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How to Get a California Real Estate License (Step-by-Step Guide)
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The Buyer’s Inspection Advisory (BIA) is a disclosure that is included with the Residential Purchase Agreement (RPA) when you make an offer on a home.
In California, this disclosure is commonly titled the Buyer’s Investigation Advisory (BIA) (C.A.R. Form BIA) and is often included in the offer paperwork with the California Residential Purchase Agreement. Other states may use different purchase agreements and inspection disclosures, so the name and exact form can vary.
Simply put, it is advising the buyer to have a professional inspect the property.
Disclosures are designed to inform and protect the parties entering into an agreement. In this case, the Buyer Inspection Advisory is for the buyer.
Let’s discuss why the BIA is important, what items are on the Advisory to inspect, and what to do when your client chooses NOT to perform an inspection.
Purchasing a home is one of the most important decisions that people will make in their life. It’s a large investment and buyers will want to make sure that the home is sound.
A buyer is given disclosures by the seller’s agent, but there is only so much that the seller can know.
This is why a home inspection is important.
Some buyers may be tempted to inspect the home themselves. But, they’re not usually qualified to fully inspect the property.
There can be underlying problems with electrical, plumbing, or the foundation that only a professional can identify. Buyers will want to know about these issues before the sale is final. This avoids dealing with any major issues with the home in the future.
Disclosing that the buyer should perform inspections using the BIA helps ensure that the buyer has been fully informed and can reduce liability risk for the real estate agent—but it does not eliminate an agent’s disclosure/inspection duties under California law.
If the home buyer purchases a home without being advised to have a home inspection and there are issues that arise later, they could sue the real estate agent for finding them a faulty home.
The Buyer’s Inspection Advisory is a one page document that outlines the importance of inspections. It also has a list of what to inspect:
As a real estate agent, it’s important for you to be aware of the items, why they should be inspected, and the professionals that you would refer to your client.
Let’s discuss a few of those items here as an example.
Typically, a home inspection will cover the general conditions of the home like the foundation, roof, plumbing, electrical, and air conditioning.
But, the list discloses areas beyond the general condition of the home. There are inspection areas that buyers should use a professional – like a termite inspector.
What about the square footage and boundaries of the home? If it’s important for your client to know, they should confirm this with an architect.
In practice, buyers often confirm square footage/room dimensions/lot and boundary questions with the right specialist(for example: an appraiser, architect, or qualified measurement professional for size questions, and a licensed land surveyor/civil engineer for boundaries). The BIA also warns that numerical statements are typically approximations and may not be verified by sellers or brokers.
Also, property boundaries noted on online maps are not accurate. A licensed land surveyor or civil engineer can identify the physical boundaries of a property.
If the home is located on a hill or a slope, calling in a professional to test the soil stability is crucial. There are companies that test the soil to make sure the home is not susceptible to slippage or movement.
In many cases, this is handled by a geotechnical engineer (or similar qualified professional) who can evaluate slope stability, drainage, and soil conditions.
They can also identify and implement erosion control measures.
Because your client has been informed, they can decide what inspections they want to move forward with.
The Buyer’s Inspection Advisory is designed to disclose information to protect the buyer. But, it also protects you, the real estate agent. While your client does look at you as the professional on real estate, your role is clearly outlined in the Advisory:
The BIA makes it clear that brokers don’t have expertise in all areas, can’t advise on everything listed, and don’t guarantee the performance of any referral professionals.
This sets the expectation of what you are responsible for during inspections. Any recommendations you may make to your client about professionals are just that – recommendations.
Despite your best efforts, you might have a client who chooses NOT to do an inspection.
So, what do you do now?
Have your client sign a Buyer’s Inspection Waiver. This is a one page disclosure that informs the buyer on the importance of inspections and states that NOT performing one is against the broker’s recommendation. This will remove your liability if something bad happens to the property.
A Buyer’s Inspection Waiver (C.A.R. Form BIW) is intended for use between the buyer and the buyer’s broker and documents which inspections the buyer is choosing to waive (and that the buyer is acting against the broker’s advice). It also recognizes that the buyer may still elect inspections later within the investigation period if the contract allows and the buyer makes that election in writing.
This will remove your liability if something bad happens to the property.
The waiver can help document that the buyer was advised and chose to waive, but it does not automatically remove all liability—brokers/agents still have duties (including visual inspection/disclosure duties in California) that generally can’t be “waived away.”
Also, the waiver has a section to confirm inspections made by the seller and disclosed to the buyer.
So, if your client is electing NOT to perform inspections, the Buyer’s Inspection Waiver is to document what reports they do receive. If your client chooses not to follow any improvement recommendations, the liability will fall on them and not on you.
Documenting is key—but because outcomes depend on the facts, the contract, and state law, avoid absolute promises about “who will be liable.” The safest approach is: document the buyer’s choice clearly, keep communications in writing, and remind the buyer to review reports and consult appropriate professionals when needed.
The Buyer’s Inspection Advisory is another disclosure that informs and protects the buyer during the transaction process. When buyers are properly informed, they can make decisions to best protect their investment.
Although the Advisory is primarily designed to protect the buyer, now we see how the BIA limits the liability of the real estate agent as well.
The BIA is best thought of as a strong written reminder: buyers should investigate thoroughly, and brokers aren’t experts in every specialty—so buyers should hire the right professionals for inspections and research.
So, become familiar with the items on the Advisory, why the items are important to inspect, and what professionals are most qualified to make those inspections.
When all else fails, if your client still refuses to have inspections done, remember to use the Buyer Inspection Waiver to document their decision and help reduce risk.
Mindset is everything when it comes to thriving in your real estate career.
As a new agent, adopting a mindset for success is essential to overcoming the tough days—whether it means making phone calls or knocking on neighborhood doors.
Developing the right mindset may not be easy, but it is crucial for making positive changes in your career.
Having the right mindset automatically sets you up for success.
Your thoughts and feelings have a direct impact on your productivity and confidence.
While passion and excitement are great assets for starting your new career, many agents fall into a negative mindset when faced with initial adversity or rejection.
Discouragement at the first sign of difficulty is common, but starting with the right frame of mind can help you avoid career obstacles.
Let’s discuss what to avoid and where to focus to cultivate a success-oriented mindset.
There are a few basic things to avoid that may seem obvious but are worth mentioning.
Negativity is a mindset that can develop without you realizing it. Negative thoughts and actions will lead to a negative business environment.
Another important tip—don’t surround yourself with negative people. Constant negativity only reinforces negative energy and hinders progress.
Remember why you got into real estate in the first place. You have a passion for it, and you invested time and energy to obtain your real estate license. There is no reason for self-doubt.
Self-doubt erodes your confidence, impacts your energy, and ultimately affects your ability to succeed.
Entering a new field naturally comes with some level of insecurity, but continually telling yourself “I don’t think I can do this” will ensure that you can’t. Instead of second-guessing yourself, focus on taking action and improving every day.
Successful people focus on the positive. Let’s talk about what you should prioritize during your first year as a real estate agent.
Confidence comes from within, and it starts with your thoughts and words. Focus on what you do well, and confidence will guide you through challenges. Surround yourself with confident people—their success can inspire you to grow.
Confidence is not only beneficial for you but also builds trust with your clients, making them believe in your capabilities as an agent.
Challenges are a daily occurrence in the real estate business, but letting obstacles cloud your mindset will only hinder success. Approach every challenge with a solution-based attitude.
Being optimistic and focusing on finding solutions will help you keep moving forward.
Continued success is centered around continued learning. The most successful real estate agents know that their learning journey never ends. Seek out opportunities to grow and expand your knowledge.
This proactive learning mindset will help you reach the next level in your career.
Maintaining the right mindset can be challenging, but seeking out positive resources and outlets can help.
Your environment, the people you surround yourself with, and even your own actions can either support or undermine your mindset.
For example, music can be a great resource for keeping you motivated and energized while you work. But be mindful—a slow ballad might not be ideal if you need an energy boost for a run.
Consider where you’re working. If you’re feeling secluded at home, try changing your environment. Working in your office with like-minded people can keep you engaged, focused, and encouraged.
Seek out networking groups and talk to people achieving high levels in real estate—their success can be both motivational and inspirational. Attending seminars can also be beneficial, but be cautious of those promoting a "get rich quick" mindset.
As you embark on your new real estate journey, remember that you already possess everything you need to be successful. Tap into your confidence and stay optimistic.
Be solution-based when confronted with adversity and continually strive to expand your knowledge. Surround yourself with people who operate at a high level to foster growth in yourself and your business.
Just as important, learn to recognize when you are getting in your own way. Be mindful of negativity, avoid self-doubt, and leave insecurities behind. You have the power to actively shut out counterproductive thoughts.
In the end, your mindset controls your actions, and your actions will determine your success.
Everyone is trying to get the best deal for their dollars.
Whether you’re a first-time homebuyer or a real estate investor, it’s tempting to make a lowball offer on a property.
The success of these offers depends on several factors.
Buyers who understand the elements at play in the real estate market have a better chance of having their lowball offers accepted.
Lowball offers are significantly lower than the asking price of a home.
Commonly an agent will recommend negotiating a price on a home that’s lower than the asking price. This is to get a better deal for their client.
But, a lowball offer is even lower than that.
Generally, one would assume that a seller wouldn’t ever consider making an offer that is significantly less than their listing price.
But, there are times when sellers are willing to take a lowball offer seriously.
A major factor that affects how a lowball offer is received is the market trend.
In markets where real estate deals are moving quickly and there’s high demand for property, such as a seller’s market, the sellers are less likely to accept a lowball offer.
There are too many potential buyers who would pay the full asking price (or more) for the property.
Lowball offers are typically unsuccessful in this kind of market environment.
Another aspect that will determine how likely a lowball offer is to succeed in the days on the market.
A seller whose property has been on the market for one week may be less willing to consider a low offer than a seller who has been on the market for 3 months.
Properties that are new to the market have a high chance of securing higher offers, especially if they are priced correctly.
Houses that have been on the market for a while maybe priced too high for their location or not be in the best shape. For buyers looking to purchase such properties, consider including a justification for the low price offer.
Another factor that can determine whether or not the seller will accept a low offer is the seller’s motivation to sell.
For instance, if a seller has purchased another home or is in the process of relocating, they may be in a rush to get the property off their hands. The money may not be as important to them, so they will consider any offer, low or not.
Conversely, if the seller does not have time constraints or is selling specifically for the money, they are more inclined to wait for the best offer. If the owner is motivated to sell, a lowball offer has a higher chance to succeed.
Buyers can always ask the listing agent why the seller is selling the property. This information will give buyers an idea of how likely the seller is to accept a lowball offer.
Buyers need to be strategic when making lowball offers on a property. If a buyer comes across their dream home and the asking price is fair, it’s a good idea to make an offer close to the asking price.
For perspective, there are a few different options a seller has when faced with an offer. The seller can either accept the offer, propose a counteroffer, or reject it outright.
If the offer is too low, especially on a well-priced listing, the buyer runs the risk of having the offer rejected and losing the opportunity to own that home.
If a buyer is still aiming for a lower price on the home but wants to minimize the risk of getting rejected, making an offer no more than 10% less than the listing price is a great place to start.
It shows the seller that the buyer is serious about the home, but believes there is some room for negotiation regarding the asking price.
A real estate investor has different goals than the average homebuyer, so they’ll take a different approach.
The goal for real estate investors is to make a profit from their properties. The general strategy is to buy low, improve the property, and then sell it for a higher asking price.
Again, lowball offers are likely to be rejected. To account for this, real estate investors will submit offers on several properties at a time to increase their odds of securing a property.
While this is a common strategy, investors do not always need to acquire properties through lowball offers.
Many buyers can make reasonable offers on a property and still make a great profit. For example, outdated homes or homes that are in states of disrepair are likely priced low.
Investors can buy those properties at a fair price, then do the necessary repairs and upgrades and add some more square footage to the property.
These are simple ways to create a higher property value and increase the profit margin, especially when the property is in a desirable location.
The success of lowball offers hinges on a few factors.
First, the availability of homes on the market and demand will dictate how likely sellers are to accept a lowball offer.
Markets with high demand (seller’s markets) may not be the optimal condition for lowball offers.
Conversely, sellers who have been on the market for longer periods of time are often likely to consider low offers on the property.
Those who have the motivation to sell quickly may also entertain lowball offers.
Investors have more success when they make offers on several properties at once to increase the likelihood of having an offer accepted.
You’re excited and ready to start your new career – you don’t have time to wait to become a real estate agent in California.
Go-getters like you want to get their real estate license as fast as physically possible.
Oftentimes, it’s better to take your time through your real estate school because expediting the process could make the real estate exam harder.
But, if you have a familiar grasp on real estate and you’re ready to kickstart your new career, then buckle up. You’re about to learn how long it will take to get your real estate license in California.
The fastest way to get your real estate license is through an online program. In California, students are required to complete three college-level pre-licensing courses before qualifying for the salesperson exam, and DRE rules still make 54 days the fastest possible course timeline if you complete each course in the minimum allowed window.
There’s no way around that.
That means the real advantage comes from controlling the parts of the process you can control: how quickly you move through the coursework, how fast you submit your application, how carefully you avoid mistakes, and how soon you schedule your exam once you’re eligible.
If your goal is speed, here’s what that usually looks like:
California DRE currently allows qualified examinees to self-schedule an exam through eLicensing as late as 6:00 a.m. on the day of the exam, which gives fast-moving students more flexibility once they’ve been approved.
If you want to get licensed quickly, focus on the steps that create the biggest time savings.
Since there’s a minimum time required to spend in real estate school, you’re probably considering how to optimize your time.
By taking an online real estate courses only, you won’t have to wait on a cyclical class schedule. You can work at your own speed – which is really fast.
You must spend 18 days on each required course:
Learn the material, pass the final exam, rinse, repeat. Completing each course in 18-days requires you to optimize your schedule to make studying a priority.
When you finish your 135-hour program, file the Salesperson Exam/License Combo Application (RE 435) in eLicensing right away. It’s a single “combo” form that covers both your state exam and your first license.
The DRE now posts its queue every week: as of March 9, 2026, they are reviewing combo applications submitted February 25, 2026.
An even faster way is to apply online. The Department of Real Estate has an eLicensing portal which allows you to send your application online. This is easier because you don't have to wait on the postal service to deliver your application. DRE also recommends using eLicensing for faster service.
Once you’re qualified, eLicensing lets you choose from available exam dates and locations. DRE says qualified examinees can even self-schedule into an open exam as late as 6:00 a.m. on the day of the exam, although availability depends on application volume, seat capacity, and demand for the exam site you choose.
That means the fastest path is not just finishing your 54 days of coursework. It also comes down to submitting RE 435 promptly, completing fingerprints without delay, and scheduling your exam as soon as you’re eligible.
This way, the moment you pass the real estate exam, you get signed on at a brokerage of your choice. This means, you will instantaneously become a real estate agent in California. Nothing's faster than instantaneous!
Speed is great. Rework is not.
Application mistakes can create unnecessary delays. Missing information, mismatched names, incomplete uploads, fingerprint issues, or waiting too long to handle required items can all slow your path down.
If you want to move quickly, your best move is to submit a clean application the first time.
Studying for the real estate exam can quickly become overwhelming. There's three courses of material that you need to know and relying on your notes, textbooks, and free online content will only get you so far.
That's why I would highly recommend our exam prep package and crash course. When you join our exam prep program it consolidates everything you need to know to pass into one, easy-to-use, online portal.
You get unlimited practice exams, digital flashcards, an eBook study guide, video explainers, and 2,000+ question and answer videos. That's just the exam prep too!
The crash course will add an additional 16-hours of exam prep content led by a California real estate exam expert. We have crash courses in-person, online through Zoom Webinar, and in video format (which you can watch as many times as you want.)
Here's why the exam prep and crash course program is the fastest way to study for the exam. It consolidates all of the learning resources you need to pass the licensing exam on the first time into one, easy place. All you have to do is join for a weekend to learn the bulk of the material you need to pass and then you can use the exam prep package to learn even more. All it takes is an hour a night of taking the practice exams, learning what you got wrong, rinsing and repeating.
This program and study method has helped THOUSANDS of people pass and start their real estate careers.
Also, studying like this will guarantee you pass, first try. Which is more cost effective than taking the exam 3-4 times.
Most delays do not happen because the process is impossible. They happen because people lose momentum or make avoidable mistakes.
Here are some of the biggest slowdowns:
Momentum matters. When you pause too long between courses, application submission, or exam scheduling, the overall process stretches out quickly.
Some students choose slower class formats or wait for the “right time” to begin. If your main goal is getting licensed fast, self-paced online learning is usually the better option.
A simple mistake can cost more time than most students expect. Clean applications move better than rushed, sloppy ones.
If you don’t prepare well, you increase the risk of failing and retesting. That is one of the biggest delays of all.
This one sounds backward, but it’s true. Students who obsess over getting done fast sometimes skim too much, retain too little, and create more problems later.
Taking your time through real estate school will help you understand and master the learning material. This translates to knowing more, practicing real estate with integrity, and building a powerful career.
When you take a structured program like our live training, you get the extra details that help you when you start your career. You also get the added benefit of having the most important information broken down for you. It makes learning simpler.
Best of all, you build a relationship with the trainer, an active agent, and the rest of the class. In the end, understanding the material can actually help you get your real estate license faster because you’re less likely to retake quizzes, tests, or even the licensing exam.
California allows you to get your license in less than one year from the day you enroll, and for many people, the process can move much faster than that.
Some students try to complete everything as fast as possible. In some cases, that works well. But the real goal should not be rushing blindly. The smartest way to get your California real estate license fast is to avoid delays, stay organized, and move quickly through each required step without sacrificing your understanding of the m
Setting clear goals is essential for agents to thrive in their real estate careers. Without defined objectives, it’s easy to feel overwhelmed by daily tasks and lose focus.
Aligning personal goals with career milestones ensures every action contributes to meaningful success. Whether it’s building a real estate sphere of influence (SOI) or increasing income, each step becomes purposeful.
Goal-setting provides clarity, helping agents prioritize opportunities that match their ambitions. It also helps avoid distractions that don’t align with their plans.
Having a clear direction keeps motivation high, even during setbacks. It reinforces the purpose behind the hard work.
Start by visualizing where you want to live and work, and who you want to surround yourself with. Think about the types of colleagues, mentors, or clients you aim to have in your life over the next five years.
When setting real estate goals, it’s important to be specific. Avoid vague ideas like “I want to be successful” and instead define what success means to you. Success could mean achieving a target income, closing a set number of deals, or even purchasing a new home.
These real estate goals examples keep your vision clear and actionable. By narrowing down your focus, you’ll know exactly what you’re working toward and stay motivated along the way.
Turn every target into a SMART goal—Specific, Measurable, Achievable, Relevant, Time-bound.
These examples keep your vision clear and actionable. By narrowing down your focus, you’ll know exactly what you’re working toward and stay motivated along the way.
Breaking down long-term real estate agent goals into measurable real estate KPIs makes them more achievable. Start by identifying smaller, immediate objectives that align with your 5-year vision. These short-term goals provide a clear path, helping you stay focused on daily tasks while working toward bigger achievements.
Setting milestones along the way keeps you motivated and on track. For example, you might aim to close five deals in the next quarter or expand your professional network by meeting three new referral partners.
These smaller steps ensure steady progress toward your larger goals in real estate, making the journey more manageable and rewarding.
Research plays a crucial role in achieving your real estate goals. Start by exploring both online and offline resources to gather valuable insights. Blogs, YouTube videos, and podcasts are excellent sources of information and inspiration to help shape your action plan.
In addition to online research, connect with real estate mentors and role models for guidance. Meet with experienced professionals, whether they work within real estate or in other industries, to learn from their successes and challenges. These conversations can provide fresh ideas and motivate you to stay focused on your goals for real estate agents.
Visualization tools are powerful for staying focused on your real estate agent goals. Creating a vision board helps keep your objectives top of mind with constant visual reminders.
Seeing your goals every day reinforces your commitment and keeps motivation high, even during setbacks. It ensures you stay aligned with what matters most.
You can also use technology by creating a digital vision board. Make a collage of your real estate goals examples and set it as your phone wallpaper.
Since your phone is something you check often, these reminders will keep your goals in real estate front and center throughout the day.
Knowing when to say no is essential for staying aligned with your real estate goals. Not every opportunity will fit into your long-term plan, and saying yes to everything can pull you off course.
Focus only on opportunities that move you closer to your goals for real estate agents. This helps conserve your time and energy for tasks that truly matter.
Setbacks are inevitable, but they offer a chance to reassess your progress. When challenges arise or priorities shift, take time to reevaluate your goals and adjust your plan as needed.
Staying flexible ensures you remain on the right path while keeping your goals in real estate within reach.
Plan with 2025 baselines in mind (mortgage rates expected around the mid-6% range and total home sales near ~5.0M), then back into realistic monthly targets
Staying focused on your goal path is key to long-term success. A clear roadmap keeps you moving forward and helps prevent career stagnation by giving you direction and purpose.
Regularly tracking your progress ensures you stay aligned with your real estate agent goals. Periodic reviews also allow you to identify what’s working and what needs adjustment.
As your career evolves, your real estate goals may need to shift too. Making timely adjustments ensures your goals stay relevant and keeps you on track toward meaningful progress.
Once you have created your 5-year plan, it is important to remember that this may evolve over time. A goal that you have set three years ago may not be completely true and relevant to where you are now. What’s important is that you continually observe where you are in your career and adjust.
What are your 5-year goals? How do you plan on accomplishing them? Let us know in the comments section below!
About 4 in 10 first-time test takers fail the real estate exam, according to the California Department of Real Estate (DRE). Most of them put in the hours. They didn't know how to study for the real estate exam the right way.
This guide shows you how to study for the real estate exam: how many hours you need, what to focus on, and the 10 study habits our trainers have watched work for thousands of students. The real estate exam is the state-administered test you must pass after finishing your pre-license courses to earn your license. No matter which state you're in, the study method is the same.
| Question | Quick answer |
|---|---|
| How many hours should I study for the real estate exam? | Plan on 60 to 80 total hours: 8 to 10 hours a week for 6 to 8 weeks. |
| Is the real estate exam hard? | It fails a lot of people. In California, 63% of first-timers pass and only about 20% of retakers do, per the DRE. |
| What's the best way to study? | Short, scheduled study blocks plus repeated practice exams. Rereading your textbook is the weakest method. |
| Can I cram for the exam in a week? | You can, but it's risky. If you're short on time, a structured crash course beats solo cramming. |
| What score do I need to pass? | Most states require 70% to 75%. California salespersons need 70%, per the DRE. |
Plan on 8 to 10 hours of studying per week for 6 to 8 weeks, which works out to 60 to 80 total hours for most people. If you finished your pre-license courses last month, you can land on the short end. If it's been six months since you cracked a book, give yourself the full eight weeks.
The total hours matter less than the rhythm. Ten hours every week for six weeks beats 60 hours jammed into the last ten days, because your brain needs repeated exposure to store this material. For a deeper breakdown by timeline, see our guide on how long to study for the real estate exam.
Every state's exam draws from the same seven core subjects: property ownership and land use, laws of agency, property valuation and appraisal, financing, transfer of property, real estate practice and disclosures, and contracts. The wrapper changes by state. The material doesn't.
California is a useful example because it's one of the biggest testing pools in the country. The California salesperson exam is 150 multiple-choice questions in 3 hours, and you need 70% to pass, according to the DRE. Our California real estate exam guide covers the state specifics.
Your state outlines its own exam content on its real estate commission or department website. Read that outline before you build your study plan. It tells you exactly where the points are.
The tips below cover scheduling, practice testing, memory tools, and test-day mindset, in the order that matters most.
A study schedule turns studying from a vague intention into an appointment. Pick fixed days and times, like Monday through Friday, 6 to 8 p.m., and treat them the way you'd treat a client meeting. Phone off, door closed.
The schedule you'll keep beats the schedule that looks impressive. Three honest sessions a week beat seven imaginary ones.
Long marathon sessions feel productive and aren't. After about two hours, retention drops and frustration climbs, and frustration is how burnout starts. Study in two-hour blocks at most, take real breaks, and stop while you're still absorbing.
Practice exams are the single highest-value thing you can do with your study time. They show you what the test asks, how it phrases questions, and exactly where you're weak. Start them in week one, not the final week.
Our rule of thumb: when you can score 80% or higher on five practice exams, you're ready. Start with these 25 must-know questions for the national real estate exam.
Don't grind one topic until you hate it. Rotate through the seven subject areas across the week: contracts on Monday, financing on Wednesday, agency on Friday. Rotation keeps sessions fresh and forces your brain to retrieve older material, which is what locks it in.
Everyone has a subject they quietly hope won't show up. It will. Once you've covered everything once, circle back to your worst area and break it into small pieces. Figure out which specific concepts confuse you and work through those, not the whole chapter.
A mnemonic is a memory shortcut that compresses a list of facts into one word or phrase. Real estate is full of them, and the exam rewards people who use them.
Two you'll want on test day: M.A.R.I.A. (method, adaptability, relationship, intention, agreement) for deciding whether something is real or personal property, and U.P.T.E.E. (use, possess, transfer, encumber, enjoy) for the bundle of rights. We keep a full list in our real estate exam acronyms guide.
A study partner or group gives you three things solo study can't: impromptu quizzing, accountability on the days you'd rather skip, and the chance to explain concepts out loud. Teaching a topic to someone else is one of the fastest ways to find out whether you understand it.
Sleep is when your brain files what you studied. Pulling a late cram session the night before the exam trades a few extra facts for foggy recall on all of them. Bad trade. Close the book early, get a full night, and walk in sharp.
Self-study works until it doesn't. If your practice scores have plateaued or you keep missing the same question types, a structured program with flashcards, mock exams, and a trainer to ask questions gets you unstuck faster than another solo weekend with the textbook.
Most exam questions are more direct than nervous test takers believe. When you catch yourself hunting for a trick, take a breath and remember: a five-dollar bill is a five-dollar bill. Read the question, answer what it asks, and move on. Don't question the question.
Yes, the numbers say it's harder than most people expect. According to the California DRE's 2024 Sunset Review report, 63% of first-time test takers pass, and the pass rate for retakes drops to about 20%. That gap is the whole argument for preparing properly the first time.
How do you know if you're ready? When you score 80% or higher on five practice exams in a row, you're ready. If you're not there yet, you don't need more confidence. You need more reps.
There's no secret formula here. Get on a schedule, keep sessions short, drill practice exams until 80% feels routine, and sleep before test day. Do that for six to eight weeks and you walk in as the prepared minority.
The studying is the hard part. The exam is the receipt.
If you want the schedule, flashcards, mock exams, and trainer support in one place, our exam prep package is built for exactly this. Start your exam prep with US Realty Training and pass it the first time.
A common phrase in real estate is, “when you list, you last!” Depending on the market, a listing is almost guaranteed to sell.
The only problem: getting the listings.
So, how does one become a successful listing agent? What aspects help a listing agent’s longevity in the real estate industry?
Bryan Collins, also known as the Listing Guru, shares the process that has helped him become a successful listing agent.
Prospects gravitate towards something that feels personal.
A more personal approach lets them know that you’re a human being with both a personality and a heartbeat.
They are deciding whether or not they can trust you. Selling a home is a highly-personal transaction and process.
A home is someone’s safe space and is a huge investment. Buying a home is a big commitment and so is selling one.
That’s why, whenever you generate new leads, you must show that you’re not only a likable person but someone they can rely on to handle their biggest investment.
What are the warm, friendly lead generating ideas that add a personal touch?
From mailers to flyers or even handwritten letters. Compared to a generic email, a handwritten letter makes the process a whole lot more personal. This creates a better opportunity for you to build a strong relationship with the seller.
Another strategy for lead generation is the ever famous door knocking. Although this method will need a lot more effort and time, it is still a strong strategy that works.
Here’s why:
This strategy shows the seller that you’re willing to go the extra mile to serve them as your clients. On top of that, door knocking gives you the chance to have conversations with your prospects. You can then answer their questions or provide them with a home value report of their property.
Use this magnetic strategy to strike up a conversation: Create home value reports and send them to prospects who have defaulted on their home loans. Sending a home value report to prospects will help them see that they have an accessible option that will stop them from accruing debt.
Knowing how to price a property is paramount to your success as a listing agent.
Pricing a property gives your prospect a ballpark range of the money they can get when they work with you. You’re giving them the price of how much you think their home is worth.
Whether they are looking to rent, downgrade, or upgrade, showing them how they can earn money helps them achieve their dream. That’s what makes this a powerful way to spark a conversation. You open a dialogue with the homeowner to understand their vision for their future.
When you talk about pricing, this gives them a tangible number to work with. It shows the homeowner a lump sum of money that they can use to invest however they want. This realization is exciting for everyone, because it’s a spark of a new chapter for both parties.
If you feel like you’re not great at pricing properties yet, no problem.
Here’s a quick way to get better at pricing: test yourself through the MLS. Look at the details of the house, guess a price, and check the actual value of the home. Another way is to have other agents estimate your home’s value. If your answers match, you’re improving.
Another crucial skill of a successful listing agent is breaking bad news to your clients. The real estate industry is harsh and you can’t avoid tough conversations.
Along the way, you will discover a major issue with a property that can ruin a deal. As a listing agent, it’s your job to have honest and clear conversations with your client.
Nobody wants to hear bad news but it is harder to be the bearer of bad news. Having to tell a client that their asking price is too high and unrealistic is difficult.
When and how you deliver bad news is crucial.
Also, time is a valuable resource. Breaking bad news as early on as possible is key. You wouldn’t want to be wasting your time away if you know a deal is not going to work out.
The same goes for your client, they need to be aware of these things as soon as possible. The sooner you break the bad news to your clients, the sooner they will be able to rethink their strategy.
Developing great marketing skills is essential to one’s longevity in this industry. As a listing agent, you are first in the business of generating and nurturing leads.
The fact is, you can be the best real estate agent but without great marketing skills, that means nothing.
If people can’t find you, then it doesn’t matter if you’re the best at what you do.
Regardless of how often or consistently you market yourself, your messaging has to be right. Know who you’re selling to, identify their problems, and let them know you can solve their problems for them.
The quicker your prospects realize that you’re the solution they need, the easier it is for them to get on board.
As a real estate agent, you are dealing with a multitude of moving pieces. You have many clients who are at different stages within different transactions. Also, you’re looking for new leads while dealing with your daily tasks.
This is a recipe for clustered disorganization.
It is easy to get disorganized and lose track of your client’s progression. As a listing agent, you are the negotiator, transaction coordinator, the director. You have to stay on top of the transaction.
One of the most important aspects of staying organized is great communication. Again, you have to be direct and clear in what you say.
Make sure your clients are current and in the know with the status of their deal. If you are representing a couple, make sure both parties are up to date.
Take advantage of reminders, calendars, schedulers, spreadsheets, whatever your poison might be. This is what determines whether clients walk away happy or displeased.
Tech adaptations in the industry make things easier for everyone. In some cases, agents will inundate themselves with industry hacks and tech innovation because they want to get ahead.
What those agents lose sight of is one simple thing: the basics.
Real estate has been around for a long time. There’s a stack of methodologies that have stood the test of time and has transformed thousands of people into successful listing agents.
As you press forward into your real estate career, remember adapting to the times is important. But, it’s even more important to stick with tried and true methods that produce repeated positive results.
Remember: Lead generating comes down to finding an accessible way to talk with your target audience and scaling that over a wide area. Real estate is a game of numbers. Lead generate, find clients, help people, and repeat.
You don’t need to complicate it. As a real estate agent, you already have the knowledge and tools for closing a transaction. The bottom line is, you don’t always have to reinvent the wheel. Evolving with the times is natural and great. But sticking to what you know is what will work.
Don’t forget about the human part of the job. Once you close a deal and get your paycheck, remember to stay in touch with your client.
After all, you helped them sell one of the biggest assets they’ll own. You can send your former prospects a postcard over the holidays. Something as simple as a checkup also works.
What’s important is that you maintain a relationship with a client even after the deal is over.
Referrals fuel your business. As long as you stay in touch with your former clients, there is a huge chance that they will refer you to people they know.
Although there are a lot of factors that can dictate the success of an agent’s career, these 7 tips are a great framework. You have to remember that this is a long-game and it’s all about consistency.
Your California real estate license expires every four years. Renewing it takes 45 hours of coursework, one online filing, and a fee. The whole thing stays easy right up until you leave it too late.
This guide covers the full California real estate license renewal: what the Department of Real Estate requires, what it costs in 2026, why your first renewal is harder than every renewal after it, and how early to start. Every requirement below comes from the DRE's own published rules, linked so you can check them yourself.
A California real estate license is valid for four years and must be renewed on or before the expiration date printed on it. This is the same for salespersons and brokers.
A real estate license renewal is the state filing that extends your license for another four-year term. In California, it requires proof of continuing education plus a fee.
According to the California DRE, the department emails a courtesy renewal reminder to your address on record roughly 90 days before your expiration date. Treat that as a backstop, not a plan. The DRE states plainly that not receiving the notice does not excuse you from renewing on time. Put your expiration date on your calendar the day you get licensed, and if you are not sure what that date is, you can look up your license number and status in the DRE's public records in about a minute.
You renew a California real estate license in three steps: complete 45 hours of DRE-approved continuing education, enter your course numbers and completion dates into the DRE's eLicensing system, and pay the renewal fee.
Your renewal counts as on time if the eLicensing transaction is completed before midnight on your expiration date. Filing on paper instead? You mail the Salesperson Renewal Application (RE 209), the Broker Renewal Application (RE 208), or the Corporation Officer Renewal Application (RE 207), plus the Continuing Education Course Verification (RE 251) and the fee, postmarked before midnight on that same date.
Here is the part most agents do not know: according to the DRE, if you renew on time, Business and Professions Code Section 10156.2 lets you keep working under your existing license after its printed expiration date while the department processes the renewal. File late and that protection disappears.
California requires 45 clock hours of DRE-approved continuing education for every real estate license renewal, for salespersons and brokers alike.
Continuing education, or CE, is the coursework the state requires you to complete each license cycle to stay current on law, ethics, and practice.
Per the California DRE, those 45 hours always break down the same way at the top level:
The 18-hour consumer protection minimum is fixed. It applies to your first renewal and every renewal after it.
On your first renewal you must take each mandatory subject as its own separate course. From your second renewal onward, you can replace all of those mandatory courses with a single nine-hour CE survey course.
A CE survey course is one nine-hour class that bundles all seven mandatory California subjects into a single course with a single final exam.
Two details in that table trip people up every cycle.
Management and supervision changes hands. On a first renewal it is a broker-and-officer requirement only. From the second renewal onward, the DRE lists it among the seven mandatory subjects for all licensees, whether you take the survey course or individual classes. Salespersons who assume it never applies to them are reading first-renewal rules into a later cycle.
Trust fund handling never goes away. Older guides floating around online claim you can drop it after your first renewal. That is wrong. The DRE still lists trust fund handling as a mandatory subject on every subsequent renewal.
Also worth knowing: the interactive participatory component required in the fair housing course is not a formality. Regulation 3015 defines it as instruction where the instructor actively involves students through instructor-student or guided student-student interaction, and the DRE expects you to role-play as both consumer and licensee. If a fair housing course does not clearly include it, it will not satisfy the requirement.
If your first renewal is coming up and this is all new, our guide on what to do after you get your real estate license covers the rest of the year-one admin.
Renewing a California real estate license on time costs $350 for a salesperson and $450 for a broker, according to the DRE's published fee schedule.
Two costs total, then: the DRE fee above and your CE courses. USRT's 45-hour California CE package runs [PRICE], which covers every course the DRE requires for your cycle.
Renewing late is not a small penalty. It is a 50% surcharge, meaning $175 more for a salesperson and $225 more for a broker, and you cannot legally work during the gap. Confirm current amounts on the DRE's fee page before you pay, since the department can revise the schedule.
The fastest you can legally finish a 45-hour California CE package is three days, because the DRE caps final exams at 15 credit hours per any 24-hour period.
Here is the mechanism, straight from Section 3007.3(c) of the DRE's continuing education regulations. A 45-hour package has to be split into three 15-hour exam segments, and the regulation states you cannot be granted access to the next segment until the 24-hour period has lapsed. Three segments, two mandatory 24-hour waits: three days minimum, no exceptions, no matter how fast you read.
In practice, plan on about six days. You still have to move through 45 hours of actual course content, and Regulation 3006(o) requires internet course providers to control your navigation so the material cannot be completed in less time than its approved hours. There is no clicking through it. Six days is a real target for someone studying hard. Three days is a regulatory floor, not a schedule.
Start your California renewal 120 days before your license expires. That gives you a full month of buffer before the DRE's 90-day filing window even opens.
We call this the USRT 120-Day Renewal Runway, and it is built backward from the one date that cannot move:
Miss step 4 and you are relying on step 5. Miss step 5 and you are reading the next section.
Yes. California gives you a two-year late renewal period after your expiration date, but the DRE is explicit that you cannot perform any activity requiring a real estate license until your renewal is processed and your status shows as current.
Late renewal costs $525 for a salesperson and $675 for a broker, and your CE has to fall within four years of the date you file, not your original expiration date. Past the two-year mark, the right to renew is gone entirely and you start over as a new applicant, exam included.
If your license has already lapsed, the full walkthrough is in our California late and expired license renewal guide, which covers the forms, the CE timing rules, the 90-day RE 213 extension, and the 70/30 exemption for long-time licensees.
USRT's California CE package covers all 45 DRE-required hours in one enrollment, structured to satisfy both the mandatory subjects and the 18-hour consumer protection minimum.
Here is how our 45 hours are built. This is USRT's specific package, not the DRE's required topic list. The DRE sets subject and category minimums, and schools build packages that satisfy them:
You get chapter quizzes throughout, an open-book final exam, and your DRE course completion certificate immediately on passing.
California real estate license renewal is not complicated. It is 45 hours, one filing, and one fee, every four years. What trips agents up is timing and cycle confusion: starting too late, or buying a first-renewal course package when they needed a survey course, or the reverse.
Confirm your expiration date and your cycle today. Then work the runway backward from it.
Start your 45 hours now: enroll in USRT's California continuing education package and finish every DRE-required hour in as little as six days.
There are lots of ways you can hold property ownership.
Some ownership types impose conditions or restrictions that don’t allow the homeowner to fully exercise their “bundle of rights”.
The term “fee simple ownership” refers to one’s complete right and legal privileges over a real estate property. This means it’s the most complete form of ownership, with very few limitations—other than those imposed by law (like taxes, zoning/building rules, and government powers) and any recorded encumbrances (like easements or CC&Rs).
Let’s discuss what this means for the homeowner and what rights and privileges are included with Fee Simple Ownership.
To understand fee simple ownership, let’s start by discussing what a freehold estate is.
As the name implies, when you have a freehold estate that means you hold the estate freely. You are free to do what you want with the property while you presently own it. (as long as it’s lawful and not restricted by things like zoning, taxes, easements, or deed restrictions). You also have the rights to the property for an indefinite period.
You have what’s called the “bundle of rights”. This means full ownership and legal privileges over a property.
This bundle of rights allows the homeowner to do a multitude of things with the property. Here is a breakdown of the benefits that are included with the bundle of rights, also called U.P.T.E.E.:
USE – The owner has the right to use the property as he wishes (lawfully).
POSSESS – The right to live on the property and exclude others.
TRANSFER – The right to sell it, gift it, will it off, etc.
ENCUMBER – The right to use the property as security to borrow funds.
ENJOY – The right to enjoy the property without interference from others.
Even in fee simple, these rights can still be limited by the four government powers (taxation, eminent domain, police power, escheat) and by encumbrances like easements, liens, and CC&Rs.
As long as a person is on title, they will enjoy the bundle of rights under the freehold estate and all that it has to offer.
Now that you understand what the freehold estate is and what it entitles the owner, you can understand fee simple ownership. This is a form of freehold ownership and a subcategory under the freehold estate.
Fee simple ownership is also known as fee simple absolute because the holder has full ownership.
There are property ownership types that come with certain restrictions or conditions. Fee simple defeasible falls under this category.
Defeasible means able to be revised, voided, or annulled.
In relation to real estate, it’s referring to property ownership. With fee simple defeasible, ownership is transferred with some condition or restriction placed on the property. If that condition is violated, the ownership may be defeated—and depending on the deed language it may revert to the original owner or pass automatically to another named party.
There are 2 types of defeasible estates – fee simple subject to a condition subsequent and fee simple determinable. (These are the two most commonly taught in real estate exam prep. In property-law sources, you may also see a related category: fee simple subject to an executory limitation.)
The conditions or restrictions placed on the property can vary. Here’s an example of fee simple subject to a condition subsequent:
The land is located near a protected wildlife area. The property will be sold on the condition that the land must be preserved. If the property is ever developed, that would violate the condition and result in loss of ownership.
In this scenario, if the condition is violated, the original owner has the “right of re-entry”. But this doesn’t happen automatically. The original owner would have to go to court to re-establish ownership.
With fee simple determinable, the condition refers to the property’s use while ownership is being held. This is an example of fee simple determinable:
You have a property sold on the condition that while it is being held, it will be used as a school. If the property at any point is not being used as a school, then they are at risk of losing ownership.
With fee simple determinable, if the property condition is violated, the ownership automatically reverts back to the original owner.
The life estate is another form of the freehold estate. This is when the owner of a fee simple, also known as the “grantor”, gives ownership to a person for the duration of their life. The person receiving ownership is called the life tenant.
The life tenant enjoys most of the ownership rights while in their possession. They can use and possess it as described in the “bundle of rights”. They also enjoy the right to rent or lease the property and received the income.
Upon the life tenant’s death, the ownership reverts back to the original owner or can be passed on to another party.
Creating a life estate is particularly useful in estate planning.
Normally, a will is created and then goes through probate. Probate is a court-supervised process intended to authenticate a last will and testament. This can be a lengthy process depending on the assets and how quickly the documents are filed.
Instead of creating a will, you can set up a life estate. When the ownership is set up in this way, you can avoid probate.
There are different types of fee simple ownership. Some with viable reasons for restrictions or conditions.
When it comes to ownership, fee simple or fee simple absolute allows for the most rights and privileges under the law. It is unrestricted and has no conditions. Fee simple ownership allows you to fully enjoy the “bundle of rights” afforded to homeowners. Fee simple is only one of the ways to hold title to a property, and the exam tests all of them.
That means you can paint your house pink or knock down a wall if you want. You can choose to live on your property or rent it out.
If you are a private or solitary person, you can put out a “no trespassing” sign. It is your right and you can exercise it.
How does a real estate agent help their client buy a home?
You get the idea of how it all works: agent meets buyer, buyer meets home, dreams are made, and you get paid!
But, when you zoom in on the process, what’s really going on? How does it all come together?
Here’s a step-by-step rundown of the home buying process to help you close that deal.
Your client’s pre-approval letter is your ticket.
A pre-approval letter determines how much of a mortgage loan the homebuyer is qualified for; unlike a quick pre-qualification, it is issued only after the lender verifies income, assets, and runs a hard credit check.
This will determine your client’s price range. As an agent, this is important information to have because it will help you narrow the parameters during the next step.
Since Aug 17 2024, every REALTOR® must have a written buyer-representation agreement in place before any in-person or virtual home tour. Make this the very first form you present to a new buyer so showings don’t get delayed.
This is when the search begins. To find the perfect home for your buyer, you must use two qualifications to narrow your search.
The first qualification is that it must fit within your client’s budget. Based on the pre-approval letter, go to MLS and search for listings that are within the budget. The second qualification is that it is a property that your clients might be interested in.
Once you have found 5 to 6 properties, it’s time to showcase them to your client.
Previewing properties with your client will give them a chance to interact and see themself in the house. To set up a preview, go through your list of properties and contact the listing agents for a showing.
Once your client are there it is important for you to observe how they react towards the property. Take note of every comment that they have. Whether it’d be something they like or dislike. This is valuable information.
This is where you actually see if the property fits their lifestyle. Based on this information, you can adjust your parameters to find the perfect home.
It will also give your client an opportunity to check out the condition of the home as well as the surrounding area.
Time for negotiation.
After you and your client found the perfect home, you have to make an offer on it. You will use the Residential Purchase Agreement (RPA) to pitch your offer. The RPA is a contractual agreement between the buyer and seller on an agreed upon price of the home.
In the State of California, the RPA is always utilized when making an offer. So, discuss with your client about what the right offer should be. Based on the economy and the real estate market, what is a reasonable offer for that home? With 30-year fixed mortgage rates hovering around 6.7 % as of August 2025, many buyers offset higher monthly payments by negotiating seller-paid closing-cost credits or a temporary “2-1” rate buydown—concessions you can write directly into the RPA. Our guide to navigating a market with high interest rates covers buydowns and loan assumptions in more detail.
Use this opportunity to consult with your client and share your thoughts. You’re the real estate expert!
When the offer is accepted – it’s a great day! Escrow opens and you’re off to the races.
Opening escrow starts the exchange of money. This is where money is deposited into an escrow account, inspections and appraisals start, and other payments are made. An escrow company holds the money in a secure location to ensure that the seller gets paid and the buyer receives their home at the end of the transaction.
Here’s one of the most important steps in the home buying process. The next step is for the homebuyer to do their inspections, lenders to perform appraisals, and to review the disclosures. California’s RPA still sets a 17-day default for investigations and appraisal contingencies - so time is of the essence!
The buyer will hire the inspector, which you can recommend to them. This will help identify problems with the property before they become disasters. Property issues will also be noted in the disclosures.
In California, real estate agents are required to disclose defects on a property. But, sometimes, they go unnoticed. That’s why hiring an inspector is vital to ensure your client isn’t about to invest their money into a house of cards.
Also, the lending company will send an appraiser to value the property of the home. The buyer often finances the appraisal. By doing so, they will get an updated price on the property. Sometimes, the buyer might find out that the home is actually undervalued.
Once the inspections are done, appraisals are made, and disclosures are sent, it’s time for one, final step: the final walkthrough!
This is where you and your client confirm that the property is in great condition. You’d want your clients to sign the Verification Property Condition (VP.) This document states that the client agrees that the property condition meets their standard.
Always schedule the final walkthrough at the end of the transaction. Here’s why:
The final walkthrough confirms the status of the property. If the final walkthrough is conducted before inspections are made, appraisals conducted, or disclosures are sent, then your client can sign off on a property that has unforeseen problems.
The final walkthrough lets the buyer give the “green light” on sealing the deal. That’s why you need to be absolutely sure that the property is in the buyer’s preferred condition before the final walkthrough.
This is the step where the bank gets involved. The bank will go ahead and verify that the appraisal looks good. This is where the bank now wires the money to either the title or the escrow company. Funding is a great day in the home buying process!
This is where the county declares that the ownership of the property has been transferred to your client. Congrats – the deal is done! The seller gets their money, the buyer gets their home, and you get your commission check. It also signifies the end of escrow.
What separates the newbie agents from the pros is this final step.
You helped your client buy their dream home, you made the process as easy as possible, and everyone had an incredible experience. At this point, emotions are high and the rewards are amazing.
The relationships you make in this career are your lifeline. They help you get more business so you can help people and get paid for it. That’s why you should always ask for referrals or, the very least, a review.
A referral to a friend is all you need to get your next client. If the client had a great experience with you, then they will have no issues recommending you to the next person they know who is buying or selling a home.
Under the 2024 NAR settlement, every buyer must sign a written representation agreement; compensation is fully negotiable. Buyers may pay their agent directly, ask the seller for a credit, or split the cost.
Most lenders keep a pre-approval valid for 60–90 days; after that you’ll need updated documents and a fresh credit pull.
Freddie Mac’s weekly survey for August 1 2025 pegs the national average at 6.72 %.
A 2-1 buydown lets a buyer (or the seller) pay an upfront fee so the rate is 2 points lower in year 1 and 1 point lower in year 2 before resetting to the note rate—easing payments during the first two years of ownership.
Working with homebuyers is an exciting experience. You help people’s dreams come true! With high stakes and high reward comes responsibility.
The home buying process has many steps and it’s easy to get lost along the way or do something out of order. That’s why this process exists. Not only will it help you understand what needs to be done and by when, but it will also help you ensure the best quality experience for your client.
At the end of the day, isn’t that the goal?
If you're thinking about getting licensed, you're probably asking a very practical question: is a real estate license actually worth it?
For many people, yes — but not because the license creates success on its own. A real estate license is worth it when you use it as a tool to build opportunity: a new career, commission income, a part-time side business, a bigger network, or long-term flexibility in an industry with real upside. If you only want a one-time benefit and aren't interested in the work, it may not be worth it.
Here's an honest breakdown of the real benefits, who gets the most out of a license, and when it may not be the right move.
A real estate license is worth it if you plan to actively use it — to earn commission income, work flexibly (including part-time), build a business, and grow a network in real estate. As of May 2024, real estate sales agents earned a median wage of about $56,320 a year and brokers about $72,280 (U.S. Bureau of Labor Statistics), though pay is commission-based and varies widely. The value comes from using the license, not just holding it.
The better question isn't "Is a real estate license worth it?" It's "Will it be worth it for the way I want to use it?"
| Metric | Detail |
|---|---|
| Median pay — sales agents | ~$56,320/year (BLS, May 2024) |
| Median pay — brokers | ~$72,280/year (BLS, May 2024) |
| Income model | Commission-based (varies widely) |
| Typical entry-level education | High school diploma or equivalent (BLS) |
| Agents & brokers employed (U.S.) | ~532,200 (BLS, 2024) |
| Projected job growth, 2024–2034 | +3%, about as fast as average (BLS) |
Income figures are medians — half of agents earn more and half earn less. New agents typically earn well below the median while building a client base.
A license can be valuable for different reasons depending on your goals:
A license lets you earn money by helping clients buy, sell, lease, or refer business. Your income isn't capped the way it often is in hourly or salaried roles — but it's commission-based, so it rewards consistency and effort. (For context, BLS put the May 2024 median wage for sales agents at about $56,320, with top earners well above that.)
You don't have to jump in all at once. Many people start part-time while keeping their current job, learning the business and deciding whether to grow it. That lower-pressure entry point makes real estate attractive for career changers, parents, and side-hustlers.
Real estate isn't one lane. Depending on your market and brokerage, a license can support transaction income, referral business, leasing activity, and niche specializations — so you're not relying on a single narrow path.
You learn how properties are priced, how listings move, how contracts work, and how local trends create opportunity. That real-world market knowledge helps you make better decisions and operate with confidence — and it's valuable even beyond a single transaction.
Passing the exam is just the start. In the business you build communication, negotiation, marketing, follow-up, client service, and contract awareness — skills that compound over a career.
A lot of careers give you a position. Real estate can give you something you build: a niche, a personal brand, a referral base, and repeat business. If you want a path where your effort compounds over time, that ownership is a major draw.
Getting licensed connects you to an entire ecosystem — brokers, lenders, escrow and title reps, investors, contractors, inspectors, other agents, and clients. Those relationships drive referrals, support, and long-term growth.
A license usually becomes more valuable the longer you stay active. The real payoff rarely comes from one deal — it comes from building experience, a network, and repeat opportunities. Real estate rewards consistency more than curiosity.
Compared with careers that require years of college or graduate school, real estate is more accessible — the typical entry-level requirement is a high school diploma (BLS). You'll still need to complete your state's pre-licensing education, pass the exam, and keep learning, but it's a faster, more practical on-ramp to a profession with real income potential. Most states require roughly 60–180 hours of pre-licensing education, and getting licensed typically costs about $200–$1,500 and takes a few weeks to a few months, depending on your state.
A license isn't only for full-time sales agents. With one, you can:
That flexibility is a big part of why people ask not just whether a license is worth it, but what they can do with it.
Real estate commissions are negotiable — there's no standard, legally set rate. Since the National Association of REALTORS® (NAR) settlement took effect in August 2024, buyer-agent compensation is no longer advertised in the MLS, and buyers now sign written representation agreements before touring homes. For new agents, the takeaway is simple: be ready to explain your value and how you're paid.
A license isn't always the right move. It may not be worth it if:
The point isn't to talk you out of it — it's to be realistic. A license creates real opportunity, but mostly for people prepared to use it. Here are 10 things aspiring agents wish they knew before starting.
Real estate income is commission-based and varies widely. As of May 2024, the U.S. Bureau of Labor Statistics reported a median annual wage of about $56,320 for real estate sales agents and $72,280 for brokers. Half earn more and half earn less, and new agents typically earn below the median while building their business.
It varies by state, but most people spend roughly $200–$1,500 and take a few weeks to a few months. The biggest variable is your state's required pre-licensing education, which generally runs 60–180 hours.
No. The typical entry-level requirement is a high school diploma or equivalent (BLS). You must complete your state's pre-licensing course, pass the licensing exam, and meet your state's other requirements — but a college degree isn't required.
Yes. Many people use a license part-time, focus on referrals, or keep it active under a broker while working another job. The license is a tool — how much you use it is up to you.
Sometimes, but be realistic. You'd need to do enough of your own deals to offset the cost of getting licensed and staying compliant (education, fees, and continuing education), and commission arrangements are negotiable. For most people, the license pays off when they use it actively, not just for an occasional personal transaction.
You can represent buyers and sellers, handle leases and rentals, earn referral income, work part-time, apply market and contract knowledge to your own investing, and build toward a broker's license, property management, or commercial real estate.
For many people, a real estate license is worth it — if you want income potential, career flexibility, long-term opportunity, and a chance to build something of your own. It's especially worth it if you'll work consistently, grow your network, and develop real business skills over time.
Like anything, the value depends on what you do with it. If you're serious about using your license to grow, learn, and build, it can absolutely be worth it.
If real estate is your next step, the move is simple: learn how to get licensed in your state and choose a real estate school to help you get there.
California gives homeowners more time and more ways to stop a foreclosure than almost any state. But once the clock starts, every deadline matters.
This guide walks you through the California foreclosure process step by step: the timeline, the notices, the new laws that changed the rules in 2025, and what it all means whether you're studying for the exam or thinking about working the foreclosure niche.
A foreclosure is the legal process a lender uses to take back a property after the borrower stops making mortgage payments. The lender sells the home, usually at auction, to recover the money it loaned.
Here's the setup behind it. When someone buys a home with one of the common types of mortgage loans, they sign a promissory note, which is the written promise to repay. In California, that note is secured by a deed of trust, a document that gives a neutral third party (the trustee) the power to sell the home if the borrower defaults.
That "power of sale" clause is why California foreclosures skip the courtroom. The trustee runs the process, not a judge. Lawyers call this nonjudicial foreclosure, and it covers nearly every residential foreclosure in the state.
The California foreclosure process moves through five stages: missed payments, a notice of default, a notice of trustee's sale, the public auction, and eviction or resale. Each stage has a legal waiting period attached, which is why the process takes months, not weeks.
A California foreclosure takes about 200 days at minimum from the first missed payment to the auction, and most take longer. Add the 120-day federal waiting period, the 3-month reinstatement window, and the 20-day auction notice, and roughly 7 months is the floor. Postponements, loan modification reviews, and bankruptcy filings often stretch it past a year.
Since January 1, 2025, AB 2424 gives borrowers two more levers. Deliver a signed MLS listing agreement to the trustee at least 5 business days before the sale, and the auction must be postponed 45 days. Deliver a signed purchase contract at least 5 business days before the new date, and the trustee must add another 45. That's up to 90 extra days to sell the home on your own terms.
AB 2424 also added a price floor. At the first auction, the home can't sell for less than 67% of its fair market value. If no bid hits that number, the sale is postponed at least 7 days, and at the next auction the highest bid wins regardless.
A homeowner can stop a California foreclosure any time until 5 business days before the auction by reinstating the loan, selling the home, completing a short sale, or signing a deed in lieu of foreclosure. The earlier you act, the more options you have.
Reinstate or modify the loan. Pay the past-due amount plus fees, or negotiate a loan modification or repayment plan with the servicer. This is the cleanest exit, and Civil Code 2924c protects your right to do it.
Sell and use your equity. If the home is worth more than the loan, sell it, pay off the debt, and keep the difference. Say you owe $600,000 on a home worth $850,000. Selling clears the loan with room to spare. Here's a refresher on how equity works in real estate.
Short sale. If you owe more than the home is worth, the lender can approve a sale at market value. Under Code of Civil Procedure 580e, any lienholder that signs off waives the right to chase you for the shortfall. Junior liens on the property that don't sign still have to be cleared before escrow closes.
Deed in lieu of foreclosure. With the lender's consent, hand over the property voluntarily and walk away without an auction on your record.
One piece of good news either way: after a nonjudicial foreclosure, California law bars the lender from collecting the remaining balance. No deficiency judgment, period.
At the trustee sale, the home is sold at a public, cash-only auction to the highest bidder, or it reverts to the lender as a real estate owned (REO) property. The winning bidder gets title once the trustee's deed is recorded.
The sale isn't always final the moment the gavel falls. Under SB 1079, eligible owner-occupants, tenants, and qualifying nonprofits have up to 45 days after the auction to submit a higher bid on homes of one to four units. And if a large institutional buyer takes the property back as an REO, AB 2170 requires a 30-day "first look" period where only those same groups can make offers.
Former owners who stay put get a 3-day notice to quit before eviction. Tenants get at least 90 days, or the rest of their lease, under federal law.
Foreclosures are a workable niche for California agents again in 2026, because distressed inventory is growing for the first time in years. According to ATTOM's April 2026 Foreclosure Market Report, lenders started foreclosure on 2,786 California properties that month, the third-highest count in the nation, and repossessed 515 more, the second highest. ATTOM also reported national foreclosure filings up 18% year over year.
Short sales reward agents who can manage paperwork and lender timelines. Approval often takes 60 to 120 days, but fewer agents compete for these deals, and a closed short sale builds a reputation fast.
REO listings offer steadier volume and cleaner pricing, but the homes are often neglected, and SB 1079 and AB 2170 can slow how fast a bank-owned property reaches the open market. Know those timelines before you promise a client a quick close.
If you're not licensed yet and this niche interests you, start with our step-by-step guide to getting a California real estate license.
Foreclosure is a deadline game. A borrower who calls the lender at the first missed payment has half a dozen exits. A borrower who waits until the notice of trustee's sale has two or three, and they're all painful. Whether you're protecting your own home or guiding a client, knowing the timeline is the whole battle.
Terms like notice of default, trustee sale, and deed in lieu show up all over the California real estate exam, and questions about foreclosure timelines trip up plenty of test takers. Our exam prep covers every one of them with practice questions and live training. Start the California Exam Prep program and walk in ready.
A real estate license background check decides if you qualify to become an agent in California.
The Department of Real Estate (DRE) requires all California license applicants to take one. This is because they want to maintain the integrity and safety of the industry.
So, what happens when you want to get your real estate license but have a criminal history? Does this mean it can’t happen?
Wrong! Even with a criminal background, you can still qualify for a license in California.
In this article, you will learn what will disqualify you, how background checks work, and how you can submit a real estate live scan.
Outside of not fulfilling the basic requirements, there is one thing that disqualifies you from a license: your criminal background check. A real estate license background check occurs when the Department of Real Estate (DRE) reviews what crimes (if any) you have committed. Depending on the nature of these crimes, the DRE may stop you from practicing real estate in California.
However, the DRE doesn’t disqualify you for just any crime. According to § 10177(b) of the Business and Professions Code, the DRE will disqualify applicants based on crimes "Substantially related to the qualifications, functions, or duties of a real estate licensee." In other words, they primarily disqualify applicants based on how relevant a crime is to the honesty and safety required of a real estate agent.
Can you still get a real estate license if you have a felony? The answer is: it depends. If your felony relates to the work or duties of being a real estate agent (such as financial fraud, grand theft, or forgery), the DRE may disqualify you.
Under AB 2138, the DRE generally cannot deny a license for a conviction that occurred more than 7 years ago, provided you have completed all sentencing requirements. This 7-year "washout" period does not apply to serious felonies like those requiring sex offender registration or certain financial crimes. This rule applies to both felonies and misdemeanors but does not pertain to minor infractions.
Note: The DRE may not deny you for an arrest with no conviction, but they can require a criminal matter to be resolved before issuing a license if the charge is substantially related to real estate duties.
You can still apply to get a real estate license even if you have a felony, but there is no guarantee you won’t be disqualified. The best course of action is to be transparent.
Don’t try to sweep anything under the rug. Under current laws, the DRE cannot deny you solely for failing to disclose a conviction that wouldn't have been a cause for denial anyway, but honesty is still the best policy. Because the DRE performs an extensive background check through the DOJ, they will see your record regardless of disclosure.
A background check is required for every applicant. You must complete a fingerprint Live Scan at a state-approved location, such as a police department or private business. You can find a list of approved Live Scan locations on the DRE website.
After your Live Scan, the Department of Justice (DOJ) informs the DRE of your past criminal convictions. The DOJ also keeps your fingerprints on file to notify the DRE if you are arrested or convicted in the future.
While the background check can show an applicant's entire history, AB 2138 limits the DRE's ability to use older crimes against you. Generally, convictions older than 7 years cannot be used as the sole basis for denial unless they involve serious crimes. Additionally, the DRE cannot deny a license based on dismissed arrests, infractions, or juvenile adjudications.
A Live Scan is an electronic scan of your fingerprints used for identification. It is the industry standard for background checks. Results usually post in 3-7 business days, but may take longer if prints are rejected or require manual review.
Let’s cover how you can fulfill the live scan part of your license application.
First, download the RE 237 form from the DRE website. Once completed, you should print 3 copies of this form.
Second, fill out the 3 forms as much as possible. Some sections of the form need the live scan service provider to fill out.
After you have filled out all 3 RE 237 forms, the live scan service provider has filled out their sections, and the fingerprint has been taken, you can mail the forms.
The fingerprint service provider will take one of your copies. You will hold onto one of the copies.
Then, you will mail your final copy to the DRE at the following address:
Department of Real Estate
P.O. Box 137002
Sacramento, CA 95813-7002
Attn: Fingerprint Desk
The cost of a real estate live scan varies based on the service provider. Every provider will have 2 separate fees:
Typically, you should expect to pay a total of $70 to $100 depending on your location. You pay these fees directly to the Live Scan provider, not the DRE.
The background check ensures the integrity of the California real estate industry. While a criminal history can be a hurdle, the law now provides more protection for rehabilitated individuals than ever before. If your application is denied, you have the right to appeal and present evidence of rehabilitation, such as stable employment or letters of recommendation, to prove you are fit for the profession.
Property management in California is one of the most in-demand real estate career paths in the country — and one of the most misunderstood when it comes to licensing. Most people searching this question assume there's a dedicated "property manager license" they can get. There isn't.
What California actually requires is more important: a real estate license. And the path to that license — and then to a real property management career — is very clear once you know what you're working toward.
In California, third-party property managers who collect compensation for managing other people's properties are required to hold a California real estate broker license — or to work under the supervision of a licensed broker.
Third-party means managing properties you don't personally own. If you own the property yourself, you can manage it without a license. But if someone is paying you to manage their property, the California Department of Real Estate (DRE) considers that a real estate activity requiring licensure.
California law recognizes limited exemptions:
If you're planning to build a career managing properties for owners, plan on getting licensed. The exemptions are narrow, and operating without a license when one is required exposes you to significant legal and financial risk.
You have two licensing options in California. Both come from the same DRE exam system — the difference is in the experience and education requirements.
Most people entering property management start with a California real estate salesperson license. This requires 135 hours of DRE-approved pre-license education and passing the state licensing exam. Once licensed, you work under a licensed broker who oversees your activities.
This is the faster, less expensive path. You're in the field sooner, building experience under a broker's guidance.
A broker license lets you operate independently — you can manage a property management company without working under another broker. The requirements are more demanding: two years of full-time licensed salesperson experience and 360 hours of DRE-approved broker-level education before you can sit for the broker exam.
Most property managers start with the salesperson license and work toward the broker license after accumulating experience. Some skip property management under a salesperson license entirely and spend two years in sales first — then transition to property management with a broker license.
Start with the California real estate pre-license course to fulfill your DRE education requirement.
California law doesn't require certifications beyond your real estate license, but the right credentials open doors and add credibility with property owners.
The CPM is the most recognized nationally. The CCRM is particularly valuable in California's regulatory environment, where staying current on tenant law is genuinely complex.
Day to day, a property manager in California handles the full lifecycle of a rental property on behalf of an owner.
California-specific complexity: California's landlord-tenant laws are among the most tenant-protective in the country. Key areas property managers must know:
Compensation for property managers in California varies significantly by experience, portfolio size, and whether you're working for a company or operating independently.
Property managers with a broker license who work independently typically structure fees as a percentage of monthly rent collected — usually 8–12% for residential management. On a portfolio of 20 properties averaging $2,500/month in rent, that's $4,000–$6,000/month in management fees before expenses.
High-cost California markets (Bay Area, LA, San Diego) typically support higher fees due to higher rents and greater management complexity.
Both career paths use the same California real estate license. The choice comes down to income structure and day-to-day reality.
Property management: Recurring, predictable income from management fees. You build a portfolio of clients over time. Less income volatility than commission sales, but also slower income growth. Strong demand in California's rental-heavy urban markets.
Real estate sales: Commission-based income — nothing until you close a transaction. Year one is typically lean. But a single high-value sale in California can generate $15,000–$40,000+ in commission. Top producers earn far more than most property managers.
Many licensed agents in California do both. They manage a handful of properties for steady recurring income while building their sales business. Your license covers both — the question is which you want to prioritize.
For a full look at what the sales career looks like, read about real estate career trade-offs.
Breaking into property management without experience requires a deliberate approach.
The first step for most people is getting the license. Start with the how to get a California real estate license guide, or go directly to the California real estate pre-license course.
Are you thinking about switching brokerages?
Switching brokerages is not unusual in the real estate industry. Yet, most agents think it’s much harder than it is.
Reasons for leaving may vary from agent to agent. But, all you need to do is familiarize yourself with the process.
Not every brokerage can meet your needs. When you’re ready for something new, you can always mix things up. Here is how you change your real estate brokerage.
Now, let’s explore what you need to do during each step.
It is always important to conduct research when looking for a new brokerage. You can ask people you know who work at other brokerages, interview with brokerages, or do a quick internet search. The idea is that you have to make a shortlist of new brokerages to consider.
The best way to start looking for a new brokerage is by giving them a call. Also, you can use this opportunity to get to know the brokerage and ask basic questions. Before ending the phone call, be sure to book an appointment with them.
When you meet with a new brokerage, recall the unmet needs you have with your current brokerage. Ask questions to find out if this new brokerage is a good fit for you and your business.
If this new brokerage checks every box, then you can start discussing making the switch.
Once you have found a new brokerage, you will now have to inform your current brokerage of this decision. It’d be best if you were to inform them yourself. As much as possible, avoid informing them of your decision via email or text message.
Discuss your decision to change real estate brokerages with your leadership. Also, make sure you do it with professionalism and without offending them. Explain to them your reasons for leaving and be articulate as possible. The last thing you’d want to do in the real estate industry is to burn bridges.
It is important to note that not every discussion is smooth. Your leadership can talk you into staying but you have to remain firm in your decision.
Once you informed your leadership of your decision to leave, you have to file the paperwork. There are 2 ways to do this.
Your first option is via the Department Real Estate (DRE.)
You start by getting the form RE-204 from the DRE. This is the application form for changing brokerages.
Once you have obtained the form from the DRE, both your current and new brokerages will have to sign this. After it’s signed by both parties, you can send it back to the DRE.
Your second option is via the DRE website.
Fill in the form and answer the questions on why you’re switching brokerages. The website will forward this form to your current brokerage for their confirmation. Once your current brokerage confirms the form, input your new brokerage’s information.
There may be many reasons why you are considering a brokerage switch. More often than not, it’s because your expectations are no longer met or satisfied.
One of the reasons why an agent switches brokerages are the financial deals offered.
When you started working with this brokerage, they gave you a flat commission split. That may have worked to your advantage.
But, now that you have grown, you are closing bigger deals and a flat fee no longer works for you. Also, it’s possible that the commission split seems unfair to you.
How well does your brokerage treat its agents? Are their values still aligned with yours? Is it still a healthy work environment where you feel happy?
Sometimes, your reasons may not be financial. If you have been with your brokerage for years and something feels off, then it may be a problem with cultural fit.
There could have been a change in leadership. Now, this new leadership no longer provides the support that you need.
It’s possible for agents to feel that their work is not acknowledged enough. Also, it’s possible that there is a lack of transparency between the leaders and their agents.
Poor leadership can drive real estate agents to make the switch.
Continued training and education are crucial to a long-lasting career in real estate. If you are no longer getting the training that you need, then it’s time to move on.
Growth is a cornerstone of progress in this career. The best way for agents to grow is through training and education. If a brokerage no longer offers these (or never had) then seeking them out should be a priority.
Technology plays a crucial role in the day-to-day lives of real estate agents. Outdated technology can lead to poor performance and workplace happiness. Whether it’d be slow processing of data and paperwork or not having the right data at the right time.
These are small things that can make or break a deal. When you change real estate brokerages make sure to seek out one that’s savvy to the times.
In an industry where trust and relationships are the names of the game, reputation means everything. If your brokerage has a bad reputation, it can affect your business.
Sometimes a brokerage can have a poor reputation that deters agents or clients. This is why finding a brokerage with a great reputation (and Google review) will work in your favor.
Growth can come in many shapes and forms. In real estate, it can be in the form of expanding your business or network.
One possibility is that you want a new mentor who can help you build your expertise. Maybe you’d like to expand to a new community or neighborhood. It’s also possible that you’d want to venture into a new segment of real estate.
At the end of the day, you have to remember that you are an independent contractor. As an independent contractor, you have to look out for yourself and what’s best for your career.
Switching real estate brokerages is not unusual and is sometimes necessary. There are plenty of reasons why you should change real estate brokerages.
If you’re no longer happy and your expectations are no longer met, then it’s time for you to move to a different brokerage.
Let’s face it, real estate transactions can be extremely complicated and take up a lot of an agent’s time. But, dealing with contracts and disclosures comes with the territory when you’re in escrow.
While this is a necessary part of being a real estate agent, savvy agents leverage their time, so they can continue cultivating leads and getting new business.
One way to make time for yourself is to hire a transaction coordinator (TC.)
One important thing to know is that a Transaction Coordinator is not an assistant. Their priority is to keep the transaction in order and manage the documents.
So, what is a transaction coordinator, and what do they do?
First, let’s look at the transaction process to see how a transaction coordinator gets involved.
When you’re an agent, you represent your clients. Whether it’s the buyer or the seller, they are the principals in your real estate deal.
Opening escrow starts the transactions process. The escrow company is responsible for ensuring that every stipulation of the contract is met. They act as a neutral third party to protect the deal’s integrity.
But, they don’t exactly work for you. Transaction coordinators get their fees from the seller.
All the required contracts and disclosures involved with the transaction must be completed and signed by all parties. This usually falls on the agent, but you can hire a transaction coordinator to do this for you.
A transaction coordinator’s goal is to handle contracts and disclosures. They are responsible for ensuring that all documents are completed in the proper time frame.
The offer will outline when certain documents are due and which parties get them. The transaction coordinator will calendar all dates and keep you informed.
A transaction coordinator will do the following:
While these are the common duties, every transaction coordinator is different. Ask upfront what services they provide. That way, everyone is on the same page.
A Transaction coordinator does not have to be licensed, but you should hire one that does have one. When a transaction coordinator has a license, they become familiar with the transactions process and disclosures.
Despite whether a transaction coordinator has a license or not, there are a few things you shouldn’t expect them to do.
A transaction coordinator will prepare certain disclosures, but they won’t write them. But, they can explain everything you need to know about disclosures.
A transaction coordinator will talk with all parties to gather signatures or to deliver documents. But, don’t expect them to negotiate terms with the other agent or their client on your behalf.
Your transaction coordinator will schedule reports, such as a home warranty or NHD report. But, they won’t schedule general or termite inspections.
As the agent, you are present at these inspections. You must maintain control and coordinate them yourself.
The benefits of hiring a transaction coordinator are:
On average, completing a file can take anywhere from 8-15 hours. Each transaction is different, so that estimate depends on the deal and how many parties are involved.
As we discussed earlier, gathering all the required documents and disclosures is tedious and time-consuming. They will also save you time by updating all parties on the status of the file. Using a transaction coordinator can help you leverage your time and use it on more productive tasks.
As an agent, you will have time to get more leads, meet with new clients, and network. You will be able to get new listings and secure future income. These activities result in more open deals and more commission checks.
As mentioned earlier, the goal of the transaction coordinator is ensure the success of every document. This will result in flawless paperwork and ensure that you have fully compliant files.
This is crucial. This will limit your liability if you are sued or a complaint is filed against you. Your files may also be subject to a random DRE audit. Having clean files will lessen the chance that you have to use your Errors and Omissions Insurance.
Errors and Omissions Insurance helps protect you from lawsuits. This is a safeguard against people who claim that you made a mistake or were negligent while performing as an agent.
Yes, hiring a transaction coordinator is affordable! They are considered independent contractors. This means they get paid per deal and are not considered an employee.
Prices will differ depending on what services they provide. But the average price you can expect to pay is between $350 – $500 per file. Overall, this is a fraction of what you will receive as your commission.
Most agents will have the escrow company pay the transaction coordinator along with their commission check. This makes payments simple.
Every agent should use a Transaction Coordinator. The benefits and advantages outweigh any cost.
As a new real estate agent, it is always a good rule to have ownership of a task before you give it away. So make sure you are informed of the process and have a good understanding of the disclosure and contracts.
That being said, make the investment to use a Transaction Coordinator. They will literally save you time and money.
A real estate transaction is hard to close. So many moving parts make it stressful and hard to maintain.
That’s why they pay real estate agents the big bucks.
A buyer can back out of the deal at any given time for many reasons. As a real estate agent, you must be aware of these should you ever encounter them.
Here are some of the most common reasons buyers back out of real estate transactions:
One of the most common reasons a buyer backs out is they get cold feet. Buying a home can be overwhelming for any homebuyer.
Aside from the emotional journey that they go through while choosing a home, it is also time-consuming. From going to several open houses to finishing the paperwork, buying a home is no easy feat.
On top of that, it’s a major investment! Most likely the biggest investment they will make in their lives.
That comes with a great deal of pressure and commitment. A buyer may realize that they’re not ready to make a decades-long financial commitment.
A real estate transaction may fall through because of unexpected expenses, even with qualified homebuyers.
Aside from the mortgages, there may be several repairs required for the property. This realization usually happens after the home inspection. A home inspector’s job is to examine and check every square foot of the property and report back to the buyer.
The results may show the need for major repairs and that can scare away a buyer.
To prevent this from happening, it’s worth suggesting to your sellers that they hire a home inspector before the listing. Should they agree, review the results with them and discuss possible options. They may choose to take on minor repairs, major repairs, both, or neither. Either way, it would still be helpful for you and your sellers.
Being aware of the issues and repairs that are needed immediately gives you an upper hand with the negotiations. Also, you can value the listing at an appropriate price post-inspection. This way, you mitigate the risk of the buyer backing out.
Sometimes, the homebuyer changes their mind. The home buyer might see the property for the first time and fall in love.
Then, later, when they have a fresh pair of eyes, it could look different. A buyer can visit the property again after some time and realize that they’re no longer confident in buying.
Unfortunately, this could happen in the middle of the real estate transaction. Remember to always ask questions to understand what it is about the property they don’t like. That way, you can always provide them with the best options later.
Keep in mind that a homebuyer is looking at more than one house. When they walk into your listing, they can be ecstatic – enthusiastic about living in that house. At the same time, they can be making offers on other homes.
This is because they want the best deal on a home. If their dream home breaks their budget, they will opt for their backup option.
As a result, you can lose a lot of time and energy engaging in a deal that falls through. A great solution for avoiding this to set a high earnest money deposit.
A high earnest money deposit will solidify your buyer’s commitment to you. Investing more money upfront creates more stakes and shows the buyer wants to buy your listing.
This doesn’t keep them around, of course. The buyer can still back out of the real estate transaction. But, if a buyer commits to the earnest money deposit, you will be more reassured that your buyer is serious about purchasing the listing.
It’s not unusual for a buyer to buy or sell a home at the same time. This is called concurrent closing. Most buyers get their funding from the sale of their previous home.
So, the buyer can back out of the real estate transaction because they can’t sell their first home.
What’s important in this situation is communication. Keep an open line with the other agent or the homebuyer to verify their progress.
If you receive a concurrent closing offer, you will know to change your expectations for the real estate transaction should you accept it.
Have you ever bought something and asked yourself, “why did I buy this?” Sometimes, a buyer may not have any other reason for backing out other than a buyer’s remorse.
This usually happens after a buyer makes a huge investment. They may feel anxious and change their minds after committing out of the blue.
When someone experiences buyer’s remorse, it’s important to be patient with them. As the listing agent, it’s your job to lay down the facts with your potential buyer and remind them of why this is a worthwhile investment.
Understanding why people back out of the real estate transaction is hard. From cold feet to buyer’s remorse, there are tons of reasons why that would happen.
This is what makes the job of a real estate agent so emotional.
The answer to coping with the ever changing real estate transaction is to do everything you can to close the deal. So, if things go awry, remember that it’s a-okay. It happens. It’s part of the job.
Everyone has their reason for terminating the real estate transaction. Staying positive, not becoming obsessed with closing, and fulfilling your duties to the best of your ability help you increase your chances of closing and also creates the best possible experience for all parties.
You have to build strong relationships with your clients to have a long, lucrative career in real estate.
The top producing agents earned their fame and fortune because of the people they know.
So, how do you build a strong, reliable, trusted relationship with people?
The answer: provide good customer service.
When your clients like working with you, they will recommend your services to other people they know. That’s how successful real estate agents create their careers.
Their network starts finding work for them.
Now the question becomes, “how do you provide great customer service to your clients.” To do this, you have to build trust with your client.
The National Association of REALTORS® created a method to build trust that has helped millions of agents generate satisfying customer service.
NAR promotes professional standards and ethics (like the REALTOR® Code of Ethics), but fiduciary duties themselves come from real estate agency law (state statutes/common law) and apply when you represent a client.
This method is a set of ethical rules that agents follow to foster a trustworthy relationship with clients.
It’s called fiduciary duties. So, let’s learn about the fiduciary duties of a real estate agent so you can foster trust.
In its simplest form, fiduciary refers to a trust.
Once a client signs a contract with you, a fiduciary relationship forms.
More accurately, once you enter an agency/representation relationship, fiduciary duties apply. In many states that relationship is established in writing, and the timing can vary by state and situation.
This relationship means that the client now places their trust in your hands. In return, you perform your work with your clients’ best interests in mind.
The fiduciary duties of a real estate agent are:
Now that we know the fiduciary duties of a real estate agent, let’s explore what they mean.
In many markets, buyers are now asked to sign written agreements earlier in the process than they were in the past. For example, NAR’s MLS policy changes became effective August 17, 2024, and require MLS participants “working with” a buyer to have a written buyer agreement before touring a home (including live virtual tours), unless inconsistent with law.
CA DRE explains AB 2992 adds requirements for buyer representation agreements (including required terms), with timing that differs from the trade association practice.
Real estate agents must fulfill their fiduciary duties. By doing so, they uphold the credibility of not only themselves but agents across the country.
So, let’s see how you can apply the fiduciary duties of a real estate agent to your career.
Loyalty refers to an agent’s responsibility to be loyal to their principal (client.) Regardless of the situation, you must always put the interests of your client ahead of your own.
For example, you represent a buyer who wants to buy a 5-bedroom property with a maximum budget of $1,000,000. If you find a listing that meets your clients’ requirements for $700,000, you have to tell them.
Monetarily speaking, you earn a bigger commission check if your client buys a $1,000,000 listing. But, because the $700,000 is a better deal for your client, you must tell them about it.
On the other hand, if you represent a seller, then you must do everything in your power to sell the property. You must market the listing and close it while getting the best deal for them.
One fiduciary duty of a real estate agent is to adhere to the lawful requests of their clients.
If your client asked you to take a break from marketing their home for a week, then you are legally obligated to follow their instructions. Also, if your client asks you to stop showings while they aren’t around, you have to stop showings.
But, you may encounter a client who asks you not to entertain offers or showings for people of a specific religion or race. In this situation, you should not follow the order because doing so is discrimination, an unlawful act.
A client may also request that you do not disclose a property defect. Withholding this information may help you sell the property fast and earn more money, but it’s illegal. So, you are obligated to disclose all information about a house – even if it goes against your client’s wishes.
This fiduciary duty instills the client’s confidence in you as their representative.
Confidentiality of information means not sharing information that your client gives you. This information is vital if the disclosed information damages the reputation of your client and affects ongoing negotiations.
Here’s an example: if you represent the buyer and discover they are comfortable paying more, you shouldn’t disclose this information to the listing’s agent.
On the other hand, if you’re the seller’s agent, you cannot inform buyers that your client is willing to accept low offers.
Always ensure you’re getting the best deal for your clients.
If you have information that can benefit your client in the negotiations, you must disclose it.
For example, you must share information about the property’s well-being with your client. This information will position your client better for negotiating a lower price if there is a property defect. Also, if you represent a seller and find out that the buyer urgently wants to sell, you can tell your client.
This example is likely meant to say the buyer urgently wants to buy (for example, they need to move quickly), which could affect negotiating leverage.
Another piece of information you must always disclose to your client are offers. Regardless of how bad an offer is, you should share it with your client. Also, You must inform your client should a potential buyer or seller be someone with whom you have a relationship.
Another fiduciary duty of a real estate agent is to take good care of the client’s funds. The first part of this duty is understanding the elements of financial transactions and how you should handle them.
You have to let your client know where their money is going.
Whether you’re a buyer’s agent or a seller’s agent, you have to keep track of the money.
You can’t accept your client’s funds. For example, if your buyer hands you their deposit for the property, you must send it to escrow. Do not deposit it to your account, even if you intend to send it to escrow.
In many states, a broker/agent can receive client funds (like an earnest money check), but it must be treated as trust funds and handled under strict state rules and brokerage procedures (often delivered to neutral escrow, placed in a broker trust account, or handled as otherwise permitted). The key point is: never put client funds into a personal account and always follow the required timelines and recordkeeping rules.
The last fiduciary duty is to apply reasonable care.
As a real estate agent, people expect you to act as a capable professional.
You must apply and exercise your skillset and knowledge with diligence. By doing so, you create a strong, trustworthy relationship with your client.
Do fiduciary duties of a real estate agent apply to third parties? To put it simply, no.
But, just because you don’t have a fiduciary relationship with them does not mean that you are allowed to break the rules. You’re a licensed professional, so you should uphold your professionalism with everyone you work with.
Even when someone isn’t your client, you may still owe duties like honesty, fair dealing, and disclosure of material facts when required (rules vary by state and your role in the transaction).
The fiduciary duties of a real estate agent demonstrate how to uphold integrity. When you practice these duties in every relationship, you will build trustworthy relationships.
These relationships will provide long-term benefits to your career because you provide exceptional customer service. That’s how real estate agents become successful. In short, don’t try cutting corners or sneaking your way to money because the best way to earn success is with integrity.
As a real estate agent, you will encounter the terms ‘law of eminent domain’ or ‘eminent domain’ in real estate. But what does it mean?
Eminent domain is the government’s right to expropriate private property for public use. In exchange for this, the property owner must receive just compensation—which is often based on the property’s fair market value, but can also include other amounts in certain situations (especially in partial takings). Let’s break this down a bit further:
The process of eminent domain starts when the government or agency has a public interest project. This project would then need to be in a specific location that gives the greatest return to the public.
Once they have identified a specific property, the agency will typically have it appraised to estimate its fair market value. The amount determined by the appraisal helps form the compensation offer the owner may receive in return.
The appraiser must be independent, accredited, and knowledgeable about the property.
After the value is determined, an offer gets presented to the owner. But if the owner finds this unreasonable, they have the right to hire their own appraiser. If the buying party and owner can’t agree, then negotiations may begin.
If negotiations still don’t resolve the situation, the agency (or authorized entity) may file a condemnation case in court to take the property and have compensation determined under the law.
That is why the owner should have an attorney throughout this process. A real estate attorney can ensure that the owner is aware of their rights.
One of the first requirements of eminent domain is public use. For a project to be considered as “public use,” it should serve a purpose that can benefit the public.
It’s important to know that “public use” (sometimes described as public purpose) is often interpreted broadly. In other words, a project can still qualify as public use even if a private party benefits, as long as the overall purpose is considered public (like transportation improvements, utilities, redevelopment, or community-wide economic benefits). State laws can be more restrictive, so the exact rules can vary depending on where the property is located.
Some examples of valid projects for public use are bridges, reservoirs, freeways, roads, and parks.
There are some occasions when people other than the government have the power to exercise eminent domain, such as public utilities.
Projects such as electricity lines or new pipelines may require approval by a state utility regulator (for example, in California, certain utility projects are reviewed by the California Public Utilities Commission). If authorized, the public utility may then move forward with an eminent domain action through the trial court process to acquire the needed property rights and determine compensation under the law.
There are three different approaches to determining a property’s fair market value.
The appraisal agency typically notifies the owner of the property in advance when their home will be appraised. Also, the owner is often given the opportunity to accompany the appraiser during the inspection and share information that could affect value.
Here are the methods used:
Comparable sales is based on the idea that no one else would be willing to pay more than they would for a similar property. This approach utilizes data from the recent sales of comparable properties to determine the value of a parcel of land.
Agencies will use this approach when determining fair market value for residential properties. Characteristics such as the number of bedrooms, bathrooms, and other features are used to identify similar houses.
The income approach is ideal for income-generating properties. The fair market value of the property is based on the income that the property can generate. This method determines the value of the property as an investor.
This method is used for specialty structures wherein the property of interest is unique and is designed to operate for something specific. In cases such as this, the only acceptable way to replace it is to reproduce the structure elsewhere.
To determine the fair market value of the property, the experts would evaluate two different components. The first component is the value of the land without any structure. The second component is the value it would take to replace or reproduce the existing structure on the land.
It should be noted that under this approach, depreciation is also considered and is deducted from the final fair market value.
There are several different types of eminent domain, here are some of them:
A complete taking occurs when the government takes an entire parcel. The owner’s compensation is generally “just compensation,” which is typically based on the fair market value of the property under its highest and best use.
The partial taking only assumes a part of the land. The just compensation for partial taking consists of two different components.
The first component is direct damages. Direct damages refer to the acquired land’s value of improvements. The other component is indirect damages, which are referred to as severance damages.
As the name suggests, this type of eminent domain will only require the owner to give up their parcel of land for a fixed time. Typically, the just compensation for this taking is the rental value of the property that is being occupied.
Permanent taking means the property, condemned by the government, will never return to the owner. The most common projects with permanent takings are roads, highways, and other public infrastructures.
Eminent domain is an emotional experience. Nobody wants to lose their home. But, this is a power that the government holds over property owners.
For eminent domain to go into effect, there must be “public use” involved. Examples include building highways, schools, or other necessities Because “public use/public purpose” can be interpreted broadly and rules vary by state, owners typically focus on (1) whether the stated purpose qualifies under that state’s law and (2) whether the compensation offered meets the “just compensation” standard.
2025 Update: This guide reflects the current California Association of REALTORS (C.A.R.) forms released through June 2024 and the latest Fannie Mae credit‑limit rules.
If your client is buying a house with defects, they don’t have to stay silent. Nobody wants to buy a house with structural problems!
Homebuyers can request house repairs before they buy it. Doing so is common across California.
A buyer’s agent can issue the request for repairs during the transaction. When the deal closes, the buyer has a house they love, without the added need for repairs.
So, how do request for repairs work in California?
Buyers should request repairs after a home inspection.
A professional will find every issue that is not obvious. Surface-level blemishes are easy to spot, but buyers need a professional to see the real problems.
The home inspector will create a list of property defects to fix. This list is called the inspection report.
The inspection report is a powerful negotiation tool for agents because it can influence a home’s final cost. The inspection report has this power because it has professional opinions about the well-being of the property.
If the property is in poor condition, the agent has more negotiation power to lower the sales price for the homebuyer.
As an alternative to lowering the price of the home, the buyer’s agent can issue a request for repairs.
TIP: Paragraph 7B(1) of the Residential Purchase Agreement obligates the seller to keep the property “in substantially the same condition” from acceptance to closing. Any new roof leak, appliance failure, or other damage that occurs after acceptance must be repaired or credited by the seller, even if no repair request was submitted.
A real estate agent should talk to their client about the inspection report. The goal is to decide what, in detail, the home seller should fix.
When they decide on what needs repairs, the real estate agent has two options:
A request for repairs form is a document that lists the home buyer’s repair needs before they buy the home. The buyer’s agent sends this document to the seller’s agent for consideration.
California buyers list desired fixes on C.A.R. Form RR (Request for Repairs, revision 6/22).
Sending informal e‑mail “punch‑lists” instead of the RR form leaves gaps in disclosure and makes enforcement difficult.
A buyer’s agent can amendment the purchase agreement to get the home seller to repair the property. When amending the purchase agreement, agents should always be specific and direct in their language. This way, there is no confusion about what the seller must do to sell their home.
Homebuyers could be scared of losing their dream home if they request repairs. In a seller’s market, that fear makes sense. But, not all home sellers will react the same way when they see a repair request.
Home sellers can accept all requests, deny all of them, or negotiate which to repair. This is when real estate agents help the transaction. The agents negotiate on behalf of their clients to determine the best option for everyone.
Each agent will take into consideration the market and their client’s priorities. The buyer’s agent will have more leverage in the buyer’s market because they have more options (vice versa in a seller’s market.)
The statewide Residential Purchase Agreement sells the property “as‑is in its PRESENT condition.” Sellers are not required to grant—or even reply to—a repair request. If the seller refuses or stays silent, the buyer’s only remedy is to cancel within the inspection‑contingency period.
Lenders see credits as financing concessions and cap them under Fannie Mae guidelines:
Buyer loan‑to‑value above 90 % – maximum credit 3 % of purchase price
LTV 75.01 % to 90 % – maximum credit 6 %
LTV 75 % or lower – maximum credit 9 %
Credits that exceed these limits are re‑classified as sales concessions and reduce the value used for underwriting. Negotiate within the cap and disclose all credits to the lender.
California law overrides “as‑is” for a few life‑safety features:
• Smoke alarms on every level
• Carbon‑monoxide alarms near sleeping areas
• Water‑heater seismic bracing
The seller signs a Water Heater and Smoke/CO Detector Statement of Compliance confirming these items are installed by close of escrow. No request is necessary.
Finding the defects and sending the request for repairs form are the easy parts. The challenge is navigating those requests with the other party.
Some deals crumble because the houses need too many repairs.
A request for repairs runs the risk of scaring away a seller. But, the buyer won’t invest if a seller doesn’t make the repairs. This problem needs a mediator.
Real estate agents negotiate on behalf of their clients. Their goal is to get the best deal possible for their client without dropping the deal. Moments like these are what make agents so valuable. Instead of canceling the deal, they find a middle ground that will make both parties happy.
The agent and buyer must work together to send a request for repairs. The seller might deny them, but you never know if you don’t ask.
First impressions make deals.
The listing presentation is a real estate agent’s opportunity to make a first impression on their prospective client. This is the presentation that pitches them as the best person to hire.
A great listing presentation converts home sellers into clients. Part of that is being ready for the questions home sellers ask before they hire you.
There’s a common saying in real estate that goes, “when you list, you last.” It means that agents who work with listings have long-term success.
So, how do you make a powerful listing presentation to get the listing?
You have to focus on building trust. When the prospective client trusts you with their biggest investment, then you have a deal.
Building trust in your listing presentation comes down to 5 steps.
Dressing like a professional makes you feel like a professional. When you feel like a professional, your prospective client believes you’re the professional.
Clients want real estate agents who they can trust. Dressing like a professional sends the message that you are serious about your career. You show the client that you hold your work to a high standard.
From the client’s perspective, they want a real estate agent who wants the best for them. The client’s well-being is their priority, which is why they are looking for a real estate agent.
Communicate to the prospective client that you uphold your fiduciary duties and ensure their well-being. The client expects professionalism. So, deliver on their expectations and become professional – starting with what you wear.
Information sells. The information you share with the prospective client is part of making a powerful listing presentation.
So, what do you include in your listing presentation? You should communicate the value you can give with numbers. A property profile shows their land’s primary selling points. So, add this data:
Collecting this data shows the value position the listing can take in the market. It can show your home seller how much money they can make. At the end of the day, they want the best deal possible.
The competitive market analysis shows how much money similar houses made when they were sold. This analysis collects information from houses that fit the make-up of the property you want to sell.
This information can become skewed if the information is not collected right, which gives your client the wrong expectation.
So, how do you make an accurate competitive market analysis?
Start with learning about the house’s make-up. Contact a title representative to collect information on the square feet, bedrooms, bathroom, age, encumbrances, and anything else that you can find. Next, use the MLS to find similar houses in the area to see the sales price.
Once you have this information, you can make an accurate estimate of the property’s value.
The property value is a powerful piece of information. It shows the seller how much they can make. They don’t just see the number, but they visualize everything they can do with that money. They feel what life is like when they have that much money.
The seller’s motivation to sell tells you how to handle the listing sale. Their motivation determines the goal you set for yourself.
If the prospective client’s purchase of another home is contingent on the sale of their current home, then time is of the essence. Speed is a priority. But, if they are an investor who wants to cash out, then time will come second to earnings. They want the most money possible from the sale.
So, how do you find your client’s motivation for selling?
Make time to understand their motivation. Communicate with the client. Top-producing listing agents get to know their clients because that’s how they get the information they need to satisfy their needs.
Time to pick a price. The price determines how much money the prospective client makes and how much you, the listing agent, make.
The price of the home can become a contentious subject. Sometimes, the seller will ask for a higher price to make more money. They might expect to make more money (especially if the market is in favor of sellers.)
As an expert in real estate, you must share a convincing reason as to why you chose the price. Take the seller’s motivation into consideration along with the market and your CMA. Together, these factors should help you show your prospective client the correct answer.
Remember, at the end of the day, your fiduciary responsibility is to follow your client’s wishes. So, if they don’t budge on the asking price, you can choose to follow their wishes or turn down the listing.
After you and the prospective client agree on a price, you should have them sign a Residential Listing Agreement (RLA). This is an official declaration of converting them from a prospective client to an actual client.
The RLA should communicate, with clarity, the timeline of the representation and the expectations of the parties involved. Now, all that’s left to do is sell the property.
What makes a real estate listing presentation powerful is its ability to build trust. So, your goal is to ensure the prospective client can trust you. You can do this with how you present yourself, the data you share, and how you communicate with the homeowner.
At the end of the day, the homeowner wants everything to go well for themselves. So, practice empathy. What would convince you to hire a specific agent to sell your home?
How do people afford houses? They cost so much money!
The way most people pay for the cost of a house is with a home loan from a bank.
This is a large chunk of money that the bank loans to homebuyers to help them buy their house. Over time, the homebuyer pays the loan back with interest.
Real estate agents should expect their clients to withdraw a home loan to buy a property. Unless they’re sitting on a big mound of money.
So, at some point, you will encounter the word “pre-approved” or “pre-qualified.”
That’s why you should know the difference between pre-approval vs pre-qualified.
Both are helpful steps that show a buyer is likely to get financing, but neither is a guaranteed loan offer—and pre-approval usually carries more weight because the lender verifies more information.
Here’s what a pre-approval letter means: a letter that verifies the approval of a specific amount of money that the bank is willing to lend to the home buyer.
In real-world lending, a pre-approval is typically a tentative statement from a lender that they’re willing to lend up to a certain amount based on assumptions—so it’s stronger than a pre-qualification, but still not final approval.
Should the buyer meet the requirements of the lender, they will be issued a pre-approval letter. This contains the type of mortgage, interest rate, and terms and conditions.
Many pre-approval letters clearly state the loan amount (and sometimes the loan type), but an interest rate may not be included unless the buyer has locked a rate, and the final terms can change during underwriting.
This letter will also state the amount of mortgage the lender is willing to provide to the buyer.
Securing a pre-approval letter is essential. This is submitted along with the offer when buying a home. A pre-approval letter is important to have because it will ensure all parties that there are funds to finance the purchase. It gives the seller confidence that financing is likely, but it still isn’t a guaranteed loan offer.
The bank will need the following information to determine if they can approve the homebuyer for a loan:
But, the pre-approval letter is not a guarantee, only the beginning of the lending process. The lender still reserves the right to either accept or reject your buyer’s request should they deem it.
Common reasons a pre-approval can change include underwriting conditions, an appraisal issue, job/income changes, new debt, or changes to the buyer’s credit.
Also, a pre-approval letter is not a commitment. Should the buyer choose to back out from the transaction, they can do so without facing any financial repercussions.
So, what about a pre-qualified letter? What does that mean? A pre-qualified letter is a letter that informs the homebuyer that they qualify for a home loan.
Pre-qualification is usually a high-level estimate of what the buyer may qualify for based on information they provide—and depending on the lender, it may also involve a credit check (often a soft inquiry).
In other words, the letter proves that the homebuyer has the chance to become pre-approved.
Pre-qualification is often fast (sometimes minutes or same day), because it’s a high-level assessment. Timelines vary by lender.
Unlike the pre-approval letter, this does not take into account the analysis of the buyer’s credit history, tax history, and other financial documents.
Pre-qualification usually involves less documentation than pre-approval. Some lenders may still check credit (often a soft pull), while others rely mainly on buyer-provided information.
In order for a buyer to be pre-qualified, all it takes is for them to contact the lender. They will then provide them with an overview of their financial history. The lender may ask about their financial status such as their assets and liabilities, as well as their income.
Once the lender has reviewed the information, they will give an estimated loan amount to the buyer.
The pre-qualification process usually only takes a couple of days as it is a high-level assessment. In many cases, it can be much faster (even same day), because it’s designed to be a quick snapshot rather than a full documentation review.
Unlike the pre-approval letter, this does not take into account the analysis of the buyer’s credit history, tax history, and other financial documents. The better way to say it is that pre-qualification usually requires less documentation than pre-approval; some lenders still look at credit and other basics, but pre-approval typically involves deeper verification.
Before you are able to help your client with their mortgage application process, you must first connect them with the right lender.
When you’re growing your network, connect yourself with lenders. This way, you can find a reliable lender that you can confidently refer to your clients.
Once your buyer is connected with a lender, the lender will connect with your buyer. It is the lender’s job to understand the buyer’s financial situation and verify if the buyer can afford a mortgage. Through this process, the lender will determine if the buyer will be pre-approved or pre-qualified.
Pre-approval typically carries more weight because it’s more verified, but both pre-approval and pre-qualification are not guaranteed loan offers.
Both pre-approval and pre-qualified mortgage letters are in the mortgage application process. But, a pre-approval letter is still not guaranteed, it signifies that a lender has verified their financial status. This will provide the buyer with more leverage when trying to secure a deal. The simplest takeaway is: pre-qualification = quick estimate, pre-approval = stronger verification, and neither is guaranteed financing until the loan closes.
Leads are everything.
More leads mean more clients. When you meet a lead, you have a chance to convert them into someone who wants to hire you.
That’s why agents always want new ways to find more leads.
Real estate agents have many tools and methods to find leads and convert them into clients.
One method is called real estate farming.
What makes real estate farming stand out is that it’s an easy, practical way to build trust and meet hundreds of potential clients.
Real estate farming is a marketing strategy to find clients in a designated area or demographic. Agents “farm” an area for new leads.
Similar to agricultural farmers, agents plant their seeds in neighborhoods to reap their rewards when the time is right.
In other words, a real estate agent will find a neighborhood they would like to farm. Then, they position themselves as the local expert by saturating the area with marketing. For example, they will buy bench ads, door knock, or mail letters.
The goal of real estate farming is to be the go-to person. When someone in that neighborhood is ready to sell, they will contact the agent who farms that area.
Real estate farms come in many shapes and forms. Before you farm, you should know which real estate farm is conducive to your business. Here are the different types of farms:
Geographic farming is sometimes called geo-farming. A geographic real estate farm has physical parameters that contain an agent’s target audience. A few examples include neighborhoods, subdivisions, and zip codes.
As the name suggests, demographic farming focuses on a specific demographic. Instead of physical parameters, demographic farming focuses on people with specific wants, goals, or interests. For example, people who want to downsize their home, investors trying to make money, or surfers who want to move closer to the beach.
Micro-farming is where agents talk to the neighbors of their listing to advertise an open house. This starts conversations and raises awareness for that listing, but doing so also introduces the lead to an agent.
To pick an area to farm, you should choose somewhere you are familiar with. This is the easiest way to quickly become a local expert.
Your own neighborhood is a good area to start with. You know the land, community, and any events that are coming to the area. Also, connecting with local homeowners is easier.
The size of your area also matters. So, refrain from making your farm too large – the bigger the area, the harder to manage. Also, your expenses will go up! Unless you have the budget to market to a large audience, stick to a small area.
If you are comparing areas, you should compare data. Look at the average sales price, commission per sale, turnover rate, and income potential. These metrics help you learn how much money you will put in and how much you can make.
On average, farming an area can cost $10,000 per year. This includes all marketing material you need for consistent promotion. That’s why you should crunch the numbers first. Farming can cost a lot, and doing it wrong comes with a big loss.
Quick tip: attend local events, community meetups, or council meetings to stay connected with people in the area. These are effective ways to stay current with your target audience.
A plan to farm an area will only get you so far. Staying top of mind calls for creativity and personality. So, here are some ways to connect with locals:
Be the source of information: Let people know how much their land is worth through MLS data or comps. Then, deliver this information on postcards, door hangers, or leaflets.
Gift baskets: Welcome new homeowners with a gift basket and introduce yourself. This helps start the conversation.
Sponsoring: Sponsor a local sports team, school events, or helping local charities. You can also consider co-marketing with a lender and share the cost of marketing materials and events.
Local social media: Connect with local businesses and residents on social media. People love to see what’s happening in their community. You can use this to your advantage to reach locals through engagement and geo-hashtags.
Partner with local businesses: You can leave promotional material in local shops. This is another way you can stay top of mind.
Launch your website: Create a real estate website. If done well, your website can be at the forefront of search results when people look for agents in your farm’s area.
Real estate farms are effective ways to build trust and relationships with people in a specific area. But, don’t think you’ll make big bucks overnight. Real estate farms can take upwards of a year to start building momentum. But, when they do, you won’t have to find business because business will find you.
A buyer's offer just got accepted, and now every deadline in the contract matters. Real estate contingencies are the escape hatches built into that contract, and knowing how each one works is the difference between protecting your client and losing their deposit.
This guide explains the four contingencies you'll see in almost every deal: appraisal, inspection, loan, and home sale, plus the deadlines that govern them and what contingent vs. pending really means.
A real estate contingency is a condition written into the purchase contract that must be met before the sale becomes binding. A contingency is a future event that's possible but not guaranteed, and in a real estate contract it gives one party the right to cancel if the condition isn't satisfied.
Sellers prefer clean, contingency-free offers. Buyers use contingencies as protection: if the condition fails, they can walk away, usually with their earnest money deposit intact. There are dozens of possible contingencies, but four show up constantly: appraisal, inspection, loan, and home sale.
An appraisal contingency lets the buyer back out or renegotiate if the home appraises for less than the purchase price. Lenders won't loan more than a home is worth, so a low appraisal forces one of three outcomes: the seller drops the price, the buyer pays the gap in cash, or the deal dies.
With the contingency in place, the buyer chooses among those outcomes instead of being trapped. Some versions even require the seller to reduce the price to the appraised value. We cover the playbook for when a property appraises under value in its own guide.
A home inspection contingency gives the buyer a set window to professionally inspect the property and back out or renegotiate if major problems turn up. It's the most common contingency in residential deals. According to the National Association of Realtors' Realtors Confidence Index, about 75% of buyers include one. (Refresh this figure from the latest RCI report before publishing.)
The inspector checks the home's systems and structure: HVAC, electrical, plumbing, roof, foundation. If the report comes back ugly, the buyer can request repairs, ask for a credit, or terminate and keep their deposit. Buyers sometimes confuse this step with the appraisal, and we break down the difference in appraisals vs. inspections.
A loan contingency, also called a financing or mortgage contingency, lets the buyer cancel the contract and keep their earnest money if their loan isn't approved by a set date. Contracts typically allow 30 to 60 days to finalize financing.
Pre-approval doesn't make this clause unnecessary. Pre-approval is a lender's preliminary review of a buyer's finances, not a loan commitment, and underwriting can still kill the loan over appraisal issues, job changes, or new debt. That's why buyers get pre-approved before the home search and still keep the contingency in the contract.
The clause protects the seller too. If the buyer can't produce financing by the deadline, the seller can cancel and relist instead of waiting indefinitely. Cash buyers routinely waive this contingency, which is a big reason sellers find cash offers attractive.
A home sale contingency makes the purchase dependent on the buyer selling their current home first. Buyers use it when they need the sale proceeds for the down payment or can't carry two mortgages.
Sellers take on real risk here, so many counter with a kick-out clause, a provision that lets the seller keep marketing the home and accept a better offer while the buyer's house sits unsold. If the buyer's home doesn't sell in time, the seller can walk away or negotiate an extension.
The contingency period is whatever the contract specifies, and in California's standard Residential Purchase Agreement the default is 17 days. Some contingencies run shorter, some longer, but the principle is universal: time is of the essence. A buyer who lets a deadline pass without acting can lose their protection, their deposit, or the home itself.
Contingent means the seller accepted an offer but conditions still need to be met, while pending means every contingency has been satisfied or waived. The practical difference: a contingent listing can stay active, and the seller may keep showing the home or take backup offers. A pending sale is much closer to done.
Yes. Sellers can refuse or counter any offer, and in multiple-offer situations they often favor the bid with the fewest contingencies, even over a higher price.
Yes. If the inspection uncovers problems, the buyer can request repairs, a price reduction, or a seller credit. If the seller refuses, the buyer can typically walk away with their earnest money.
With a loan contingency in place, you cancel the contract and keep your earnest money. Without one, the deposit is usually at risk.
Yes. Waiving contingencies strengthens an offer but transfers the risk to the buyer. A smarter middle path is shortening the contingency periods instead of eliminating them.
Four contingencies, one rule: the contract's deadlines decide everything. An agent who can explain appraisal, inspection, loan, and home sale contingencies in plain English earns trust before the first offer is ever written.
Contingencies show up on every state's licensing exam, usually as scenario questions about deposits and deadlines. Get the US Realty Training exam prep package and practice them until the scenarios feel routine.
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