As a real estate agent, your success in business depends largely on how well you market yourself. This means more than just telling people that you are an excellent seller’s agent or listing all of your impressive credentials.
You have to know how to appeal to potential clients so they will want to work with you. You need to be able to differentiate yourself from other agents in your area by offering quality services and value. And you must be persistent when it comes time to talk to customers about their homes and find them new representation.
Agent commissions can add up quickly. The better you are at marketing, the higher your pay check will be!
But before you get too excited, there is a way to make sure you don’t take advantage of others by paying less than your fair share. It’s called negotiation. Marketing to ensure you get paid what you deserve is part of being a successful broker.
This article will go into detail on some strategies you can use to negotiate your commission.
What is a sales contract?
A sales contract or purchase agreement is an essential document that outlines what items, services, and/or materials will be transferred from one party to another. It also contains details about how much money each person owes to the other individual or business entity.
The seller (individual) transfers ownership of their home to the buyer (business) by signing this documents. The buyers attorney typically reviews these agreements before they are signed.
A standard sale contract includes several sections such as property address, legal descriptions of the house, lots, and surrounding area’s, brokers’ name, agents’ names, commission rates, etc. These pages must be reviewed carefully since not everyone varies in how they structure theirs.
Many sellers include a contingency clause in the contract; this states that the deal won’t go through unless the buyer can provide them with at least two bids coming in above the listing price. This protects the seller in case no one offers more than the listed price. However, it also gives the seller some leverage to demand higher prices if they want to sell!
Real estate agents earn their keep via a broker’s fee which is usually between 6% and 10% of the selling price. This is why it is important to know how many days it takes to find your next home, and whether or not you would like to work exclusively as a agent.
What is an offer?
The term ‘offer’ comes from the word invite, because someone offering a job to you wants you to accept it by saying yes. It is typically a lot of money or material goods that you are being asked to take possession of and use as your own.
With real estate, one of the most expensive purchases people can make, the offer usually includes paying a large sum of money (the sales price) in exchange for the home. This makes sense because investing in a house is a significant purchase!
The seller will be the ones giving away the house so they want to receive a good return on their investment. They may even get more than what they put into it since houses increase in value over time.
By having a professional agent represent them, the sellers save money through discounts and/or free services, like advertising materials and showings. Agents also have resources and tools to help promote the property which saves you time!
Agents get paid a commission when you buy a house so there is incentive to do well for you. However, doing bad work could hurt their paychecks so agents must be careful about how they handle business.
What is the selling process?
After you have determined that it is time to sell, then the next step will be to find your ideal seller and create an action plan to get their house sold as quickly as possible!
As a real estate agent, you earn a commission when someone you refer who buys or sells a home earns a profit in relation to what they paid for the property. Your agent fee covers our overhead costs like office space, phones, advertising, website design, etc.
So how much does the average real estate agent make? According to the National Association of Realtors (NAR), the median annual income for all agents was $52,000 in 2018. The lowest earning one-third earned less than $35,000 per year while the highest earning one-third made more than $65,000 per year.
However, this figure includes those agents that do not work full time from their business, so please remember to deduct these types from the above numbers when calculating yours.
Can I get a mortgage without a sales contract?
Even though it is not required, most lenders require you to have an adequate sale agreement before they will approve your loan. This can be difficult when you are first starting out as a real estate agent.
Most agents start off with their own agency, but soon expand into owning or renting their own house. During this time, they must find a way to finance the down payment and monthly payments while still earning enough income to pay bills.
Since many home owners hire professional Realtors to sell their homes, some lenders may feel that you are already guaranteed of success in your job, so there is no need to include requiring a sale agreement.
However, just because someone else has done something does not mean it is best for you! Just because everyone else was able to buy a boat does not mean that you should too.
You would want to make sure that you have checked out any potential loans thoroughly and know what types of mortgages exist.
What is the difference between a buy and sell?
As real estate agents, we are sales professionals who help sellers find their home or get them into a new one. We also handle purchases by buying a house and then rehabbing it or selling it as a pre-owned property.
The important thing to remember about being paid as an agent is that your commission is dependent on two things: how many people you bring in as representatives and what type of representative you become for each person you talk to.
As a seller’s agent, you will earn more because there are more people paying you to be a representation for your client.
On the other hand, as a buyer’s agent, you will make less due to the fact that most buyers don’t need an agent to represent them.
This can feel like a lot of pressure at times if you are looking to purchase a house yourself.
How can I get a good agent
Finding a great real estate agent is not an easy task, but it is definitely worth your time. You want to make sure you are looking at all of the qualities of the agent before investing in them.
As mentioned earlier, buying or selling a house is both expensive and stressful, so you do not want to hire someone that cannot handle this.
You also don’t want to be with people who seem too friendly, as this could mean they will try to influence you into working with them instead of the other way around.
There are many ways to evaluate the quality of a real estate agent, such as by talking to people about them, reading their reviews, and watching a few open houses they hold.
Making these calls ahead of time will help you determine if the agents talent is beyond question and if they are the one person you will be connected to when things go wrong.
Review agent website
As mentioned earlier, being commissioned as an affiliate real estate agent comes with its own set of rewards. But before you start working hard to earn those commissions, make sure you are aware of what kind of commission you will be earning!
Most major brokerages have a separate division that oversees affiliates. This group is made up of people who handle all aspects of the business, including marketing, sales, and referrals. They also manage your account so you can focus on doing what you do best — helping sellers find their dream home!
The amount of commission you earn depends on several factors, such as where the seller lives and how much they sell for. The more expensive or popular properties you bring in the sale, the higher your earnings!
Your potential income as a referral agent varies from company to company, but General Property Agency (GPA) gives you an average estimate of how much you could earn per month here.
Call and see if they are a licensed agent
As mentioned before, to be a real estate agent you must be trained and certified by an organization such as the National Association of Realtors or RE/MAX. These organizations run certification programs that cost anywhere from 5,000 to 10,000 dollars per applicant.
Once you have been awarded your license, each state requires you to pay a licensing fee which is usually around 6-8 thousand dollars. This includes both the broker’s and agents’ licenses.
The brokers’ license allows you to work under their name, while the agents’ license lets you use your own. It also gives you permission to represent other agents in certain situations, something that comes in handy when you are trying to grow your business.
There are several ways to avoid paying extra money for agents’ licenses, however. You can choose to go through a brokerage firm instead of individual agents, or you can look for agents who are already working full time and just need someone to help them cover other areas of the market.