By Frederick Peters, CEO of Warburg Realty
What do real estate agents really earn? Every year the National Association of REALTORS® releases data on the median income of its members. For 2017, the median income for real estate agents countrywide was just under $40,000, while the median income for experienced brokers was over $100,000. Of course, there are many variables that go into these numbers. Those agents who have qualified to be brokers almost always earn more than salespeople, and agents with broker's licenses who have been in the business over 15 years tend to earn far more than their newer colleagues.
Every year, the study brings to mind how little most newcomers know about making a career out of a real estate brokerage, and how much harder it is to succeed than they think it is.
The exam rooms for the New York State real estate salesperson's exam are always full. Of those taking the exam, maybe 50 percent, maximum, will stay in the business more than a couple of years, and of those 50 percent, maybe another 40 to 50 percent will actually make a decent living. Because the bar for entry is so low, and because the job looks easy from the outside, many people want to get in on the easy money. After all, as prospective agents have said to me many times over the years, how hard can it be? I used to say—half in jest—that the public looks at brokers in Manhattan and sees a fur coat, a ring of keys and a big check. If only it were so easy…
During almost 40 years in the business, I have seen some stunning successes and a lot of failure. While I can't offer a formula to guarantee the former, I can make some observations about what makes people successful in real estate:
Great agents are not ashamed. You can't succeed in a job you are embarrassed to have. Sure, it's true that agents don't have the best reputation, but I always urge that we make it our business to elevate that reputation with every client interaction. Most of the agents I know adhere to the highest ethical and professional standards. If you cannot say with pride that you are a residential agent, you probably won't get too far trying to succeed as one.
Great agents know how to mine their spheres. Great agents build a powerful network of referrals—but how? The answer: It is different for everyone. Social media is great if you are a whiz, but useless if it's not intuitive and fun for you. Do you love giving big parties or intimate dinners? Are you brimming over with market data and tactical advice to share? Any one of these serves the purpose of keeping you connected to once and future clients. Whatever you choose, it has to be an intuitive fit for you. If you don't like doing it, you won't do it, and it won't work.
Great agents get back up again. In this business, you'll get knocked to the ground often. My rule: Give yourself a day—then bounce back. You can't stay down if you want to succeed.
Great agents self-start. It's not your company's responsibility to give you buyers or hand you exclusives. In my career, I never once had a deal handed to me by either of the companies I worked for as an agent. I worked day and night to build a sphere of contacts to whom I demonstrate my competence and commitment. If you're not self-reliant and always figuring out how you can do it better, this line of work is probably not for you. It's a 24/7/365 affair, and the ball is always in your court. Win or lose, your success as a real estate agent is up to you!
Frederick Warburg Peters is CEO of Warburg Realty. He entered the real estate business as a residential agent in 1980 and has since brokered approximately $1 billion in New York real estate. After working as a sales director at Albert B. Ashforth for several years, he acquired and renamed the 95-year old firm in 1991. Since then, he's expanded the company from 40 to 130 agents and from one to three locations.
This article is intended for informational purposes only and should not be construed as professional advice. The opinions expressed in this article are those of the author and do not necessarily reflect the position of RISMedia.