Thereís more than one way to make money as a real estate agent. Earning your real estate license opens up a lot of different doors. You can go into residential real estate, commercial real estate, property management, investment, appraisal, income properties, development, and many more areas of specialization.
This is a quick guide to the most common and lucrative ways licensed real estate agents can earn money.
#1 Residential Real Estate
The bread and butter of most real estate agents is helping clients buy and sell residential real estate. They help their clients find buyers or properties, negotiate a selling price, and file the paperwork. As a real estate agent working in residential real estate, you will spend a lot of time showing homes, running open houses, and talking to your clients.
In addition to family homes or condos, residential real estate might also include working with landlords and tenants to find rental units. Standard commissions for finding tenancies are generally around 10% of an annual lease.
#2 Industrial & Commercial Real Estate
Not every real estate agent works in the residential sector. Itís certainly the most common and what people usually think real estate agents do, but there are plenty of opportunities in commercial real estate. There are some important differences when you look at residential vs. commercial real estate:
- Residential real estate is about personal wants and needs to fit the homeowner and their family
- Commercial real estate is about meeting business objectives and achieving a rate of return on commercial investments
Commercial real estate includes office buildings, retail, hospitality, warehousing, storage, manufacturing, and many other purposes. It may also involve development, apartments, and raw land leasing.
#3 Real Estate Appraisal
Not everyone has the personality or motivation to become a salesperson. You donít need to always be selling to succeed at real estate. One way you can enjoy a career in real estate without selling properties is by becoming a real estate appraiser.
You become a neutral third-party who assesses the value of properties. Real estate appraisers may be hired by sellers to find the market value of their house, while most mortgage lenders require an appraisal before they approve the loan.
It also turns out that the number of real estate appraisers is falling rapidly, causing longer waits times and higher fees. That could be a great opportunity for someone looking to enter real estate appraisal.
#4 Real Estate Investing
There are many, many ways you can start investing in real estate. You donít have to have a ton of money to get started, but a traditional way to get started in real estate investing is saving for a down payment for a property that you can rent out to tenants.
Renting property means you earn a steady stream of income which you can use to pay down the mortgage, cover expenses, and ultimately put money in your pocket. If the housing market causes property values to rise, you can cash out on your investment with a pretty positive rate of return given the income it generated in the meantime.
There are many more ways you can earn an income with a real estate license. To get started, click here and discover your options for real estate license courses. Thereís more to real estate than just residential property. Find out more about diversifying your career from schools like RealEstateU, an online real estate license school that offers students tons of resources.
Start planning for your future and get a start in real estate.
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