business, size of your database, your skill level, your likes and dislikes, your age, your personality profile, communities you prefer to work in, etc. What you are trying to determine is the direction that will become your main focus.
For you to make the right decision, you would need to try working with all 3 categories from above: sellers, buyers and renters. If after 2 or 3 years of running with it, you understand where your preferences and abilities are, you will be able to make a choice and develop the skills in that area further. You will still be working with all of them, to a degree, but your focus will be with only one of those directions.
There is a lot of information available on how long it takes to develop a hard to learn skill. Playing a piano at a confident amateur level, so you could mesmerize an audience for 30 minutes or competing in sport at a state level or developing your writing skill to a degree where you are invited to become a regular contributor to the New York Times. Those kinds of skills take about 10,000 hours of intentional and focused practice to develop. That’s almost 3 hours of daily practice over the period of 10 years. If you want to be in the top 1% of real estate agents in your state or the country, you are swimming in a large pool, where most agents are drowning. You have to have a long term outlook on your business strategy and you have to be putting in a lot of intentional practice hours.
Theoretically anyone can get a black belt in Brazilian Jiu Jitsu, practically very few aspiring martial artist do. For most of them it takes too long, it is too hard and there is not a lot of incremental payoff to maintain the motivation. Unless you are in it for the process and you don’t mind getting your ass beat by sweaty sparring partners, you won’t have the motivation to go on. You have to love the process to go through this grind.
Now, you have to answer a question. Do you have the ambition to become a black belt listing agent, where you have mastered the listing business and can produce results at will? This will take you 10 years of hard work and dedication to achieve. Are you content with being a blue belt listing agent? This will be a hit and miss on the listing side, but you will likely be very effective with buyers. Or, are you ok with remaining a yellow belt practitioner, where the leases will be your main area of focus?
Of course, it is not as rigidly compartmentalized in real life. You will be gaining experience and acquiring skill by just staying active and working with whatever clients come your way. There is no substitute for intentional practice though. If you don’t have a specific skill development plan, you will reach a plateau very quickly and that’s where you will stay, unless something or someone compels you to start improving.
In this article, I am focusing on skill development and not on the income associated with each business direction. You can turn any of those three into a very lucrative business by growing a structure around it over time, but that is a different skill and a different article. Here we are talking about an individual agent and her individual skills. If I narrow the conversation to that, I am confident that as an individual buyer agent, you will make 3 to 4 times more money than a lease specialist and again 3 to 4 times more, if you decide to upgrade yourself to the position of a listing agent.
Consider your options carefully and always have a long term plan.