Education & Work Career Change

Hi guys, just a quick message for some advice on the best way to break into the real estate profession. I know there are many facets and roles within the industry to specialise, but for a beginner is the best option to attain my Certificate of Registration and move forward from there?

About me - I have 9 years retail management behind me, majority with Aldi Stores. Im days away from my 27th birthday and have a passion and keen interest for real estate. I have a small portfolio based in Wollongong ( Figtree, Horsley, Albion Park ) and a potential 4th on the way but after resigning from my job last month im not sure if I should.

I was unhappy and border line depressed doing retail, and want to make my interests my profession. I believe I could knock over the CoR in a few weeks given my down time at the moment, the only issue I see is lack of experience perhaps therefore an entry level role would be assumed. Keen to start asap, as a month off living off passive income sounds great but I am slowly starting to become bored haha

 

What were you wanting to do within real estate?

If you were wanting to list and sell houses then think about minimum wage for the next 12-24 months. However it really depends on;

1. The market in a hot market the ramp up time is probably next to no time as everyone is trying to sell and buy. However if it is a slower market vendors will be typically more picky about who the list with and the experienced REA will use that against you. Typical line might be 'I don't know Ramos personally but he only just got into RE and he appears really young. Where as I have been doing this for 10/20 years and I know the market like the back of my hand. Would you really want to trust your largest asset to a sub 30 yo with no RE to sell your house?

2. Hardly anyone knows you, todays buyers are the future vendors and typically we deal with people we have dealt with before or have been recommended by (again previously dealt with however with a 3rd party). As you haven't sold anything this means you are a number of years away from getting a benefit from that side.

3. If you do a great job with prospective buyers they might tell others about their experience with you however as you might know with word of mouth if you do a good job you will be lucky if they tell 3 others, you do a bad job you and be almost certain they will tell at least 10 others.

I used to work as a REA so these are some feedbacks, I left not because of minimum wage however I had a child and it made me think about the weekends I had when growing up and having my dad there watching me and I want to do the same for my children and RE doesn't support this.

However after one year it gets easier (if you do the right things) and it is one of those jobs the longer you are in it the more you make and less you need to do (if you keep doing the right thing). As the people you sold to will become vendors and 90% of the time will upgrade in the same area (schools/work etc).

An example is say every 10 years the person you sold a house to upgraded/downgraded house and you sold one house per month without any listings (sold other REA listings). Lets also assume that the vendors bought different houses and you were able to list and sell each property at 10k per pop.

Year 1-10 - 120 Buyers/0 Vendors - $1.2M commission (your take home is 20% typically for the selling agent = $240,000/10 years = $24,000 p.a.

Year 11-20 - 240 Buyers/120 Vendors - $2.4M commission (120 properties list/sell (40%) of 120 = $480,000 + 120 properties @ 20% - $240,000 - total = $720,000/ 10 years $72,000 p.a.

Year 21-30 - 360 Buyers/240 Vendors - $3.6M commission (240 list/sell - $960,000 + 120x sell - $240,000 = 1.2M/10 years = $120,000 p.a.

This is only a very rough way of breaking it out and not factor in CPI raising house prices or the fact that each vendor isn't going to stay at the house exactly 10 years. As there is the unfortunate events of the 3 d's Debt, Divorce and Death, plus just people's living requirements change. E.g. myself (still living at my place) however I bought a 4 bed house when I was single living (had gf) as I knew in the near future I would get married and have children. Now married and first child has come I have grown into the house rather than getting a 2 bed unit and I would be forced to move.

 

Bill Will makes some valid points and it's certainly an industry that you need to be people-oriented, great at building and maintaining relationships and willing to work long hours (including Saturdays). Real estate selling is predominantly about securing listings however and in such a competitive field this can be challenging. I'd suggest you work as a PA/sales associate for a bigger firm to develop a feel first, to see if it is an industry you would be happy to work in. Selling RE is very different from retail altogether. Best of luck

 

If it's what you want to do then just go for it. Some advice though:

• At the interview don't say that you want to be a RE because you love property - REs are just selling a service. The skills they are after are things like communication, sales, customer service, marketing, promoting, organising etc.
• Don't be surprised if the role initially involves telesales. Most newbies / assistants have to spend alot of time on the phone cold calling people from the database 'just to see if they are in the market to buy or sell'. You need to love rejection!
• As stated in posts above, your initial wage will be the minimum wage and getting a slice of any commission or bonus structure may not come for quite some time.

There's a guy on YouTube called Tom Panos Real Estate Training. Check out his videos. He interviews top agents about how and why they got into the industry.

Good luck and don't die wondering - give it a go.

 

Real estate is not just selling residential property

 

Hello,
Good luck on your new journey and I would love to share my experience in working in real estate.
I was a sales manager at a logistics company and after a few years I got bored of the 9 to 5 hours.
A friend of mind opened up a Hocking Stuart in Werribee (Melbourne) and here are some points of my experience:
Well done on having the guts, to do something you like vs staying in a place you hate.

• I loved real estate as it taught my many skills that has helped out my investment journey and also helped my grow my mortgage broker business.
• Hours can be long but if you enjoy it, you wont worry about it at all.
• First year is going to be a challenge - most people quit after the first year but it takes two years to build a solid business.
• Real estate is not just selling property - you need to build a network in the area you are working in....
• I left real estate when i MET my wife, I was spending to much time with other families and not enough time with mine.

Other then that!!! go for it!!

 

What the thoughts on being over exposed to property?
If you really love property investing, working in the industry too may seem like the perfect thing to do, but it may also backfire and cause a loss of interest in your investing pursuits.
My opinion only, but too much of the same thing is not always good, need some variation in life.

 

This is really interesting idea! Something my gf brang up too.... my interests are sports, property, fitness. I would love to be involved in any or all of them! I also have Bachelor Commerce : Human Resource Management

Just at the point where I want to do something that I enjoy so its not "work" work but thanks for getting me thinking more

 

Hi Ramos,
I had the same challenge as you and share the same passion as you for property. I wish I had set my course earlier though and am now playing catch up. I left the corporate world in 2012, had a year off and then set about chasing my property dream. I got a job in real estate and held that for 2.5 yrs, then left early this year to pursue developing full time. It has been a ride and a half. Sometimes you have to do things really outside your comfort zone, or out of the norm to .... but you sound like you are already doing that in getting ready to jump. I say DOOOIT! Happy to chat about my path privately if you want to msge me

 

Thanks JPC, if I didn't have property income I would no doubt have stayed in a dead end job as I saw it for a while so im thankful I have options as a result of investing.

I had a friend ask me if I considered mortgage broking and to study for that! Random you mention that he works for CBA

 

This is good advice I would have no doubt jumped into my investment story to show off my passion etc etc

Rejection doesn't scare me! I was on the dating scene for awhile as a young single chap hahahah

 

Thanks for all your responses! Not afraid of hard work or long hours. Even as Assistant Store Manager for Aldi, I would stack shelves, serve customers etc on top of office work. They introduced in my store for the management team to do a weekend each and this resulted in a shift of 6am - 830pm both days at least once a month. Getting up in the dark all day inside then coming home in the dark was depressing so I walked. I have a low LVR so I have a small passive income and not in dire straights, so I thought id look to do something im happy to do as lifes too short. That's where I am at currently!

I figured I would have to start as a assistant of property manager etc

and I learnt how to multi quote sorry for the PC amateur hour haha

Also was thinking about the Valuation side also, as when / if the market slows down any new agents will have a hard time making a name for themselves as you said. I read also property management is a career option these days not just a stepping stone to get into the industry.

 

Good on you mate, jobs come and go. Focus on self and development,money will be a by product of doing things that you love.

Further study, fitness, travel , reflection and contemplation is required. Property will always be there when you are ready.

 

Hence why I asked what he was looking at doing.

I think my post was long enough just on being a REA listing and selling property not to go into PM, Valuation, Mortgage broking, insurance etc etc.

 

Big Will - yes your post was super informative, I re read it a few times. Abit of an eye opener really.

But yes plenty of avenues to branch into hence its attractiveness to me! Also the fact there is always going to be houses for sale, needing to be managed, valued, etc etc so career longevity

 

I've worked in resi, commercial and govt property. Also done all the study if u want to pm me for any advice/questions?

 

Great post, I say go for it bud!

It's all experience at the end of the day, the more uncomfortable you get the better off you'll be. It's teaching you to be adaptable!

 

Also, this is kinda on topic.

Does anyone have information on becoming a business broker? Or has been/ knows anyone in the field?

These guys sell property also, from what I understand. Though mostly commercial with tenant structures etc etc.

Might be worth exploring this as an avenue?

 

As a current agent, in addition to what others have said, if you're single, then I would only get into real estate sales if you had 1 year of savings to cover your expected living costs as it takes time to "replace your income/expected living costs" and realistically it may take 1 year to do this. As you said you have passive income from your IPs, so if that's the case, then go for it. A lot of newbies I seen over the past 15 years, jump in thinking they're gonna make $100k in their first year, and then almost "go broke" after 6 months and then have to jump back into a salaried/wages job before they end up with no money. Same scenario for mortgage broker, whose trailing commissions may not add up to a decent income until year 3 or so. Real estate is like any other business - it takes time to build up.

If you're partnered, then this is ideal, if your partner's income covers the total expenses together, so your real estate income is like bonus income.

 

That doesn't sounds like much fun, good on you for getting out of there.
I've had friends who kept working in retail, moved into management etc, but all have moved on to other professions. It's not really something you want to still be doing as you get older, they take as much as they can get from you.