Real estate brokers in New York City have a reputation for sleaze and sloth. The typical broker tries every trick in the book to show you an apartment you could have found on the Internet, only to hold out her hand for thousands of dollars in commission fees. Right?
Not exactly, as I discovered in my brief career as a NYC rental agent. In reality, the brokerage business is a tough slog, filled with hidden costs, clients who cancel at the last minute, and prolonged haggling over fees that make up the entirety of a broker's income.
I took the plunge and became an agent a few months after I graduated from college. I wanted to be a journalist, but even after the degree, requisite internships and experience on the job, I couldn't swing a full-time position.
After a fruitless summer of sending out applications into what felt like a black hole, I met with Bill (not his real name), an HR rep from a well-known Brooklyn-based real estate firm. What ultimately transpired was a worthy, if trying, experience that didn't quite end up as I'd imagined. Here's what it takes to become a real estate agent in New York--and why I decided to quit.
My road to real estate
Bill had seen my resume, which included experience as an apartment shower with a Manhattan property management company, on Monster.com. Instead of unsteady freelance writing, a job as a broker seemed stable and adult. This can be a career, not just a job, I thought.
When going in for my first interview to meet with the HR rep and one of the senior agents, I was nervous. I didn’t have a real estate license, thus I was legally not qualified for the job.
“Don’t worry about it,” the affable HR man assured me. “We’ll figure it out.”
The first interview went well, and then the second. At the third, I was presented with a pile of paperwork and a pen by the ever-friendly Bill. Most of it made sense, but certain things were more confusing.
Sign here to acknowledge your status as a “statutory independent contractor” (a complicated term, meaning in this case that, although I was employed with the firm, I was technically “independent”: they or I could cut the work agreement at any time, and I was not eligible for worker's comp or other benefits, including a legal limit on hours worked or not worked). Initial here to agree to the “mentor” program. There were numbers here and there, percentages mostly, explaining the portion of the broker’s fee I could keep in specific circumstances, such as if I worked with another broker or my mentor.
With the help of comprehensive lists Bill provided, I signed up for one of the cheapest options to get licensed: a 75-hour course to become a New York Real Estate Salesperson with Career Web School for $158. Unlike in-person lessons, for these all you need is an Internet connection, and you’re on your way to becoming a New York real estate agent.
The class was not difficult and, at times, could be interesting. It covered everything from mortgages and loans to various laws regarding real estate, from fair business practices to different types of housing. Anyone with decent reading comprehension can pass it.
However, the course was more time-consuming than I thought it would be. Between my freelance writing and a pesky cold, the 75-hour course took me close to a month to finish. The coursework is broken up into chapters with a quiz at the end of each one, which makes it easier to take at your own pace. Once completed, I received my certificate in the mail and was allowed to take the course test.
The 100-question course exam was administered at the Brooklyn School of Real Estate, in a dimly lit room on the second floor of what looks more like a rundown apartment building than a school. Within the next few days, I found out I passed, and was given the go-ahead to take the state exam.
This was more daunting. Only a handful of state exams are administered per season, and there are only two locations remotely convenient for New Yorkers without a car: Franklin Square in Long Island and the Financial District in Manhattan.
Those 100 questions determine whether your weeks or months of effort were worth it. The tests are administered only a handful of times a year at these two sites, and can fill up months in advance. The nonrefundable license application fee is $50.
For me, the hard work paid off. I passed the test in early November, and excitedly began my training with the company.
An agent's life--not what I expected
As a recent graduate blowing through my savings, all of the start-up fees (ads, business cards, certificates, etc.), which added up to about $400, felt like an enormous burden. And while I understood the concept of independent contractor status in theory, in practice, it means working at least 9 a.m. to 6 p.m., five, six, seven days a week without a guaranteed income.
I felt it would all pay off when I got that first commission check, so I persevered.
My biggest issue thus far was how much of my time felt utterly wasted. While I have generally had positive experiences in sales work in the food industry, real estate in New York is (as one might expect) a different animal altogether.
It's a process: you find out about listings through your connections or from your company’s database and you spend hours a day creating ads for those places. Then, once you have a potential client, you compile a list of all suitable places. Here’s where things get tricky.
I had an amazing experience with some clients. But I also had clients call me at 4 a.m. on Christmas morning, then cancel 20 minutes after they were supposed to arrive (and after it took me an hour and a half to get to the apartment). I've had clients that loved everything about the apartment and were “totally ready to sign a lease tomorrow!” and then fell off the face of the earth. And then you have to do it all over again, just hoping to rent one apartment.
In addition, nearly every client, regardless of price point, had an issue with the broker’s fee. Even if I told them up front exactly what my cost was, they tried to negotiate.
I do understand why the average 10% to 15% of the annual rent fee could be problematic for some. But don't think all of that goes to the individual agent. After forking over a share of the commission to the firm you're with (usually 50%), taking into consideration the money you spent on advertising and mentorship fees, the broker's left with anywhere from a quarter to a third of the commission. And had I not shown you this apartment you love, you probably wouldn’t have found it alone.
The bright side--coworkers and scoping out homes
I had some interesting clients and helpful co-workers. Although many New Yorkers think of real estate agents as sharks--myself included before I became one--many of them are just trying to do their job, just like you.
One co-worker, a native New Yorker in his 60s with a penchant for corduroy, would sit me down and explain to me what each Brooklyn neighborhood was like throughout his lifetime. It was no shtick; he wanted everyone to enjoy living in the borough as much as he did.
Another salesperson was a mother with a teenage son, already working one full-time job. She would take a client to 15 apartments, and after they didn’t like any of them, come back to the office at 8 p.m. and start looking for others they might like.
Of course, it was fun to check out townhouses in Park Slope, airy two-bedrooms in Williamsburg, and gargantuan apartments in Ditmas Park, imagining what it was like to live in each one.
But it was hard to imagine living in a $2 million home when you consider two slices of $1 pizza a splurge.
I was able to successfully rent only one apartment (working during the notoriously slow winter season didn't help). It was for a surprisingly easy client, and it was the first apartment I showed her. With a monthly rent of $1,300, I brought home around $750: a decent percentage of the rent and a great amount for only working with the client a couple of days, but certainly not enough to make up my only income for weeks.
Just weeks after depositing my first and only commission check, I accepted an offer to work in a salaried position as an editor--far preferable to unreturned phone calls and spending hours posting ads. And far from looking back with regret, my stint as a rental agent in one of the country's toughest rental markets made me appreciate the value of a regular paycheck, a 9-to-5 schedule and a more structured occupation.