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Episode 6:  The Most Important Sales Skill
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Episode 4:  Will the Internet Replace Realtors?
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Episode 3:  Mike Kim Interview (How Not to Make a First Impression)
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Episode 2:  What Type of Realtor Are You?
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So, You Wanna Be a Real Estate Agent… How Much Does it Cost to Go Into Real Estate? Part 2

Guest Post by Jennifer Allan-Hagedorn

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Jennifer Allan-Hagedorn

 

I hope you were able to complete your assignment from last week to do an honest assessment of your financial situation.

Today I’m going to help you figure out how much it costs to get INTO real estate and to BE IN real estate on a monthly basis. Of course, any figures you see here are purely estimates and will vary widely depending on the state you live in and the office you eventually work in. And, I’m sure I’ve forgotten a few items in my list of expenses and perhaps included some that won’t apply to you. But I did my best ;-]

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  • Real Estate School: $500-$1200
  • Exam, Background Check: $100-$300
  • Activate Real Estate License: $80
  • Join the National Association of REALTORS + Local Board: $400 – $700 (annual fee)
  • Ethics Class: $40
  • “Initiation” Fee: $1,000 (many franchises don’t require this)
  • Initial business cards: $20-$40
  • Open House signs: $100+
  • For Sale signs: $100-$200
  • Lockboxes: $100-$300

Being IN Real Estate Monthly Expenses:

  • Desk Fee (If you aren’t on a split): $500 – $1700
  • MLS Fees: $30-$60
  • Miscellaneous office charges (advertising, copy/printing, voicemail, website): $50 – $400
  • Contact Management System: $35 – $90
  • Printing and postage: $100
  • Website: $50-$100

Of course, you’ll also need to factor in the cost of your gas, increased cost of car insurance (since you’ll be using your car for business), cell phone charges, health insurance if you aren’t covered elsewhere, wardrobe expenses, computer equipment and programs, home office expenses (increased utilities, etc.), and probably other stuff I haven’t thought of, but I hope this makes it clear that getting into and staying in real estate isn’t something to be taken lightly from a financial perspective.

But here’s some good news.

Contrary to what you might hear, you don’t have to spend a fortune marketing yourself in your early days – and it’s not necessary to purchase every gizmo-gadget and techno-toy available. In fact, the majority of effective marketing for new agents costs nothing or very little. If you enroll in the follow-up newsletter to this one, or in one of our rookie training programs, we’ll help you figure out where to spend your precious marketing dollars, but for now, the good news is that you don’t have to factor in a significant amount of money for self-promotion in your early days.

So, how do you feel about your financial readiness to enter a real estate career so far? Please feel free to share your thoughts!

Next time we’ll talk about a part-time versus full-time real estate career.

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Jennifer Allan-Hagedorn began her writing career after ten years of selling real estate successfully in Denver, Colorado. She was dismayed at the low level of professionalism she frequently encountered in the real estate industry and, with her “soulful” message, hopes to encourage the real estate community to self correct the negative stereotypes of the profession.

Jennifer’s message to agents is that they should strive to be competent real estate advisers, rather than competent real estate prospectors. She urges agents to respect the intelligence of their clients, rather than attempt to insult that intelligence with aggressive closing techniques. She preaches that agents should appreciate the significant commissions paid by their clients, rather than complain that they, themselves, are not appreciated.

Allan-Hagedorn is the author of seven books about real estate and one of the industry’s most popular bloggers. She is also an avid dog rescuer in the Panhandle of Florida.

To learn more about Selling Real Estate with Soul, visit Jennifer’s website can i buy viagra over the counter in canada

 

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Breadcrumbs

In “The Real Estate Sales Secret,” I discuss breadcrumbs; little clues or signs of success.

This year I am guessing my company will hire about fifty new agents.  How many of these will have a fruitful, positive, and motivating year?  That’s an open ended question, one that I hope is answered with a high number.  It’s also a question the answer to which is within your control as an individual at your company.

I have been taking notice of what some of the newer agents are doing to be successful; what breadcrumbs are they leaving?  By successful, I mean not just closing deals, but also looking happy and motivated, living an impassioned life.

Here is what I have been noticing from newer agents who are having good success:

More than anything, I see them actively in my office.  There is no specific time they seem to be here, or even amount of time.  I just see them routinely.

100% of the new agents I am seeing have success emanate humility — they act humbly.  They have not been posturing, vocalizing past success, or “making lots of noise.”

Additionally, 100% of the new agents whom are having success have been asking lots of questions.  I see them routinely asking the receptionist questions.  They ask lots of questions of our managing broker.  They ask me lots of questions.  Listening is power, and these people are just soaking up power.

The successful new agents I notice vary in age, race, and even in “look,” BUT they all smile routinely.  They all laugh at my jokes too (at least they are faking it!!!).

They are individuals, not having started in a team framework.

They are consistently seen educating themselves, trying to understand things they don’t, or, aren’t good at.

By no means is this a comprehensive scientific study.  Having said that, I found it interesting, when I thought about the breadcrumbs of successful new agents, that they were all doing the same things.  One of them even signed a nearly $1,000,000 waterfront sale, closing this week (congrats to a dreamer Brian O’Neal!).

In these clues, hopefully there are some areas you see that can and will improve your life and your business.  If people are doing things or behaving in a certain way, and, on a small scale, demonstrating success, other new agents, and, we tenured agents, can learn from them.

Here’s to the rookies!

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A significant number of people ask me:

“How do I find a listing?”

I am going to offer some specific, real, anecdotal ways here.  First, I am going to give you some interesting (I think) personal facts and/or statistics with regard to my experience finding listings.  This is mostly from my experience only, having sold for about ten years since age 24:

  • I HAVE NEVER, in ten years, signed a listing directly from any contact on FACEBOOK, LINKEDIN, or other social media.
  • I have never signed a listing directly from a mailer to a FARM AREA.
  • I have never signed a listing from a lead from ZILLOW or TRULIA.
  • About 1-2 deals per year for me (almost a negligible amount), come from “FRIENDS;” people whom I regularly associate with.
  • In ten years, I have received 1 or fewer listing leads per year from vendors whom I use (Title and Escrow companies, Lenders, Inspectors, Contractors, Etc.).

This is not to say these marketing media do not work; they can and definitely do, for some people.  It is safe to say, however, that too many agents rely on the tools above to “hopefully” fill their pipelines.  It is also safe to say many agents spend way, way too much time with these illusory marketing tools (especially when practiced without intent and consistency).

Here are some (surprising?) ways I actually get listings:

1. DRIVING.  Yes, driving.  The statistically significant majority of sellers still hire someone they like and get along with.  These are interpersonal phenomena that require human contact.  When I am stumped for business, I go on slow drives, talk to people, engage them, and let them know I am looking for sellers.  Consider this: who knows about a listing first? Generally, the people who live around that person know for months, or years, in advance.  These people, neighbors, freely offer great market insider information.  Additionally, and importantly, people see my face in the places I want to sell.  I would say this tactic leads to 20% of my business.

2. LISTING BAD PROPERTIES.  This is a joke, kind of.  No property is a bad property, but, if a seller has a unique/tough situation, even having tried to sell, if you can list, market, and sell that property, you develop a perceived “expertise” for that category of sale.  This expertise is referred more than easy, conforming sales.  An example might be a piece of land with wetlands. It might be a little tougher to sell it, but, when you do, you have a specific competitive advantage over other agents for this type of parcel.  I would say this accounts for about 20% of my business.

3. SPECIFICITY.  Many people just ask for referrals.  I ask for specific referrals: “Jim, do you know anyone with a really bad fixer?  I need listings like that right now, they are selling easily in my market.”  Or: “Samantha, everyone seems to be calling me for lakefront property right now.  Can you please keep an eye out for lakefront for me?”

I haven’t seen a study published on why this might work, but, my hunch is a specific request is more personal, and, requires more thought from the person you are addressing.  As a result, I think it lodges in folks’ minds better than “Know anyone selling?”  This probably accounts for about 15% of my business.

4.  ANGER. I love this one. I look for people whom dislike agents, or, had a bad experience.  If they are upset, they really wanted to sell, but didn’t. I repeatedly call on people whom have shown angst for real estate practitioners, because I know they have energy for the process.  I would say after someone reacts with anger 3-5 times, they say (about 90% of the time, no kidding):  “You really are persistent, aren’t you?”  To which I reply:  “I knew you would come around!”

Ironically, once they come around to trusting you, they generally are the easiest customers to work for.  This is probably only about 5% of my business, but, it’s fun so I do it.

5.  SECONDARY QUESTIONING. If you are talking to someone about selling, and, they clearly aren’t going to be a customer, take advantage of the fact you have someone in person.  Ask them anything, anything, anything (!), about real estate in their locale with respect to real estate:  “Okay, it’s clear you love where you live and are going to stay here for a long time, what’s the other coolest house in your neighborhood?”  They may introduce you to that person, for another conversation.  The idea is to be continuously keeping real estate in the front of your, and their, minds. By doing this, you are cultivating a garden of leads.  This is probably about 10% of my business.

Listings do not grow on trees.

Unless, you plant forests.

Plant a listing forest by talking a little longer, asking a little more, and laughing a little harder.  This insignificant amount of extra energy has made all the difference for me, and many other tenured agents.

Good luck!

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  • Keller Williams
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  • Matt Parker is a decorated Seattle-based Real Estate Broker having been voted by customers and peers to be a top agent year after year.  He is a 4-time Five Star Professional, a multiple time national top 10% realtor and has been used for national and local television and print media on NBC, KOMO and the Seattle Times.
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So, You Wanna Be a Real Estate Agent… How Much Does it Cost to Go Into Real Estate? Part 1

Guest Post by Jennifer Allan-Hagedorn

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So, moving on from our earlier cheerful discussion about the income potential of a real estate agent…let’s talk about whether you can AFFORD to go into real estate right now.

Fact is, it costs money to be a real estate agent and chances are that you will not make any money for several months once you officially begin.

Let me say that again and please “listen” with every fiber of your being: “Chances are you will not make any money for several months once you officially begin.”

Many first-year agents do not make a dime until their sixth or seventh month in the business; some take even longer than that. That’s a fact and should not be taken lightly, or dismissed as something that won’t apply to you because you’re special. You very well may be special; in fact, I’m sure you are, but you MUST prepare for this possibility. If you are among the few who begin making money right away, that’s fantastic, but I’m sure you won’t regret having a nice nest-egg socked away for yourself. But PLEASE do not go into this career thinking that you’ll receive your first paycheck in a month or two because it’s likely you won’t. And all the while, you’ll be paying out money for the privilege of having a real estate license.

A few months ago, a first year agent contacted me to ask about one of my training courses. During the conversation, she casually commented that she felt misled by her early advisors because they failed to mention how many nickel and dime expenses there were to being a real estate agent. Of course, she wasn’t referring to actual nickels and dimes; more like $200’s and $400’s! I felt bad for her, but I confess I had to ask myself why on earth she would have gone into business for herself with so little financial commitment that a few unexpected $200 expenses put her at the brink of failure.

Because, my friend, you ARE going into business for yourself, make no mistake. And you need to take that concept seriously.

How seriously? That is – how much money should you have put away before jumping in?

That, of course, depends on you and your personal situation.

Some new agents have saved up a nice nest-egg for their venture into real estate and will be able to pay their start-up costs, ongoing expenses and household bills for a reasonable about of time.

Some new agents have a supportive spouse or partner who is willing to pay all the household bills during the agent’s non-income-producing months.

Some new agents have taken out personal loans to finance their venture into real estate (I don’t recommend this approach).

Some agents have (and intend to keep) a relatively well-paying and flexible job that they feel will accommodate their venture into real estate.

But some agents have a family to support, with no outside or supplemental income, and no discretionary money in the bank.

Before I continue, I’d like you to spend a little time today being honest with yourself about your own personal financial situation. Please do the following assignments by the end of the day today:

  1. Add up how much money you have saved to invest in your real estate career
  2. Figure out how much it takes to run your household on a monthly basis
  3. Calculate how much income would be coming into the household if you become a real estate agent

We’ll return to this discussion soon!

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Jennifer Allan-Hagedorn began her writing career after ten years of selling real estate successfully in Denver, Colorado. She was dismayed at the low level of professionalism she frequently encountered in the real estate industry and, with her “soulful” message, hopes to encourage the real estate community to self correct the negative stereotypes of the profession.

Jennifer’s message to agents is that they should strive to be competent real estate advisers, rather than competent real estate prospectors. She urges agents to respect the intelligence of their clients, rather than attempt to insult that intelligence with aggressive closing techniques. She preaches that agents should appreciate the significant commissions paid by their clients, rather than complain that they, themselves, are not appreciated.

Allan-Hagedorn is the author of seven books about real estate and one of the industry’s most popular bloggers. She is also an avid dog rescuer in the Panhandle of Florida.

To learn more about Selling Real Estate with Soul, visit Jennifer’s website can i buy viagra over the counter in canada