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California Real Estate Exam: Everything You Need to Know
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A real estate property lien is a claim against a property to secure debts. The property is used as collateral to compensate the debts if the owner is unable to pay the debt owed.
This information is crucial to know especially if you are an agent. A listing that has a property lien will directly affect how you are able to market and sell the property.
There are three common types of liens and each one has a unique role on a property owner's land: mechanic's lien, voluntary lien, and involuntary lien.
The mechanic’s lien. The name can be misleading. It does not refer to the common definition of someone who fixes cars. But it is related to someone who fixes your home.
This can refer to someone who put a pool in the backyard or a contractor who did remodeling in the house or major construction. The person who has made the improvements is referred to as a “mechanic.”
So what happens when the owner decides they are not going to pay the person who has done the work on the home? The worker can place a mechanic’s lien on the property in an effort to get paid.
This can get this done by going to the county recorder’s office. The mechanic’s lien gets filed and added to the property. If the lien gets approved, it will also be added to the title.
This is important when it comes time to sell the property. Buyers will not be as interested in a home that has a lien on it.
A voluntary lien is when the owner agrees to have the lien placed on the home. They volunteer to accept it. It sounds counterintuitive to the property owner’s interests. So under what circumstance would, the owner agree to a lien?
One example of a voluntary lien is a mortgage.
A mortgage is a lien. In this case, the lender puts a lien against the property’s value. Having the bank place a lien on the property as a mortgage, allows the individual to borrow the money against it to purchase the home.
A mortgage gives the individual the advantage of homeownership. Since they would benefit, they are more inclined to voluntarily accept this type of lien.
Another example of a voluntary lien would be a home equity loan. The owner is borrowing money against the current worth of the property.
These are liens that homeowners do not want and are unwelcome. They are placed by other parties against the homeowner in an attempt to collect fees or compensation. Here are some examples that would fall under this category as an involuntary lien:
One common example of an involuntary lien would be a tax lien. If you don’t pay your federal income taxes, the government will place a tax lien on your house. This also includes property taxes, special assessments, and state tax liens.
The mechanic lien is also considered an involuntary lien because it’s initiated by a third party. As discussed earlier, it’s filed by a worker or service provider. The file to receive compensation for work completed and the homeowner refusing to pay.
If a homeowner has an unpaid debt to a creditor, the creditor can file a judgment lien. A judgment lien can also be created when someone wins a lawsuit against you and records the judgment against your property.
Ideally, you don’t want to list a home that has any liens on it, because that can be seen as a negative to potential buyers. But that doesn’t mean you have to refuse the listing.
As an agent, it’s important to know if a property you are about to list has liens taken against it. You can find this information by having your title representative pull a preliminary title report for you.
This preliminary title report will give a full history of the property. It will include information like the names of the previous owners, the current mortgage amount, and when the property was purchased. Along with this information, you will find any liens currently on the home.
So what happens if you do find liens listed on the property?
If the liens are voluntary, there are usually no issues when it comes to selling the home. When the property sells, the owner will pay them off with the profit of the home. Again, the most common examples of a voluntary lien would be a mortgage or home equity loan.
If the liens are involuntary, the seller has to address them. Whether it’s paying it off or coming to a settlement, sellers will want to get that lien cleared before putting it on the market.
It’s inevitable, some of the listings you’ll take in your real estate career will have liens on the property. While not all liens are negative, it’s still important as an agent to know and understand the difference between the two.
The preliminary title report will be instrumental in accessing the home’s history and letting you know about current liens on the property. If you are working with the seller, you can communicate which liens need to be addressed with urgency.
This knowledge will ultimately help in getting the property sold with no issues, leading to a happy client and another closed escrow.
Becoming a real estate appraiser is an exciting career choice.
Appraisers help determine the value of real estate.
They work closely with agents, investors, banks, buyers, and sellers to identify the value of a specific property or home. This helps entities find a fair value of the real estate to sell it at the right price.
Becoming a real estate appraiser requires time, effort, and studying. However, once you become an appraiser, you will find the work was worthwhile.
To become a real estate appraiser, there are 9 steps you must meet:
You must be at least 18 years of age to be a residential real estate appraiser. An associate's, bachelor's, or doctorate degree from college or university is not required. You can be fresh out of high school and ready to dive into appraisal studies. A real estate appraiser is a great career option if you enjoy houses, report writing, and numerical analysis.
As with many real estate jobs, there are prerequisite courses that must be completed before you can take a State Exam. To become a real estate appraiser, the state of California requires you to pass 150 hours of appraisal courses. Following these classes is a live proctored exam. You get 3 attempts to pass this exam. If you do not pass within those 3 attempts, you are required to retake the prerequisite courses.
After you have completed your exam, you can apply for your license. Applications are sent to the Office of Real Estate Appraisers (OREA). You need your application (one of the RE forms available on the Department of Real Estate’s website), certificates of completion from your prerequisite courses, and payment forms or checks. This process is similar to your real estate (salesperson) exam application.
After their waiting and verification period, the OREA will issue a date for your initial Appraisal License exam. Along with this, you are requested to send in a Live Scan. A Live Scan is a fingerprint and background check. Once you have completed these requirements and sent in the verification, you are ready for your exam.
Sharpen your pencils–it's time for a test! After you pass the exam, you have one (1) calendar year to pass the exam, pay any additional fees, and get your real estate appraisal license. However, this does not mean that you can appraise independently–yet. At this point, you have to find an established appraiser who is can train you. Additionally, they cannot have trained three (3) real estate appraiser trainees prior to you.
When you find an appraiser, you must accompany them on inspections and assist them in writing reports for at least 2,000 hours. That’s 40 hours a week for 50 weeks, which equates to one year of full-time work. During this time, a Supervising appraiser must review and approve your work. This does not mean it has to be the same appraiser every time. It is possible to get experience at two separate firms.
Tip: Choose an experienced and reputable appraiser as a mentor to build industry connections and gain valuable insights.
After 2000 hours of experience, you can become a certified residential real estate appraiser. This is where you can work for yourself, control your schedule, and income. Most appraisers are self-employed. Therefore, there are more certified appraiser than there are trainees. Your Certified Appraiser (the one training you) must approve your 2,000 hours of work, which includes the quality of your work and your work ethic.
You can apply for your residential real estate appraiser license when you have received supervisor approval, practiced report writing, and practiced appraising. You are then eligible to complete your application and send it to the OREA and wait for the department's response.
After you get your license, you can file with banks, loan reps, and more. This will allow you to receive requests for jobs. If you follow the typical appraiser’s business model, you will be self employed. Therefore, you will have to market your service and prospect for leads. Unlike a real estate agent, your target market is not the consumer. You will have a different marketing strategy than typical agents or title reps.
It typically takes 1-2 years, depending on your state's requirements and how quickly you complete coursework and experience hours.
The average salary of a real estate appraiser varies by state and experience level. According to industry reports, certified appraisers earn $60,000 - $100,000+ per year.
Yes! Appraisers enjoy job stability, flexible work schedules, and the ability to work independently. It is a lucrative career path with opportunities for growth.
You will be churning out reports on a weekly basis and, hopefully, getting multiple jobs a week. Once you are “on the list” with a lender or bank, you are will be more likely to receive passive work. It is a facet of the real estate industry that operates heavily on trust capital and experience. This is why it is helpful to do your 2,000 hours with a professional, profitable, and busy appraiser–your name gets in front of the right people even before you are licensed.
This job path requires a big time investments. At first, it can seem daunting. You have to spend more than year studying and training for the chance to become a real estate appraiser. But, when you apply yourself and do the work well, you will achieve your goal. And, when you do, you will realize what a terrific decision it was.
Think about today’s world versus the world of 20 years ago. Everything is different now due to the technology that we possess in our palms and pockets. Make sure to use this technology wisely and meticulously, given that we are all so bombarded with online advertisements. It’s tough to stand out from the pack unless you’re really putting work and dedication into it!
The digital world makes life so much easier for so many people, in so many ways. Just one example: instead of getting in your car, walking around the grocery store, and shopping for your own food, now you can do all of the shopping on a laptop or phone from the comfort of your couch, and the groceries get delivered right to your door!
That’s great for people that want to do less work, but imagine if you were disabled -- this would literally be a life-changing development.
Back in the day, marketing yourself required legitimate legwork - walking to houses, knocking on doors, canvassing neighborhoods, and more.
It was tough, it was grueling, and it was costly - both in time and money. But, it started conversations with people -- and conversations are what led to business.
Nowadays, though, situations have evolved. With the advent of the digital world, interactive websites and apps, and unfathomable computing power in your pocket, marketing has completely shifted tracks to the digital world. The younger generation tends to be much more accepting of digital advertisements and digital/online personas, but also more skeptical and judgmental of the content they see online.
That’s why it’s absolutely key to be authentic and genuine by posting engaging content and promoting/advertising with posts that naturally encourage people to interact.
Marketing yourself digitally also has many more components than old-school, traditional marketing. Whereas with traditional marketing you’re simply selling yourself as an agent; when you’re selling yourself digitally, you’re selling your products, yourself, AND how well you can put together an online presence.
One great thing about digital marketing compared to in-person marketing is that you can do it from anywhere - be it your office, home office, or even your bed!
Of course, we’re not suggesting you work from your bed (it’s not great for work/life balance), but in a pinch, sometimes you need to. You can also do a lot more productive work by spending time and money on promoted posts, rather than spending the same time and money driving through neighborhoods and knocking on doors where nobody’s home.
Especially with a listing, digital marketing is king -- you can post pictures, describe the home, put your contact info, and more, all within one post online!
However, there’s something to be said for the in-person marketing angle. Humans, by nature, are social creatures. This means that we are programmed to LIKE interacting with other people. Sharing information and experiences are all key to forming a strong bond with clientele. When you’re in person, networking, and actually shaking hands, you form a stronger and quicker bond than if you are competing for their attention online (with everyone else’s ads competing with yours for eye space and brain space).
So what should you do now to make yourself the most successful Real Estate Agent? We definitely recommend -- can’t stress enough -- that you do both online and in-person marketing to make yourself successful.
While everyone expects you to do online marketing, people will be surprised that you went above and beyond to do in-person, traditional marketing. Judge the neighborhood, but door-knocking and traditional cold calling are surprisingly effective! Connecting is super important in this industry. Instead of just making someone’s life easier with your digital marketing, make it better through your traditional marketing.
Competing with others to be the absolute best is in our blood - it’s survival of the fittest. This drive pushes us to become better than the people with whom we surround ourselves.
When it comes to being a successful Real Estate Agent, it’s easy to be overwhelmed with the competition.
Competition isn’t just the drive to push us further, but a tool to measure our own success. However, we forget that competition isn’t always good. Being competitive is destructive to our own self-worth.
The secret to being a successful real estate agent isn’t by competing with others, but rather it’s competing with yourself.
In real estate, you might consider yourself successful if you’re making $50,000 a year, but someone else might consider yourself successful when making $150,000 a year. Everyone has their own definition of success. This is because people have goals that are unique to their own ambition.
If earning $150,000 a year isn’t important to you, then you shouldn’t let the number of yearly earnings define your success as a real estate agent.
Taking time to consider how you define success is important to your growth as a real estate agent. If you want to take your career in real estate seriously, then you need to be honest with how you measure your growth. Defining success for yourself is the first step in becoming the agent you’ve always wanted to be.
Everyone has their own level of success, therefore you can’t compare yourself to others.
Being competitive is the fuel that pushes you towards success. However, the idea of competing with others is fundamentally flawed. The reason why you shouldn’t compete with others is that you can’t race someone else when you both have different finish lines.
If your goal is to make $50,000 a year in real estate, you can’t compete with someone whose goal is to earn $150,000 a year. Competing with others for the sake of being the best is a losing battle. As a result, you will lower your self-worth, make yourself resentful of others, and have the never-ending feeling of constantly craving more out of your life.
You will never be happy in your real estate career if you compete with others.
You are the only constant in your life. Therefore, your own progress is the only way to measure your success. Instead of competing with other people, compete with yourself. Real estate agents should not be pressured to be better than others - they should push themselves to be better than they were yesterday.
Improving yourself is the only true way of being successful.
Competing with yourself gives you the opportunity to grow as a real estate agent and person. When you’re not worried about other people, you’re free from the stress to outperform others in your field. Moreover, you will appreciate your career and the development you’ve made as a professional.
Start competing with yourself today by monitoring your progress then consistently make an effort to outperform that growth. Doing so will eliminate the thousands of competitors in your industry because the only real competition is yourself.
Encumbrances are quite common in real estate transactions, and because they affect the legal right of a person to buy or sell properties, every real estate enthusiast needs to understand them.
Although encumbrances mainly come as monetary claims, some are more about property control than debts. These could be seen as land use covenants or government restrictions.
In this article, you would get to know what an encumbrance is, the various types of encumbrances, and how to discover and remove them to avoid complications down the road.
In real estate, an encumbrance refers to any claim on a property that prevents its owner from fully utilizing and benefiting from it.
This claim is usually placed by a third party who is not the owner of the property. Claims like these, when filed, can restrict and limit the ownership and/or use of the property.
An encumbrance on a home could be a result of anything, ranging from a loan agreement to a type of restricting license.
Depending on what type it is, legal processes may be necessary to address encumbrances. The existence of an encumbrance on a home has major consequences that could prove unpalatable for homeowners. Some of these effects are:
One effect of encumbrances is their limitation on ownership. This can result from a debt, legal contract, or a transfer of property ownership when given as a gift.
In cases where an encumbrance limits home ownership, the home is owned by the lessor or creditor, and the homeowner is subject to the limitations specified in the agreement or deed. These limitations prevent property sale or transfer of ownership by the homeowner.
If extremely restrictive, an encumbrance on a home may make the property's title unmarketable. This simply means that the property cannot be sold or bought.
As a result, it is extremely important for anyone looking to buy or sell a house to carry out findings into the property’s title to make sure it is not in any way encumbered.
There are various types of encumbrances in real estate. However, all of them have the same effect -create restrictions on a property.
Here are the four most common types of encumbrances that can be found on real estate properties:
An easement is a permission given to another party that grants them access to the home owner’s property for a specific purpose. It is created by an easement deed that is recorded in the public records of your county and becomes part of the title.
Easements sometimes ensure public services are available to all and are sometimes voluntarily granted to help another person.
For example, a landowner may allow a neighbor to construct an on-site well to avoid the cost of extending sewer lines to the property, or a driveway could be constructed through a person’s property to provide easy access to another location.
An encroachment occurs when a part of the property extends beyond its boundary and onto another property. This is often unintended and may not be detected until a survey is conducted.
Encroachments can be resolved simply by one landowner offering to sell part of the land which has been encroached on to the other landowner. If this offer is refused, legal actions can be taken.
An example of an encroachment is when barns, fences, backyards, and sheds stretch beyond their boundaries into someone else’s property.
Deed restrictions are contractual promises that bind a buyer to be subject to certain terms and conditions on a property.
These encumbrances may include a conditional purchase agreement when a buyer does not have enough money to purchase the property and needs financing, and very often, they determine the property's legal use.
An example would be a restriction that prohibits the construction of certain structures on a property.
Generally, if a deed restriction is too restrictive, many buyers may be unwilling to purchase the property.
Liens are one of the most common types of encumbrances in real estate.
If a property owner defaults on his mortgage payment, then a financial claim called a lien will be issued against the property.
This is to assist the creditor -banks or other mortgage agencies- to get back their money.
An example of a lien is when a court order that transfers ownership of the property to the creditor is issued.
Knowing if a property is encumbered is important to understand the restrictions and determine if they wouldn't interfere with your real estate plans.
The following are a few ways through which you can find out if a property is encumbered.
A title search is an investigation into the history of a property to ascertain and reveal any claims or restrictions and who the legal owner is. A title search reveals every detail about a property, including its transfer of ownership over the years, making it one of the best ways to discover if a property is encumbered. To carry out a proper and in-depth title search, it is best to hire the services of a title company.
Another way to learn more about the encumbrances on a property is to talk to a real estate professional.
A good and experienced real estate attorney will be able to detect and interpret any encumbrances on a property, as well as advise you on whether the property should be purchased or not.
Removing encumbrances is essential to the full utilization and benefits of your property. There are different ways to remove encumbrances, depending on the type.
In some cases, it could be as simple as destroying a structure from the property, while in other cases, it could be complicated enough to require legal action.
In the case of a lien, if the homeowner pays off the mortgage, a deed of reconveyance will be issued. This deed transfers ownership of the property from the lender to the borrower. Likewise, if it is an encroachment, reconstructing boundaries or purchasing the encroached land should remove the encumbrance.
Although encumbrances may appear to be terrible because of their restrictions, they serve to safeguard the property and can be advantageous to both owners and buyers.
Sellers who fail to disclose encumbrances to potential buyers expose themselves to severe legal action and buyers who fail to take note early may need additional funds to remedy encumbrances.
Encumbrances are one of the many ways the real estate industry regulates and monitors the sale and purchase of properties to ensure equity.
Understanding the different types of encumbrances will enable you to make informed decisions regarding buying or selling properties.
It will also provide you with an easy way out when you find yourself with an encumbered property on your hands.
Just like in every other industry, some real estate agents are super nice, some of them are incredibly helpful, and -- let’s be honest -- some of them are downright rude, mean, or incompetent.
The party you’re representing in the transaction is called your principal. Don’t ever forget that you are acting with their best interests in mind. Remember, there are multiple people involved in a real estate transaction, all of whom want the escrow to close.
There is the escrow officer, looking for his or her job to be complete. There may be a transaction coordinator looking to get all the documents signed cleanly. There are two interested agents looking for commission checks -- don’t let that process get held up! And of course, the sellers want to sell, and the buyers want to buy. You may not be able to control other people’s behaviors but you can control your reactions.
“You can't always control circumstances. However, you can always control your attitude, approach, and response. Your options are to complain or to look ahead and figure out how to make the situation better.”
― Tony Dungy, Quiet Strength: The Principles, Practices & Priorities of a Winning Life
There are two main ways real estate agents can make a situation more messy than it ought to be.
It’s important that you reach out frequently, and especially so if you’re not hearing back promptly. Your clients will appreciate you for it, and your commission check will come on time -- we call that a “win-win situation!"
When working with another agent, they are literally called your “cooperating broker." If they are not cooperating, though, there is a lot 1600risk. If the other agent is not being reasonable, it’s time for you two to have a one-on-one conversation, not in front of the principals and not at the house for sale.
You need to remind the other agent of a few things. First, you should always maintain a professional and friendly demeanor between each other. Second, you both have a lot riding on this sale, so it’s best to focus on the end result and put aside any differences you may have. Third, you MUST communicate openly and frequently about any issues that may occur. Neither of you want this escrow to fall through!
As they say, “it takes two to tango.”
Sometimes the other agent is simply unwilling or unavailable to be a good and thorough agent. As a last ditch effort, you can go to the broker of record on the transaction. This person, the head of the office at the brokerage, will be able to put some pressure on the agent to be a better representative for their principles.
They have a brand at stake, and they want to maintain the reputation of that brand with the clients and within the neighborhood.
So, as a recap, there are plenty of good agents out there. However, some of them are simply irresponsible -- whether uncommunicative, incompetent, or simply rude. You want to avoid them when possible. Stay professional, communicate constantly, and take them aside if necessary. If all else fails, go to their broker. Just don’t get discouraged!
An easement is one of the many types of encumbrances that can be found on real estate properties. Like all other encumbrances, easements limit the type of activities that can be carried out on a property by its owner.
Since they occur very regularly, it is important for any real estate scholar or investor to understand what easements are all about fully. This article explains in detail what easements are, how they work, and the different types of easements you can come across in the real estate industry.
An easement is a legal term that refers to the lawful right a person has to use a property they do not own for a specified purpose and time. It is a nonpossessory property interest that gives the easement holder legal rights to use another person’s property, usually with the property owner's knowledge.
Easements can be granted to government agencies or utility companies to ensure public services are accessible to all. Additionally, a neighbor or private party may decide to assist another neighbor or private party by granting them usage of their land for certain reasons. In some cases, the easement holder can pay compensation to the property owner for the use of the property.
Although most easements are recorded in public records and included in the property deed, the property owner possesses the title to the property and remains its rightful owner by law. Common easements may include road access, power lines, TV cables, and utility access.
Easements influence a property owner’s rights to use their property freely, and since the easement holder has legal rights to a property, the property owner is not allowed to infringe on those rights. For example, if people have to pass through a property to access their homes, it would be unlawful for the property owner to erect structures that obstruct the path in any way.
An easement is a mutual agreement between the property owner and the person requesting the easement; therefore, the property is utilized within guidelines that are explicitly outlined in the easement agreement. These agreements are sometimes transferred during a property sale, and the current owner has to keep up with them.
Under certain circumstances, an easement can be terminated by the property owner with the support of the law. This can either happen if the easement is abandoned or expired or if the reason for the easement no longer stands.
To completely understand how an easement works, here are several important terms that you need to be aware of:
The right of “ingress” is the legal right to enter a property, while the right of “egress” is the legal right to exit a property. These rights are granted to individuals through the issuance of an easement and can be exercised regardless of the type of property.
The rights to “ingress” and “egress” can come to be of unique importance in situations where a property owner risks trespassing onto the properties of others each time they enter or exit their property.
When an easement is issued based on providing access, the two parties involved are usually the owner of the “dominant tenement” and that of the “servant tenement.” The property which an easement falls on is the “servient tenement” while the property that benefits from the easement is referred to as the “dominant tenement.”
There are different kinds of easements, each depending on the conditions and specifics of the easement agreement. Below are detailed explanations of the most common types:
A prescriptive easement is an easement that is acquired through adverse possession. This type of easement is established when an individual openly uses a property for a continuous and uninterrupted number of years without the owner’s permission.
This easement is centered around the long-term use and enjoyment of a property. Therefore, a prescriptive easement can be legally granted on this basis even if the property owner disputes the use of the property by the other party.
A utility easement is an easement that gives utility workers the right to access infrastructure located on private property. Utility easements come with restrictions and can be very inconvenient for the property owner. Without these easements, utility companies may find it challenging to provide services for everyday lifestyles, such as pipelines and sewers.
When a utility easement is initially granted, the existing owner will often be paid some compensation. However, subsequent property owners are usually not entitled to receive compensation of any form.
“Appurtenant” is a legal term that means something that belongs to a larger body. Therefore, an easement appurtenant is a type of easement that is permanently attached to a property and not just present for the short term. Since it is permanent, it is usually transferred to a new owner along with the property title.
An easement in gross is an easement that is attached to a person or an entity and not to the property itself. This easement is considered valid throughout the life of the burdened property owner but may become void if the property is sold.
An easement in gross is often granted to utility companies, permitting them to construct public infrastructure on private property. Other examples can be when a property owner allows a person to use their property for hunting.
Easements are most of the time granted to provide improvement and solutions to situations. However, while they do this, they also limit the owner’s use of the property, which is why some people might consider them bad or uncomfortable.
Whether easements are bad depends on the property owner's or buyer's preferences. Many property owners wouldn't want to have limited use of their property, while others wouldn't mind as long as it is justifiable. Therefore, general feelings towards easements are mixed.
The best thing to do as a prospective property owner is to find out if there are any easements on a property before buying it. If there is one, you might want to consult with a professional to fully understand the agreements and conditions of the easement, after which you can decide if you want to purchase the property or not.
An in-depth understanding of the concept of easements is important in knowing your rights, responsibilities, and the limitations you stand to face with them.
You should know that asides from limiting your rights as a property owner, easements can also significantly impact the value of a property. Therefore, it is important to seek professional help before making any agreements or purchases.
Starting your journey as a real estate agent can be scary.
From adopting the right frame of mind to understanding your finances, there are many challenges that new agents face. In this survival guide, we'll share practical advice to help you navigate your first year successfully.
The first year in real estate is full of challenges, and the right mindset can make all the difference. It's common to feel overwhelmed when progress seems slow, but instead of getting discouraged, you need to get M.A.D.
Managing finances is crucial for new real estate agents. It's important to understand where to invest and how to plan for expenses.
Setting realistic goals is vital to tracking your progress and maintaining momentum. Both short-term and long-term goals are essential for guiding your career.
Goal setting keeps you focused on growth and helps you avoid wasting time. With clear objectives, you can work towards specific achievements, ensuring that you're on the right path.
Setting goals that are too ambitious can lead to discouragement if you fall short. Instead, break down your larger goals into smaller, achievable milestones. For example, instead of aiming to make $100,000 in your first year, set a goal of earning $25,000 per quarter.
This makes it easier to stay motivated as you achieve smaller successes.
As a new real estate agent, it's important to stay organized and focus on the essentials that will help you succeed. Here is a checklist to guide you through your first year:
The only way to earn clients is through consistent prospecting. Networking and building relationships are fundamental to building your career as a real estate agent.
To generate leads, you'll need to actively meet people and get referrals. This process, known as prospecting, is the foundation of any successful real estate business.
Your sphere of influence includes your immediate network of friends, family, and acquaintances. These people already trust you, making them a valuable source of potential leads and referrals. For instance, if someone in your network is planning to sell their home, you can leverage your relationship to gain their business.
Advertising and marketing are also effective for expanding your network beyond your immediate sphere. Paid ads, digital marketing, and in-person promotions can help you generate fresh leads and build your reputation.
Your first year as a real estate agent will be full of ups and downs. Challenges, setbacks, and successes are all part of the journey. The key to success is staying disciplined and refusing to give up.
Patience and perseverance are essential traits for surviving and thriving in your first year. Many new agents enter the industry expecting instant success, but the reality is that building a successful career takes time and consistent effort. Stay patient, stay committed, and remember that hard work always pays off.
Encroachments are one of the biggest encumbrances in real estate that affect homeowners. Just like other restrictions that may be on real property, encroachments affect an owner’s ability to make use of their property in whatever way they feel is best.
As a broadly used term and regular occurrence in real estate, it is important for real estate enthusiasts and homeowners to fully understand what encroachments are about.
With this article, we aim to provide you with adequate knowledge of what encroachments are, how they work, and how to deal with encroachers.
Encroachments are situations in real estate when part of the property extends beyond its borders and onto another property.
It can also be referred to as the violation of contractual property rights by illegally building or extending structures onto neighboring properties without approval.
Encroachments are a significant cause of conflict between neighbors and are perceived to hinder the buying or selling of a property.
Whether it occurs with or without the knowledge of the encroacher, the encroaching property owner remains responsible for infringing on the rights of their neighbor.
Let's say a homeowner decides to erect a fence around his property, and in the process, the structure extends onto another property.
This will mean that the homeowner is guilty of encroachment and has infringed on the property rights of his neighbor. Encroachments often occur when homeowners make improvements on their property without requesting building permits and conducting surveys.
Most times, it is possible that an encroachment may not be noticed until a proper survey of the property is conducted.
Therefore, it is important to get a professional to examine the legal descriptions when buying a property. Homeowners can also call for surveys to settle disputes between neighbors.
An encroachment may be as simple as tree branches growing beyond a property’s boundary or as severe as a structure intruding into another property.
However, it is usually left to the owner of the encroached property to decide on what actions to take. A property owner may decide to overlook the encroachment if it doesn't cause any inconvenience.
If you discover that your property is being infringed upon, your next line of action should be to contact the encroacher and take steps toward resolving the problem. Here are the best practices to use when dealing with encroachers.
In many cases, a friendly conversation could be all that is needed to resolve an encroachment.
This is usually effective when the encroaching structure can easily be removed, and the encroacher has no problem doing so.
Encroachments such as intruding tree branches or an overlapping garden can be handled this way.
Some encroaching structures may be too difficult to take down or may have cost a lot of money to erect.
Therefore, offering to sell the land that is being encroached upon to the encroacher isn't a bad option. The encroacher doesn't have to bother about demolitions, and as the property owner, you get paid for the portion of your property.
Since your property serves as collateral for any existing mortgage you might have, it is necessary to consult your mortgage lender when doing this.
You might also want to hire a real estate attorney to ensure that accurate land survey records are kept.
Legal actions should only be taken as a last resort when dealing with encroachers. If you and the person responsible for the encroachment are unable to come to a peaceful and fair agreement, you might as well just take the matter to court with the help of a real estate attorney.
Encroachments and easements are two similar real estate terms in the sense that they both involve the extension of structures onto a neighbor's property.
Despite this huge similarity, they are inarguably different. When there is an encroachment, the structures exist on the property illegally and without permission.
There is often compensation paid to the neighbor by the property owner requesting the easement for the intrusion.
Unlike an easement, encroachment problems that go on for years can give ownership rights to an encroacher through adverse possession.
Also known as “squatter’s rights”, this is the occupation of another person's property to own it.
Nonpossessory interests and possessory interests are rights, claims, or privileges that an individual has regarding land or real property.
Although these two real estate concepts share some similarities, they are as different as the two sides of a coin.
A nonpossessory interest is the right possessed by an individual to use another person's real property or land. It is usually an agreement between two parties expressing one person’s intention to use the other’s property.
This agreement can be made through a contract, as in a lease agreement, or through a verbal agreement. An example of a nonpossessory interest is an easement.
On the other hand, a possessory interest refers to an individual's right to occupy real property.
Although a person with a possessory interest does not own the property, they have some right to control it. This interest is expressed in a contract agreement between the two parties.
Now that you have fully understood the concept of encroachments, you can see that they shouldn't be taken with levity.
It is possible that even the slightest infringement on real property can cause many problems to the property owner. These problems include an inability to sell and, in severe cases, the loss of a part of the property to an encroacher.
Therefore, when encroachment is noticed, the property owner should begin dealing with the encroacher immediately.
Also, seeking the expertise of a real estate attorney is always a good idea when dealing with cases like this.
A deed restriction is a term widely used in real estate to refer to any limitation on a property that affects the ability of the property owner to utilize the property as he wishes.
As a real estate enthusiast or a potential investor, it is crucial to understand what deed restrictions are and what sort of challenges they pose to property owners before deciding to go on with any real estate transaction.
In this article, we shall cover everything you need to know about deed restrictions: what they are, how they work, and how to check for them. So, what are deed restrictions?
Deed restrictions are provisions in a deed that limit how property owners can use their property. These restrictions are rules and regulations that govern the legal use of a property and are usually stated in the property purchase agreement.
The buyer is expected to be aware of these restrictions before agreeing to them, and once the deal is signed, these terms are legally binding on the buyer.
Deed restrictions are one of the most common types of encumbrance on a property. They usually dictate what can be built on a piece of land or what a property can and can't be used for. They can either apply to one specific property or a subdivision of properties, regardless of who owns them at any point in time.
For example, in a neighborhood of look-alike houses, specific regulations may be set to ensure that every building maintains a particular look, thus limiting homeowners within the area to make any changes to the look of their property.
Deed restrictions work in the following ways:
The duration of a deed restriction on a property varies, depending on the source of the restriction. While some stay for only a limited amount of time, others can remain for an unlimited period. These are the two most common sources of deed restrictions on real estate properties:
Covenants, conditions, and restrictions, also known as CC&Rs, are rules and regulations of a neighborhood -usually a planned community- that govern all activities regarding the homes in the area.
For example, CC&Rs may state that all cars should be parked inside the garages at all times or that all fences should be painted a particular color. It isn't unusual for CC&Rs to regulate things like the general home appearance, short-term rentals, pets, satellite dishes, parties, business, and trash cans.
Covenants, conditions, and restrictions are considered a type of deed restriction because once these rules are agreed to, they create limitations that impact the day-to-day lives of homeowners and their freedom to use their property as they will.
The declarations of a neighborhood’s CC&Rs are usually documented in the records of the county within which the neighborhood is located and are legally binding.
A Homeowners Association is a legal non-profit association in charge of maintaining and managing assets in a community.
Once a property is purchased in a planned community, the buyer automatically becomes a member of the Homeowners Association and has to abide by the HOA’s governing rules.
HOAs are the primary enforcers of Covenants, Conditions, and Restrictions. They impose penalties such as fines, lawsuits, and suspension of community privileges for any violations of the Association's governing rules.
A freehold estate refers to a real property whose owner possesses exclusive rights to the property for an undefined period. Simply put, a freehold estate gives its owner full privilege and absolute reign over the land.
Unlike houses with deed restrictions where limitations restrict a homeowner’s preferences, freehold estate owners are at liberty to decide what to do with their property and what not to. The homeowner can customize the property to their taste without having to answer to anybody.
In a freehold estate, the owner has a right of title to the land and the property attached to the land. There is no fixed duration for ownership, and ownership can be passed from one person to another without end.
Unless you've always wanted to live in a planned community, purchasing a deed-restricted house could be a problem if you're unaware of the restrictions attached to the property. This is why it is essential to check if a home has deed restrictions before purchasing it.
Here are two ways through which you can do this:
A title search report is a document that contains accurate historical and legal descriptions of the transfer of ownership of a property over time. Title search reports also identify limitations or problems that could affect the purchase of the property.
By conducting a title search on a property through public records, it will be easy to find out if there are any deed restrictions on the property, thus preventing any unpleasant surprises much later.
Since CC&Rs are also documented in county land records, visiting the county clerk's office can be a great idea when checking for deed restrictions. The county clerk's office will provide you with a deed abstract that lists the encumbrances, rules, and regulations attached to any given property.
There is no doubt that deed restrictions are limitations, but whether they are bad depends on the homeowner's or buyer's preferences. Some individuals enjoy the organized and uniform scenery of planned communities, while others crave the freedom to express their individuality.
Although deed restrictions may be regarded as too exacting, they are effective measures to curb the excesses of homeowners, thus ensuring that the interests of everyone are protected. If you are not a fan of deed restrictions, then the safest thing to do is to search a property’s history before purchasing it.
Deed restrictions are encumbrances that exist as part of real estate contracts known as a deed. These documents outline how a property owner is expected to use a property. By signing this contract, the buyer agrees to abide by the rules guiding the use of the property.
Remember, before making a real estate purchase, it is important to know if any restrictions are attached to the property and how serious or restricting they are.
Nobody can predict the future of real estate. With the popularity of new websites like Trulia and Redfin, you don't need a crystal ball to see the impact they’ll have on the industry. Technology and websites are making real estate research, purchasing, and selling easy and accessible to everyone.
California real estate education is important to being a successful agent. But, some people are getting discouraged from entering a career path that could become obsolete.
This leaves people questioning the relevance real estate agents have in the next few decades. More people than ever are using websites to answer questions and to sell or buy property.
Despite some people’s expectation of an inevitable real estate agent demise, the future might not be as bleak as they think.
Third party aggregators like Trulia, Zillow, and Redfin have made their presence known in the real estate industry. However, they can’t replace the work of a Real Estate Agent. When selling a property, there’s information the regular buyers and sellers don’t know.
This is the data accessible to the Real Estate Agent; information the websites don’t distribute.
Real Estate Agents help clients through the entirety of the property transaction process. From the legal issues involved (such as disclosure reports) to filing the correct paperwork, buying or selling a home turns into an overwhelming process.
Real Estate Agents lessen the burden of the legal hoops clients have to jump through.
Real Estate Agents share a common feeling that websites are stealing clients. When a property is listed on a website like Trulia, Zillow, or Redfin, the client will bypass the agent to go straight to the property owner or buyer.
What most agents don’t realize is this isn’t a case of losing clients, but an opportunity to make the transaction process efficient.
Instead of spending days - even weeks - browsing through property listings, clients have the opportunity to come prepared into a meeting with a Real Estate Agent.
Less time is spent on client-agent property searching, and more time on the transaction. When you have prepared, decisive clients there becomes more room to take on additional clients.
You will have more clients, commission, and time to run an efficient business.
The presence traditional Real Estate has in a digital world doesn’t change. Despite owning a website, you still have to go door-to-door finding leads. Currently, the digital world doesn’t have the services available to remove traditional Real Estate Agents from the transaction process.
Real Estate Agents have to shift their mindset when working with clients. Instead of looking at websites as a lead thief, they should use them as a tool to expand their clientele. Moreover, the transactions in Real Estate are extremely complex.
This kind of intricate transaction can’t be done behind a computer.
Real Estate deals need to be done between people due to the extensive amount of paperwork, negotiation, and relationship building involved. A good Real Estate Agent will have skills in bringing people together and being the mediator between two parties.
Their goal, in the digital world, is to ensure buyers and sellers are both happy.
Online discount brokerages, such as Purplebrick and Redfin, are websites that list houses for a substantially less amount of money than you can with a traditional Real Estate Agent. This type of business discounts people’s ability to make money. Essentially, it’s a discounted service.
This might sound like a great deal, however the quality of service reflects its costs.
When selling or buying a property, the current tech and website climate will only get a client so far. If a client is serious about buying or selling, they need to hire a real estate agent.
Whether you’re a real estate agent or a first-time homebuyer about to go through the process, following the proper ethics around kickbacks will help you navigate the transaction easily.
Kickbacks are illegal payments or gifts that occur during the transaction. These laws were put in place to avoid any bribery and protect consumers in the process.
While not all gifts or rebates fall under the illegal kickback category, it’s essential to understand the complexity and how the law defines kickbacks.
A kickback in real estate is when a real estate agent, who has a fiduciary responsibility to the client, receives benefits or items of value for referring certain businesses or services.
These are usually illegal and considered bribes, as it is often in the form of cash or something of value like a gift.
If your agent recommends additional real estate services like escrow companies, title companies, inspection companies, or other businesses that are involved in the real estate transaction, they have to comply with the law and not be bribed to refer business.
This helps maintain the integrity of the transaction and ensures consumer’s interests are protected.
A piece of law called the Real Estate Settlement Procedures Act (RESPA) was put in place in 1974 to prevent unethical or illegal actions between real estate service providers and their clients.
Real estate agents and mortgage brokers must abide by this, and it falls under the jurisdiction of the Consumer Financial Protection Bureau. Under RESPA section 8a, giving gifts or kickbacks in exchange for business is illegal.
Specifically, it prohibits any “unearned” fees or bonuses paid for services that weren’t performed.
RESPA is civil law that applies to all federally regulated mortgage loans, including purchase loans, refinances, home improvement loans, land contracts, and home equity lines of credit.
RESPA will not cover transactions like all-cash offers or rental transactions where a mortgage is not involved.
If you are caught violating RESPA as a real estate agent or mortgage lender, you can face severe consequences such as:
These kickbacks, in certain situations, can also be considered tax evasion since they are unreported income for the agent.
If you have any concerns about when or who can give gifts during the transaction, it’s best to confirm with your broker or a real estate attorney to ensure you’re not violating any RESPA laws.
One key exception to RESPA is when a referral fee is paid between two licensed real estate professionals.
This can be done when one real estate agent refers business to another agent and end up doing a transaction with that client. Sometimes known as a “finders” fee, it is not uncommon for a real estate agent to pay a small percentage of their commission for referring a client to another agent.
This can be anywhere from a few hundred dollars to 25% of their commission, depending on the state they’re in and the agreed-upon fee between the parties.
Each state has different regulations that outline what constitutes a referral fee and how much an agent is able to give, so check with your local state’s board of realtors to confirm. Most states require you to be a licensed real estate agent to receive a referral fee.
But a few states will allow unlicensed individuals - like previous clients - to receive a finders fee for sending business to an agent.
However, this does not apply between mortgage brokers and real estate agents. It is considered an illegal kickback when a referral fee is paid between a real estate agent and another service provider. But if it’s a referral fee between two real estate agents, it is permissible.
While providing gifts in exchange for referrals violates RESPA, not all credits or gifts to clients are against the rules.
A mortgage lender or agent can offer the buyer or seller a closing credit or gift for using them as their service provider — just as long as there are no expectations to refer other businesses to the lender.
RESPA allows for gifts, refunds, or discounts to the client if it doesn’t involve referring business to that provider.
In this case, an agent might offer to refund part of their commission in the form of a “closing credit” that can go towards the client’s down payment and closing costs.
These credits are legal in 40 states and allow agents to give their clients a little money back at the closing table if necessary.
Giving gifts to a client at the closing table or after they move into their new house is a common practice in real estate.
But does that count as a kickback? According to RESPA, as long as there are no strings attached to the gift, agents can give gifts to their clients.
These would be considered more of a thank-you gift and is a way to build a relationship with clients.
These types of gifts and rebates are okay, so long as the client is not expected to get a referral out of it. Remember that next time you want to thank a client for choosing you as an agent!
While Kickbacks are illegal and unethical in real estate, there are some exceptions to gift-giving for your clients, and from agent to agent.
RESPA was created to ensure that buyers and sellers have full transparency and trust in the transaction. If you’re a real estate agent, make sure you’re following proper procedures to avoid violating RESPA laws.
Make sure you have a complete understanding of the law so you can avoid any RESPA-related issues!
While technology has changed a lot in the real estate industry, open houses are one of the most popular “traditional” tactics that real estate agents use to sell homes.
But does hosting an open house and having strangers walk through actually help sell the house? Well, that depends.
An open house is a publicly marketed event hosted by a real estate agent that allows prospective buyers and their agents to tour the home during set hours.
Agents will often host these on the weekends, and they’ll last anywhere from 1 to 3 hours. During that time, the agent will show people around the house, answer any questions and hopefully, find a buyer for the house.
When you get ready to list a property, the agent and the seller will discuss ways to market the property to get the most exposure.
Once the seller agrees to allow the agent to host an open house, the agent can begin marketing it to their network and sharing publicly.
They can also include it in the MLS description of the property, so other agents are notified that an open house will be held. If the open house is entered officially on the MLS, it will also show up as an upcoming event on sites like Zillow, Redfin, and Realtor.com.
On the day of the open house, it’s strongly recommended that the seller of the property is not present. This will prevent any awkward scenarios where the potential buyer meets the current owner.
Once the owner has left the property, the agent will stay at the house and greet any visitors or agents that attend.
Usually, you can expect a wide variety of people attending, ranging from neighbors, real estate agents, home buyers that are starting to look, or sellers in the area who want to look at comparable homes.
As a buyer, when you visit an open house, you’ll be asked to likely sign in and share some information with the listing agent. This can help the agent determine if you’re already working with an agent or might be looking to hire an agent to help in your home search. As a newly licensed agent, hosting open houses can be a great way to generate buyer leads.
There are a lot of benefits to having an open house, and when done correctly, they can generate a lot of interest in the property.
It’s hard to exactly attribute the percentage of homes that sell from an open house, but it can be an effective tool to gauge interest and get more eyes on the property.
While most sellers start their home search online, they will need to see the home in person to make a final decision.
Having an open house to welcome prospective buyers is often a much more relaxed and less formal way to view a house instead of scheduling a formal showing.
It also is more convenient, allowing buyers to visit several open houses throughout the course of the weekend.
While touring, they can ask questions, visualize themselves in the space and get an idea of whether the house is a good fit for them.
According to a 2018 Zillow study, 72 percent of sellers in urban areas host open houses, 63 percent in suburban areas, and 42 percent in rural areas.
Depending on your seller’s situation or the home's condition, it might not always be in their best interest to have an open house.
Make sure you weigh the pros and cons with your seller to ensure everyone is on the same page.
If you want to get additional traffic to your property without opening the door to the public, hosting a broker’s open might be a better fit.
At a broker’s open, only other licensed agents or brokers can attend, providing a more intimate and exclusive setting for agents to preview the property.
From there, they can consider whether they have a client who might be interested in viewing it.
Depending on the property, your seller’s wishes, and your local market, a broker open could be a better fit for you.
While they’re not necessarily any better than an open house, they accomplish the goal of getting additional traffic to the house from professional real estate experts.
This can give you, the seller’s agent, great feedback about the home and the opportunity to network with other agents.
A broker open is a great way to provide your client feedback from other industry professionals.
If, ultimately, your seller isn’t comfortable having strangers come through their house en masse, you will have to conduct private showings with potential buyers.
This is when prospective buyers and their agent will schedule a time to view the home without other buyers or the current owner present.
Most serious buyers will plan a private showing where they can have the house to themselves and ask the seller's agent specific questions.
At the end of the day, hosting an open house is an individualized decision you and your client should discuss. While there are plenty of benefits, there are certain situations where it might not make sense:
Ultimately, it’s up to the seller whether they feel comfortable with an open house. Make sure you walk your clients through all the pros and cons so they can make an informed decision that works best for them.
Your clients might have an urge to find houses for sale by owner to avoid working with real estate agents now. To be the best Realtor® California has ever seen, you must follow a strict code of ethics. This means, when there’s property for sale, the client is the agent’s priority.
Your client shouldn’t learn how to buy a house on their own because they worked with a dishonest real estate agent.
Sticking to the ethical code that was created by the National Association of Realtors® is important to maintaining an agent’s moral integrity. Without it, the industry will get filled with low value agents trying to make a quick buck.
The National Association of Realtors® changed the industry in 1913 when they developed a code of ethics. By doing so, they solidified the ethical duties and responsibility that agents uphold in their profession.
The goal of the code of ethics is to create cooperation among real estate agents to further meet the client’s best interest.
The NAR® code of ethics is used as a moral compass for agents. Even going as far as to say that agents “...connote competency, fairness, and high integrity resulting from adherence to a lofty ideal of moral conduct in business relations. No inducement of profit and no instruction from clients ever can justify departure from this ideal.” Agents must put aside the idea of earning a few extra dollars to stay true to their moral integrity.
Those who are loyal to the real estate agent’s mission will respect the client’s best interest and work for them. Unfortunately, a few agents will stretch the truth with the client.
The reason why agents mislead a seller or buyer is because they’re desperate to earn their commission. Most of the time, the agent will try hyping up their client when finding homes for sale in California. They do this by promising fantastic - but unattainable - deals on their home.
This is to excite the client so they will hire the agent.
The agent will be desperate for clients depending on their current level of success and the size of their clientele network.
If the agent is unsuccessful in their career, they’ll have more desire to manipulate the truth. The same goes for an agent with a small network. When they hype up their client, they’re trying to grow the amount of connections they have.
You can avoid this low status agent behavior by committing to the NAR® code of ethics.
Deciphering the difference between truth and “untruth” can be complicated for the client. Telling the truth is always the best policy.
This allows clear, unaltered, real information to be exchanged between the client and agent.
When an agent chooses to lie or give false information, they’re being untruthful. For example, an agent might tell a client to raise the price of their home to create a sense of excitement towards the agent.
The client will be more inclined to work with someone who could make them more money.
Agents know this and will leverage this desire in their favor. When agents sugarcoat information as a way to be more marketable, they are being deceptive.
As an agent, you should always be supporting and honest to your client.
Always play fair in real estate. Being dishonest and corrupt in your business is a great way to lose your license, but it’s also a morally irresponsible characteristic for a person.
The California Association of Realtors® (CAR) handles investigation into any ethics violations. This means brokerages are investigated when an agent has committed an action deemed immoral or unethical.
Agents sign with the brokerage, so the actions of the real estate agent reflect that of the brokerage.
When unethical behavior is reported, CAR undergoes an extensive process investigating the report. Depending on the severity of the report, CAR could warrant the suspension or revocation of the perpetrating agent’s license.
When you put your client first, everyone will notice.
Practicing clear, transparent communication is an effective way to show the client you respect their time and business. When you are open, honest, and communicate your goals, they will reward you with their loyalty.
You should also keep your word. Holding yourself accountable to provide quality service is important to building trust between you and your client. If you promise to sell their home after raising by $50,000, you should do everything in your power to do so.
Agents can build strong relationships when they are honest with their clients. When they do, there’s immeasurable returns.
When you practice honest habits as a real estate agent, you’ll earn a larger network of clients.
This happens because people want to work with you. When a client finds a real estate agent they trust, they’ll most likely hire them for future deals or recommend them to a friend and family. A successful real estate agent grows their network quickly through referrals.
Avoid falling into the vicious circle of dishonesty by holding yourself accountable to being an honest agent. Doing so will decrease the incentive to lie or tell “untruths” to future clients. As a result, your network will grow - so will your commissions!
If you're selling a house, what kind of brokerage should you work with? Ideally, convenience is best. You may turn to online brokerages.
Online brokerages like Redfin provide convenience and lower fees. But are the services better?
This article walks you through the advantages and disadvantages of using an online real estate brokerage.
Sure - listing houses for sale with an online brokerage can help you save money. Instead of breaking off 6% of the sale with a traditional realtor, you could be spending around 1% with an online brokerage.
This small percentage change means monumental savings.
But, like any discount brokerage, you get what you pay for. Using an online brokerage could mean you lose the opportunity to work with a real estate agent.
In fact, online brokerages like Redfin and Purple Bricks are directly competing with the brokerages you see today. The reason being: saving money is great!
But, when you spend less, you may want to expect less. Real estate agents prefer higher commissions.
When a commission of 1% is split between the broker and real estate agent, the agent will be less likely to work with you.
Sellers can undoubtedly save money using an online brokerage.
Compared to a brick and mortar brokerage, the amount of money that one can save is highly apparent. Companies like Redfin or Purple Bricks will charge the seller around 1% when selling their house.
If the value of the house is $1,000,000, then that’s only $10,000 spent for listing.
A traditional real estate agent will charge the seller 6% for selling the house. Taking the same property value, that’s $60,000.
With $50,000 at stake, making the decision of who will sell your house becomes pretty simple.
Online brokerages make selling and listing the home easy for the seller. They also make the service charge affordable.
This sounds too good to be true, right? Well, there’s one, large downfall that makes this great deal, not so great.
When you’re working with an online brokerage, you get what you pay for.
Paying a lower amount of money to sell and list your property will bring less buyers and a lower quality of buyer.
You don’t have the opportunity to filter the right person for your home. Additionally, buyer agents will not take interest in your property, because they’ll have to share the 1% commission.
The buyer’s agent will be deterred, because they don’t want to invest their time to split $10,000 with an online brokerage. They could be earning more money for themselves and client by working with traditional real estate agents.
As a result, online brokerages could make the selling process more challenging.
When a traditional real estate agent charges the seller 6%, they’re committing to a promise of quality service. The agent will make the process of selling a home simple by finding valuable buyers for their client.
By paying the extra 5%, you are agreeing to hold the agent to a standard that will pay dividends when finding your buyer.
This means they will be working for the seller.
By looking out for your best interest, they will go above and beyond what an online brokerage is able to do. By meeting your needs and finding the right buyer for your home, your sellers agent will show you why the 6% service charge is necessary.
You can save money with an online brokerage, but it might cost you much more money down the line.
Homebuyers stress over finding the absolute perfect home. When they purchase a property, they want to know everything there is to know about it.
But, when the seller withholds a real estate disclosure, the buyer could find these imperfections after the purchase.
Without a property disclosure form, the seller could be held responsible for fixing these issues that creep up after the transaction - especially when they had already known about them. A seller’s disclosure agreement helps make all issues with a house apparent to the seller.
By signing a sales disclosure form all parties are legally aware of the property problems before closing the purchase.
Yes - buyers always have the right to know about issues with a piece of real estate. This is because the homebuyer may not want to purchase the home if they had known about the property’s defects.
With this in mind, it would be unethical to knowingly withhold information from them.
A house disclosure informs the buyer of every defect. Some agents might think this is a bad thing, as it will deter buyers from making a purchase.
To some extent, this is true.
But, buyers will be more eager to work with an agent, if they’re upfront and transparent with the house issues.
The best way for the buyer and seller to communicate the problems with the property is through a real estate disclosure form.
Also known as the seller’s disclosure form, this legal statement reports the condition, well-being, and material defects of the home.
The seller’s property disclosure statement is usually found in the transaction document. This will have a complete description of the defects of the property and ensure the buyer is aware of these problems before completing the transaction.
When the buyer reads the disclosure statement, they will be informed about the property issues.
When the seller or agent intentionally withhold information on the property problems, there will be a chance of legal repercussions.
There will be legal backlash for the real estate agent - and especially the seller - if problems are knowingly withheld from the buyer.
In some situations, buyers are even suing sellers for nondisclosure of latent defects.
Latent defects are problems that are not obvious during the house inspection. One example of a latent defect in the house having a coat of led paint.
This isn’t something that would be obvious during the initial inspection. Therefore, the buyer will have to be told about this information.
However, the seller and agents are not responsible for sharing patent defects. These are the issues that are apparent upon a normal inspection of the property.
This could be apparent house blemishes, such as damaged material property.
So, who’s responsible for fixing the issues with the property? Moments like these are why real estate agents are important.
Disclosures can be used as negotiation power during the transaction. That’s why most sellers are afraid to share them.
A real estate agent will leave a major impact on their client if they’re able to negotiate in their favor.
If you’re representing the buyer in a transaction, and you’re able to convince the buyer needs to fix the issues with the property, you’ll be doing the buyer a major favor.
Putting the needs of the clients first is one of the characteristics of a successful real estate agent.
There are thousands of experienced real estate agents who will happily share their best method of selling real estate.
Filtering through the noise of empty real estate tips can be a challenge. However, there’s one piece of advice that will always outperform other real estate agent tips.
You’ll find the best selling tips by discovering what makes a good real estate agent a great one. Instead of researching overnight hacks, there’s one strategy that will change your real estate career for good.
The right way to sell a property is with grit, tenacity, and - most of all - passion.
Passion is real estate isn’t just a motivational hack. It’s a measurable characteristic that clients and peers will notice. People who are passionate will always be more likely to succeed in their careers. Here’s how you can stay passionate to sell a property.
Becoming a real estate agent takes discipline and stamina. Holding yourself accountable is a challenge that most agents struggle with. As a result, they find themselves in 3 different levels of effort.
Most agents will fall into the level of doing the bare minimum in their careers.
These are the people who will learn the course material, pass the real estate state exam, and sign with a brokerage, but fall short of excelling in their careers. They follow the same motions day-in and day-out.
The next level is for the agents who perform above everyone’s average. You will find these people closing more deals, developing a brand, and being well versed in real estate knowledge.
Finally, the best real estate agents are the ones who perform well in their jobs and show passion. These are the agents who have a superb reputation.
They work hard in their careers and they stay invested with their clients. These agents will go the extra distance that most choose not to.
People always want overnight success. They believe finding that one tip or trick to better their real estate careers will fall into their lap. Then, they expect to have instant success by following a strategy guide or scheme.
In real estate, there are no overnight success tricks.
The best real estate selling tips to make you successful are: working hard and showing passion. People want to work with those who are invested in their careers. When you are dedicated to doing the best job you can, you will attract clients and professionals to you.
Passion is the strong, emotional drive that makes you invested. When passion is described like this, it might sound unattainable if you don’t have it. Passion is something that comes to you when you’re able to shift your mindset.
When you figure out what makes you care - you will find it easier to feel passionate about your career. In regards to real estate sales, you will feel passionate about finding the best deal for your client, when you've invested in ensuring they have the best property at the best price.
This is why building strong relationship with clients and peers is a vital part of being a real estate agent.
Discovering why you care about your job will always lead to being invested in your career. When you are invested in your career, you will become passionate. Therefore, the right way to sell or buy property is to, firstly, care.
The first step to combat discrimination in the United States was the Civil Rights Act of 1866. However, neighborhood discrimination wasn’t addressed until the Civil Rights Act of 1968.
Also known as the Fair Housing Act, this legislature made “refusal to sell or rent a dwelling to any person because of his race, color, religion, or national origin” illegal.
Real estate agents can’t determine where the home buyer can or cannot live. That’s why choosing your client’s future home should be handled with caution.
In 1968, The Fair Housing Act was passed to counteract discriminatory behavior that controlled the ethnic makeup of neighborhoods.
This legislature was to provide equal housing opportunities to everyone, no matter their race, religion, or national origin.
This landmark regulation wanted to take the discrimination out of the housing.
This was an expansion of the Civil Rights Act of 1866, which didn’t enforce federal action against discriminatory behavior in housing.
The major acts in housing discrimination were steering and redlining. Each attempted to serve the real estate agent to make a sale or fragment neighborhoods based on ethnicity.
Steering is the act of guiding home buyers to neighborhoods based on their race, ethnicity, or religion. It also worked in guiding home buyers away from neighborhoods.
This practice was used by real estate salesperson agents and urban planners.
Racial steering is used to segregate neighborhoods.
Steering as an act is something that hasn't gone away since the early 1900s. One of the most recent national cases occurred in 2006.
When dealing with a client, you should always consider where they want to live. Never outright choose the location for them without hearing their interests, tastes, and needs.
Therefore, the best way to avoid racial steering (even inadvertently) is by asking the client “where do you want to live?”
Redlining is another discriminatory behavior in real estate. This is the act of segregating neighborhoods based on race, ethnicity, and religion.
Redlining was used most often with banks in the mid to late 1900s to avoid financial investment in minority-populated neighborhoods.
This form of discrimination accounts for the devaluing of land and property by encouraging a negative stigma.
For example, in the late 1900s, banks wouldn’t give loans to residents of redlined zones, causing the well-being of houses and property to drastically diminish.
This resulted in the well-being of land decreasing as well.
Real estate agents must show the property in a variety of neighborhoods. In other words, steering a client to a redlined neighborhood is illegal and must be avoided.
When a client asks about the racial makeup, crime rate, or education rate of a neighborhood, always direct them to resources that will help answer these questions.
Advertising property must be handled with care. Promoting a property could result in excluding certain populations from the property. This won’t only be considered illegal practice, but it could harm your business whether intentional or not.
You must be conscious of advertisement phrasing.
Aside from being aware of race, ethnicity, and religious practice, you should consider how you speak to people of a specific gender, disability, and familial status.
Here’s one example of unaware exclusionary phrasing: When advertising a property with a great hiking trail, you might say, “This home is fantastic for hikers.”
What you might not realize is this is excluding people who cannot hike, because of a disability.
They will be less likely to work with you, because of being excluded from your advertisement.
When you’re in doubt about whether or not something could be exclusive, you should omit it from the advertisement. Also, always be aware of how your speaking to others, whether through a listing or in person.
Inclusivity goes a long way - especially in real estate.
To become a successful real estate agent, you don’t need to close the biggest million-dollar listing (it couldn’t hurt, though!) Success isn’t based on a real estate agent's salary. To thrive, you’ll have to do more than finding real estate for sale.
You have to focus on the fundamentals that make you an unstoppable agent.
These are the foundational elements that make up a successful agent's professionalism and work ethic. In other words, success is more than just dollar signs.
Here are the characteristics of successful real estate agents:
Real estate motivational quotes can only go so far. There’s a number of ways to keep yourself pumped up to work every day. One of the best ways is to keep an open mind about your career.
Staying open-minded is the best way to invite opportunity into your life.
In real estate, you experience hurdles that will ruin your momentum to grow. Trying new strategies to sell a home or to market your services will help you maintain a competitive edge amongst others.
Adopting new, inventive ways to conduct business will not only help feed your open-mindedness, but it will help you build passion.
When you’re passionate about your career, you’ll naturally find yourself motivated to excel.
Agents who are active in their careers will, sooner or later, find success. When you put in the extra work and go beyond what is expected, your success doesn’t become a matter of “if” but a matter of “when.”
Here’s why going that extra mile in your career will always lead to success:
Whether you’re negotiating for your client or - literally - going the extra distance to attend a real estate class, you’re showing people you have an excellent work ethic.
This will make you adopt the reputation of being a hard worker. When people hear you take yourself seriously, they’ll be more likely to work with you. It will also keep you from slacking off in your career.
You’re your own boss in real estate, so you have to hold yourself to higher standards.
This is why discipline and commitment play a big role in your success.
To stay disciplined and committed in your career, you - simply - can’t give up. That’s easier written than done. You need to go through the daily work, always be networking, and choose to work when others aren’t.
Commitment to maintaining an excellent quality of work is also an important part of being a real estate agent. Some people cut corners or practice unethical behavior.
When you practice unethical behavior, people will have a negative opinion about you. Nothing is worse for your success than a bad reputation.
Always stay disciplined to do the work and stay committed to doing it with excellence.
The real estate industry is always changing. That’s why staying updated on trends, news, and practices is the best way to remain a cutting-edge real estate agent.
Having sharp, updated information about markets, the economy, and the greater industry will keep you competitive. You will never be out of the loop and run the risk of being an obsolete real estate agent.
You will also have the authority and knowledge to help you excel in your real estate career.
The final step is to change your frame of mind. Instead of listening to the inner monologue that makes you second guess yourself, remind yourself that you can achieve success as a real estate agent.
Whenever you have the thought “What if I can’t do it?” remember to ask yourself “What if I can do it?”
Taking the time to change your mindset will give you the confidence you need to close deals, negotiate, and find leads.
The successful real estate agent doesn’t become successful by hacking the system or practicing unethical work behavior. They become successful by choosing to go the extra mile because they feel passionate about their career.
This is an internal change that everyone has to go through in order to become lucrative in their career. You can start becoming successful today by adopting these characteristics.
Becoming a real estate agent is daunting. You have the onus of finding your own clients, negotiating with heated personalities, and handling confusing legal work. There’s plenty to fear.
How to be a successful real estate agent is dependent on how you overcome these common fears. When you find yourself avoiding responsibilities in your career, you could be putting them off because you’re fearful of tackling the challenge.
Finding how you can connect with a client or managing a heated negotiation isn’t easy. These are skills that you develop over time, and overcoming your fear of failure is a major part of getting better.
You might even find out that once you start breaking down these fears, they aren’t so scary after all.
Residential purchase contracts, deeds, and leasing agreements - oh, my!
These are just a few real estate contracts you’ll work with as an agent. Just by how they sound, these contracts sound intimidating. But the more you work with them, the less daunting they become.
You’ll even realize these real estate contracts are easier to learn than you think.
Before you begin working in real estate, you should educate yourself (at the very least, brush up on) the types of contracts you’ll encounter as a real estate agent. This will help you manage the paperwork when you’re putting in the real work.
One of the biggest problems real estate agents face is talking to clients.
More real estate agents than you think to struggle with their fear of working with another person. They might think they’ll say something that ruins the client relationship.
These are the inner fears that creep up in most careers. The reason: being likable and professional is important to your success.
Exposing yourself to more professional interactions is the best way to overcome this fear. You will be surprised at the sight of your shy personality shift into a charismatic socialite. When you do, you’ll attract more leads and retain more clients.
The most popular fear that real estate agents (and most people) experience is rejection.
Prospecting and door-knocking make you vulnerable. You’re putting yourself out there and, more often than not, you’ll be rejected. There’s no way to avoid people turning down your services as a real estate agent.
When you experience rejection while prospecting or door knocking, remember they aren’t rejecting you: the person. They are expressing how they are not interested in your services. In other words, try not to take it personally!
Easier said than done, right?
Remind yourself that a “no” doesn’t mean the client is angry with you. There’s no animosity or hatred projected. They simply are not interested in working with a real estate agent.
And that’s okay! Every time you experience a “no” from a prospect, you’re one step closer to the one that will give you an excited “yes!”
The only way to overcome the fear of rejection is to expose yourself to rejection.
Everyone wants job security, but that might not be available as a real estate agent.
Starting your career in real estate is a challenge for some people. This is because you could go months before you receive a paycheck since the job is commission-based. That’s why having job security before you become a real estate agent is recommended.
When you’re going from a full-time job to a full-time real estate agent, you will have some long nights.
To avoid the monetary stress and anxiety from starting a new career in real estate, you should plan on taking small steps. Whether you're taking online real estate classes or working on the weekend, you should have another source of income when you’re starting your career.
Most fears you experience as a real estate agent will dissipate with exposure. When you confront these fears head-on, you’ll realize they aren’t as scary as you think. And, when you do overcome these fears, you’ll find yourself excelling in your real estate career.
What’s a time when you overcame fear in your professional career?
As a real estate agent, you’re your own boss. This sounds wonderful, but you also have to play the role of the boss when holding yourself accountable. You can lose track of projects, client relationships, and listings when you don’t practice excellent real estate agent time management strategies.
Top real estate agents all have one thing in common: time management skills. Becoming a real estate agent will require you to develop great habits that keep you progressing through your career. Below is actionable, real estate agent time management advice that you can apply to your career right now.
Goal setting will help you visualize what needs to get done. What people don’t realize is that the majority of goal setting is done wrong. You might have an idea of what you want to accomplish, but if it just remains an idea, you’ll never accomplish it.
To practice efficient real estate agent time management, you should set realistic, tangible goals. The best way to do this is, to be honest with yourself and your capabilities of completing a task. Writing “becoming a successful real estate agent” is great for dreams, but don’t expect to reach this goal without simple action steps.
When you have a big project, break it down into as many small goals as possible. Doing so will help you identify every action item you need to complete to meet your goal.
You could knock a bunch of items off your to-do list, but still, get nothing done. Productive procrastination is the phenomenon of working on simple, mundane tasks to avoid the bigger, more daunting task. It’s a symptom of not having a clear action plan for tackling the bigger projects.
Prioritizing your work will help you alleviate those busy days with low results. According to the 80/20 rule, 20% of your projects will produce 80% of the results you’re looking for. Therefore, focusing on the 80% of projects that produce 20% of the result, will be using your time unwisely.
Breaking down the bigger projects into smaller steps will help you not feel so intimidated in getting those priority tasks done. This is efficient real estate agent time management.
We like to think we can do everything, but the truth is: we can’t. Sometimes we have to ask for help - and that’s okay!
Taking on more work than you can handle is a sign that your brand is growing. That means it’s time to grow your team. There’s plenty of benefits in delegating responsibilities to another person. When your business grows, you’ll have more real estate jobs for people who could use the extra work. This will grow your network and help you take on more clients.
Delegating will help you manage your time better by setting your schedule free from the confines of repetitive tasks. This means you can focus on the important work.
Managing your time and beating procrastination is all about creating clear objectives. Making a list of the action steps you need to complete in order to finish a project is just as important as setting deadlines. When you give yourself deadlines, you create a timeframe for when a project must be completed.
This will keep you from lallygagging.
People with clear deadlines will have more drive to finish their tasks within the timeframe. This is because they have a clear objective to follow. By removing any room for procrastination, you will be able to finish any project you start - in a timely manner.
Distracted working is inefficient. Avoid multitasking when you can, because the added stimulus will distract you from the priority tasks. According to the American Psychological Association, multitasking reportedly decreases productivity by 40%.
Sending emails to clients, while showing off a property to another client, might sound like efficiency, but you’re actually hindering yourself by doing this. Therefore, you should focus on one thing at a time. You can fully immerse yourself in the work and produce a higher quality result than you would when you’re multitasking.
One of the best real estate agent time management strategies is keeping a Rolodex of your contacts. Whether it's a spreadsheet of names and phone numbers or a fully functional contact management system, you should always keep your contacts nearby.
This will decrease the amount of time you take searching through your phone or a piece of paper, that you lost long ago. Having your contacts organized and well-managed will also keep you from procrastinating from reaching out to leads.
One of the reasons why real estate professionals procrastinate is because we fear failure. What’s even more confusing is that we often subconsciously lie to ourselves about why we procrastinate. Often times we will use the excuse “now’s not the best time” or “I’ll do this tomorrow,” when we are avoiding the possibility of failing.
If the task is a priority, then you should plan on doing it immediately.
You can overcome this fear by accepting the fact that we all fail at some point. This is okay because failure is a natural part to becoming a successful real estate agent. Overcoming this fear becomes easier the more often you expose yourself to failure.
Batching your work is a quick way to optimize your work schedule. Real estate agent time management is easier when you're creating a schedule to focus on one project. This will keep you in the same mindset as you complete your project. One of the reasons why we fall off our productive workflow is because we have to shift gears from one project to another.
For example, you could switch from sending emails to showing property and then back to sending emails. Batching your work in timeframes throughout the day will optimize where you allocate your time. For example, you can reserve the morning for showing property and the afternoon for sending emails.
Don’t forget to reward yourself for completing projects. This form of positive reinforcement will encourage you to work towards rewards. Whether it's sleeping in a little the next day or enjoying a few hours at the spa, giving yourself a treat is a great way to show self-appreciation.
Moreover, you should schedule time for play. This can be grabbing lunch with a friend or decompressing with a walk through a park. Scheduling time to relax and not think about work is important to stay productive. Without play, you’ll burn out and grow resentment for your own career.
Scheduling, prioritizing, and creating a list of what needs to be done might seem like simple things to do, but they go a long way in boosting your productivity. Since you’re your own boss, you have to act like a boss. By managing your time wisely, you won’t let yourself slip.
What’s a simple real estate agent time management tip that’s helped you finish your work?
You need a way to make more money.
Your current job doesn't pay you enough money. You're exhausted from saving your money, pinching every penny, and enduring strict budgets, only to find out it's still not enough.
If you're like most people, you're searching for lucrative side hustles ideas that are easy to start. This is why becoming a real estate agent is agent is a great idea.
This guide will show you exactly why your next side hustle should be in real estate.
Working as a real estate agent is a full-time job. But it also makes a great side hustle.
The reason why so many people join the real estate industry to make money is because of the:
Let's explore these perks to see if it works with your lifestyle.
Real estate agents work on commission and earn that commission based on a percentage of a property's sale price. That means that a part-time real estate agent can make a sizable commission.
The current average home value in the United States is $374,900. Let's figure out how much an agent earns on a home valued at the national average.
Keep in mind, all commissions are negotiable. Let's assume the agent works at a 1.5% commission rate. That means, the agent earns 1.5% of $374,900. In this example, that would be $5,623.
If a transaction closes within 30 days, that's a lot of money for one month. It's more than what some people make with their full time job!
Chances are, someone you know would like to buy or sell real estate right now. The likelihood of this will greatly increase over the next 6 months.
That's great news! That means there will be someone that you know who needs your help within 6-months. People within your network are more likely to work with you over other agents. That is because they trust you more than a stranger.
As a part-time agent, you can work remotely from anywhere, make your hours, and have the freedom to put as much or as little effort into the gig as you want. Of course, the more you dedicate to your side hustle, the greater the return.
When your side hustle is working as a part-time real estate agent, you have the opportunity to decide if a full-time career in real estate is right for you. If it seems like the right move, it is the safest way to transition into a full-time job as a real estate agent.
One of the best things about a real estate career is the flexible schedule. This part is vital for side hustlers. Agents don't have strict hours they work.
Most agents work throughout the day when because they are on-call to answer questions from clients, coordinate with third parties, and to carry out admin duties.
Agents who are side hustlers often work evenings and weekends. This is conducive for clients because they too will have 9-5 jobs, and they will not be available during working hours.
With your real estate license, you can choose to work exclusively as a referral agent. Referral Agents earn their money by referring clients to other real estate agents.
The other agent then handles the entire transaction, and the referral agent collects a referral fee when the deal closes. The average referral fee is 20-25% of the agent's commission. All commission rates are negotiable, however.
Using our earlier example, if you act as a referral agent in that transaction, you could collect as much as $1,405.75 for a simple referral.
That means no client interfacing, no burdensome paperwork throughout the process, just collecting a few for recommending people to other agents.
What you put into the your side hustle is what you get out of it. This is great for people who love their real estate side gig because they have the power to make it their full-time focus.
The success of the agents is based on how many clients they can book. If they lead generate more, they can find more clients. This is the lever they can pull to grow their income.
Being a part-time real estate agent can open the door to a career in real estate investing, and it can also be beneficial if you want to buy your own home. A real estate license gives you early access to exclusive multiple listing service (MLS) properties.
You can also represent yourself in purchasing your own home, which means you'll be able to pocket some extra money in the form of a commission on the sale.
Real estate is a big industry and agents are in a unique position. Their jobs can serve as a gateway to more careers opportunities. As I mentioned in the previous section, they can represent themselves in the transaction.
This sets up agents to be great investors. They can invest in property to flip it, to hold it for a higher price, to add renters for monthly revenue, or all three.
They can use this opportunity and flexibility to find new, exciting ways to make money. This type of opportunity can help anyone design the life they want. The only determining factor is their own drive.
Although specific requirements for becoming a real estate agent are different from state to state, the following are the general steps that someone needs to take to start your real estate side business are:
It depends on the number of deals you close. Even selling one home every few months can bring in thousands of dollars.
Yes! The potential for high commissions, flexible scheduling, and scalable income make it a lucrative side business.
The costs vary by state but typically range from $500 to $1,500, including pre-licensing courses, exam fees, and licensing fees.
While you'll have to spend some time and money to get a real estate license and launch your side hustle, having a real estate license can open the door to opportunities well beyond your initial part-time gig.
You are in control when you become a real estate agent, whether part-time or as a full-time career. You create your schedule, set your own pace, and even decide your role. The power is in your hands, and the potential to make lots of money is within your reach.
Just remember, you can only get back how much you put into it, and the more time you dedicate to your side hustle, the greater the return will be.
Money is one of the most important resources a real estate agent can have. Having great real estate budgeting habits will help you save up when times get tough. This might sound obvious, but some agents blow through their savings with negligent spending habits.
When they do, they have to adopt another form of income or give up on the real estate agent lifestyle for good.
Real estate budgeting habits will keep you from ruining your career with a few purchases. With the right kind of budget for real estate, an agent can turn their entire business around. Adopting the right habits starts with creating a foolproof real estate budget.
The best way to start your budget is to plan month-by-month.
Planning a monthly budget gives you a clear idea of where you are allocating your money. Using an excel budget template or another form of tracking is a beneficial tool in visualizing your expenditures.
While creating a monthly budget, you should have a clear goal of how much money you are willing to spend. The best way to determine the amount of money you’re willing to spend each month is by listing the accrued monthly costs.
To list your costs, you will have to track where you spend your money month-to-month. Keeping receipts, transaction documents, payment records, and any other receipt form are integral to any money management plan.
When you have the appropriate documentation, make a list of your monthly expenditures. This should include every product or service that you spend money on.
Plan on being honest with yourself about your spending habits. Remember, it’s always best to err on the side of caution when listing your costs. You should also plan on listing the money you will be putting away in investments, retirement funds, and your emergency fund.
Investments and retirement funds should be included in your listing costs. This is because you are completely responsible for your own investment and retirement. You don’t have the security of a company to help you reserve funds for the days you will no longer be working.
The real estate agent's salary is entirely dependent on a commission-based income. Therefore, planning for the future is a vital part of saving money. If you don’t put away funds into investments or a retirement plan, you won’t have any money to fall back on when (or if) you decide to retire.
Making an emergency fund is an excellent safety net for rainy day situations. When a drastic, unexpected event occurs that siphons your money, you’ll want to have the security of an emergency fund to help finance your living conditions.
Reserving some of your money for a bad scenario is standard practice for real estate professionals. Your salary is unpredictable and inconsistent. Having as many safety nets in place to catch you when you fall will make or break your career.
Paying with cash is an old, traditional trick. When you strictly use cash for the payments of goods and services, you will spend less overall. The reason being, paying with cash is harder than paying with a debit or credit card. Transparent money transactions (such as paying with a credit card) cause you to be less averse to payments.
Therefore, when you pay with cash, you’re less likely to overspend. This will help you stay within your real estate budgeting limits - especially if you run out of cash in your wallet.
When you’re paying with credit cards, you’re more likely to spend more money. However, there’s plenty of benefits to making payments using a credit card. One of the major benefits is accruing points over time. This will make you eligible for special perks and rewards with your bank provider.
Another benefit of using a credit card is accumulating good credit for making payments on time. This will help you on down the line by building an excellent credit score.
Finally, you should always keep the receipts of payments, money transactions, or over-the-counter deals. This is an old-school habit that helps you collect a history of your payments. Doing so serves well when calculating your monthly expenditures and gauging how much over (or under) you are with your spending.
Keeping a record of your transactions will greatly benefit you when doing taxes too. Tax season is a headache - especially for real estate agents. You can make the process simpler by keeping your receipts organized.
Being conscientious about your real estate budgeting habits will help you survive as a real estate agent. This is especially true for your first year. Adopt these healthy habits now, so you growing your business is easier in the long run.
If we created a downloadable real estate budget template, would you find it useful?
If you’re reading this, chances are you’ve wondered how to become a successful real estate agent. Achieving success in real estate takes dedication and hard work, but there are a few tips that can make your journey a little easier.
We sat down with CA Realty Training owner and head trainer, Robert Rico, to learn the best advice for new real estate agents and the tips that helped him build a successful career.
Producing wholesome work will set you apart from every other real estate agent in the industry. In the words of Robert Rico, “Don’t half-a** it.” Every task deserves your full attention and energy. Without this commitment, you risk producing subpar work, which often leads to the reputation of an inexperienced agent.
Imagine you’re preparing a marketing package for a new listing. Instead of quickly throwing together some photos and a description, you take the time to create high-quality images, an engaging property video, and a well-written description. You hold an open house that’s well-promoted, with snacks and a welcoming atmosphere. The result? Your clients are impressed, and your extra effort sets the standard for future referrals.
Tip: Always go the extra mile and commit to delivering quality work. This commitment will differentiate you and help you build a reputation as a professional real estate agent.
Scheduling everything you do will help you stay organized, increase productivity, and improve time management. By keeping an organized schedule, you’ll be able to track appointments, meetings, and commitments on a visual calendar.
A new agent relies on their memory for appointments and meetings. After double-booking two important clients and missing an open house, they quickly realize the importance of scheduling.
Tip: Plan your days, weeks, and even months in advance to stay on top of your workload. This practice will help you take on more responsibilities without feeling overwhelmed, and it will greatly reduce stress.
Not building relationships is one of the biggest mistakes a real estate agent can make. The agent with the biggest network gets the most work and the most referrals.
An agent works with a first-time homebuyer and takes extra time to answer every question, follow up regularly, and take note of their preferences. After closing, the agent sends a thoughtful thank-you gift and checks in periodically. A year later, that same client refers a friend because they felt so valued.
Tip: Take time to show your clients you care. Taking notes after conversations and setting reminders about their needs can help you prioritize them. When clients feel remembered and valued, they are more likely to refer you to others.
You can’t rely on your memory alone. Writing everything down—from client details to important meetings—will help you stay organized and avoid missing crucial information.
An agent fails to write down key client preferences discussed during a call. Later, they present the wrong type of property, which frustrates the client and causes them to look elsewhere.
Tip: Keep a notepad, tablet, or digital tool handy to record all important information. Documenting conversations and client preferences ensures nothing gets overlooked, helping you deliver better service.
Becoming a successful real estate agent isn’t about luck—it's about effort, strategy, and dedication. By taking the time to thoroughly execute your responsibilities, you can transition from wondering “if” you’ll be successful to “when” you will be.
When you build a professional lifestyle based on fundamentals like quality work, scheduling, relationship-building, and consistent note-taking, success becomes inevitable.
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