Education and Certification Requirements
Currently, every state requires that real estate brokers and sales agents possess a real estate license. Candidates must have a high school diploma and pass a written test. While it is possible to become a real estate agent without a bachelor’s degree, many firms are hiring brokers and agents with college graduates, as transactions have become more complex.
Courses in finance, real estate, business administration, statistics, law and economics are helpful for a real estate agent. If the broker is planning to start their own company, courses in marketing and accounting are critical for running a successful office.
Job Responsibilities
Real estate brokers and agents need a thorough understanding of their communities and the real estate available in each area they cover. Brokers and agents need to be familiar with housing availability and pricing to best meet their client’s needs. When a buyer finds a property they want to purchase, the agent functions as the intermediary in the price negotiation between the seller and the buyer.
Brokers and agents need to understand the financing options available in the market and if there are favorable options for buyers. By understanding the Chicago lending market and being able to explain the options to the buyer you may make the difference resulting in a sale. The Chicago banking market is also rapidly changing, as bank consolidations impact available lenders. The brokers and agents need to keep up to date on all banks and mortgage programs available.
Brokers and agents also need to be familiar with the local employment outlook for the area, especially when looking for properties to sell. Currently, setting a selling price has become very challenging, as prior comparison standards are not as effective as they once were. As they negotiate the price to sell the house, the agent needs to be familiar with comparable houses currently on the market. Because the time on the market has been extended in the Chicago area, the agent also has to prepare the seller for an extended listing period.
Brokers and agents who list properties to sell also schedule title searches to verify the seller actually holds ownership on the property.
Once a buyer is located for a seller, the brokers and agents may attend the closing meeting at the title and abstract company. Other times bankers and lawyers are the intermediaries at the closing.
Brokers and agents essentially have the same job. The difference is that a broker is licensed to manage a private real estate business and employ agents. All agents must work with a broker. Most times, the agent is an independent contractor who is paid on commission based on sales.
Skills
Real estate brokers and agents need excellent communication and listening skills. They also need an excellent memory as well as an attention to detail. The agent needs to be able to listen to the buyer to hear what the buyer is looking for, as well as understand clearly what price is the limit the buyer is qualified to purchase.
The agent also has to understand interior and exterior design to help stage a property for the seller to improve curb appeal. Through this process, the agent needs to be clear with the seller what the reasons are for the recommended changes.
Job Outlook
The housing market for Chicago, whether it is commercial, industrial or residential, is projected to be flat for the next 12 months. The market is not expected to rebound until 2010 according to surveys of top real estate executives, as well as an inspection of single family housing inventory currently on the market. Because real estate brokers and agents earn a commission based on successful property sales, the next 12 months will be very challenging for agents.
After the 2010 turn around, projections from the Bureau of Labor Statistics indicate that the growth rate for real estate brokers and agents will mirror the market at 10% by 2016. Chicago should also begin to reflect the overall market.
Career Path
As an agent becomes more successful finding buyers and sellers for properties, they close more transactions per quarter. In larger firms, agents may advance to a manager level, or work to earn their broker’s license. If they earn their broker’s license, they are qualified to open their own office.
Salary Range
Brokers and agents are paid on commission based on the sales transaction on the property. Commissions are divided between all of the agents and brokers who are involved with the sale of the property. If an agent and a broker represent the seller, and another agent and broker represent the buyer, then the commission may be divided four ways with various percentages paid to each party. If an agent both lists and sells the property, they will double their commission.
The median annual income for salaried real estate sales agents, including commissions, was $39,760 in 2006.
Conclusion
The next 12 months will be very challenging for the Chicago real estate market. All sectors from industrial, commercial, and residential expect a soft market to persist until 2010. The current inventory of single-family houses is also causing prices to decline, and thereby causing a decrease in commissions.
