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Be your own boss, earn a huge commission – up to five figures sometimes – with flexible working hours! These are the reasons people become property agents, and you often see them driving nice cars and living in huge homes.
Of course, good things do not come easy. There are a lot of things you need to power through before achieving financial success through selling property.
Here are some cold, hard truths you need to know before becoming a fully qualified property agent:
1. You might not have a stable income
An agent’s income comes purely from sales. There could be months when you are closing deals left and right and there could be a dry spell that lasts for months. There is no fixed estimate for how much you receive for each transaction.
The maximum commission that a property agent receives is 3% of the sale or purchase of land and buildings, while a minimum of RM1,000 must be paid on any transaction.
An agent can also earn up to 10% of the sales proceeds of chattels such as furniture, plant equipment and machinery.
For rentals, agents can receive 1.25 to 1.75 months’ gross rent, depending on the terms of the rental.
2. You may face cash flow difficulties
A career in real estate is very much like running a business. Cash flow is crucial to build up the business and create profit.
An agent is not paid until the transaction is completed, which is why it is best to have at least six months’ income put away before switching to full-time property sales.
To get hired, you first need to make yourself seen. Whether you decide to go the conventional route of printing newspaper ads, flyers and other physical media or go digital with listings on property portals and creating social media ads, some money is needed to make yourself stand out.
An agent also needs to stay up to date with all the latest market trends to give their clients the best advice.
To conduct their research on the trends, an agent will require a tool or platform that instantly provides the information needed to impress potential clients. Typically, this kind of platform requires a subscription to access the data.
There are online platforms like Property Advisor that do just that, and even provide price comparisons for nearby areas, making it great value for money.
3. You need to be very disciplined
Flexible working hours may sound tempting, but it comes at a steep price.
The chances are high that you will end up working more hours than a regular nine-to-five job. What is certain is that you will be working outside normal working hours, especially on weekends.
Initially, this freedom may cause you to lose focus. Arranging appointments, attending to clients, handling paperwork and conducting research can take up a good deal of time, and in settling one task you may wind up neglecting another.
An agent has to multitask – consulting clients on how to make the best of their budget, helping them to plan their finances and providing detailed information about the market while juggling the sales process at the same time.
Eventually, you will find your momentum, and if you are naturally a highly disciplined person, working as an agent will be an exciting challenge.
4. Uncertain market conditions
We are in uncertain times, not just for real estate but the entire economy. Covid-19 has affected the incomes of many, leading people to postpone major purchases such as property.
Apart from the pandemic, digitalisation could make a real estate agent redundant.
The internet has changed the buying and selling behaviour of consumers, and increasing numbers of people are deciding to proceed with their sub-sale transactions without the help of an agent.
5. Rejection is merely a redirection
In the beginning, the rejections will dishearten and frustrate you. You may spend time on research and presentations, only to have the buyer back out.
But remember, rejection is part and parcel of all sales jobs.
Ultimately, it is how you respond and build yourself up that will make or break your career as a property agent.
This article was written by Adlene Hanna of PropertyAdvisor.my, Malaysia’s most comprehensive source of property data, property analytics and insights.