Author Topic: Mustachian Real Estate Agent = No Car?  (Read 7997 times)

babysnowbyrd

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Mustachian Real Estate Agent = No Car?
« on: July 11, 2015, 07:12:13 PM »
I'm considering getting a real estate license. I have a full-time graveyard shift job, (pay is not so good) and I typically sleep in the mornings from about 8am to noon, sometimes later. I'm open the rest of the day, and I'd like to bring in more money selling real estate.

I'm not pretending I'm going to be (or even want to be) a million-dollar agent making 6 figures commissions, but I think even a few sales a year will nicely pay down debts, and eventually be my source of investing income. Maybe even get me to the point that I can take advantage of a nice deal for myself to buy a place to live while renting out part of it. (I'd love to work out a deal for myself where I have renters paying my mortgage.)

Anyway, my main question is whether or not I can be successful without a car. Most people and most forums are non-mustachians and 99% agree you MUST have a GOOD, NEW car (less than 5 years old) or at least LEASE one *shudder* to use for the business. I see what they're saying about making a good impression, but as we know, most people accept the status quo for how things "should" be done without taking time to even consider other options that aren't as mainstream.

Are there Mustachian agents out there who make it without a car? How do you work around the most common situations where it's assumed you MUST have one?

I've tried to anticipate what you will ask me in order to provide good responses so here goes:

*I currently DO have a car: '92 Honda Station Wagon (own it.) It's not very pretty. I think many people in Real Estate forums would find it just as bad or even worse than not having a car at all.

*I also own a nice bike. I plan on commuting with it now instead of my car (first try will be tonight.) I want to make it my main mode of transportation, but I've been pretty slow at implementing it. I feel having the option of a car is my main crutch and I'm considering selling it to help move the process along.

*If I do sell my car, I probably wouldn't be able to buy one for some time without financing. Certainly not a 5-year model.

*There are a fair amount of public transportation options where I live, but not on the scale of more densly-populated mega-cities. Most of my current options will allow me to bring my bike with, which helps for getting to areas where the public transit is difficult.

*I'd say there's a decent biking population and it's getting more and more popular, but single-person cars are definitely the norm.

*For those who want to question my current graveyard shift job, I have several motivations behind why I want to keep it. It's complicated. It may be stupid but it's everything that I want in a job except for the dismal pay.

I appreciate your help.


Letj

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Re: Mustachian Real Estate Agent = No Car?
« Reply #1 on: July 11, 2015, 07:23:26 PM »
You need a car to be a real estate agent. Clients would not take you seriously nor would they want to use you if you turn up hot and sweaty on a bicycle or at a bus stop only to arrive on foot. Frankly, at least where I live, it would make you look like a loser.

Cole

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Re: Mustachian Real Estate Agent = No Car?
« Reply #2 on: July 11, 2015, 08:08:44 PM »
You need a car to be a real estate agent. Clients would not take you seriously nor would they want to use you if you turn up hot and sweaty on a bicycle or at a bus stop only to arrive on foot. Frankly, at least where I live, it would make you look like a loser.

While this could potentially be true; generally in an up-and-coming neighborhood or a trendier neighborhood riding a bike to meetings may make you totally fit in with the earth-friendly crowd and may actually garner you more business! You would have to dress nicely still.

cbr shadow

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Re: Mustachian Real Estate Agent = No Car?
« Reply #3 on: July 11, 2015, 11:47:34 PM »
I'm going to say you definitely need a car to be a RE agent.  You really won't be taken seriously without one.  Also consider that depending on the state you're in there are often expenses to keep your license.  I've been told that here in Illinois it's a few thousand dollars/year to maintain it.  Consider that, and the fact that you will need a decent car, into your decision.  No trying to discourage you, but it's good to know everything up front.  This may mean you would need more than a couple sales per year to do better than break even.


money_bunny

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Re: Mustachian Real Estate Agent = No Car?
« Reply #4 on: July 12, 2015, 05:11:53 AM »
Unless you are in NYC you will need a car. Which needs to be nice and able to move around at least three people at all times (You, and the couple). My agent drives a camry and not a 3 series which is one of the reasons why I use her.

You will need to dress at the same level or one level better than your clients. You are using social cues that you are the "Expert." I need a reference to back this up. I always think of the Drug Reps that see me once in a while. Their dry cleaning bill must be a major expense item for them.

Are you looking into RE as a career or to allow you to get the unlimited passive loss deductions post fire? Most agents work all the time and make very little money.


NoNonsenseLandlord

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Re: Mustachian Real Estate Agent = No Car?
« Reply #5 on: July 12, 2015, 06:53:23 AM »
It will be expensive to keep up your license.  A few thousand a year with education, brokerage office charges, MLS fees, commission splits, etc.

And you WILL need a car, or someone to drive you. 

Mirwen

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Re: Mustachian Real Estate Agent = No Car?
« Reply #6 on: July 12, 2015, 01:25:48 PM »
Yes, you need a car. Sometimes you will be providing transportation for your clients.  It dosen't *have* to be fancy, but it helps.  I'd go for an older reliable family sized luxury car.  Say an immaculate 10 year old Lexus.  Most people just notice if it's shiny and a Lexus.  If you don't have a fancy car you should wear a suit and be very well groomed.  Impressions do matter.  In addition to splitting your commissions to your broker you will have to pay for insurance and marketing fees every month whether you make a sale or not.  That 6% commission?  It's split four ways.  You only get 1.5% and then get your fees subtracted from that.  Expect overhead to include $2k per year in licensing, $2k(and up) per year in other fees and costs, costs of having a better car and driving a heck of a lot more, plus work professional attire if you don't already have that.

You can do real estate part time, but you better plan on making three or more sales (depending on market prices) just to break even.

An interesting anecdote:  The broker at my office drove some sort of fancy new car.  He made the most sales at the office every month.  One of the agents challenged him to drive a junker for a month instead of his fancy pants car and see if he was still so good. He did and still beat everyone else for sales.  He wore suits and a tie everyday though.  So I think you can make up for driving a junker, but it's hard when you're just getting started and need to establish your reputation.  Another realtor I knew made a good living and never wore anything but shorts and a T-shirt.  He had already established his network though.

babysnowbyrd

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Re: Mustachian Real Estate Agent = No Car?
« Reply #7 on: July 12, 2015, 05:02:25 PM »
Thanks everyone for your help.

I'm still interested in RE for several reasons, and when I get excited about things I tend to bulldoze ahead without proper planning. I think I will wait on the real estate until my debts are paid down and I have a little more wiggle room.

I have a little money, but not enough to spread between a new car and all of the initial expenses. I think it will just be a burden and bigger stress on my life at this point.

Thank you for saving me from my bull-headedness. This time. :)


money_bunny

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Re: Mustachian Real Estate Agent = No Car?
« Reply #8 on: July 13, 2015, 07:08:31 AM »
Thanks everyone for your help.

I'm still interested in RE for several reasons, and when I get excited about things I tend to bulldoze ahead without proper planning. I think I will wait on the real estate until my debts are paid down and I have a little more wiggle room.

I have a little money, but not enough to spread between a new car and all of the initial expenses. I think it will just be a burden and bigger stress on my life at this point.

Thank you for saving me from my bull-headedness. This time. :)

There is nothing wrong with getting interested in something. It's when someone gets interested and moves forward without learning that they can get in way over their head. RE Guru's love people like that since they are excited to put their money down for their classes.


Mirwen

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Re: Mustachian Real Estate Agent = No Car?
« Reply #9 on: July 13, 2015, 09:51:42 AM »
I became a licensed Realtor 2003 but only made a couple of sales and never renewed my license.  I lost money that year, but the knowledge I gained about real estate investment and transactions has paid for itself many times over since then.  Follow your interest by reading and learning more about real estate.  You don't need a license to do that.

Fishingmn

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Re: Mustachian Real Estate Agent = No Car?
« Reply #10 on: July 14, 2015, 09:43:13 AM »
I'm an agent - I think the answer depends on the clients you'd be working with.

First off, as Nononsense stated, you really need to sell at least 1-2 deals/year to break even after all of the expenses.

To answer the question though, I think you could get by if you have a large base of friends/family that are going to be your clients and they understand your situation. They can either provide transportation or understand you using public transportation if you are in an urban setting.

That said, it will be a pain in the butt.

I don't think you need a fancy new car - hardly any buyers these days actually ride in the car with the agent. They just follow behind. My car is a 2010 Ford Fusion Hybrid with 125k miles on it so it's not like an impressive ride.

zephyr911

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Re: Mustachian Real Estate Agent = No Car?
« Reply #11 on: July 14, 2015, 12:45:30 PM »
I've been a profitable part-time Realtor for over a year and I have never been in a situation where having a shitty, ugly car would have lost me business. Ever.

I've never had a client in my car - it's less and less common with all the paranoid people these days. More and more, they meet you at showings.

There are many niches in real estate and they don't all require you to haul people around town in luxury. For example, since I am also a real estate investor, my primary customer is MYSELF. I turned a profit in my first year (paid for licensing and all first-year fees, board dues, company costs, etc) just through investment deals when my partnership bought rentals. When DW and I downsized from our fancy townhouse and made it a rental, my "buyer's agent" commission on our new $120K purchase alone put me in the black.

But even if you don't have the "self-service" advantage, you can carve out a niche with like-minded people who aren't swayed by dumb superficial shit like how your car looks, or if you even showed up in one. MMM types. Cash flow investors. Rehab specialists. They're out shopping and they're smart enough to look past appearances. If you're knowledgeable and can help people identify good investments, a good chunk of them won't care about the car thing.

And of course, there's the "friends and family" angle. If I'd had time to handle the ones who were interested in the last year, I would have made *at least* $10K just from friends around town who heard I got licensed and wanted to give me a shot when it was time to buy or sell. The only reason I didn't was I'm still working 3 other jobs and I literally didn't have time.

Being licensed in real estate also gives you much of the required knowledge to be a paid property manager, which can be a good gig. You don't have to have the license to do it, but it shows that you have Fair Housing Act training and other vital knowledge to ensure you follow the laws while holding tenants to their lease requirements.

All that doesn't mean it's the time for you to go into real estate, and if - as you said - you have a tendency to jump into things - I would suggest taking your time and doing due diligence. I would suggest going and talking to a broker about your intentions, and see if they think you'd be a good fit. They generally love talking to new people, especially prospective agents, and most will be willing to help clarify expectations and outlook for you.
« Last Edit: July 14, 2015, 12:48:23 PM by zephyr911 »

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Re: Mustachian Real Estate Agent = No Car?
« Reply #12 on: August 20, 2015, 07:37:49 AM »
Not only do you need a car to be a RE, you need a nice one.  I'm not saying you need a brand new escalade, but you need a new enough to appear very clean and well maintained 4-door car. A lot of clients are going to expect a small SUV so they can easily get in and out.

Our RE drove us around to showings. We would often see 5-6 houses in one afternoon, all over the city.  It would be SO unprofessional for a RE agent to expect the client to drive, and I'm not going to follow his old car that he doesn't drive clients in around (or follow my GPS) while going to unfamiliar places. I wouldn't have used him if I had to climb into the back seat of his 20 year old camry. 

Once we picked our house, yes, we did meet him there, and I wouldn't have cared if he biked or showed up in a junker. But to get to the process of picking the house, neither is really an option.

LiveLean

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Re: Mustachian Real Estate Agent = No Car?
« Reply #13 on: August 21, 2015, 08:05:47 AM »
Depends on the kind of real estate.

I invest in timberland, which tends to be way off the beaten path. Most agents who specialize in this stuff - at least the good ones - drive high-mileage SUVs with four-wheel drive and show up in boots and jeans, as do I. I jump in their car and off we go. If it's just one property, which is rarely the case, I'll meet them there. Otherwise we meet at a strip mall and I leave my car.

I got my real estate license in 2001 after buying my first home and feeling like I was being taken advantage of at every turn. I never intended to sell real estate - and I haven't - but I have dutifully renewed my license every two years (at a cost of about $100). It was invaluable education initially and when I'm looking for property out of state (which is what I usually do), I will often mention that I'm a licensed real estate agent in Florida, which is true.

pl28

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Re: Mustachian Real Estate Agent = No Car?
« Reply #14 on: August 21, 2015, 07:52:41 PM »
In my personal experience, I purchased 4 homes and never sat in my agent's car. Now days with the technology, most clients pick the house(s) they want to see and actually do most of the research before hand and just meet the agent there at each home, so I don't see a reason you must have a car. Of course having a car is more convenient. Also you can offer some discount on your service since you don't have the cost of shuttling your clients around.

Like others said, make sure you know the total cost of maintaining your license and how many sales you need to do to at least break even.

Good luck and hope it works out.

PencilThinStache

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Re: Mustachian Real Estate Agent = No Car?
« Reply #15 on: August 25, 2015, 01:29:30 PM »
I never sat in my agent's car. I would recommend getting a Prius, preferably a 5-10 year old one w/70-120k miles. The novelty of its efficiency suitably replaces the novelty of a fancy car's luxury, and it's a novelty that saves you money. I never sat in my realtor's car. I saw it frequently, but only because he was always late - which was super annoying and almost cost him a $15k commission.