The real estate sales industry is full of opportunity for people looking to start a business where they can control their own destiny. As a result of the value that good real estate agents bring to the marketplace they have the potential to make just as much as doctors, architects, and even pro-athletes. But there’s a sad reality on why very few will ever reach those heights and why most agents will always struggle to earn even $100,000 a year.
Because most agents don’t understand the common principles of business they fail to earn more. In fact, 80% of real estate agents make, on average, around $40,000 a year while the top 10% make that in a month or less.
Here are just 3 Reasons why most agents are struggling to earn six figures:
- Don’t spend time honing their craft. There are two main skills agents must have in order to be successful. They must learn to listen to what the market wants and they must learn to communicate to the market. This doesn’t cost the agent any money, it’s a simple practice of being more aware and then enduring the trial and error of figuring out the best methods of communicating to the market. This is a skill that can only be developed over time and if the agent is willing to play the long game they’ll certainly gain a competitive advantage.
- Don’t spend money. In order to make money you have to spend it. As the market changes and the referrals become less consistent agents often find themselves not being able to generate a sufficient amount of leads. Major corporations understand that if they want to see a certain return in a year they’re going to need to invest a certain amount of money to give themselves a chance. Most agents aren’t even given themselves a chance. They’re too worried about losing the money they have, but ironically lose it anyway, because they failed to strategically invest the capital they have back into their business.
- Don’t focus. Agents are notorious for practicing the “Start Stop Business Model.” It’s when you start on an idea, then when it hasn’t worked as quickly as you hoped you stop, then start something new. They look to chase the next thing that appears to yield the biggest results the fastest. What they fail to realize is that building a business is a marathon not a sprint. You have to be in it for the long haul and that requires an intense focus on just a few tactics (three at the most) and seeing them through.