There are some business moves that everyone can do to earn more money. Whether full time or part-time, becoming a real estate agent is one of the best ways for motivated, well-spoken people to make money. Having a real estate agent gives people the ability to turn their knowledge of a local real estate market into an income-earning opportunity. There are six different ways real estate agent licenses can be used to make more money and they will all be explored below.
Sometimes the best opportunities are the ones right in front of your face. Real estate is everywhere, any building we go to, whether our own home, retail shop, or friend’s apartment was at some point bought, sold, or rented. This never-ending process means there is an opportunity for someone to make money off-market movement. Unlike other businesses that require expensive inventory, space to run their business, and employees, a real estate agent license requires minimal investment as only the cost of required course material and a licensing fee is required. This means investing in oneself has never been easier or cost less.
In less than 3 months, prospective agents can become licensed. Each course in California takes a minimum of 18 days and there are 3 required courses to take. This means an applicant can complete their courses in 54 days and take the salesperson license administered by the state they live in and take the first available exam available.
The real estate market is currently in a historic upswing, increasing by anywhere from 10-20% just in the last year alone. Market experts have two different trains of thought either believing real estate market values can either increase due to more money in the market through recent increased money printing activity or decrease in value because of the recently enacted increased mortgage rates. Either way, the market will shift, making 2022 one of the best times ever to become a real estate agent because lots of market activity is expected to occur.
The following are how real estate licenses can be used to make money in six different ways:
The most common way agents make money is by representing homeowners selling their homes. Agents earn commissions, typically anywhere between 2-3% of the final sales price. They are responsible for listing the property and marketing the house to as many people as possible. Agents typically hold open houses to the open market, broker opens to show other agents, and market the property to previous clients, buyers, and investors.
When a buyer is looking to buy a house, they either hire an agent to find their home or do it themselves. The problem is doing it yourself, as most buyers aren’t aware of when properties become available on the market thereby reducing the chance they get a good property at a fair price. Hiring an agent is the best way buyers can locate suitable properties.
An agent can earn money on the demand that buyers need to buy investment properties. A good real estate investment can be a better investment than stocks, bonds, and others. Real estate values typically increase 60-100% every ten years, higher than most other investments and with the ability to get rental income, while simultaneously increasing in value. Investment properties are typically higher in value than primary residence homes and can therefore open great commission opportunities to agents in this field.
If an agent represents the buyer as well, meaning they work for the buyer and seller, they can earn money from both sides of representation. This is called double ending a deal. When an agent acts as a dual agent and double ends the deal, they can earn anywhere from 4-6%, a minimum of 2% per client. A dual agent must disclose their representation status to both the buyer and seller. Acting as a dual agent can be the most effective way to make money as a real estate agent.
When people relocate to a new city or area, one of the first things they must think about is where they are going to live. This constant influx of mover’s present income earning opportunities for agents. An agent can be responsible for locating suitable properties, doing showings, and negotiating with listings agents to find their clients the best properties. This past year alone has been one of the highest percentages of movers relocating to new cities in an effort to save money or move to a better city.
Rental agents are always in demand as the need to find suitable rental properties is never-ending. Rental agents represent both businesses and renters needing housing and office space. Rental agents can make a living by earning commissions and fees based on the volume of units, whereas representing a sale or purchase earns more money, however, has less volume. Agents can strike a healthy balance between representing buyers, sellers, and renters to make the most amount of money.
Being a real estate agent presents people with many opportunities to make money either as a full-time agent or a part-time person. There is limitless potential while becoming an agent as it benefits anyone looking to make smart business moves throughout their lives. Even if an agent is not constantly active, just being a part of the industry presents them unique insight into the market, giving them access to profitable deals, should they ever decide to invest, and be privy to the real estate market before anyone else.
Throughout our lives, we all either buy, sell, or rent real estate, or likely all of them. Tap into this continual market activity and become a real estate agent to earn more money throughout your career. Whether you are looking to buy for yourself, friends, family, associates, you will be positioned to represent people in a transaction where everyone you know will be involved in. The process of starting is easier than you think and only requires you to do the following:
- Take three prerequisite real estate licensing courses
- Take a crash course to prepare for the state real estate exam
- Pass the exam and begin a new career
With historic levels of market activity, now is the best time to start. In less than 3 months you can begin your new journey of making money as a real estate agent.