5 Reasons Why Real Estate Agents Fail

Every year, new real estate agents hit the market with soaring optimism about their prospects. However, given the high rate of real estate agent failure, that new-career glow often doesn’t last long.

According to the National Association of REALTORS® (NAR®), 75% of new real estate agents leave the industry within the first year; 87% fail within five years.

What are the reasons real estate agents fail in such high numbers? What are some common mistakes real estate agents make in the early years of their careers, and how can you avoid them? Continue reading to find out.

Mistake #1: Treating Real Estate Like a Hobby

Not being fully dedicated to a real estate career is the number one reason real estate agents aren’t successful. Many prospective agents hear “flexible hours” and “be your own boss” and vastly overestimate the results they can get with a casual approach.

There are plenty of real estate career challenges you’ll face, but maybe the biggest one is in the mind.

If you want to be successful in real estate, it can’t just be something you do when you feel like it – you have to treat it as a career. You need to dedicate enough time and effort to see results.

This isn’t necessarily about whether or not you have a second job. There are pros and cons to starting in real estate part-time, and the right solution for you will depend on your circumstances. It’s more about the time you put in and how seriously you take the effort.

Real Estate Agent Success Tip: Work Hard and Smart

The most successful real estate agents know that to be successful, you have to work long hours and be available when your clients need you.

This means real estate agents clock a lot of time in the evenings and on the weekends meeting clients, but also during business hours when they deal with lenders, appraisers, and other professionals. You’ll need to account for this if you have a second job, and it might mean sacrificing the time you set aside for family, friends, or hobbies.

It’s not just a matter of time logged, however. You’ll need to spend that time in the right places. At first, that will mean doing a lot of the “less sexy” but necessary steps – we’ll talk more about an important one (leads generation) below.

To keep yourself on track with tedious tasks, you’ll need to set and track professional goals. Ones that are Specific, Measurable, Achievable, Relevant, and Time-Sensitive.

Mistake #2: Wasting Sweat Equity Where You Shouldn’t

Part of working hard and working smart is knowing what activities are worth your personal attention and what can be automated. This includes using tools to help with things like lead generation or online marketing so that you don’t have to do everything manually.  

There are plenty of parts of your new job that require hustle, so don’t burn yourself out by hustling in places that don’t need it.

Real Estate Agent Success Tip: Using Technology Effectively

While you shouldn’t rely on technology to do your job for you, it can help you get the most out of your work hours.

Some tips for where strategic use of technology can boost your effectiveness:

• Automate some of your lead nurturing and relationship-building with your Customer Relationship Management (CRM) software.
• Give your potential clients a more immersive experience by putting a virtual walkthrough in your listings.
• Use virtual staging to shine up your listings without mucking with real furniture.
• Leverage targeted social media marketing and remarketing to get the most out of your ad campaigns.
• Consider the use of chatbots or virtual personal assistants.

Most importantly, keep an eye out for new time-saving options all the time.

Mistake #3: Not Generating Enough Leads

A real estate agent only gets paid when they close a deal. There are a lot of steps leading up to that point, but it all starts with finding people who are looking for your services.

To be a successful real estate agent, you’ll need a steady stream of people coming to you. Early on, you can start with your existing network, and eventually, you’ll want to build a business that is mostly referrals or word-of-mouth. But in between, you’ll need to constantly seek possible future clients from outside your network.

Many new agents simply can’t figure out how to do this.

The process of finding potential clients is called lead generation. It’s a numbers game – every successful sale first requires hundreds of leads. Underestimating the importance of this step is one of the most common mistakes real estate agents make.

Real Estate Agent Success Tip: Invest (Intelligently) in Marketing

Good marketing is a key piece of lead generation.

Sometimes, your sponsoring brokerage will assist you with marketing because it’s in their best interest to help you find business. However, some don’t – this is an important factor to consider when choosing a brokerage.

Common ways new real estate agents can market themselves are through open houses, social media, personal websites, and other online marketing. You need to work with multiple sources of leads to keep them rolling in.

For the best results, you need to track results and make data-driven marketing decisions.

Mistake #4: Thinking Like You Still Get a Salary

Unlike a typical nine-to-five job, you won’t be paid every two weeks as a real estate agent. Payday only comes when you help a client buy or sell property. While commission checks are a lot larger than a regular paycheck, the money has to last until the next time you close.

Unpredictable income is one of the big reasons real estate agents fail. Many first-time agents splurge when their commissions come in early on, assuming another payday must be right around the corner. They end up unable to pay their regular bills and need to give up on real estate as a result.

Real Estate Agent Success Tip: Learn to Keep a Disciplined Budget

You need to learn how to budget for the long term to ensure your income sustains you between sales. Especially at first, you should operate under the assumption that every commission check will need to sustain both your life and your business for several months.

A zero-based budget strategy can be a lifesaver for people with unpredictable incomes. Instead of taking a theoretical amount of money and distributing it across categories, you work with what’s in your bank to give each dollar a job. This shows you very clearly how long a check can cover your basic needs.

Mistake #5: Not Making Time for Training and Education

Your education as a real estate agent can’t end with your pre-license courses. The success of your real estate career depends on constant learning. The basics are a lot to tackle for a newbie and will require curiosity and self-education even after you’re licensed.

Even as an old pro, there are plenty of topics to keep abreast of economic news, legal and regulatory changes, new technology, broader real estate trends, local market conditions, new land development, and new tricks and techniques.

It can be hard to fit learning into your already busy schedule.

Real Estate Agent Success Tip: Use Online Education

The best way to stay educated is to use a variety of methods – newspaper articles, in-person seminars, think-pieces, conferences, and webinars. However, some types of continuing education can only be satisfied by formal courses.

Online continuing education is the best fit for many busy professionals – you can learn anywhere, stop and start when you have time, and work through things at your own pace. Plus, no commute to a classroom, no waiting for teachers or other students, and no dumb questions from the peanut gallery.

Satisfy CE Requirements Grow Your Career with Self-Paced Learning

Not all online courses are created equal, so you’ll want to check whether your options are approved by your real estate commission, count toward your license renewal requirements, come from a reputable provider, and remain up to date. You should also look for courses that are interactive, engaging, mobile-friendly, and self-paced.

We’ve been a regulatory training provider for over 20 years, with courses designed by trusted real estate professionals and approved by your state board. Check our continuing education catalog to see how we can make learning easy for you!

Written and Published by: VanEd