The continued popularity of HGTV, home improvement shows and Million Dollar Listing makes everyone a real estate expert. It has to be the only profession where everyone in the world has a vested interest – we all need a home right?,
As such I have lost count of the people who tell me they’d love to be a Realtor® because they love looking at homes and love interior design. Those people need to be designers, not Realtors®.
The fact is our job is much, much, much more than that, as the many 1000’s of people across Canada (and the world) with a similar mindset can attest to, and who have subsequently left the business.
What we actually do in the event of a day in our working lives I’m saving for another post – because I’m a tease like that. This post is dedicated to all those contemplating a career in real estate, a shout out to those working hard in the business to provide a professional service to the home buyers and sellers in our communities and to those who may have some doubts about our role, the industry and what we offer – we are all pretty decent people, I promise.
Occupation or Vocation?
The ‘job’ can take over your life, if you allow it, with people in the business working long days, 7 days a week.
Even if you can work an effective schedule, you are never off the clock in the eye of the public, even when you’re completing the mundane task of the weekly grocery shop and you’re accosted in the frozen food section by a voice shouting “What’s the market doing?”
Crap, my own Dental Hygenist only asked me about the market on a recent visit while my mouth was full of floss and metal! I’ve got a big mouth, but even I have my verbal limits!
Family time is interrupted by phone calls you HAVE to take and could be the difference between having or not having a pay-check that month.
I find our time is not valued and you have to be very strict to set your own bounderies when it comes to communicating with your clients outside ‘normal business hours’.
Be strict with your time. Polite so not to appear rude, but assertive enough for people to understand that there is life outside your real estate business – HOLY CRAP, I JUST TYPED THAT!
The Painful Truth…
One of the biggest misconceptions is that we work for someone – We don’t! Apart from a tiny percentage, most Realtors® out there, regardless of who they affiliate their business with (big national brand brokerages or independent brokerages), is a self- employed business person.
So, for those of you who are self-employed you will understand what this means, but for those of you who are not, here is just a few of the joys of self-employment.
- No paid vacation – and if you take holidays you risk losing leads. Leads = Business
- No paid sick leave or sickness benefits – and considering our work schedules, high levels of alcohol consumption (trust me we need it), and poor and irregular eating schedules, we are not the healthiest bunch of professionals out there
- No corporate pension plan
- Never off the clock
So, we have discovered what we don’t get, so now let’s concentrate on what we do get. Oh, and I know all those anti-realtor folks (because they do exist) will jump on the band wagon shouting about how much money we earn. But you know what, if it was that lucrative, y’all would be doing it!
There are Realtors out there selling real estate to subsidize another form of income, there are Realtors who just work part-time, maybe to top up a pension or simply because they are happy working part-time, there are Realtors working 80 hours a week and scratching a living and there are Realtors working 40 hours a week and living the highlife.
Realistically, you have to be at it all the time to make a decent living and the public expect you on the clock all the time simply because they perceive we earn extortionate amounts of money and gotta work for it.
So, I’ve decided to show you a basic plan of the average pretax earning’s of an average Realtor® – just to give you a guideline of your earning potential in our market. (Please note, this information is by no means a guaranteed income, nor is Bob any kind of average ♥)
Bob has a decent real estate business in Anytown, where the average price of a home is $200,000.
Bob works under the umbrella of a large corporate real estate firm and pays 30% of every transaction to that firm.
Bob sells around 20 homes per year with an annual gross income of $100,000.
For business expenses, Bob has…
- Commission splits to his firm of $30,000.00 per annum
- Car payment, because Realtors® need cars – say $200 per month – $2,400.00
- Car insurance – $700.00
- Car maintenance – $500.00
- A phone – say, $150 per month – $1,800.00
- An advertising budget – low end! – $2,000.00
- To pay for his MLS™ Dues, BOND, Errors and Omissions – $2,222.00
- To pay for website hosting – $350.00
- To pay office dues (depending on the office but let’s say $200 month.) – $2,400.00
- Business cards and marketing material – $500.00
- Client appreciation and PR – $1,000.00
- Donates to a local kids football team – $500.00
- 5 professional property videos per year at $300 each – $1,500.00
- Continued education and spends on extra accreditations per year – $500.00
- Stationery and personal office expenses – $500.00
To run his real estate business, (on the frugal end), Bob spends – $46,872.00
So, our friend Bob runs a pretty tight ship and makes after expenses $53,128.00 per year
Let’s translate that money into time Bob spends making it!
Bob takes 3 weeks vacation per year and works 5 days per week.
He works 10 hours per day between appointments, marketing, business planning, prospecting, networking, administration and looking after current buyers and sellers.
So Bob works 245 days per year for 2,450 hours per year earning $53,128.00 = $21.68 per hour.
Certainly a fair hourly wage and above our Provincial minimum hourly wage, but nothing close to the extortionate figures people think real estate agents earn. Remember also, those few in our business dealing in high numbers of transactions a year, like any business, extra business means extra expense.
For those of you considering a career in Real Estate, it has to be the right move for you and you have to be prepared to make sacrifices. Ensure you have a little nest egg stashed away to help set up your business and keep expenses paid until you start making a living.
Trust me, the day you pick up your first commission cheque you want to make sure you’re not giving it back to the brokerage to cover unpaid expenses – There’s nothing so demoralizing than working your butt off for weeks, possibly months to secure that first deal and you don’t see the fruits of you labour. Ensure you have enough in the pot to cover your costs month to month until you start earning a regular commission cheque.
I can guarantee, 99% of people in real estate now wished they had been given a clearer idea of how much it costs to start a business, what the job really entails, what they can expect to earn and the hours expected to make a decent living. The Real Estate course is great but will never give you real world situations because every Realtors® ‘real world situation’ is different.
Why Are We Different?
I’m going to let you in on a little secret…Are you ready?
Realtors don’t sell houses, they don’t buy houses. They help people buy and sell houses. The only thing a Realtor sells is themselves.
We sell ourselves, our experience, our personality, our ability, the company we work for, our track record, just to name a few. That’s why our business is so diverse and probably why people who have had a bad Realtor® experience/s tend to tar all of us with the same brush. We are not the same and there are people who feel negatively about all of us as a collective group.
The fact is, we are all very different and finding someone to look after you shouldn’t be a decision you take lightly.
Would you chose just anyone to service your car? NO – you do your research to find someone suitable or you go to the dealership where you have built a trusted relationship.
Building relationships is exactly what we do. Choosing the right Realtor® for you is a very personal choice because it’s a very personal transaction.
The one big thing I want from this blog, is for some doubters to recognize our role as business people in our local communities. A great Realtor® relationship is an incredibly rewarding one, for both sides, client and Realtor® and committed real estate professionals offer a great service to the buying and selling public.
With the market starting to take a new direction from the craziness of the hot market for the past few years, people will start to recognize the importance of the right Realtor® representation.
My job has given me so many incredible opportunities. I have served clients who have become friends, (I have the innate ability to work with the best clients), I work with some great professionals and made some of my best memories during my working life.
When your job can ease someones concerns, doubts or nerves, can help someone realize a life ambition, can support families on the road to security that home ownership can provide, help people take a new path, a new direction in their lives, that’s a pretty special occupation.
Our job is hard, its stressful, its a juggling act, but our job allows us to have a different day, every day, meeting different people and, with some dedication and discipline, living life and working on your terms.
Helping people find home is a wonderful career and I consider myself very blessed to be still loving what I do after 24 years!
If you are thinking of a career in our industry, are currently in or about to take the real estate course or are in the business and finding it a struggle and looking for direction or just want to chat to gain a new perspective, reach out and give me a call on 902 394 7071 or connect via the blue CONTACT button at the bottom of this screen (all in the strictest confidence).
This article is not intended to solicit buyers or sellers currently in contract with other members of the PEIREA. Using this article in full or part without permission is a violation of copyright laws. Copyright © 2019 Melanie Press Real Estate.