To Niche or NOT to Niche?

Question

I just passed the national and state exam for my real estate license. Now I am waiting for my paperwork to be processed with my broker. Now is the time to build up my business model.

Before taking classes, I was purely focused on being an investor agent. Working with investors for their own properties, and giving myself a leg up on investing in properties of my own. Until recently, I had very little interest in being an agent for the average home buyer.

This mindset began to shift when I realized how many agents are over the age of 40. I am 22 years old, and live in the DC metro area (rated one of the best cities for millennials on several lists).

Is it wise to split my marketing and networking time between two groups of people? What benefits do you see in limiting oneself to investors only?

JOAN DICKIE · Answer

No reason not to combine the two.  Lots of millennialist would like to be investors.  Have webinars to teach the basics of investing.  They see you as a real estate expert and maybe want to buy a residential home with you too!

Lacey Russell · Answer

The commercial MLS used in this area (Greater DC) is called Costar. Commercial is a totally different ballpark than residential, if you're interested in being a realtor that specializes in commercial, ask around a find someone who does well with it and ask to be apart of their team. That will help get your foot in the door and help you gain experience from the 'inside.'

The reason why it's more exclusive is that most commercial investors own more than one property but they use the same agent they have for the past however many years. More money is typically involved in commercial properties, which makes landlords/owners not want to work with people they don't have prior relationships with.

Lacey Russell · Answer

DC is a great area for job opportunities for millennials who are college graduates. Unfortunately the DC metro area isn't very affordable for many millennials, Bloomberg wrote a report about it a couple days ago (I included the link below). First time homebuyers can also be challenging clients for a newbie realtor as they require a lot more time and attention with (often) less sense of haste. I would recommend focusing on investors and use your personal contacts to refer you to millennials looking to buy (friends of friends).

In my personal opinion first time home buyers are on the opposite spectrum than investors. Where investors know the market and have contacts (inspectors, loan officers, etc) a first time home buyer is going to rely heavily on you for that.

If you have the time then focus on both groups (why not?) and see which you like working with better, then if you want to cater toward one or the other you're more informed at that point.Link: These Are the 13 Cities Where Millennials Can't Afford a Home

http://www.bloomberg.com/news/articles/2015-06-08/...

Carson Sweezy · Answer

@Lacey Russell Thank you for both comments, very insightful. Two of my friends dads are in commercial RE. My plan is to work in the residential side to learn the process of transactions, and gain training, and transition into commercial by the time I graduate college.

Nikki Robinson · Answer

Millennial investors.. Great idea! Getting licensed is one of my short term goals for 2015. That niche is perfect for me.

Carson Sweezy · Answer

It is very separate here i the DC metro area as well. I haven't gained access to our MLS yet, so I do not know if they list them there. My real estate licensing teacher called commercial "an all boy's club" so I am guessing a lot of deals are done through connections, and past clients.

JOAN DICKIE · Answer

I'm in a small population area, so I don't think I could make a living doing only commercial.  Because of this, a lot of agents do both residential and commercial.  When I started out in the Minneapolis area, commercial agents were very separate from residential.  Commercial sites weren't in the residential MLS.  I honestly don't know how the properties were marketed.

Carson Sweezy · Answer

Another bonus to the commercial game! Joan, do you have any plans to transition into commercial?

JOAN DICKIE · Answer

My nephew is in Commercial.  He works no evenings or weekends.  i do envy him.

Carson Sweezy · Answer

@JOAN DICKIE

You bring up a great point. A friend of mine has been an agent for 9 years, and has clients that buy/sell with him, and invest in properties with him.

@Benjamin Ficker I am passionate about building passive income! I think the average homebuyer would burn me out, talking about how they dont like the house because of the paint color, or the carpet. This is why I plan on going into commercial once I get the basics down.

To Niche or NOT to Niche?

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