On paper, working as a part time real estate agent sounds like the perfect way to make your first million. You show a few houses, make a few phone calls, and double your income in an afternoon with one rich client. Easy right?
Well…not quite. While luck and a magnetic personality are great assets for any agent, the reality is that this is a job like any other. In order to become great, you’re going to have to work at it. The question is whether or not you can build your knowledge and hone the skills that you’ll need to succeed while working part time.
The short answer is yes, and in this guide, we’ll tell you how. We’ll cover the following and include advice from successful realtors and brokers:
- How to Make it Work as a Part Time Real Estate Agent
- How Much Money Can You Make as a Part Time Real Estate Agent?
- What are the Benefits of Working as a Part Time Agent
- What are the Risks of Working as a Part Time Agent
How to Make it Work as a Part Time Real Estate Agent
Working part time as a real estate agent can be a great way to supplement your current income and test the waters before going full time, but there’s a right way and wrong way to be a part time agent. Here’s how to do it right.
Make Sure Your Second Job Has Some Flexibility
Today, clients expect real estate agents to respond instantly and be available when they are. If you’re not available, they’re going to move on to the next agent who is. You’ll also need to work around the schedules of seller’s agents, inspectors, lawyers, and building superintendents.
While most jobs are going to make it very difficult to run out the door at the drop of a hat, you should ideally have a job where you can at least answer the occasional email or take a five minute call.
Make Sure You Can Support Yourself with Your Second Job
Since you won’t have as much time to dedicate to real estate as a full time agent would have, you need to make sure you can scrape by on the money you make at your second job. Ideally, you want to be in a position where you’re already living comfortably on the income from that job because you may not see any return at all from real estate for at least two or three months.
Start Out with Rentals if You Can
Since rental transactions can close in a matter of days instead of months, working rentals can be a great way to scrape by until you start closing sales deals. If you live in a city with a strong rental market, consider working rentals for the first few months to supplement your income. While you’ll make much lower commissions, starting with rentals will teach you the rudiments of working with clients, and you can get a fair number of transactions under your belt.
Set Aside Regular Blocks of Time in Your Schedule to Focus on Real Estate
In order to succeed as a part time agent you need to stay organized. Virginia-based Realtor Valorie Easter recommends setting aside specific blocks of time in your schedule to work solely on real estate. How much time you devote will depend on your work schedule, but ideally you should be aiming for at least 20 hours per week. That works out to about two hours per weekday generating leads (cold calling), plus a few hours on the weekends and evenings showing.
“You need to block off time daily and stick to a schedule. That is your ONE job. In that time block, you need to lead generate for 2 hours per day and make at least 20 voice to voice phone calls. If you can do that, you will be more successful than most of the full time agents! Be purposeful. It is possible to sell real estate part time and it is a very profitable industry.”
Find the Right Brokerage
In this industry, finding the right brokerage can mean the difference between thriving and starving. You need to make sure they’ll work with part-time agents and that they offer great training, mentorships, and teams.
Arizona-based Realtor Melanie Narducci agrees.
“The most important first step for a new agent is finding the right brokerage. Do they have lots of training? Is there a mentor program? And how much of your commission do they want? If you’re going part time finding a partner who can take calls while you’re at your day job may be the best route, so co-listing with an experienced agent would be wise.”
If you want to learn more about picking the right brokerage, check out our in-depth guide here.
Join a Team
Instead of jumping into the fire alone, consider joining a team instead. A real estate team is a group of agents at the same brokerage who work together by sharing leads and showings. They often are led by a senior agent, and will have junior agents, an administrative assistant, and often a closing coordinator.
If you do choose to go it alone, you can always team up with one more agent on any listings you pull in. This is called co-listing. This way you can be sure there is 100% coverage for the days you work your other job.
The only drawback to joining a team or co-listing is that your commissions may be lower, but you’ll get great one-on-one training and have a steady stream of leads to work with right away.
Here’s Illinois-based Commercial Real Estate Broker Mathew Rasche’s take on joining a team.
“The team model provides many benefits. Firstly, it provides experienced mentors who can teach the business. This is great for people who have full time aspirations. It’s also very helpful in providing credibility. When you start out, nobody wants to hire a “rookie.” However, being on a team lends all the credibility of your associates to whatever potential client you have.
Secondly, expanding on monetizing your network and sphere, a team allows you to bring opportunities into the firm and have others (more experienced) do all the heavy lifting. You get a good cut of the deal and keep your time to make sure you can handle the responsibilities of your primary career. Many people have added a near six figure income on part time referrals alone!”
Atlanta-based Realtor Joshua Jarvis had the same advice for new part time agents.
“Find a mentor (or hire a coach) You’re already going to be behind the curve because you’re doing part time. It’s best to have someone that knows what to do to coach you along. It’s money well spent (or split).”
Denise Supplee, part time Realtor and founder of SparkRental.com agrees.
“My best tip is to join a team or at least partner with a full time agent. I have done this because I know that the demands on my time may not fit with the demands of many of my buyers and sellers. Being part of a team, I tell my clients, gives them two for the price of one, so to speak.”
How Much Money Can You Make as a Part Time Real Estate Agent?
This is the big question: can you actually turn a profit as a part time real estate agent?
While it may take some time to ramp up your knowledge and skills, the potential income you can earn from working in real estate, even part time, is determined by how hard you work. If you put in the work and are in an area with high home prices and low inventory, you could theoretically make a six figure income working part time.
Here’s what you’ll want to do to assess your local real estate market and figure out how much money you can make as a part time agent.
- Find average sale price in your area – Get this from your MLS or Zillow.com. Zillow gathers data from recent sales, and gives you median sales prices for your zip code.
- Assess whether it’s a buyer’s market or a seller’s market – Zillow also tells you whether the market is “hot,” meaning a seller’s market, or “cold,” meaning a buyer’s market.
- Determine how many deals you need to close to turn a profit – In order to get a sense of how many sales you’ll need to close, multiply the median sales price by 1.25%, which is what you can expect to take home from a typical sale. That number comes from a commission of 5%. Half of that (called a transaction side) goes to the seller’s agent, and half goes to the buyer’s agent. The remainder is then split in half again by your brokerage, which leaves you with 1.25%.
In an ideal world, you’d want high sales prices and a hot market. High sales prices mean higher commissions, which means you’ll need to close fewer deals per year in order to make decent money. A hot market means homes sell quickly, so buyers are under more pressure to close.
Let’s use Katonah, New York as an example.
The median sales price in Katonah is $615,200. 1.25% of that median price gives you $7,690, This would be your gross profit from representing one side in a deal in Katonah. Not bad!
You need to keep in mind that this is gross profit. It doesn’t take into account your costs as a real estate agent, including NAR dues, desk fees, marketing costs, gas, or wear and tear on your car. That can add up. If you’re working as a junior agent on a team, you might make only half that.
Remember that everyone has to start somewhere and that your potential income is truly unlimited. The better you get, the more you’ll make.
What Are the Benefits of Working as a Part Time Real Estate Agent?
Working as a part time real estate agent means you might take longer than full time agents to reach income and career milestones, but you also get the following benefits:
Have a stable source of secondary income
Many new full time agents hit the ground running and see success early on. Then, they up their marketing budget or maybe buy a nicer car to impress clients. When the inevitable bad month arrives, they suddenly can’t pay their rent and end up having to sell the new car at a loss. While purely hypothetical, scenarios like these are all too common for new agents. However, if you already have a stable secondary source of income and want to be an agent part time, you may need to tighten your belt, but at least the damage to your bank account won’t be catastrophic.
Be able to take your time cultivating relationships and getting great reviews on Zillow
Having great reviews on Zillow, Realtor.com, or other real estate ad platforms can mean the difference between thriving and starving as an agent. The rationale here is simple. Everyone prefers to work with highly rated professionals, while no one wants to work with poorly rated professionals. Agents with no ratings at all often get lost in the shuffle, whether they are full or part time.
Instead of being forced to market yourself with no ratings, as a part time agent on a team (more on this later) you’ll have a steady source of leads to build out your ratings with.
You can decide if real estate really is the right career for you
Working as a real estate agent can be one of the most fulfilling and exciting careers you’ll ever have. It can also be a thankless, soul-crushing grind, even for the die hard optimists. While the difference between the two extremes is vast and beyond the scope of this article, some people love the unpredictability. For them, the highs more than justify the lows. For others, the lack of stability is too much to take.
If you’re only working part time, you can get your feet wet without risking too much of your time, money, or sanity. If you find yourself beaming at the end of a grueling day of showings, then you might decide to make the leap in the future to working as an agent full time. If not, you can always return to your second job.
What are the Risks of Working as a Part Time Real Estate Agent?
In case you were thinking working as a part time agent is all BMWs and power lunches at Spago, let’s go over some of the risks. Unfortunately there are several.
Finding a brokerage to work for is much harder
Since brokers often invest large amounts of time and money recruiting and training agents, many of the best brokerages simply don’t want to deal with part time agents. Think about it. They’ll have to work just as hard recruiting and training part time agents, and full time agents will probably make them more money.
You likely won’t be able to afford a high split brokerage
In order to give their agents high commission splits (up to 90%), high split brokerages brokerages often charge agents desk fees that can range from $300-$1000 or more per month. If you’re closing enough deals, this can be easy to justify, but if you’re only working part time, you’re more than likely going to end up eating that desk fee most months.
It might take you longer than you think to cut your teeth
Malcolm Gladwell famously said that it takes 10,000 hours of practice to become a true expert on anything. While many people see amazing success in real estate much sooner, the takeaway here is that it will take time to hone your instincts and build up your knowledge base to become a true real estate expert. It may even end up taking you a year or more to get your first listing.
Clients might doubt your dedication and commitment
If you needed a root canal, would you rather work with a part time dental surgeon or a full time dental surgeon? For almost everyone, the answer will be a full time dental surgeon. After all, if they’re any good, why wouldn’t they be working full time? Are they not able to get enough clients? Why not? Before choosing to commit to you, clients are going to naturally kick the tires. For many, the fact that you work part time might be a deal breaker.
Worse, they’re going to think you won’t be able to devote as much time to them as they think they need. What if they need help at the last minute and you’re not able to take care of their problem until 5:30?
The Bottom Line
Working part time as a real estate agent can be very challenging, but as long as you have a stable, flexible day job and work smarter instead of harder, you can get a great start in the industry without risking too much.