Entry by Jose Rivera

What is the Net (financial) Worth of the average Realtor?


Why do people become Realtors? Would most of you agree, that the prime reason is to "make money" ? Yes, I know there are other reasons too, like "I want to help people" or "I get to be my own boss". Oh sure, there are many other reasons. So then, what kind of money does the average Realtor make? Are most Realtors today, in the "RED", just making ends meet, or truly in the "BLACK", financially speaking?

The reason I'm talking about all this is because....before "ACRE", all Realtors were thinking of just one thing...Closings! If they didn't have any "closings" for a long period of time they just dropped out of the business, unless they had some "financial means" to keep them going until they finally started making some closings.

What a shame, that a lot of Realtors, who probably know their business very well, and could be "ACREs", can't continue their real estate careers because they run out of money. How about YOU? My fellow ACRE member. Where are you today, financially? Are YOU in the "BLACK" ?

If not, what changes do you have to make, in your life, to be in the "black"....or as the general public likes to say "to be successful". Well, "successful" just means making more money than what you spend.

Just something to ponder.......


Great points Jose. Let me add this: most agents think in terms of commission checks rather than how many hours they had to devote to get them. Some agents, when hearing about ACRE, will say "why should I settle for a $400 check when I can get a $4000 check?"

The answer is: "Because the $400 check will pay you well for the time you put in. The time (or tasks) are finite. Once you complete them, you get paid. With the $4000 check, it's for how many hours it takes, and if the transaction falls apart, you start again. Many times, the transaction takes so much time, that you're being paid minimum wage.

Agents just don't think about their hourly worth. When we get a check, we conveniently forget about how many hours that transaction took to earn the check, PLUS all of the other listings that didn't sell, the buyers that didn't buy that the commission check has to cover. And don't forget the "free" CMA's!

I find that True

People who have owned and operated a business, soon learn that there are direct and indirect costs related to everything in business.

As independent contractors agents are now business people who need to do a cost analysis of their annual fixed and variable expenses, which should include everything legally allowable by the IRS and divided the total  by 12 months for your monthly costs, again by the available working days (22) and then by the number of reasonable hours (6) that you believe are required to cover your costs, together with your personal compensation and your profit margin in order to have a reserve fund for equipment replaceement and emergencies,etc,

Not everyone may work the same, or determine their billable hour the same, so each individual will have to determine what works best for them.


This page contains a single entry by Jose Rivera published on September 16, 2011 2:35 PM.

Make it happen ! was the previous entry in this blog.

ACRE® Approved for CE Credits in TN! is the next entry in this blog.

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