March 05, 2018

How to Become a Real Estate Agent


So you want to become a real estate agent? That’s great! If you’re a people person who loves looking at houses, becoming a real estate agent could be a very rewarding career for you. It has the benefits of being your own boss, working flexible hours, and making a solid annual income.

However, before investing the time and money into becoming an agent, it’s important to determine whether the real estate agent lifestyle is for you. The good news is that you don't necessarily have to go to college  or be a natural-born salesperson. What you do require is a strong ability to listen and understand the needs and wants of your clients, an aptitude for networking, and knack for analyzing the market. If you’re someone who naturally has these skills, then you may be primed for a strong career in real estate.

Along with these foundational skills, you must also have a high level of flexibility in terms of your schedule and your income. Since most clients work during the day, they won’t always be available from 9 to 5. That means that evenings, weekends and sometimes even holidays will be when you need to work. Income-wise, a commission-based career means that your paydays may not be as consistent as in other industries, so you have to be a smart money manager.

Lastly, an eye for detail is a skill that sets the most successful agents apart from the rest of the pack. The ability to stage homes in a way to make them appealing to buyers, point out unique selling points, and notice any potential clues that a home might have hidden repairs needed is often a difference maker in whether or not a deal closes.

Becoming a Real Estate Agent: Educational and Licensing Requirements

Each state has its own requirements for becoming licensed as a real estate agent; however, many of the requirements are comparable.

Minimum Age

All states have a minimum age, usually 18 years old, except for Alabama, where you must be 19 by the time you take the licensing exam.

US Citizenship

Many states, such as North Carolina and Alabama, specify U.S. citizenship as a mandatory qualification of obtaining a real estate license in the state. Alaska and New York are among many states that don't list U.S. citizenship as a requirement for licensing. Nevada allows non-citizens to hold a real estate license with the requirement they provide proof of eligibility to work in the U.S.

State Residency

Unless you're already licensed in another state, you'll need to be a resident of the state in which you're seeking a license. The exception is Nevada, which allows non-residents to become licensed after signing a notarized consent to the service of process form. Many states have reciprocity agreements that allow current licensees to get a license even if they're not a resident.

Educational Requirements

All states have minimum educational requirements, which can be satisfied by enrolling in real estate classes online or in-class.. Texas requires 180 hours of pre-licensing education while Kansas requires just 30. Wisconsin allows individuals with a license to practice law in the state an exemption from its 72-hour educational requirements. Nevada accepts course hours taken in other states to fulfill educational requirements. As you can see, requirements vary significantly by state. Course prices also vary state-to-state, but you should not expect to pay more than $700.

Licensing Exam

All licensee candidates must pass both a state and national real estate exam. Both portions of the test are included in the testing fee. Should you fail one of the two parts, you can take just the one part over. However, in certain states you might find yourself paying the full testing fee of $75 the second time around.

Background Check and Fingerprinting

All states require a background check, fingerprints or electronic fingerprint clearance card. Expect to spend about $65 to meet this requirement.

Check Your Finances Before Becoming a Real Estate Agent

Once you passed the licensing process, you'll still need plenty of money in reserve to get started as a real estate agent. Set aside savings to pay for at least six months of your living expenses to give you time to learn the ropes and get your first commission. Factor in expenses for monthly brokerage fees if you hang your license in an office that charges one and also budget for business cards, signage and other startup costs.

Realtor® membership fees must be taken into account as well. In Southern California, fees amount to just over $800 for new Realtors, including local, state and national dues, one quarter of Multiple Listing Service dues, and the one-time MLS security fee.

6 Steps to Becoming a Real Estate Agent

If this all sounds good to you, then perfect! Here are 6 summarized steps to get you started on your journey to becoming a successful real estate agent:

  1. Plan for a lifestyle change. During this phase, gather the funds you'll need for classes, fees, startup costs and money to pay your bills. You might need to find babysitters who will take your child on short notice when you need to show a property last minute and figure out arrangements for picking up your child from school or activities if showings turn into writing a contract.
  2. Learn the foundation. Find online or in-person pre-licensing classes to get you started.
  3. Pass the exam. Many real estate licensing schools offer practice tests and review classes so you feel confident going into the exam.
  4. Find a broker who sponsors and trains new agents. Although you can technically apply for your real estate license on your own in some states, it will remain inactive until you join a brokerage.
  5. Submit your application to the state, including any necessary background check information.
  6. Buy E&O insurance. This insurance protects you should you make an inadvertent misrepresentation of fact or fail to disclose information that ends up with a complaint or lawsuit against you. Your license must be hanging with a broker before you can buy E&O insurance. Budget $500 to $1,000 annually for this protection.