Three veterans describe how they launched their careers in down markets

Beginning any new career takes guts. But starting out as a real estate agent at a time when far fewer transactions have closed in many local markets takes even more than the usual amount of intestinal stamina.

So, how can a new agent prosper in today’s highly competitive and weak housing market?

A Winning Attitude Wins

New Business

New agents need a vision, a great attitude, an ability to deal with negativity, and integrity, according to Diana L. Bull, broker and general manager of RE/MAX of Santa Barbara & Montecito in Santa Barbara. Beyond that, new agents should learn the basics and then be coached by a seasoned agent or mentor. “For the first three to five transactions, their guardian angel (i.e., mentor) has to be with them and help them through the mounds of paperwork,” she says.

In addition, Bull adds, a new agent can piggyback on someone else’s success by offering to help out. Busy veterans who control a lot of listings and have too many leads to manage present the new agent with “a perfect opportunity to say: ‘May I assist you with your Internet leads?’ or ‘May I assist you with your open houses?’” she suggests.

New agents rarely have an established client base, which means they need to “work, work, work,” says Sharah Bokeko, a broker with Century 21 Auburn Realty in Auburn, who started her real estate career in 1988. It’s important to be proactive and react fast because “the business is not going to come to you,” she explains. “You have to go out and seek business.”

Developing leads and meeting as many people as possible should be top priorities for the new agent, suggests Doug Buenz, a veteran broker-associate with Alain Pinel REALTORS® in Pleasanton. “Your income is directly proportional to how many people you talk to about real estate,” he says. Newbies who “are petrified to talk to people about real estate … aren’t going to have a long career,” he warns.

A niche market can be a good strategy in a downturn, Buenz adds. “Right after I started selling real estate [in 1989], it became apparent that the market was slowing down drastically. … I developed a good relationship with the relocation director at my company and some strong relocation contacts, and that helped me quite a bit,” he recalls.

A franchise affiliation can help, too, Bokeko suggests. “You need to be branded with a national name,” she says. “The things that a national organization has to offer are really going to help the newer person get a foothold.”

Know Your Numbers

New agents should be well versed in market data, so they can figure out how many sales they need to close to meet their expenses, Bull advises. Use the average sales price and commission in the local market and the agent’s split to set monthly goals.

Starting out can be costly, so new agents should have a reserve—six months of living expenses is recommended—to bridge the gaps between commission checks. Having a spouse or other housemate who adds a second income helps, too.

Never spend a commission before the sale closes, Bokeko warns. But once the check is in hand, try to put a portion of it back into the fledging business. “When I started out, I always tried to make an investment in something that would benefit my business out of my initial commissions. If you get a good commission check, try to get a cell phone or a computer, so you can gear up,” she recommends.

Marketing is a necessity, but “there are less expensive ways and more expensive ways,” Buenz observes. For example, newbies who are comfortable knocking on doors and meeting people cold can generate business without spending much money. “What you spend money on is a function of what you’re comfortable with. The more passive the method, the more it’s going to cost,” he explains.

Either way, new agents should cut back on marketing and advertising expenses that don’t result in new business, he adds. “If you’re doing direct mail, for example, you need to track your results over time, and if the results don’t justify that expense, you need to shift gears,” he says.

Bull believes new agents should cut back on print advertising, invest more in their own Web site, and take advantage of Web sites such as Craigslist and Google Earth that offer free advertising. A good Web site complete with local-market listings can be had for as little as $50 a month, she says.

Qualifying Prospects Is a Crucial Activity

New agents can’t afford to spend much time with prospective buyers or sellers who aren’t ready to act right away, so the agent should always focus on qualifying prospects as a prime activity. Financial factors such as a buyer’s ability to obtain a mortgage or a seller’s equity position are important, but other factors come into play as well.

Buenz believes the most important attribute of prospects today is their ability to make a decision and their frame of mind with respect to the sale or purchase of a home. “So many prospects are not capable of making decisions right now. They are paralyzed, uncertain, or not willing to make a decision …. They may say they are going to buy a house, but if it becomes apparent that they are not making a decision, you have to decide whether to spend any more time [with them],” he says.

A willingness to accept market realities is an important qualifying attribute of prospective home sellers, Buenz adds. Homeowners who are determined to sell their home at an unrealistic price may not be good prospects. The new agent needs to assess the home’s attractiveness, the probability that it can be sold, and the seller’s willingness to set a reasonable asking price.

Motivation is a key factor as well, Bokeko notes. For example, someone who intends to retire and move to another community in three or four years is probably a less likely prospect than someone who needs to relocate for a new job within the next two or three months.

Prospects who aren’t ready to act shouldn’t be given a cold shoulder, however. Instead, they should be assigned to an automated e-mail program that can help the agent stay in touch with them without a lot of effort, Bokeko suggests. “If you have the right technology, the computer can do this [follow-up] work for you,” she says. Bokeko speaks from experience: She’s sold homes to people she initially met more than a decade earlier.

Most home buyers begin their search for a property on the Internet, and many of them prefer to communicate by e-mail or text messaging. That means newbies can’t afford to ignore Internet leads. “If an Internet lead is an appointment to show, that’s HOT!” Bull emphasizes. “These people don’t waste your time. They are educated [about real estate], and they know the neighborhood.”

Marcie Geffner is a real estate reporter in Los Angeles.