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The run-up on housing prices nationwide caused many
to salivate. Double- and sometimes triple-digit gains made real
estate not only trendy, but über-lucrative. Some turned to
investment property to get their piece of the pie, while others
opted to sell the pie by becoming real estate agents.
There are several steps necessary to become a real
estate agent. Although the exact requirements vary by state, Bankrate
spoke with industry experts to get an overview of what is needed
and what it will cost you if you want to sell residential real estate.
Typically in the U.S., homeowners can sell their own
homes without a license. But to sell someone else's home usually
requires a state license.
Pat Vredevoogd Combs, president-elect of the National
Association of Realtors, or NAR, suggests that wannabe real estate
agents first interview brokers. In most states, agents must work
under a broker.
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Source: Bankrate.com |
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"Talk to real estate companies and find one you
want to associate yourself with," says Vredevoogd Combs, a
35-year real estate veteran based in Grand Rapids, Mich. During
these meetings you should find out the company's advertising policy,
office culture, location and, most importantly, how the commission
is split between the agent and the broker. Although a 6-percent
commission is common for real estate sales, half of that goes to
the seller's agent and the other half to the buyer's agent.
Then, each agent must split his or her part with his
or her broker. Some brokers split the commission evenly with the
sales agent, while others boast taking only 5 percent from agents.
New England agent Martha Rooney, who has a 50/50 split with her broker, urges would-be agents to find out what expenses agents must pay out of their commission. Some items, such as office costs (i.e., a desk, photocopying, marketing, phone calls, postage) may be the responsibility of the agent.
"In some offices you pay as much as $2,000 a month just for your desk," Rooney says.
Next, NAR's Vredevoogd Combs, who is a partner in
AJS Realty, says after interviewing real estate firms, take prelicensing
classes.
Courses are offered online, through real estate firms,
professional schools or community colleges. Each state sets the
requirements for classes. In New Hampshire the courses are 40 hours,
while other states, such as Louisiana, require up to 90 hours of
classes.
Then there's the test. Once you pass it, you become licensed through the firm you choose to affiliate with.
Many companies have their own form of in-house training to help new agents, Vredevoogd Combs says. Some require more classes, while others pair a newbie agent with a seasoned pro. "Others offer no training at all and whatever happens, happens," she says. "If you're new, you need some type of training."
Once licensed, Vredevoogd Combs recommends joining
real estate associations and taking additional classes. NAR lobbies
Congress on behalf of real estate agents and provides training and
a code of ethics for its members.
To keep up with new laws and trends, many states require agents to take a certain number of classes each year. In Michigan, six hours of continuing education classes are required each year.
Despite the classes, the test and the fees, Vredevoogd
Combs still considers the real estate sales game easy to enter and
a "great business to be in." And from the looks of things,
she isn't alone.
Next up: "Real
estate agents: Sink or swim in tougher waters"
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