As the popular Korean saying goes, 말하기는 쉬워도 행동하기는 어렵다 . We shall be talking about budgeting today.
The sky high biggie commissions are what draw people into real estate agency. But of course, who wouldn’t love the 5 to 6 digit commissions at every sale? The biggest challenge, however, is on the frequency of the sale and how to get past that period. It normally takes a few months before another sale is made and it is quite difficult to make it through that month with all the personal expenses as well as the overhead costs of being an agent. You’re mostly lucky if you are in a popular broker’s firm because winning a client buying property in a best time comes far more easily, but the same could not be said of the people independently working as agents. 뚝배기보다 장맛이 좋다.
How do you manage your income – that is almost always without security of when it can be replenished and is heavily affected by the market – to incorporate having to finance your marketing on top of spending for yourself?
Here are some budgeting tips:
- Always set aside budget for work. You will need to drive yourself from one client to another, one house to another, and meet buyers at public places. Sometimes you’ll have to spend some for meetings over coffee and lunch or dinner and you’ll definitely have to spend on that. Most people put 10% of their commission for these ‘overhead costs’, others even more. You decide on how much you’re willing to spend for it. What matters is you have a budget made for it and you don’t go beyond it. 뜻이 있는 곳에 길이 있다
- Max out inexpensive and free opportunities for marketing. Use some help from your friends and former clients. Ask for referrals. And best of all – maximize the internet. Set up your Facebook page, Pinterest and Twitter accounts, and set up your own blog. Oh, and get yourself on the local online real estate listing. Maximize the use of the internet – it’s cheap, it’s wide in range, and it’s easy.
- Go for quality over quantity in marketing materials. Real estate agents need to bank on the traditional means of marketing – yard signs, billboards, local radio and newspaper, and the good ol’ business cards. When getting these, always go for pricey quality over cheap quantity. 모로 가도 서울만 가면 된다. Nobody wants to see pixelated photos of you in the neighborhood–especially if your target clients are setting their sights on the super exotic One Menerung or higher end properties in Mont Kiara :). Start a good marketing campaign for yourself if and when you’d have to spend on it anyway.
- Prepare your rainy day savings. Real estate agency has a lot of money involved but you can never be too sure when you’re making your next commission. When the rainy days come before your sale and therefore your commission, you’d be in deep trouble financially. So make sure you set a portion of your every commission to the bank for emergency purposes.
- Invest. There’s no one else who knows real estate investment better than you, real estate agents. When you can, invest in your own real estate properties that will have you financially covered even after you retire from your agent job. Use your own personal experience and skills in starting your own real estate property investments.