So, just how long does it take to get your first deal? It’s a question nearly every new agent asks me during the first interview. I say that they should prepare for at least six months without any income, but the reality is that everyone is different. Some come into the business with clients ready to go. Others start their career buy buying or selling their own home. Others have a massive sphere of influence and will turn a deal in a few weeks and others don’t know a soul in the city and take a few months to get ink to paper. Frankly there is no exact science to it, so I asked the question in a local Facebook group and got answers that ranged from a few weeks to half a year. Here is a cross-section of answers from agents in different markets.
One agent said… I managed to firm up my first deal in about 6 weeks. got paid in about 10 weeks. I would tell a new agent that they may lose money the first year. You can never predict how the market will behave.
Or, this one…I tell every new agent to have 6 months worth of wages (for personal and business expenses) comfortably in the bank. Don’t count on a pay cheque for 6 months min. I had mine in 5, but was prepared for 6. Too many drown in the overhead without a plan.
Another great comment… It took me 3 months and the second one didn’t come until the 9 month mark. I would say 9 months generally to a new agent.
Also this one…Started out on my own September, first commission December. I was prepared also for six months but very happy to say it took four.
And finally some wise words… it all comes down to how much the Brokerage can help them in the beginning and if the person will work it is a job. So much learning to do in the first year or so… so the stronger the brokerage I believe the faster the deals. Just like the stronger the team… more experience for the new agents, greater confidence and more deals.
Actually, I believe that it isn’t the first year that determines your success in any business but what you do in the years that follow. Many agents coming into the business with prospects or clients ready to buy or sell. They spend there first few months buying or selling homes for friends and family that they forget the basics of building a business for life. We have seen it several times, new agents who rock their first year, they go out and buy a new car, go for a holiday and think that they have walked into the easiest job ever. Then the reality of year two sinks in and they have no business in their pipeline. It’s called the “sophomore slump”.
So, how can you avoid the “sophomore slump”? Don’t take your initial experiences as gospel. Use your first commission cheque wisely. Use every opportunity to research your farm area, work on your website, get your continuing education credits out-of-the-way, and above all, prospect. These are just some of the basic building blocks for constructing a successful career.
Of course there is more to think about than surviving for as many as 6 months without an income. Have you heard the old expression…you need to spend money to make money? Starting any new business, whether it is a flower shop or real estate, requires some capital outlay. The good news is that, depending on where you work, the initial few months can be floated by the brokerage. Still, there are business cards, open house signs, name riders, website, not to mention a clean car, rent, food, gas. The list goes on and the amount needed will differ substantially depending on where you live and work. As crazy as it sounds, it’s important to have your finances in order right from the start.
mark mclean is the Broker/Manager at the Bosley Real Estate Queen St W office and President-Elect for the Toronto Real Estate Board. The opinions expressed here do not reflect the opinions of TREB or Bosley RE.
It’s starting to sound like a broken record. How many people have said that we need to promote “professionalism” in real estate? I’m perhaps a little guilty of it too, in fact it’s one of the reasons why I write this blog. I figure that if I write about mistakes some agents make, other agents might learn about the right way to work. I blog my meeting topics out and encourage other managers to engage their agents the way I hope I engage with mine. Trust me, it hasn’t come easily but blogging has definitely helped me be a better manager and Realtor. But (and there’s always a “but”) I propose that we stop talking about professionalism in real estate and start thinking about real estate as a profession. When we choose to believe that this is an skilled, caring, ethical and honest way to make a living, professionalism just kinda comes along for the ride. It’s a small tweek in thinking but a powerful one.
I think most would agree that we are fighting a losing battle trying to teach professionalism in an industry that has low barriers to entry. Sure, RECO, our governing body, has increased minimum education requirements for people wanting to take the courses, but more could be done. Last year RECO replaced the continuing education credit system with a 6 hour online update course along with two elective online courses. I get their logic. In fact I would be the first to agree that the 24 credit education system had its flaws. Do we need to study Feng Shui and different roof styles? Will that make us better Realtors? Does this help in consumer protection? Because, make no mistake, that’s what RECO is all about…looking after the consumer. A RECO-administered update at least keeps the content relevant and consistent and online learning is the way of the future. I’m just not convinced this was the right answer. It is, after all, a system that could be corrupted and abused.
Currently The Ontario Real Estate Association or OREA is the entity that delivers the real estate education program in Ontario on behalf of RECO. That course content, which took years to develop and fine tune, is owned by RECO as a result of a previous transfer from OREA. I believe that at some point RECO has designs on administering the courses directly. Some agents might think that might be a good thing as much of OREA’s income is generated by education. No more OREA would save us in dues, but I’m worried about what could happen next. RECO was established under the Real Estate and Business Brokers Act to, first and foremost, protect the public, but their acts of simplifying the process could have the opposite effect. In a time when the real estate transaction is getting more complicated, does it really make sense to make the courses easier and faster? It’s no surprise the Toronto Real Estate Board has nearly 40,000 members.
I’m concerned for our industry and while I don’t want to sound the alarm bells I believe it is important for real estate boards across Ontario to stop talking about professionalism and start promoting real estate as a profession. If doctors, lawyers, plumbers and mechanics take years to get their ticket, why aren’t we? Third party educators of additional accreditations like the ABR, SRS, SRES, ePRO have helped but I would also ask why prospective agents aren’t given standard aptitude tests before beginning the programs?
Here’s the other problem…when you talk to good, successful agents they say, either charge Realtors $5,000 a year to keep their memberships or have a minimum sales standard. In theory, that’s not a bad idea but real estate boards across the country, survive on membership. Think of it as belonging to a gym. The more members you have the cheaper the dues. As far as a minimum number of transactions…well I’m sure the Ministry of Labour would have something to say about that.
Thinking about real estate as a profession starts with a solid educational base. Let’s start by turning the licensing program into a three year curriculum where students need to get passing grades to move ahead. Let’s encourage designations, and solid in-class learning. Least we forget that this is an industry full of entrepreneurs. Brokers should be encouraged to provide more training and serious career counseling.
As a two-time past education committee member I believe OREA is the best organization to deliver a college level real estate program. As for me, I hope to continue to promote education, OREA and the real estate profession through my blog and in my role as director at the Toronto Real Estate Board.
The first thing you need to know is that real estate is always evolving. Rules and regulations change from time to time and new technologies affect the way we do business. As the old saying goes; nothing is as contant as change. So what do we do as an agent, or brokerage for that matter, to stay on top? Simple. Make education a part of your monthly timetable. Believe it or not, it is as much a part of your business as marketing or negotiating.
20 years ago, the governing powers in Ontario decided that Real estate agents would need to collect 24 continuing education credits every two years as part of their licence renewal procedures. In the early days agents accepted these stricter guidelines with hesitation and generally waited until their renewal was almost upon them before they signed up for their CEU credits. They felt that the CEU program was nothing more then a waste of time and money. There was even a weekend retreat offered, where, for a few hundred dollars you could get all 24 credits in one sitting. What few didn’t understand was these courses were designed to make them better agents and raise the bar in the real estate industry as a whole.
Today, CEU credits are offered by a host of providers and the topics are much more engaging and interesting. I believe it is important to work with a company that believes strongly in providing education to their agents. They should organize office meetings and have accredited speakers talk about relevant topics like Social Media, changes to the Tenancy Act or Changes to real estate forms. For managers, CEU credits become extremely important. After all, isn’t it a manager’s job to know everything?
Staying educated is not just about listening to someone speak about a topic. To truely understand the nuances of the real estate business, agents should take advantage of trade magazines like REM or Market Watch. They should read the notice pages on MLS and take advantage of the many real estate related websites for up to date information or trends. The information you learn will not only make you a better agent, but having that extra knowledge will set you above the competition.