Should I Go Into Real Estate? 10Things to Consider.

I want to be really clear before I get started on this post. I never want to be a dream-crusher. Never. Anyone who knows me knows that I am a huge believer in entrepreneurship.

That being said, I’m a straight shooter. It’s kind of my thing. So, from my perspective, if you’re thinking about making the jump into the wild, wild world of real estate, here are 10 things to consider. 

1. Kiss Your Evenings and Weekends Goodbye. I would say a minimum of 75% of showings for homes happen after 4pm or on weekends. Guess what… people who can afford to buy homes usually have jobs! Between showings and open houses and other commitments, you can pretty much guarantee that – particularly in your early years as you establish a name for yourself in real estate – you will spend evenings and weekends out of your home.
2. The Industry is Changing. Real estate today is nothing like it was 20 years ago, 10 years ago, or frankly even 5 years ago. Now, we have an information-driven economy that has consumers questioning the value we bring – especially consumers who are selling houses and, thus, have to actually pay us for our services. I’ll be honest, I see it getting harder and harder to make the same dollar today that I did even three or four years ago. I do think that the true masters of the profession will always do well – because they are committed to excellence. Everyone else… not so sure how they will fare in an age where it takes two clicks of a mouse to list your home for sale privately, and real estate TV shows have the average Joe thinking he knows pretty much exactly what Realtors do. (He doesn’t, by the way.)
3. Fees May Surprise You. In Ontario, we wind up paying… everyone. Okay, maybe it just seems that way. You’re going to pay your brokerage fees in some way, shape, or form – and they’ll also be taking a percentage of “your” commission (which isn’t really yours, by the way – it’s the brokerage’s.) You’re going to pay the local board. You’re going to pay on a provincial and national scale and you’re going to need mandatory Errors & Omissions insurance. And, by the way, in some cases the start-up fees are pretty staggering, followed by monthly or annual fees that are also significant. The main thing is this: Do your research and know what you are getting yourself into.
4. Marketing and Promotion Comes with Costs. I know that seems like an obvious statement, but I do find that sometimes people are surprised at just how expensive marketing and advertising initiatives can be. So you want awesome signs and business cards and a website? You want to see your face on the side of a City bus? Right on! Get the cheque book out. Now, in fairness, every business has start-up costs. Those for real estate are pretty much in line with setting up shop in any business. As for advertising, it’s a case of ‘how high is up’.
5. How and When You Get Paid. If you are a person who really needs the ‘instant reward’ for a job well done… this might be a problem. We get paid when – and only when – a real estate transaction has closed. I’ve gotten paid within 24 hours of closing. I’ve gotten paid more than a month after closing. Instant rewards in this business come in the form of satisfied clients. The money is, literally, an afterthought.
6. Speaking of Money… If You Are Looking for Easy Money, This Isn’t Going to Be It. Honestly, is there even such a thing as “easy money”? I’ve never stumbled across it! But I have heard it referenced in relation to real estate and I just think… huh? No. It’s not easy. There is plenty of business out there for those who want it and will work hard for it. But this is not a path to “easy” wealth.
7. The Numbers Aren’t Encouraging. It’s an awfully-high percentage of Realtors who leave the profession within the first two or three years. There are so many reasons for this, I can hardly begin to list them. But just know that you will need to work hard, you will need considerable support both personally and professionally, and you will almost certainly need a financial safety net in order to make a go of it in real estate.
8. It Takes a Few Years to Get Established. You know, there are some people who either inherit a book of business or have huge financial resources and can advertise out the wazoo but, honestly, those folks are the exceptions. Most of us just do the work. We do the grind. It takes years to really make it, for a couple of reasons. First, the learning curve to become a true local market expert is steep and it takes time. Second, things like repeat business and personal referrals, well… they take time.
9. It Can Be an Isolating Profession. You know, depending on where you land in terms of brokerage choice, you may find some team-oriented stuff and some camaraderie and that is all well and good. But, I’ll be honest. Many times I have felt very isolated in this profession. You truly are your own boss. You are called upon to give counsel, to offer opinions, to help people make hugely-important financial decisions. And ultimately it’s your call. It’s your word and your reputation. And that can be isolating and a bit scary.
10. There is Agony and There is Ecstasy. This is not a coast-pretty-much-the-same-month-by-month career. You may have months where you feel like the money is rolling in and you are on top of the world and then – bam! – a slump hits and you’ve got months of showings and appointments, day after day after day, and you think… will anything ever come together? There are highs and there are definitely lows. Real estate is anything but average and that is what’s great about it – but it is also a challenge from the perspective of staying positive and motivated, as well as – practically speaking – cash flow.

So there you have it!

I believe that real estate is a great, challenging, and rewarding career. Is it right for you? I don’t know. If I haven’t scared you off by now then… quite possibly!

I am always keen to share my knowledge and to support others who are thinking about entering this business – or any other form of entrepreneurship. If you’d like to connect, please do so. Reach out and I will be more than happy to see if I can help you in any way.

Thanks for reading.