15 Tips for First-Time Real Estate Business Owners

15 Tips for First-Time Real Estate Business Owners

The real estate market is seeing strong demand from new home buyers right now; real estate agents are on track to earn $100 billion of commission income in 2021. Now might be a great time to start a real estate business to get in on this vital, fast-growing part of the economy.

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Real estate is an exciting and challenging field. If you are looking to start a real estate business, here are some simple, actionable tips you can use to begin.

15 Tips for First-Time Real Estate Business Owners

1. Get Your Real Estate License

This process varies from state to state, but you will find extensive online resources allowing you to complete required courses, prepare for the exams and get your license. Having a real estate license of your own makes it easier to start a real estate investing business, since you can cut out the middleman and negotiate your own deals.

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2. Get a Website

According to the National Association of Realtors, close to 70 percent of all realtors have a website, regardless of how long they’ve been in business. Having a landing page to send potential clients is an absolute must in building your business. It makes you look more professional and gives you an additional method to capture prospective client information.

3. Network

The more you put your name out there and get in front of clients, the greater your possibilities for building your business. When you are first starting out in real estate, you should take every chance you can get to network and meet new people, no matter how “small” the event might seem. Talk to everyone, and always make sure they know you are ready to help if they’re about to be in the market to buy or sell a home.

4. Follow the Market

Real estate business owners need to be expert market-watchers who are constantly monitoring the pulse of the latest trends in your city. See which neighborhoods are hot and which are cooling, which areas are getting overpriced and which ones have undiscovered potential. If you are looking to invest, try to avoid homes that are at the top of their price point already, because this doesn’t give you much room to improve if you are looking to flip or resell.

Also, look at houses that have been sitting on the market a little longer. Sometimes sellers will be a little more interested in negotiations if their home has been actively on the market for an extended period of time. If you are looking at homes that have been sitting on the market, sometimes there are issues that are making the home hard to sell. Make sure that the reason is something you or your client is willing to deal with; often it comes down to price, but the home could also need repairs or renovations or have major structural problems or inspection defects.

6. Market Your Properties, Market Yourself

Get engaged with potential clients by utilizing social media and other marketing outlets to market yourself, your business and eventually all the properties you have for sale or rent. Get business cards made, even if they are simple ones. Business cards are a must anytime you are in front of people.

7. Invest in a Great CRM System

As your business grows, your client base is going to grow as well. A good CRM (customer relationship management) system will make it easy for you to keep track of birthdays, anniversaries, notes from previous sales conversations and any other details that help build successful relationships with customers.

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8. Don’t Be Afraid of FSBO

Many agents avoid For Sale By Owner (FSBO, usually pronounced FIZ-BO) properties, but they can be a good source of sales opportunities for your business. Contact the FSBO seller to ask if they would be willing to work with an agent to get the right buyer. If you are working with a FSBO seller, make sure they are willing to sign a commission agreement with you to ensure you will still get paid for your work since your commission is a portion of the seller agent commission and there is no official seller agent in a FSBO property.

9. Build Your Schedule Around Your Clients

Many people go into real estate with the expectation that they will be working their own schedule. If you are starting your real estate business purely to invest in your own properties, this is very likely true. However, if you are starting your business to be an agent of clients, plan to make yourself available in the evenings and weekends. When you are first starting out, the easier it is for them to book with you, the more likely they are to do so.

10. Remember: It’s Not a Desk Job, It's a Sales Job

Negotiations for purchasing a home are only a fraction of what you will be doing in your real estate business. You are selling homes, you are selling yourself and your brand and you are selling people their dreams. You can’t do this sitting at a desk all day. Plan to schedule time each day to be on the phone doing follow-ups with clients. But to make money in real estate, you need to spend the rest of your day out in the field making deals.

11. Create a Wonderful Customer Experience

Even if you’re just starting out, make sure you are providing rock-star customer service to every client. Make it your goal to ensure they love every moment of their experience with you. Keep in touch with them over the years. Guarantee that you have a return customer for life. Most people buy and sell homes multiple times within their life; according to the National Association of Realtors, as of 2021, only 31 percent of home buyers were first-time buyers. So there is a lot of opportunity for real estate agents to build long-term relationships with their customers. You should try to be the person they remember and want to call when they’re ready to move to their next home.

12. Build a Referral Network

As well as building relationships with your clients, you should also work to build relationships with service providers. Have a network of preferred people you go to for certain things, such as mortgage brokers, home inspectors, interior designers, professional stagers, photographers or even plumbers, handypersons, house painters or anyone who provides professional services to homeowners. Once you build that relationship and start sending referrals to them, they will do the same for you.

13. Be a Great Colleague

Be a real estate business owner that other realtors and real estate professionals like to work with. People should enjoy seeing your name on a contract, not shudder at the thought of working with you again.

14. Be Patient and Build Your Business Skills

Understand that it takes time to build your real estate business. This is a competitive field, and your first two years could be tough. Make your real estate business your priority and treat it like any new business. Making money takes time and effort, so don’t expect your first year to be a six-figure year unless you are going into it with something already in the works.

Take the time to learn how to negotiate deals. Whether investing in properties for yourself or helping others buy, be sure you know how to get the best deal. Understand all the opportunities there are to negotiate in a real estate transaction, from the price to inspections to who pays the difference if an appraisal comes back short. There’s more to negotiating a deal on a house than just the purchase price.

Also, check out the National Association of Realtors' list of real estate tools to help you manage and grow your business. Programs like calendar management, digital signing tools and contact management are essential. Being a business owner, whether you're in real estate or any other industry, is a constant learning process. See what inspiration you can get from others who have more experience in your fields, and get savvy about how to run your business "like a business."

15. Understand That "Time Is Money"

Commit yourself to practicing good time management skills. If you know yourself to be less than stellar at managing time, set alarms and make to-do lists each day. Schedule yourself! Set yourself up for success by not wasting your time, by being punctual for business meetings and by generally being a reliable, on-point person to work with.

Can I Start My Real Estate Business With No Money?

If you already have a real estate license in your state, you absolutely can start your real estate business without a significant investment. There are fees and licensing requirements in each state, which will usually come in under $1,000 annually. Most brokerages charge monthly fees in order to take you on as an agent, but many will offer to take that out of your commission checks. Outside of the regulatory and brokerage fees, it’s really up to you what you want to invest. As long as you have transportation and time, you are ready to go.

Real estate is an exciting field that is constantly changing and always ready for new agents and investors who are willing to work hard. If you are willing to put in the time and effort, the opportunities for success as a real estate business owner are limitless. Take the time to research the education and testing requirements in your state and get started.

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