Christina Hoffmann is a former managing editor of REALTOR® Magazine and now content manager for the National Association of REALTORS®’ HouseLogic.com site. HouseLogic is free source of information that helps consumers make smart, confident decisions about all aspects of home ownership. Made possible by REALTORS®, the site helps owners get the most value and enjoyment from their existing home and helps buyers and sellers make the best deal possible. HouseLogic’s consumer content is available to NAR members via the REALTORS® Content Resource.
Surviving Rookiehood: Getting by When the Check's Not in the Mail
Tales from the green but hardy
May 1, 2000
Whether you joined the real estate industry after saying good-bye to another career or fresh out of school, you know how lean things can be until you cash that first commission check. If you're in that position now or have some new salespeople who are, read these first-person accounts of how your comrades in arms survived those hungry rookie years. You'll also want to check out the "30 under 30" profiles—success stories about the under-30-year-old real estate crowd—in the print magazine.
Selling to myself
I had just graduated high school in 1975 and had some gift money to play with, and I was still living at my parents’ home, so I didn't have a lot bills. My first deal was selling a house—to myself as a licensed salesperson. When I originally bought the house from the seller, I was too green to ferret out a title problem on it and had to resell it to the legal owner and buy it back. The good news from all this was that I learned how to do transactions the right way.
In addition, at my broker's urging, I would pick a neighborhood and go door to door. My broker would go with on any appointments I earned from this cold calling.
—Ralph R. Roberts, Ralph@RalphRoberts.com, Ralph Roberts Real Estate, Warren, Mich.
In the nick of time
I've always been a saver. So I was able to support myself until my first commission. But that first check arrived just in time. I only had $17.30 in the bank by the time it came. My first sale resulted from an open house. A seller attended and listed with me. And I ended up selling a home to her as well.
Before real estate, I sold cable TVs for a wireless television company. I was promoted to sales manager, but the company couldn't pay me what I was worth.
—Ryan Bishop, Ryan@gotmoved.com, Coldwell Banker Grand Realty, Spokane, Wash.
Cloak and dagger
I've been in the business less than a year. I'm fortunate enough to have a supportive husband who helped me pay my monthly real estate fees to keep me rolling. I'm also a substitute teacher at our local elementary and junior high school. If I substitute two to three days a month, the salary pays for my fees and advertising budget.
That's not to say my husband and I don't feel the squeeze. We've had to cut back our budget and basically haven't gone out for a year since I started my real estate endeavor. We have two young children, who aren't in day care. I put little pressure on myself to produce immediately, but the pressure was there anyway as fees-- postage, office supplies, cell phone, copy shop, advertising, MLS dues--mounted.
In my first sale, the listing had been on and off the market for five years with two agencies, including my own. The property was a 1.25-acre vacant lot with a gulley and a power pole running through the middle. Builders were skeptical about whether they could position a house on the parcel. And the land survey was off by 30 feet so the neighbors unwittingly created a yard for themselves with a boulder fence, trees, and sprinkler system.
To sell the land, the fence and everything would have to come down. I marched builders, surveyors, and even a few seasoned salespeople down to my ‘prize’ listing for guidance. No one was positive about selling the lot. Some even said that you "couldn't build on it.” When I did all this, it was one week before Christmas.
My sellers’ attorney sent a polite letter to the neighbors stating that they have so many days to restore the property so that it can be sold. I realized that the neighbors, a married couple who invest in real estate, would be my best bet for purchasing the lot. They'd even made a few “ridiculous” offers in the past.
The husband said no to the buy, but the wife decided she couldn't live with another house so close to hers or with the expense of ripping out a yard they spent three summers building. She formed a limited liability company, and the next day called me with an offer. She didn't want her husband to know, and gave me code words to use if I needed to call her at home. Very cloak and dagger.
I made my first sale—on both sides of the transaction--within 38 days of taking the listing. The wife wrapped the closing paperwork to put under the Christmas tree for her husband.
I decided if I could manage to put that deal together successfully with little experience, I could definitely pursue a career in real estate.
—Julie Ann Lunte, email@example.com, Magic Valley Realty, Twin Falls, Idaho
Worth the wait
I took an early retirement as an engineer,and my wife and I decided to move from our small town in southern Indiana to Indianapolis. I'd obtained a real estate license a year earlier, in 1992, but used it only for dealing in rental property. Once we were settled, I decided to put the license into play. My wife found a good job in Indianapolis, so waiting for my first sale wasn't too financially difficult. The frustrating part was that it seemed to take that first deal forever to close.
After finding a prospect in 1999, I discovered that their former listing agent had extended their listing without their approval. That took about two weeks to resolve.
I put together a packet of 20 listings to see if they fit the criteria that we had discussed on the phone. The buyers were impressed when I dropped by their home a few days early to leave the packet.
They asked if I could find a house aimed at minimizing stair climbing for their parents. I found such a house and they loved it. They were willing to accept it almost "as is" just to get moved in as soon as possible. There were a few credit problems, and their purchase would take special financing.
In addition, they had to sell their current home to obtain the downpayment. The buyer used an FHA loan, and required that the sellers perform numerous repairs, such as painting the garage in 40-degree weather. It took a lot of empathy and diplomacy to keep the sellers motivated at this The sale proved how challenging, yet satisfying, this occupation can be. When I recently stopped by to visit the family's new home, one the teenagers happily exclaimed, "He's the one that made this happen.”
—Walter Miller, firstname.lastname@example.org, Coldwell Banker Wall & Associates, Indianapolis
Help when it counted
Surviving until that first commission wasn’t too nerve wracking: I just got married.
I graduated college in December 1996, married in January, and entered real estate in May in the Chicago suburbs. Luckily, we had money to pay the rent. The worst part of my first sale was waiting for the buyer's loan to be approved. I would wake up in the middle of the night worrying about it.
My manager was an inspiration. He kept us rookies in constant training with pop quizzes during office meetings on such topics as writing VA offers, and cold calling phone-a-thons followed by pizza parties. I owe him my career. When I was rejected, he was my cheerleader. In fact, by the holidays in 1977, I was ready to quit. He said he'd lend me money for Christmas presents if I stuck it out for six more months. He also helped me pay for a Tom Hopkins seminar.
His confidence led me to my first sale. Wearing my good suit, which I sewed myself, I knocked on a FSBO’s door—and hoped the owners weren't home. The couple listed their townhouse with me and it sold--with my manager's help, of course. Before closing, I remembered from my training that you couldn't bring personal checks to closing--only cashier's checks or certified funds. Diligently, I called the sellers the day before to remind them that they needed to bring a certified check. At closing, the seller leaned over to me and whispered, "Is this your first sale?"
—Diane Fowler, GRI, CRS, Dianeflr@aol.com, Douglas Realty, Cape Coral, Fla.
It only took a month after I got into real estate to land my first sale, but the money was slow to come in. I was surprised when I received my first commission check and saw how much was taken out to cover such things as board dues, office fees, and the broker split. Given that the sale was only for $40,000, the deductions were especially painful.
Although my husband has a full time job, that first year was a struggle. I had left a job at a major computer company because of downsizing, and thought I would try real estate. My first year, I teamed with a partner and together we did $1.8 million in volume. I went from making about $30,000 to $14,000 my first year.
However, I told myself I would give my new profession a fair shake for two years. I'm glad I stuck it out. I did $2.6 million in my third year, not a shabby showing in my market for a third-year salesperson. Now, my biggest worry is what I owe the IRS.
That first sale was a memorable one. The buyer was a single mom who called in during my floor time. She had phoned several companies in the area only to get ignored, receive false promises, or be told she couldn't buy a home. I was appalled at the fact that since she could only spend $40,000, no one wanted to work with her.
We found a home that needed some work, but was spacious and had a big yard for her son to play in. The payments fit perfectly in her budget. Since it was winter and the house was vacant, the water had been turned off. Shortly after closing, I received a frantic phone call from the buyer. It seems the water company came to turn on the water but found too late that there was an uncapped water pipe in the basement. The water company shut off the water and refused to turn it back on until the buyer made the necessary repairs. I was crushed when she called and embarrassed at my lack of knowledge and experience.
Fortunately for me, her family members made the repairs. I still talk to her frequently, and with my added experience, I've been able to give her advice on other real estate questions.
—Billie Jo Gubbels, email@example.com, N P Dodge Co., Council Bluffs, Iowa
Two-wheeled wheeler dealer
My first sale—the showing, the closing, opening the escrow—was unique because I orchestrated it by bicycle. To keep costs down, I didn't own a car for the first six months I was in the business. (I also survived because of a working spouse and investments.) I'd set an appointment with a client, put a rubber band around my pant legs so they wouldn't get caught in my bike chain, and set off. Besides making for cost-effective travel, it was good public relations: Seattle is an ecology minded town. I became known as Greg Stamolis, “the agent on the bike.”
Once I had enough closings under my belt, I bought a car. But, I fondly remember the days when I biked around town with a damp purchase and sale agreement and had strong legs.
—Greg Stamolis, firstname.lastname@example.org, Windermere Real Estate, Northwest, Inc., Seattle
The virtue of patience
I had the good fortune to work as an assistant for a top producer whose motto is “Patience, Courtesy, and Restraint.” The courtesy and restraint part was easy. But patience?
I worked for her from April to August 1998, and decided to go it alone. Boy, was I scared. I started with TV ads,and lo and behold, within two weeks a couple who saw me on TV decided I was the salesperson for them. By the way, in my area, there's a TV channel devoted just to real estate—ads for property, practitioners, and related services. It costs $36 a week to run an ad, which appears seven days a week several times a day. I couldn't afford real estate publications or newspapers at the time. But this was cost effective.
I showed the couple homes for a month before we found a cupcake. It was just meant to be. Everything went smooth as silk through closing. To this day, we still correspond, and they send me pictures of their daughter.
—Lisa A. Knight, email@example.com, Century 21 Wilson Minger Agency, Inc., Niceville, Fla.
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