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I was thinking about all the real estate agents I’ve met over the years. Some of them treat their real estate career as their bread and butter, while there are plenty which is doing it as a side business.
I wonder can you really work as a part-time real estate agent? What would be the work-life balance and income expectation?
But first, let’s define what a part-time real estate agent is. A real estate agent is considered to be working part-time if he/she works less than 20 hours per week.
In this article, I’ll go over the logic in being a part-time real estate agent, the income expectation, what are some common challenging and the ways to overcome them.
- Why Being a Part-time Real Estate Agent Could Make Sense?
- How Much Income can a Part-Time Real Estate Agent Make?
- How many Real Estate Agents Are Working Part-time?
- Challenges Faced By Part-time Real Estate Agents
- Practical Tips for Part-time Real Estate Agents
- Advice from Actual Real Estate Professionals
Why Being a Part-time Real Estate Agent Could Make Sense?
Reason #1: Test the Water
When going to swimming, some people would dive right into the water, while some would test out the water temperature with their feet first.
When it comes to making career choices, not everyone is comfortable in burning all the bridges. It’s okay to be risk-averse and there’s nothing wrong with that.
Even if you have already obtained the real estate license, you can only determine whether this is a career for you through field experience.
Reason#2: Keep Another Source of Income
It does take time and effort to build up your client base. In the first few years working as a sales associate, the income you earn in the real estate practice could be minimal.
Unless your family is not relying on your financial support, it could be stressful when there is so much uncertainty in the real estate business income you can take home.
Therefore, some agents prefer to keep their other job until their real estate income is proven to be stable.
Reason#3: Maintain Employee Benefits
Being a real estate agent is a self-employed business, where you don’t get any medical insurance coverage or retirements savings. If you have an existing job that is already providing these employee benefits, these could be a valid reason to have a second thought before quitting.
It is especially important if you or anyone in your family already depends on the coverage to pay for hefty medical expenses. However, if your spouse is working at a corporation which provides employee benefits, you could check to see if they would also offer spousal coverage.
Else, you could consider setting up the health and dental coverage yourself. Some insurers have plans specially designed for self-employed personnel, but they could be subjected to underwriting.
Reason#4: Part-timers by Choice
Some real estate agents have always been a part-timer. For example, one of the very first sales associates that I worked with is a family friend. He has a full-time job working for the government. He is satisfied with his current occupation, the stability of the salary and employee benefits.
However, he also enjoys showing his friends different houses occasionally and would like to make some commission on the side.
Another situation that I come across often is for stay-at-moms and dads. Since they need to take care of their kids, they cannot commit to a full-time position. But when their kids are in school, they are happy to use those time in building their real estate business.
How Much Income can a Part-Time Real Estate Agent Make?
As I was researching this topic, I realized that RealEstateExpress.com had conducted a survey with over 1,000 real estate professionals. According to their 2018 Real Estate Agent Income Guide, part-time real estate agents makes an average of $31,159 annually.
To dig a little further about the salary of a part-time real estate agent, I read the 2018 member profile of the National Association of Realtors. To generate this report, NAR sent a 96-question survey to a random sample of 200,964, of which, they received a total of 12,495 responses.
Here’s a breakdown of the income for part-time realtors.
Before we go over the figures, keep in mind that not all realtors are sales agents. Realtors are the members of NAR, which consists of sales agents, brokers, and appraisers. However, since 65% of the NAR members are real estate sales agents, this is a good indicator for our discussion.
As you could see in the pie chart, nearly 90% of part-time realtors are earning less than $50,000. This result should come to no surprise. After all, these realtors are earning less than 20 hours per week.
For the remaining who are earning more $50,000, I suspect there is only a handful who are sales associate. Rather they should be mostly established real estate brokers who have underline agents working for them.
Many factors could affect your income as a real estate agent. For example, your experience in the industry, the size of your book of business, the volume of repeat business you are getting, etc.
How many Real Estate Agents Are Working Part-time?
According to the 2018 NAR member profile, 18% of real estate agents are working part-time, while majority are still working full-time.
|Work Hours||% of Real Estate Agents|
|Less than 20 hours||18%|
|20 to 39 hours||36%|
|40 to 59 hours||36%|
|60 hours or more||10%|
Source: The 2018 National Association of REALTOR Member Profile
When I read the figures on the Bureau of Labor Statistics, there are 156,760 real estate agents in the U.S. If a similar ratio applies to the entire industry, then you could be looking a massive 28,216 of part-time sales associates.
I have met many part-time sales agents before. They consist of new entrants to the real estate industry, someone running it as a side business, stay-at-home parents, or retirees who want to continue participating in the workforce.
Challenges Faced By Part-time Real Estate Agents
The turnover rate of real estate agents is high especially in the first few years of the career. I believe a key reason is they did not anticipate the challenges that they were going to face.
So to give you a head up, here are some common challenges for part-time real estate sales associates. (But don’t worry, I’ll also provide you with some solutions to overcome them later in the post)
Challenge#1: Takes More Effort to Find a Real Estate Brokerage
Even if you were working part-time, the training and administrative support that you’ll need would be similar to a full-time. In fact, since you don’t practice your real estate knowledge as often, chances are you would have much more questions for your mentor when you are working on a deal. Therefore, some real estate brokerages are reluctant in taking on part-time agents.
Challenge#2: Some Clients will Question Your Professionalism
Let’s be honest. If you need to do surgery, would you prefer a part-time doctor or a full-time specialist to operate for you? The same concern would be in your clients’ mind too.
If a client raises that concern to you, rather than taking it personally, you should be grateful. The good news is you’ll have a chance to address their worry.
Many prospects would try to be polite and do not say that to you in person. You would have no idea why they did not return your call after meeting them.
Challenge#3: Difficult in Finding Work-Life Balance
If being a part-time real estate agent is your only occupation, then this could be relatively easy for you to handle. However, if you already have another full-time job, then you must prepare to have extended working hours.
Suppose your other job has a typical 9 am to 5 pm work hours, then you could be prospecting, networking or showing your clients houses during the evening time. Also, many clients would prefer to meet with you during the weekend because those are the time when they are available.
In other words, the downtime for most people could be your most active business hours.
Practical Tips for Part-time Real Estate Agents
Tip#1: Schedule Your Work Hours in Advance
Although making money is important, time is your most valuable commodity. Before you get over-excited about all the potential commission you can earn, be realistic when scheduling your work hours.
If you already have another 40 hours full-time job, can you still handle another 20 hours of real estate business activities? Regardless of how quick you want to build the business, every once in a while, you need some time off to refresh your mind.
Tip#2: Have a Thorough Discussion with Your Family
Starting a real estate business requires your investments of both money and time. If you have a spouse, be sure to have an open discussion with him/her. Else, your extended work hours could catch them off-guard, which results in unnecessary stress and conflicts.
Tip#3: Set Your Income Expectation
Once you know how much time you could devote to this part-time business, then you could do an income forecast. Suppose you can close one deal every two months, the average home prices you sold is $400,000, while your commission split is 1% on every settled case.
1% of $400,000 times 6 would be $24,000, which could be a nice source of supplementary income for your family.
Tip#4: Don’t Prioritize Business Over your Family
I understand that when you first start as a real estate agent, you don’t want to miss any single opportunity of doing business. Especially during the negotiation phase where discussing buy-sell offers become very time sensitive.
However, if you continuously use this as the excuse to ditch spending quality time with your family, this would create lots of disappointment and tension.
One of the real estate agents that I used has it made clear upfront that he does not work on every Wednesday because that is the time he brings his son in playing a basketball game. Most of his clients, including me totally respect that and understand if he would not recall our calls immediately on that day.
Tip#5: Work Arrangement with Your Other Job
Suppose your other job has a regular 9 to 5 office hours, then you could discuss with your supervisor whether you could come to work earlier and end the day sooner.
Most of your real estate clients won’t be contacting you or taking your calls in the early morning. So why not use this time for your other job instead? This way, you could become more available for your real estate business activities for the rest of the day.
Tip#6: Find a Real Estate Brokerage that Welcomes Part-Timers
Although some brokers do not prefer to take on part-timers, there are plenty still welcome them. You could contact the real estate brokerages in your local area. Connecting with brokers through affiliation groups or social media would be a good start too.
If you know of any real estate agents who are also working part-time, chances are their broker would be more receptive in working with you. You could ask the sales associate if they could introduce you to their broker.
Get to know what type of support they could provide in running your business. Remember if you are new to the real estate industry, you will need lots of field training to get the engine started. However, your commission split could be lower at the initial phase due to the extra mentoring required and the lower sales volume.
Tip#7: Collaborate with Other Real Estate Sales Associates
This is one of the important steps for part-time sales agents. Talk to the colleagues in your branch and see if anyone can co-work with you. Try to come up with the arrangement such that when you are unavailable, they could help in servicing the clients.
Depending on the amount of time you can put in the real estate business, you could co-work deals with another agent. In some instance, you could simply introduce the prospects to the other agent, while receiving a referral fee upon closing of the sale.
Although you would receive a smaller share of the commission, you would know that your clients would be properly served. Also, earning a small portion of something is always better than 100% of nothing.
Previously, we talked about how clients could question your professionalism as a part-time sales agent. When you co-work a deal with an experienced sales associate, you could confidently ensure your clients that they will be adequately served. In fact, your client would be happy because they are paying a commission for only one person, but having the expertise and effort of both.
Tip#8: Use Technology to Reduce Your Workload
The major challenge of being a part-time real estate agent is “TIME.” Since you’ll be spending fewer hours working in the business, you must use your work time productively and efficiently. The good news is many tools can automate your business activities or reduce the needs of your physical involvement.
For instance, is it necessary to constantly call each of your prospects and have a 30 minutes chit-chat conversation? If you just want to keep in touch with them, consider sending them relevant and valuable content through regular e-newsletters. This way, your marketing effort could be scalable.
A real estate transaction would involve multiple documents signing. Rather than presenting them in person whenever there are any changes, you could consider hosting an online meeting with your client.
To make it easier for your clients to follow along with the documents, you could consider using a platform such as Skype which allows you to do screen sharing. Then you could send the documents through a secured mean (i.e., encrypted email or secured cloud). Some apps and software could even have the feature for your clients to sign the documents with their touchscreen laptop or smartphone.
The point is you should streamline the business process as much as possible while focusing on tasks that would move the needle. (By the way, I’ll write another article which includes more info about this. Stay tuned!)
Tip#9: Focus on a Specific Niche Market
Since your work hours are already limited, you can’t afford to diverse your attention to too many different types of clientele. You should stay laser-focus and become an expert in a specific market.
For example, if you plan to service clients who are first-time home buyers, then you’ll need to know what are the rules and regulations that are relevant to them. Will there be any government support program? Or a tax return incentive?
If you are going to work with retirees who are downsizing, what type of units do they usually prefer? Does it need to locate close to a community and recreational center? Will they need to get access to health services support?
Tip#10: Take Real Estate Courses Online
If you have another job, then chances are it would be difficult for you in attending real estate classes in person. You would need the flexibility in taking the courses whenever you are available while learning at your own pace.
If that’s the case, then you should consider taking online classes. RealEstateExpress.com is a well established online real estate school. (affiliate link) They offer licensing courses, post-licensing classes, exam prep, and continuing education. Once you become their student, you could conveniently access the course materials on their website.
Tip#11: Don’t Cross Sell Unrelated Services
I know some people might disagree with me on this one. When I go to business networking events, sometimes I would come across part-time real estate agents who would promote other side businesses. If the other services they are selling is related to real estate (i.e., mortgage, staging, appraisal), then I’m okay with it.
However, some would promote entirely unrelated services such as household products, health and beauty items, nutrient supplement, utility plan, etc. This lack of focus makes me wonder how serious they would take my real estate business if I were to hire them.
Remember if you try to be everything to everyone, then you’ll just end up being nobody to anyone.
Advice from Actual Real Estate Professionals
“For some, perhaps. It would depend upon how closely aligned their other activities are and if they are the type of individual who can be laser focused. I wouldn’t tell them they will be making the same kind of salary as if they were full time. Not an easy thing to do part time and be able to well represent your clients.”
Vicki Deane, Concierge Level Real Estate Services. Assistant Manager at Baird & Warner
Working as a part-time real estate agent indeed would work for some people. I have met many stay-at-home parents, retirees, or currently employed person who is doing this as their side business.
Although you might not be able to devote full-time hours into the real estate career, you could make your work hours more efficient by streamlining your process.
Keep in mind that you still need to pay the same amount of renewal fee and complete the same continuing education courses regardless of you are working full-time or part-time. Therefore, your business volume should be large enough to justify the costs and effort.
So will you become a part-time real estate agent? Please let us know your thought in the comment below.
Disclaimer: The information in this post is for general information only, and not intend to provide any advice. They are subjected to change any notice, and not guaranteed to be error-free. For full and exact details, please contact your real estate broker/ the regulatory commission in your state/ or the associated company and organization.
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