Ep. 77: What Are Your Expenses As A Real Estate Agent?

Ep. 77: What Are Your Expenses As A Real Estate Agent?

Hello. Thank you for coming to this week’s blog here
at California Realty Training. Glad you made it. Today’s topic is a good one. Today’s topic is expenses a new agent can
expect with their new real estate career. Now I don’t want you to get too uptight and
too nervous thinking, oh my God, this is going to break the bank, it’s not. Just listen to me carefully, it’s an investment
in yourself that’s so worth it. So let’s start off slowly. First expense you’re going to have as a real
estate agent, when you want to become a real estate agent is going to be of course your
real estate school. Now there’s all kinds of real estate schools
here in the state of California. Doesn’t mean they’re all the same. My recommendation of course is California
Realty Training. It’s a great program, it’s completely proven
to be a successful program and it’s helped thousands and thousands of people get their
license so look them you, California Realty Training. That’d be your first expense. Selecting a real estate school, some of them
are as low as $200 to get all three certificates to up to you know, a $1,000 for all these
certificates. So do your due diligence on yourself and do
some research. Great, so now you got your three certificates
with the school you selected, now it’s time to apply for the state exam. You can expect these expenses. Ready? First thing you want to do is you want to
go and pay that $60 application fee to the BRE. After that of course you’ll want to go and
pay your $245, that’s going to be for your license fee to the BRE. All right? That’s good. And of course I’m going to have to add something
else in there, all right? Not my fault, just has to be done by the BRE
requirements. You’re going to have to go and get yourself
what’s called a livescan, that’s your fingerprints but it’s got to be done through livescan and
that runs on the average, I don’t know, about $80. You can do your research, might be able to
get a little bit cheaper but typically it’s about $80. So consider all that your pre-licensing fees. Got it? Now yay, you went onto the state exam and
you passed it. Hallelujah. You earned it. Now what can you expect? Now here come the big heavy duty expenses
but listen, stick with me. It’s all going to be well worth the investment
in yourself. First one you’re probably going to have to
do is when you join a brokerage whether it be ABC Brokerage of Cal Williams Brokerage
or Century, whatever it is, they’re going to probably want you to go and join the local
real estate board. Now when you become a member of the local
real estate board, you’re going to have to join the National Association of Realtors
and you’re going to join the California Association of Realtors. Got it? Good. Now that fee typically is anywhere between
I don’t know, anywhere between as low as $300, will go as high as $600 for the year. It’s an annual fee. Now this annual fee, these board dues again
cover the National Association of Realtor fees and it covers the California Association
of Realtor fees. NAR and CAR fees. Now with NAR, what does that do? It gives you the designation of a realtor. That’s big. You’re no longer just a real estate agent,
you’re a realtor. That’s a big thing. Look it up, you’ll find out why people want
to become a realtor. When you become a member of CAR, California
Association of Realtors, here’s the biggie, you’ll be selling property in the state of
California. You want to be protected legally. Got it? So with these fees, and you becoming a member
of CAR, what is CAR again? California Association of Realtors, you’ll
of course be entitled to the legal protection provided to us realtors in the state of California
because you’ve paid your dues. Got it? And you are a member of California Association
of Realtors. Now the next great benefit with CAR, California
Association of Realtors, is you’re going to have access to the ZIP forms. This is your bread and butter. Got it? The ZIP forms, this is where all the contracts
are. You’re going to buy a house with a client,
you’re going to sell a client’s house, do a listing, you’re going to rent property ’cause
you can also rent property as an agent. All these things you do you’re going to need
contracts, forms, disclosures, paperwork and that’s where you get it. You get it with the ZIP forms. Who provides you ZIP forms? The California Association of Realtor does. Now you have all these expenses but you need
these expenses ’cause you need your tools to make money. Got it? Without these tools you can’t make the money
you’re looking to make. So now you got your board membership what’s
next? Next is going to be your MLS dues. The MLS of course is the Multiple Listing
Service. This is where you find your properties. If you’re going to buy a property for a client
or list somebody’s property you’re put it on the MLS. Now we’ve discussed what the MLS is before
but you can expect to pay for the MLS, to be a member of the MLS, anywhere from, it’s
roughly $200 every six months or $400 for the year. Some people decide to pay it every six months,
some realtors want to pay it all up front for the whole for the whole year and can be
$400, $440 for the year. But you can pay every six months. Those are the big expenses you’re going to
have a new agent. Those are mandatory. Aside from those you got your optional, your
optional expenses. These optional expenses is where we separate
those who are going to become hugely successful and those who are just going to get by. Some of the optional fees that you might want
to look into are going to be your advertising expenses. Let’s think about advertising real quick. I’m talking about advertising expenses that
are optional but if I were you I would make them mandatory. Like your business cards, are you kidding? Without business cards you’re not going to
get anywhere. That’s your first point of contact with anybody. Here’s my business card. 50 bucks and you’re going to have a nice set
of business cards. So please splurge on your business cards. And your open house signs and your directional
signs, all these signs that have your name on it, it’s going to be advertising you and
your business so it’s so well worth it. These are optional but if you really want
to be successful in this business, please get them. Make them from becoming optional to becoming
mandatory for your business. Some people don’t even spend money on a name
tag. Name tags are, back in the day we used to
wear them all the time. They are beneficial. They’re going to run you maybe $10, $15 tops
for a nice name tag. It’ll even match your outfit. They have different colors, so on and so forth. Another thing you can expect probably is going
to be your attire. You want to have some nice threads of course,
some nice clothes. You’ll want to have a nice car. You’re going to have to have gas in the car. You’re going to put some mileage on the car. You want to keep that car in tip top shape
so you want to make sure you get it maintained. Keep it going. Without that car, without that automobile,
you can’t get to your next appointment. Got it? Your cellphone is going to be an expense. You gotta have a cellphone. Your computer, your internet, all that stuff,
you’re going to need it for your business. You can’t get away from it. So the ones that you are going to need mandatory
are the ones when you join the board, the MLS and all that stuff. Joining NAR and CAR. The ones that are optional but in reality
without these you’re not going to really make it in this business because everybody’s gotta
have them to communicate, of course are going to be your phone and your car and all the
other things that we’ve discussed. So you think about that. You might want to make these optional ones
mandatory. Make these optional ones mandatory because
you kind of gotta need it. And here comes the biggie as far as what you’re
really going to invest. The biggest investment that you’re going to
put forth in this real estate career aside from the dollars is going to be your time. Now what’s your time worth? Your time away from your kids? Your time away from your spouse? Your time away from your family? So by you sacrificing your time, you’re going
to completely reap the rewards later but it’s all because you’re investing in your future. And by investing in your future it’s going
to allow you to have more time with your friends and family. So up front when you first started in this
business, be careful, you’re going to spend a lot of time researching and working and
getting going in this business. It’s going to be addicting, it’s going to
be fun but you will be spending tons of time away from your family and that’s probably
in my opinion the biggest expense you’re going to have. Who can put a dollar value to time? Nobody can. Only you know how valuable time is to you. I know when I first started was huge to me. I spent a lot of time away from my kids and
that kind of hurt but it was part of the game. So aside from the dollar bills that you’re
going to be investing in this business, you’ll be investing a lot of time. Real quick, before we end this off I want
to give you one bit of advice. You’ll be spending in a sense, let’s assume
you’ll be spending a quarter to make a dollar, totally worth it. You’ll be spending a quarter to make a dollar. In real estate you’ll be spending, let’s assume
I don’t know, two, $3,000 a year just on board dues, advertising, hell, let’s say $5,000
a year on all these expenses but you’ll be making a $100,000 a year. Isn’t that worth it? This much of investment to have this much
of success. So do the math when it comes to this stuff. Oh I don’t want to spend an extra $200 on
these flyers. Might be worth it if it’s going to get you
a $20,000 listing. See how that works? In real estate hundreds of dollars, sometimes
a couple thousands of dollars in real estate is peanuts when you can expect a huge handsome
commission in the tens of thousands. Think about that, all right? Now I’m not a person that gets difficult ’cause
you only have so much but if you can save two, three, four, maybe $5,000 and keep it
in the bank just to get started comfortably, do it. Hope you learned something today in the real
estate world as far as expenses are concerned. Glad you made it this week. Hope to see you next week. Have a great day and if you have any concerns
or questions, leave them down below in the comment section. Have a great day.

One thought on “Ep. 77: What Are Your Expenses As A Real Estate Agent?

  1. Hi Robert just wondering if errors and omissions insurance is mandatory to work at a brokerage like Keller Williams? If so what does that cost?

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