Categorized | Commercial

Many Real Estate Agents Are Facing Costs and Uncertainties

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Many Real Estate Agents Are Facing Costs and Uncertainties According to a spokesperson for National Association of Realtors, most real estate agents are smalltime business people or independent contractors, unlike fixed salary or commission type employees. Even though many smaller companies merged to form professional companies, there still exists a small brokerage type business. In fact, most of these businesses run independently with regard to clients, staffing, office supplies, and adoption of newer technologies. Other added costs include insurance costs for property management, office insurance, fees payable for many listing services for both local and nation-wide real estate organizations needs to be met by many real estate agents are facing costs and uncertainties, before they even try to sell a real estate property.

It is a fact that many smalltime real estate brokers face problems like increasing fixed overhead costs, especially those who need to sell low-cost houses in volumes to cover those costs, adequately. As per Bureau of Labor Statistics, both brokers and agents do similar work, except agents work with brokers on contract basis, to get paid a certain percentage of commission, based on agent selling a real estate property on their behalf, while brokers are licensed to work, independently. Moreover, listed type brokers and agents share commission with each other and firm that employs them to sell on their behalf. So, those starting as real estate agents are facing costs and uncertainties need funds to support them for at least six months, until they manage with regularized commission income, according to Bureau of Labor Statistics.

Besides, agents must be self-motivated to work for longer hours relentlessly, as their survival depends solely on earnings generated through individual sales for each month, which could vary widely, as many real estate agents are facing costs and uncertainties. So, one need to be financially prudent to plan ahead, and get around with non-regular income inflow, as expenses need to be incurred, regularly from beginning like license fee, cost for continuing education for license renewal, rising medical insurance costs for both agent and staff, especially for those who work for at least 30 hours a week or more. Moreover, broker’s costs like office equipment and supply fees, electricity costs, advertising costs on mobile phone advertisements, upgrading websites, advertising costs using traditional sources etc, providing reliable transport services for appointment with sellers, and taking buyers to prospective locations.

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About Drew Wilson

Drew focuses on the Commercial and Mortgage/Finance categories.

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