There’s money to be made in real estate. However, making it in this fiercely competitive industry requires patience, aggressive marketing and strategic positioning of listings. As a new entrant in real estate, you quickly realize that the industry is controlled by seasoned experts. These are realtors who have established themselves as the go-to contacts in the area, so they earn high commission rates for their expertise.
What does this mean to a newbie realtor? Well, first, you need to work twice as hard and as smart as the established agents in order to earn high commission. You also have to be patient for that first sale and learn to manage your commissions when you are just starting out.
With persistence, intelligence and constant tweaking of your marketing strategy, you can easily find yourself up there with the seasoned agents in record time. Below are seven newbie tips on how to earn high commission as a realtor.
1. Earn high commission as a buyer’s agent
One of the easiest ways of earn high commission in the real estate sector is to represent those seeking to spend their money on properties. The reality is that there are more properties on the market than people with the money to buy.
When you become a buyer’s agent, you align yourself with people with money, and all you have to do is get them the property of their dreams. Your job as a buyer’s agent is to show your clients various properties until they find one they like.
Since you know what the buyer wants, and their budget limitations, you can write offers for properties on their behalf. Your clients depend on you to take care of the buying process from start to finish.
Although you can earn high commission as a buyer’s agent, getting an ideal property for a buyer is a time-consuming task. However, if you thoroughly understand what your client needs, you can make the process easier by only taking your clients to properties they’ll like.
2. Earn high commission as a listing agent
There’s money to be made by agents who list homes on behalf of sellers. As a listing agent, you work with sellers as opposed to working with buyers. Your work is to help sellers get the best price for their property.
Once you identify the going market rate for a property, you list it for sale on various online and offline property marketing portals. As a listing agent, you negotiate with buyers to arrive at an acceptable price and then proceed to complete the transaction.
While the work of a listing agent appears easier than that of a buyer’s agent, the potential to earn high commission depends on your ability to work with multiple home sellers. Besides, you will need to aggressively market your listing agency to gain visibility and brand recognition.
3. Leverage short sales to earn high commission
A realtor can assist a homeowner in settling their home loan by helping them sell the mortgaged property. However, the home may not attract enough money to pay the home loan. This is where a listing agent comes in. Their goal is simple: to convince the bank to take less money. Should the bank agree, the agent goes on to list the home as they would any other.
For their effort, the realtor gets a commission once the home is sold. Although the commission may not be lucrative since the bank might insist on the property selling slightly less than the current market value, at least you get to earn a quick commission.
4. Preparing broker price opinions (BPOs)
A licensed realtor can earn some extra bucks by completing BPOs. To prepare BPOs, you compare prices for various homes against current statistics and commentaries to get the best deal for a seller. Earnings for BPO work range between $30 and $100. While this may not seem like much money, the task is effortless.
5. Get into property management
If you are looking for reliable, consistent income, property management is one of the best ways to earn high commission rates. Here, you manage properties on behalf of investors and homeowners.
The work involves maintaining, repairing and managing properties, collecting rent, finding renters, and monitoring the accounts. You get paid a percentage of rental income collected every month.
In most cases, property managers get 10% of the monthly rent collected. A property manager can also earn leasing fees. How much you make as a property manager depends on the number of properties you manage and their rental value.
6. Become a property manager
You can sell properties by advertising them on a website. As a property manager, you get to sell properties directly from your website. These include commercial and residential properties that are listed with images and videos to give a potential buyer a virtual feel of the property. For better conversions, the website should be quick to load and easy to navigate.
7. Get a commercial real estate agent license
The field of commercial real estate is known for the ability to earn high commission rates. These are some of the best paid real estate agents. While income for residential property agents is commission based, that of commercial real estate agents is based on a lucrative monthly salary. As a commercial real estate agent, you should have in-depth knowledge of commercial property values.
You can make money as a buyer’s agent, by listing homes on behalf of sellers, by short selling, and by working as a property manager or as a broker. You can also make money as a commercial or residential real estate agent.