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To get a commercial real estate license, you will first need to meet the requirements for licensure in your state. Next you’ll have to take and pass the exams that are specific to your field of interest. Finally, apply for licensing!
The “how to get your commercial real estate license” is a guide that walks you through the steps of getting your real estate license. It also includes links to websites and resources that will help you along the way.
Agents with a commercial real estate license earn twice as much as those with a residential license, with many earning six and seven figures. This is due to the fact that commercial properties are more expensive and transactions are more complicated. However, to satisfy the demands of landlords and lessees, this specialty requires extra skills and expertise, which may increase the need for commercial agents.
While everyone’s path to commercial real estate success is different, this book will walk you through the initial stages and the essential skills you’ll need to get started.
1. Take all required courses in your state
All aspiring real estate agents, whether residential or commercial, must complete the same licensing courses as residential real estate brokers. While state requirements vary, most need 60 to 120 hours of study followed by a state-administered test.
Residential sales and leasing, fair housing regulations, kinds of real property ownership, commercial real estate, and other national and state-specific subjects are all addressed in these courses. The majority of the courses are comparable to those offered in a community college.
Depending on your state and the format you choose to take the course in, you may expect to spend anywhere between $150 and $900. Live courses or intensives, as you would expect, are more costly than online or study-at-home courses.
Here’s a short rundown of the courses required to get a real estate license in the country’s six major states:
If your state isn’t listed here, or you want to learn more about real estate licensing courses, go to Real Estate Express, which offers a variety of low-cost courses to help you meet state licensing requirements, as well as exam prep and professional resources to help you prepare for the next step in your real estate career.
Start your real estate education now with a special deal from Real Estate Express for our readers. Use the code FSB25 to get a 25% discount on your order.
2. Get Your Commercial Real Estate License by Passing the Exam
You must pass your state’s licensing test after completing the training necessary in your state to be eligible for a real estate license. Exams are usually given by your state and consist of 75 to 150 multiple choice questions covering the subjects covered in your license course.
Did you know: While the examinations are not very tough if you prepare diligently, pass rates typically range from 50% to 60%. You should seriously consider purchasing a real estate exam prep bundle or real estate practice exam software to assist you prepare more effectively if you want to ensure that you pass your test on the first attempt.
After you’ve completed your exam, you’ll likely have to wait a few days to a few weeks to obtain your results and, eventually, your license.
3. Work for a Commercial Real Estate Brokerage
You may now pursue a profession in residential sales or leasing, commercial sales or leasing, appraisal, or property management after passing your exam and receiving your real estate license. However, before you can legally and effectively start working as a commercial agent, you must first locate a sponsoring brokerage that can provide you with the necessary experience.
There are two tried-and-true methods for doing so:
Option 1: Look for rental and sales teams.
Because obtaining your first transaction in commercial real estate might be more difficult than getting your first deal in residential real estate, you may want to start with a business that permits you to do both. Rentals in a big city like New York or San Francisco may be a very profitable and rapid way to make money while you build your commercial real estate expertise and customers.
This is due to the fact that a business lease might take months to complete, but most residential leases are completed in less than a week. As a result, a brokerage that handles both residential and business transactions can provide you with rapid cash to pay your rent and buy groceries while you wait for your first commercial sale.
Only a few brokerages are equally divided between commercial and residential sales and leasing, which is a little disadvantage. The majority are either entirely or mostly residential, or entirely or primarily commercial. That implies that although you may get a faster and simpler source of income, you are unlikely to learn from a seasoned commercial broker.
Option 2: Seek for firms that provide a salaried training program.
Joining a commercial real estate firm with a training program for new associates is the second approach to begin your career in commercial real estate. In general, most training programs run a year or more, and some brokerages pay their students, so there’s no need to rush to find transactions right soon.
The main disadvantage is that brokerages that provide paid training programs are more selective in who they employ. This might result in a prolonged job search and, even worse, a lower-than-expected training salary. As a trainee, you might earn anywhere from $30,000 to $45,000 per year depending on your region, talents, and the organization you’re applying to. Many training programs are free of charge.
More information on how to pick a real estate firm to work for can be found in our post on how to choose a real estate company to work for.
4. Become a member of trade organizations.
While not all states need agents to join a professional organization, many brokerages do as a condition of employment. This is due to the fact that these organizations provide its members more reputation in the marketplace. This is also a smart idea since each organisation provides distinct networking and continuing education opportunities, as well as savings on software and services you could need.
The following are a some of the most well-known commercial agent associations:
Salaries for Commercial Real Estate Agents
Residential real estate agents earned an average of $41,800 in 2018, according to the NAR member profile. However, in 2018, a commercial real estate agent’s typical gross yearly salary was $153,000. While earning potential in both residential and commercial real estate is solely limited by one’s ability to work hard, commercial real estate has much greater median wages.
Although the figures clearly indicate the huge disparity in median wages between residential and commercial real estate agents and brokers, there are a few crucial considerations to remember:
- Residential real estate professionals’ median earnings might be skewed: The average wage is being dragged down by a significant number of new and part-time agents. As you would expect, a brand-new agent working only on commission will not earn nearly as much as an experienced agent. Similarly, a residential agent who works 20 hours per week would not earn as much as one who works more than 60 hours per week.
- Professionals in commercial real estate have greater experience: There are much fewer brand-new commercial real estate brokers operating in the sector since the barrier to entry is greater. Part-time commercial real estate agents and brokers are likewise scarce.
- Commercial real estate professionals work full time: Most commercial agents work at least 40 hours per week as a rule of thumb.
- A commercial real estate agent’s starting compensation is as follows: Many first-year commercial real estate agents start off as salaried workers. As individuals go up the corporate ladder, they will either be paid on a salary and commission basis or on a pure commission basis. Almost all residential real estate agents, on the other hand, operate only on commission.
- Commercial real estate is more costly: Finally, commercial real estate has substantially higher median sales prices and rentals than residential real estate. As a result, commission checks will be larger.
Is a Career in Commercial Real Estate Right for You?
Before you even consider enrolling in real estate seminars or deciding on a brokerage, you must first examine your present abilities. Consider your soft talents—your personality type and strengths—as well as your hard skills and experience when considering a job in commercial real estate.
While residential real estate may not be for the faint of heart, commercial real estate sometimes requires gravity and bravery simply to get a foot in the door. Clients and transactions are lot more difficult to come by, and the competition is far more knowledgeable and aggressive. To succeed in commercial real estate, you must have confidence and perseverance.
Marina Filichkina, Head of Sales at Tranio, a multinational commercial real estate business, discusses the value of trust:
“We search for those who have true confidence first and foremost.” I’m not talking about arrogance; I’m talking about self-assurance based on experience and in-depth industry knowledge. Simultaneously, we seek for salesmen who know when to seek assistance from or defer to their superiors and more experienced colleagues. You can typically tell if someone has the kind of true confidence it takes to be a top-notch salesman the minute they step into the room.”
The following are some questions to ask yourself about your soft skills:
- How sure are you of yourself?
- How would you feel if you had to make 200 cold calls a day?
- Is it thrilling to imagine strolling through a neighborhood and knocking on every single business’ door?
- Try knocking on the same door again a week after the owner smashed it in your face.
A career in commercial real estate could be for you if this seems like a challenge rather than pain.
Persuasion and relationship-building abilities, in addition to confidence, are crucial soft skills for working in commercial real estate. Is it simple for you to persuade others to open up to you? Are you the sort of person who can strike up a conversation with the new barista at your neighborhood coffee shop fast and easily? If that’s the case, you may possess one of the essential soft skills that most commercial real estate brokers seek in new colleagues.
How to Obtain Employment as a Commercial Real Estate Broker
While a dazzling personality and a 1,000-watt grin could nearly secure you a job in residential real estate, commercial real estate brokerages are more selective when it comes to new hiring than their residential counterparts.
There are two compelling arguments for this. To begin with, commercial real estate transactions are more complicated and take more skill to locate and complete than residential real estate transactions. Second, many commercial real estate businesses offer entry-level associates a wage while they learn the ropes, due to the very steep learning curve.
When it comes to interviewing prospective agents, commercial brokerages look for a few things:
Relevant Academic Experience
While a degree isn’t required, many bigger commercial brokerages will not hire new associates without a four-year college diploma. If your degree isn’t from a tier-one institution, you can have problems finding a position at the biggest, most successful businesses like CBRE, JLL, or Cushman & Wakefield.
Furthermore, since commercial real estate requires a lot more behind-the-scenes research, many brokerages prefer individuals with four-year degrees in business-related subjects. High-level math and financial abilities are valuable advantages in the area.
Professional Background
Many top commercial brokerages want for people having professional experience in high-pressure, numbers-driven professions in addition to a four-year degree in a related discipline. You’ll obtain more interviews at prominent businesses if you’ve worked for an investment bank in residential real estate, property management, recruitment, engineering, architecture, or law.
Cultural Compatibility
The commercial real estate industry still trails behind much of corporate America, with a median age of 60 and a 73 percent male workforce. You may be surprised to learn how buttoned-down and testosterone-filled many commercial brokerages are if you come from a younger, more laid-back organization.
If you are concerned about working in this kind of setting, do your homework before accepting a job offer. For assistance with this phase, see our guide on the questions you should ask while interviewing brokerages.
Conclusion
While obtaining a commercial real estate license results in a higher median income, it is not for everyone. In this competitive, fast-paced sector, special knowledge, training, and attributes are required to succeed. With the correct skills and education, you, too, may one day sell, acquire, or lease some of the world’s most valuable real estate.
The “is a commercial real estate license different” is a question that many people may ask. The answer is no, the license is not different. It’s just the same as any other type of license,.
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