So you’re thinking about becoming a part time real estate agent, or perhaps you have already taken the plunge. Maybe you like the idea of a side hustle to make some extra money for a new hobby, or you have a passion for real estate but you’re not ready to ditch your full time gig. You can do as little as sell houses to your mom, cousins and anyone else you only see at Christmas to gain some cash on the side, or you can build and scale a serious business.
Being a part time real estate agent does have some real advantages. It’s not quite like getting a side job at McDonald’s. The income upside is tremendous and it can be a super flexible way to earn a living. You work as much or as little as you want, set your own hours and it can be entirely remote.
Where do you start?
The number one thing you’re going to have to do to become a part time real estate agent is obtain your license. Each state has different licensing requirements, but you are most likely going to have to take a test or two. Do not underestimate the amount of various information you’ll need to know. Invest in some test preparation materials or a class offered in your area depending on how you learn best. A fee will also be required to sit for the test. Don’t waste your money by having to take it multiple times if you can help it.
Once you obtain the license itself, you’ll need a brokerage to hold it, before you can start staking open house signs in your neighborhood. It won’t take long before postcards and flyers start showing up in your mailbox like you’re the coolest kid in town from all from brokerages vying for your business. However, don’t be fooled by a well styled letterhead. Spend some time researching several brokerages and what they have to offer. Broker fit can be one of the most important factors in determining your future success.
Since you’re not looking to go all in at this point, you’re going to be looking for some key things in a potential brokerage:
- Low upfront fees
- Little to no desk fees
- Reasonable commission splits
- Broker provided technology
- Cultural fit
Some brokerages can be hesitant to take on part time agents. This is because of your total production, or lack thereof, affects their bottom line. Be open when you are interviewing with potential brokerages and let them know your situation. You’d rather know you’re going to be a fit from the beginning. You do not want to settle in, only to be pressured with sales expectations you can’t meet.
How Much Will You Make as a Part Time Real Estate Agent?
A key part of your success as a part time real estate agent will be determining your break-even point. No one wants to work for free, and you definitely don’t want to work for a loss. You can plan on making anywhere from 2-3% of the home value on average per transaction. A quick search online of recently sold homes in your area, will give you a median home value to base your calculations on. If you are using a different model, like flat fee, you’ll need to adjust your expected amounts.
Now comes the other expenses you have to pay as an operating real estate agent that all need to be taken into consideration:
- Brokerage or Team Splits. The amount is highly dependent on the brokerage you choose. You’re going to have to split a percentage of each deal with your broker. Or at the least, pay them a flat fee. (This amount typically maxes out a certain amount, or cap, depending on your brokerage.) In addition, if you choose to join a team, you may have to split your commission among the team as well.
- Membership Fees. Whether it’s Realtor associations or your local MLS, you’re no doubt going to owe some membership fees.
- Marketing, Lead Generation, & Other Expenses. If you’re planning on doing more than referring friends and family to another agent, you’re going to need some marketing materials. For sale signs, business cards and a website come to mind as immediate needs. In addition, if you need to drum up business, you may need to pay for leads.
- Taxes. This isn’t like your regular 9-5 job. Where all your taxes are deducted from your paycheck before it ever slides into your bank account on Fridays. You’ll be an independent contractor with zero payroll taxes. You’re going to be responsible for paying your own taxes when they come due. Don’t wait until the end of the year to pay Uncle Sam his share.
Estimate what your expenses will be. Calculate how many sales you would need to make in a given year to cover those expenses at your current commission rate and home values in your area. Now you have a basis for how much work would need to be done to at least cover your basic expenses.
What Kind of Tools Can Help You Get Started as a Part Time Real Estate Agent?
As a real estate agent, you have to worry about managing your leads, managing your listings, managing your buyers, and staying on top of every to-do. On top of that, you’re going to be part time, so you have half the time to do it. Instead of using multiple tools and apps to keep yourself together, Pro Agent Solutions can provide you with an all in one platform, perfect for part time real estate agents or successful experienced teams.
You can count on Pro Agent Solutions to do these key functions for you:
- Capture and nurture leads. Consolidating leads from your website, Zillow, email, etc. is too time consuming. Centralizing them and automatically providing them with valuable content increases the likelihood of conversion.
- Real estate contact management. It’s pretty critical you remember that Betty wants a garage apartment for Fluffy, her Yorkie poo. Instead of trying to remember everything about every one of your clients, keep them all in a CRM where you can see all their latest activity and notes.
- Real estate text lead capture. Have you ever driven by a house that had a “Text 1212” for more information attached to the for sale sign? Pro Agent Solutions’ Digital Flyer will take your listing marketing to the next level with it’s lead generation sign rider texting application. Potential buyers will receive an immediate text reply for a listing on which they have requested information. The text will include pictures, price and description. You (the listing agent) will be simultaneously texted and emailed the lead contact information. The lead will also be populated in your account for follow-up and you can login and see it at any time. Digital Flyer can be working to generate listing leads while you are at your other job. Text 101 to 678-929-6001 to see an example Digital Flyer text a prospective buyer will receive.
- Automated showing feedback. Save your time for the important things, not chasing down showing agents for seller feedback. Pro Agent Solutions can do that for you. Feedback requests are automatically sent to buyers agents by email and text. The replies are emailed to you and your seller, if desired, all while you’re still at your day job.
- Sign up here for the Pro Agent Solutions free 14 day trial.
Keeping yourself organized is going to be key to providing the customer experience that gains you referrals and additional business at a low cost. Take some time to get to know your tool, set it up properly, and learn it like the back of your hand. It will save you time and money in the long run.
Managing Your Time
As a part time real estate agent, you’ll need to commit a predetermined amount of time this new adventure. Otherwise you’ll lose your mind after the first week. If you’re doing this part time because you work another job, think about how many hours outside your other profession you can commit during the week. Don’t forget about your family, friends, and yourself either. You simply can’t commit all your time to work.
Real estate agents are often at the mercy of their clients. When it comes to when they want to see a house or when they can fit in a listing appointment, you have to consider that you’re not always going to be available.
In this case, you might want to consider teaming up with another agent. They can cover when you and your client cannot accommodate a time that works for both of you. You’ll obviously need to compensate that other agent for their time, and it’s better that you work that agreement out ahead of time. Dont wait to scramble and keep an important client waiting.
Ready, Set, Go!
Now that you’ve done all the planning, it’s time to get this side hustle off the ground. First, reach out to your sphere of influence. For those of you that are new- it’s the network of people you already know. It’s time to let people know you’re licensed, ready to help, and best of all, you are a familiar face. That reach out can come via social media, direct mail, or a postcard on the bulletin board at your day job.
You’ll also want to make sure that your tools are already set up. Preferably before all those potential leads start knocking down your door. Choose a couple of guinea pigs to run through your lead follow up system. Practice a transaction or two, and make sure you have a feel for how things are going to go when the real ones start.
Lastly, market yourself whenever you get the chance. Consider yourself a walking business.
You don’t have to go as far as putting magnets on your car with a cheesy slogan. However, you can reach out to neighbors on an online neighborhood board. Start small Facebook ad in the areas you’re trying to target, start a blog, and get involved around the community where people get to know you and your business. Focus your time on whichever ones you find the most successful after a few months.
Subscribing to Lead Gen Tools
If your own sphere isn’t big enough to provide you with a stream of leads and your brokerage doesn’t provide them, you may need to look at other lead generation tools that can until you’ve established yourself in the community. Some of the services are highly competitive. You are likely going to have to pay for them in the form of a subscription or referral fee, but it’s a great way to get your business up and moving.
If you’re not quite ready to pay for leads, there are a lot of other ways to get your name out there for free. You’ll just need to commit more of your time to researching, trying out, and modifying plans based on results.
Finding a Mentor
One of the best things you can do when you’re first starting out in the industry is find another agent to show you the ropes. They can answer any questions that you have. As a part time real estate agent, you should look for someone else who started in the industry on a part time basis. They will understand your struggles more than someone who has always given their full attention to real estate. If you don’t know anyone in your network just yet, reach out to your brokerage. They are likely to know just the agent that can provide you some pointers.
You Can Make It Whatever You Want
Every part time real estate agent defines success differently. If you’re happy with helping your Nana buy a home without a hitch, then you’re a success. If you were biding your time as a part time real estate agent until you could afford to go full time, you can no doubt achieve that as well with some hard work, time management and resilience.
Part time real estate can be exciting, flexible and leaves plenty of room for opportunity. Not to mention it’s a great introduction to the industry. If you’re diligent in your efforts and find yourself loving what you do, you can no doubt build your part time real estate gig into a full time career.