Does it make sense to drop out of college to become a real estate agent?

[DrunkFish]

I really don't think you should go into something that requires a lot of knowledge and requiring you to move for a "quick buck."
By the way it sounds, many of them don't make it. Do you think the ones that make it were the ones who did it for a quick buck?

 

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[Mattie]

I've grown up with relatives in this business, and really comes down to you. Some of them have been successful others were flops. And still they're in slow lane, so I think it really depends on timing, geographical location, your drive, determination, and if your going to do the work.

 

[IrishSpring600]

This would have been hilarious if @theag said it.
You're so limited as a broker. Brokers in New York can only broker New York properties. Same thing for brokers in Ohio. This might be impressive to some stupid property manager

Just wondering, why are property managers stupid?

 

[Ubermensch]

Just wondering, why are property managers stupid?

Most large office and industrial Class A properties belong to institutional owners (private equity firms, REITs, etc). However, some ultra-high-net-worth individuals do own premier assets like this.


Let's say, for sake of argument, that we both own such a building, a $30,000,000, 44-story, 500,000 square foot office tower. Let's say that the property is in California, our tenants include law and accounting firms, trade associations, engineering firms, etc.

As owners, we concern ourselves primarily with the Net Operating Income of the property, and the total overall value. NOI determines how much actual cash the property makes us on an annual basis, and the total overall value obviously dictates the sell price, if we choose to unload it.

One day, as partners, I call you up to discuss a problem. This is how our conversation plays out.

Me: What's up, partner? I think our property manager is stupid.

You: You mean Michael Blockhead? I think he's doing a fine job.

Me: Sure. He pays the rent, occasionally meets with tenants, and handles all of the mundane operational details that we don't want to handle. However, it recently came to my attention that he has ignored PACE and energy efficiency for the past two and a half years.

You: What is PACE?

Me: PACE stands for Property Assessed Clean Energy, and it is essentially a program that allows building owners (both residential and commercial) pay for energy efficiency projects over the course of 15 – 20+ years.

You: Okay, so how does that help us.

Me: Well, the roof on our building has reached the end of its useful life. It requires $2,000,000 in total repairs. Furthermore, the fluorescent lights throughout our building burn out every six months. Our maintenance staff spends 30 – 40% of its time simply replacing light bulbs. PACE would allow us to replace all of our toxic fluorescent lights with LED lights. These LED lights use half the energy and last up to ten years. We'll enjoy maintenance savings, and energy savings.

You: What's the bottom line?

Me: With zero money out of pocket, we can use PACE to pay for $3,000,000 in property upgrades, lower our energy bills, enhance NOI by a six-figure sum, and increase our property value by millions.

You: Sounds too good to be true.

Me: Obama just talked about PACE at the White House last month.

PACE will be part of the administrations legacy. Hundreds of millions of dollars in projects have been completed and are currently under negotiation.

You: So PACE allows us to increase property value and NOI, with no money out of pocket?

Me: Yes, and remember that PACE stands for Property Assessed Clean Energy. This means that, unlike traditional financing, it will be structured as a tax assessment on the property.

You: So, we can flip the property right after the project is completed, and sell the property at its enhanced value?

Me: Yes. Immediate profit of millions.

You: So, our choice is to either keep wasting money on fluorescent light burnouts, maintenance and energy sucking and pay for a $2,000,000 roof job with cash out of our pocket...

Me: Or we can let PACE pay for it.

You: Why hasn't Michael Blockhead done this? PACE has been around for the past two years?

Me: It's like Gordon Gekko said. Management has no stake in the company! Michale doesn't care. It's not his money at stake.

END.

Lol, hopefully that explains it. Property managers don't care about the owners money. They care about their jobs. They're the epitome of corporate American Matrix Agents that care more about punching a clock than enhancing value. That goes for most of them, whether they work at CBRE, or the recently eaten Cassidy Turley/DTZ now Cushman and Wakefield types.

 

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[Ryan D.]

All depends on the brokerage. Mine is a 90/10 split my managing broker has taught me more in 2 weeks than any other single individual.

 

[IrishSpring600]

Me: PACE stands for Property Assessed Clean Energy, and it is essentially a program that allows building owners (both residential and commercial) pay for energy efficiency projects over the course of 15 – 20+ years.

I didn't know about PACE. That's very cool!

Me: Well, the roof on our building has reached the end of its useful life. It requires $2,000,000 in total repairs. Furthermore, the fluorescent lights throughout our building burn out every six months. Our maintenance staff spends 30 – 40% of its time simply replacing light bulbs. PACE would allow us to replace all of our toxic fluorescent lights with LED lights. These LED lights use half the energy and last up to ten years. We'll enjoy maintenance savings, and energy savings.

Waaaaait a minute. The property management company I'm involved with doesn't think like this. They notify me of PACE, charge a small increase in their installment fees for those LED lights and solar roof panels, and then ask me to notify them for any extra service. Then they move on to the next building.

They don't even need licensing because they work with the contractor for installing the equipment, so they both end up getting what they want. But if they wanted more money a license could be easily obtained for installing those solar panels and other electrical equipment.

Me: With zero money out of pocket

Someone's going to have to pay for the installation of those lights over 44 stories. Whether it's passive income or not, that's fine.

 

[Ubermensch]

I didn't know about PACE. That's very cool!

Most people didn't years ago, and it's only now beginning to gain steam.

Your property manager has done PACE projects for you already? Commercial, residential, or both?

 

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[IrishSpring600]

Most people didn't years ago, and it's only now beginning to gain steam.

Your property manager has done PACE projects for you already? Commercial, residential, or both?

He's able to give you more info about managing your properties in South Florida. PM me your e-mail.

 

[socaldude]

This is something only you can tell yourself whether it makes sense to pursue. Because we can't really tell whether you are the real deal or just a wantrepreneur over a computer on the internet.

Most real estate agents are part time(they have other jobs) and don't make a lot of money.

You have to asses your sales abilities, knowledge, execution etc to say whether you will be a part of the 5% that do really well.

So here again it just comes back to the same old conclusion: only you can say whether it's the right choice for you or if it makes sense.

Good luck.

 

[JustAskBenWhy]

It's hard. At this point I may be a seller and a buyer, in different markets. Look at my picture. Am I going to use an 18 y/o dropout? No.

What a way to cut through the bull

 

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[BrandonS85]

If your leaning towards real estate, take it. I'm currently 20 years old, I got my real estate license within a couple months of graduating high school when I was 18/19.

I'm not wealthy by any means...yet. But I live decently. I've got the roaring black '15 GT mustang @Ubermensch was talking about. (NOTE: Buying brand new cars is stupid, but I'm in a decent situation and you only live once.)

You will work hard to achieve success in real estate, especially the beginning years. 90% don't make it. There will be times where you will be wondering if you made the right decision. There will be times where you work hard and make no money. There will be times where you make $15,000+ in one deal. This is what sales is about.

Real estate is not my only job currently, I do another sales job as well though I'm pursuing real estate full time soon.

There's not many job hustles where a 20 year can potentially make six figures, but fortunately, real estate is one of those hustles that give you the opportunity.

I'm also looking to buy a 4plex soon. BECOME THE LION. Real estate will teach you plenty of fastlane principles, im glad I decided not to go to college, only you can make the decision yourself.


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You HAVE to learn how it all works and work on something longer term than just doing sales. In most of the offices I've been in , a vast majority of agents had the whole 'I've got a job' mentality rather than 'I run my own business' mentality. In addition to the job one, very, very few leveraged their experience as an agent to make the real money - In investment.

Few of the best agents I know really do THAT well. Sure there's agents with 6 figure incomes but I know many real estate investors that are in the mid 7s and a few in the low 8s. Being a agent provides a person with countless opportunities to network and learn, and you MUST be willing to learn.

 

[ChasingPaper]

You HAVE to learn how it all works and work on something longer term than just doing sales. In most of the offices I've been in , a vast majority of agents had the whole 'I've got a job' mentality rather than 'I run my own business' mentality. In addition to the job one, very, very few leveraged their experience as an agent to make the real money - In investment.

Few of the best agents I know really do THAT well. Sure there's agents with 6 figure incomes but I know many real estate investors that are in the mid 7s and a few in the low 8s. Being a agent provides a person with countless opportunities to network and learn, and you MUST be willing to learn.

Completely agree with you, as an agent your most money will come from the properties you actually purchase yourself. But a great way to get that money is to sell properties and help buyers find properties, aka be a real estate agent. You have to go 100%, there's a reason most fail. But the successful ones bring in 300k+ a year. It's definitely possible.

 

[wrighj03]

Real Estate violates the rule of entry, there are tons of real estate agents. Quitting School? Com'mon. I'm sure your mom has the best of intentions, but you have to make the decision. Also, getting rich is a multi-disciplinary field. If you want to sell volunteer for a charity tele-thon. Join the Military for leadership and work to find Successful business systems.
You need experience to find peoples' pain.

 

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[Deleted20833]

If I wanted to do real estate - I'd become an agent
and start building up my personal brand in that space

This way once you start your own business, you will
be met with less resistance from your market since
they know you or have heard of you

 

[Jakawan]

I don't participate enough, so I'd like to offer a suggestion that I haven't seen from anyone else yet.
You don't have to be an agent to learn real estate and to make money in real estate.
It costs about $1200-$2000 to get started as an agent if you count all your MLS dues, classes and testing to get your provisional sales license, and as everyone else mentioned, splitting your commission with your broker.. typically 30%-40% goes to whoever you hang your license with...
and on top of all that, you're held to much stricter guidelines, have more boundaries and rules to follow.
And my least favorite part is... all the PAPERWORK! The realtor "Agreement to purchase residential real estate" in my state is like 8 pages long WITHOUT a mortgage. My personal purchase agreement is 1 page long and about 16 lines.

If you hate college that badly, or your job, or anything you're currently doing.. find a way out.. but by that, I don't mean just QUIT. Determine is this in line with your goals? And if not, change it. Go get a job to support your living expenses.. then work part time on your business.
The thing I've learned is.. it usually takes a lot more time than we think it will, and it takes a lot more WORK than we thought it would..

Anyways... summary is:

1. You can make money in real estate without being licensed. Google Bird-Dogging and Wholesaling real estate
2. If you're unhappy with your current job, college, etc, CHANGE SOMETHING. Don't do what's easy. Do what's going to get you where you want to be.

Good luck!

 

[SEBASTlAN]

Have you watched million dollar listing? The commission checks they 'supposedly' get are unbelievable (100K-1M per deal) but you can see how hard they work even with all the scenes they cut out and how long they've worked in that city to build up their confidence/network.


It's a long career not something you can do for a few years to pay the bills (at least that's what I've gathered).

 

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[ChasingPaper]

I don't participate enough, so I'd like to offer a suggestion that I haven't seen from anyone else yet.
You don't have to be an agent to learn real estate and to make money in real estate.
It costs about $1200-$2000 to get started as an agent if you count all your MLS dues, classes and testing to get your provisional sales license, and as everyone else mentioned, splitting your commission with your broker.. typically 30%-40% goes to whoever you hang your license with...
and on top of all that, you're held to much stricter guidelines, have more boundaries and rules to follow.
And my least favorite part is... all the PAPERWORK! The realtor "Agreement to purchase residential real estate" in my state is like 8 pages long WITHOUT a mortgage. My personal purchase agreement is 1 page long and about 16 lines.

If you hate college that badly, or your job, or anything you're currently doing.. find a way out.. but by that, I don't mean just QUIT. Determine is this in line with your goals? And if not, change it. Go get a job to support your living expenses.. then work part time on your business.
The thing I've learned is.. it usually takes a lot more time than we think it will, and it takes a lot more WORK than we thought it would..

Anyways... summary is:

1. You can make money in real estate without being licensed. Google Bird-Dogging and Wholesaling real estate
2. If you're unhappy with your current job, college, etc, CHANGE SOMETHING. Don't do what's easy. Do what's going to get you where you want to be.

Good luck!

Oh my, sounds like work!


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[Jakawan]

Oh my, sounds like work!


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What does? Being a realtor? Or wholesaling houses?

 

[ChasingPaper]

What does? Being a realtor? Or wholesaling houses?

Both. Too many people think it's the easy road, there is no easy road. Put in the work and get results, the problem with real estate/outside sales/insurance sales/ ect. is that people don't want to work when they are not in a "work environment". It's so easy to procrastinate, and it's what most people do.

Put in the work, get results, and live the lifestyle you want to live.


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[Jakawan]

Both. Too many people think it's the easy road, there is no easy road. Put in the work and get results, the problem with real estate/outside sales/insurance sales/ ect. is that people don't want to work when they are not in a "work environment". It's so easy to procrastinate, and it's what most people do.

Put in the work, get results, and live the lifestyle you want to live.


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Ah, you're definitely right. At first it looks easy, and then you realize how much work it takes, how much marketing costs.. and that it's not really "buy houses with no money down"... I know car salesmen who work 6 days per week to make $60k-$70k per year. I have a Realtor friend who made a little over a quarter million last year, which was his second year as a realtor. But he works 6 days a week, and takes calls 7 days a week. Work doesn't stop until 6 or 7pm at night on average. But he believes in what he's doing, and he has goals and dreams for his future.

I agree.. very easy to procrastinate and get comfortable.. no boss forcing you to wake up or be somewhere at a certain time. If you have no accountability and little responsibility.. very easy to get off track, often. I realize that I've been saying a dangerous affirmation for years... that I want to live a "stress-free" life.. well this month I've attained it.. and honestly.. it's boring, and kind of depressing. lol need to fill my mind with growth and challenge and creative thought.

 

[aldenatienza]

In my opinion, what you have is an amazing opportunity but then again what you are giving up is monumental. Is there any way that you can get training and still continue with your studies? Learning about accounting, economics, and architecture can be really vital in pursuing a successful real estate agent career and firms or agencies won't be able to teach you as well as in universities. Think about it thoroughly before making a decision. Remember, if you're 18, that's a very young age and there can still be opportunities in the future, it's harder to catch up on education if you let it go early.

 

[teddysmithnc]

I'm a full-time real estate agent and an investor. I'm not wildly successful, but I've got freedom. That being said:

If I had to give my true honest opinion, I would go with NO. But I've seen many people make it and reach insane levels of success by dropping out of school.

1. Make sure that you have money saved up because you won't make any money the first year.
2. Try to find a mentor in real life that will help you
3. Be prepared for a long grind. The first year is rough.

I've got a blog if you want to research it a bit more: Pros And Cons Of Being A Real-Estate Agent |

 

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[Jakawan]

Becoming a Real Estate agent is only worth it if you do it right. Read "The Millionaire Real Estate Agent" by Gary Keller before taking the dive to get an idea of what it takes to be successful.

I worked for a guy in Plymouth, MI (Jeff Glover) who started at 20, now 32, making 120k+ per month!

It's possible to make a great income but the key is you MUST put in the work.

To be successful early on you must cold call FOr Sale By Owners and Expireds, hold open houses and door knock, network, follow up etc. You must have thick skin because people will lie, waste your time and drive you crazy. It takes time like another business.

I would also recommend starting at a Keller Williams firm, they have great training programs for new agents and experienced agents and really support the team model very well.

I agree with everything he said. I met with a new Realtor this weekend who's getting started.

It is definitely not easy when you first start.. but you have to be careful to not tell yourself "well.. the average realtor makes $15k per year.. so if I just make $25k-$30k I can pay my bills and I'm cool..."
SCREW THAT, the world doesn't need more average realtors... My opinion is.. you have to BURN THE BOATS... have a plan, and become DEDICATED and IMMERSED in your field.. become an EXPERT.. the only reason to become a real estate agent versus having a job is because like many sales jobs.. the income CEILING is much higher.. and you can run it like a business and EVENTUALLY have more freedom.. but that's years down the line.. if you do it right, you will be pushing HARD 10-14 hours per day 7 days a week building your NAME which is your BRAND in the beginning.. you want people to call you when they need offers put in, you want to be "MY REALTOR" for as many people as possible.. you want to be known as the person who GETS SHIT DONE.

I have a friend who makes $350k+ per year as a solo Realtor. He time blocks very well, he follows up very well. He practices scripts and role plays several times per week. He understands that lead generation is the most important thing in his business, so he does it at least 3 hours per day. He works out every morning 5 days a week, he does open houses every weekend to build clientele and meet people for future business. He's constantly asking himself "how can I serve someone else today and what is the best use of my time?"
Network. Get known as a mover and shaker who won't let you down, and people will refer you A LOT of business.

Reinvest 20% back into paid marketing and things that generate leads. It will help you grow even faster.

You can make 6 figures your first year... but you have to BE OBSESSED OR BE AVERAGE. (#GrantCardoneFan)

I'm passionate about real estate because it's changed my life drastically. It's given me freedom, formed my philosophy, and allowed me to live a life worth living where I can Give back often, I can travel when I want, I can be there when I need to be, and I can constantly grow and improve. I would recommend it to anyone who's willing to go all in and burn the boats. But don't "just try it".. go head first.

 

[fastbo]

So I just got an oportunity to become a real estate agent. Does it make sense to go this route, especially when you want to drop out of college? (at 18?)

The real estate agency says, that they teach their agents all the things they need.

No! Read stats about agents... most never do more than 4 deals a year. Majority of them quit within a year.
It's not really an "opportunity". You can take a 4-6 week class and a half dozen agencies will hire and train you. You don't have to apply and be chosen... just take the class, pass the state exam, and choose where you want to work. They'll even send you post cards, and market to you to get you to choose them!