Leaving my W2 Job to do Real Estate Full Time - Is it scary?

Question

Hello BP,

My name is Brandon. I've been in B2B sales for roughly seven years.  Since I became a homeowner 4 years ago my interest in real estate has grown. I've been around real estate for a while now, my dad is a retired General Contractor and owns a few investment properties. I recently got my real estate license and now I'm even more motivated to make a career out of it.

My questions are:

for realtors that previously worked in sales or a W2 job, how was the transition for you when becoming a full-time agent?

When did you know you were ready?

what would you recommend for someone in my shoes?

any best practices you learned later on in your career that you wish you learned earlier on?

Best Regards,

Erik W. · Answer

@Brandon Carlson, I held my license starting in 1999 and became one of the enthusiastic 2-year quitters after which I went into IT and real estate investing.  Those 2 years taught me a few lessons:

1) Out of 50 agents: 1 makes big bucks.  2-3 make a decent living.  5 or so hustle, grind, and do okay.  The rest qualify for food stamps unless their spouses have good incomes.

2) The time from when you first step foot on the sales floor until your first commission check is paid is generally no less than 3 months.

3) Some of the most successful agents were sales-persons of some kind previously.  One of my agencies top producers was an Avon lady who brought her "girls" (i.e. book of business) along with her when she went from selling cosmetics to selling houses.

4) It takes 2-3 years to establish yourself in a new sale career field like real estate and make a sustainable income, unless you're like the lady in item 3.

5) You have to build personal relationships.  Probably why top sales people from other industries do well!

6) You will be on the clock 80 hours a week, even if you're not actively working.

7) The most successful agents eventually branch out into teams.  Seems like 10-15 listings at a time is about the max any one agent could handle solo.  Top agents typically have 50+ listings and teams of 3-5 sub-agents.

8) Many successful agents focused on one niche: commercial, office space, vacation property, property management/leasing, etc.  Few really good agents were jacks of all trades.

9) Technology is the future.  Learn to leverage it well.

That last one may seem pretty self-evident, but iyou should consider contracting an IT expert to help.  Tech is changing so fast, you don't have time to mess with things like repairing hardware, getting the latest software, updating your own website, etc.  Your job as an agent is to turn prospects into customers and farm everything else out as cost-effectively as possible.

It sounds like you have some advantages due to past sales experience.  I hope these items are helpful.  Good luck.

Erik W. · Answer

@Brandon Carlson, word of mouth.  Networking.  Join a BNI chapter.  Go to Rotary Club meetings.  Hang out at the VFW.  Join the local REIA.  Get involved in your local Chamber of Commerce.  Pass out 50 business cards per day.  If your inner circle of friends and family don't know you're in real estate and why someone should talk to you vs. the agents they already know, keep hustling until they do.

Being a successful agent or investor is about your name being on the top of the mind of anyone who thinks, "I need to buy/sell/rent a property."  You can spend tons of money and no one will remember you.  Or you can get involved in people's lives face-to-face for nothing more than the cost of time and they'll call you before anyone else.

George W. · Answer

If I were you I'd gradually transition. I'm not even close to being a full time real estate investor and honestly I'm fine with that.

What I will tell you though is I'm glad when I started my plumbing company that I gradually transitioned and still kept working for someone for a while. Why? Because it made my business alot easier to run with less dependence on just my companies income.

When times were good with the my business I bought assets, tools, equipment, property and expanded it further. When times were bad I still had my w2 PT to help pay my personal Bill's.

Eliott Elias · Answer

Was difficult at first, when you build your name and become more comfortable business starts to pick up. The minute you are considering leaving is the minute you're ready. I recommend going full time.

Amanda Wilks · Answer

Hi Brandon!  I'm in the same boat as you, but have been in Real Estate a bit longer.  Were you able to make that transition?  Any words of wisdom/advice?  Thanks so much!  :-)

Brandon Carlson · Answer

@Erik Whiting Thank you for the input sir. In regards to farming, what best practices would you recommend? I currently use a website called CoreFact. They have great marketing pieces but can be a bit expensive. I don't mind putting in the sweat equity when it comes to my farm but was curious what's worked well for you?

Thanks

Brandon Carlson · Answer

Thank you everyone for the insight. Definitely helpful.

David M. · Answer

@Brandon Carlson

Unless you have a strong capital reserves, transition from your W2 job into a full time real estate agent.  Yes, I agree you need to have lots of self confidence to do sales and a thick skin to accept rejection.  But you need to be realistic.  Too many agents think that clients/deals fall in their laps when they start.  You need to generate leads, get a “customer base” from which you can get referrals, actually be able to sell or list homes and close transactions to make money.

It’d be best to keep your day job for 1-3 years as you get your feet wet learning about how to be an agent.  You still need funds to get your signs, advertising, etc in place.  You need funds to live/eat for that matter.

How do you know about the commission system for agents?  Your split with your broker?  Run some numbers for your area and get an idea for your required Production (total dollar amount of homes sold) or Gross Commission Income (GCI) you’d have to do to make what your need/want.

Don’t take this the wrong way.  If that’s what you want to do, go do it.  But you are here asking so im trying to give your the big picture.  I believe the National statistics is some 80%-90% of agents quit their first year, and another 50% in the next five (I’m a little fuzzy on the latter statistic).  My understanding is mainly people over estimate the ability to make a commission.  Sure, many start out with lots of gumption.  But, for a variety of reasons they don’t make it.

For sure, doing two full-time jobs is pretty tough.  Although, there are some in my office who do just that and their production numbers are some of the best — my hats off to them.  So unless you really hate your day job, maintain some financial security.  Oh, and don’t forget as a real estate agent you are an independent contractor and unless you sign with a national company, not a franchise or independent brokerage, you aren’t going to show e any benefits such as medical.

Good luck whatever you decide.

Patricia Steiner · Answer

There is one sure way to overcome fear:

Act.

And, then don't look back.

Believe you're going to be wildly successful and then go build it.  No one else's opinion or experience will be yours so go this alone and base it solely on what you want for yourself.

Rock on...

Leaving my W2 Job to do Real Estate Full Time - Is it scary?

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