Career Overview: Real Estate

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Posted by The Editors on December 3, 2012
Overview
As you drive your Range Rover up the New Jersey Turnpike through Sopranos country, you glance up beyond hundreds of acres of landfill and see the lone pencil of the Empire State Building glinting in the distance. You think to yourself, "This is the perfect place for a golf course and housing development-a refuge for hundreds of golf-starved New Yorkers, with homes on the links minutes from Manhattan. And to round it out perhaps some light industrial space. . . ." Your mind races with plans for how to put it all together-government permits, environmental impact reports, financing, a top-tier architect, master contractor, sales agents, and brokers. You get home and tell your girlfriend, swearing her to secrecy. Bad news, she tells you, your project is already underway. Undaunted, you start thinking about the next opportunity.

Everything we do, commercial and personal, real and virtual, requires space and therefore the land on which space sits. The real estate industry is powered by agents who work in concert to make land available-physically, legally, and financially-for every imaginable human need.

This real estate profile focuses on careers in real estate sales, development, and asset management. See WetFeet's Sales and Asset Management Career Profiles for more information about other opportunities.

What You'll Do
Real estate consists of land and the natural resources and permanent buildings on it. Real estate agents, brokers, asset managers, assessors, property managers, and developers perform a wide variety of tasks, from buying, selling, renting, and leasing, to assessing, developing, and managing land.

Agents and brokers bring buyers and sellers together, acting as intermediaries in the sale of properties. Most agents and brokers work with residential properties such as houses or condominiums, though some focus on commercial properties such as office complexes or retail space.

Appraisers make sure that buyers are not overpaying for properties and that lenders lend the correct amount of money. Appraisers who work for local governments may carry out tax assessments and research facts and statistics in order to assign a value to a property. Independent appraisers are typically contracted by banks, governments, businesses, and mortgage lenders to assess property values.

Property managers maintain investment property for owners, overseeing a property's everyday operations, whether it's a commercial, industrial, or residential building. Real estate asset managers are property managers who act as a property owner's agent and adviser. They focus on long-range financial planning rather than everyday activities. Many asset managers work for pension funds, life insurance companies, real estate investment trusts, and other organizations that invest in real estate.

Developers and asset managers invest in and improve land to create a supply of real estate that they anticipate will meet the needs of a population's commercial and residential endeavors. Real estate developers specialize in residential or commercial property development, from buying land to constructing the buildings. Franchise and chain businesses, such as fast-food restaurants, grocery stores, and retail chains, often employ in-house real estate specialists to select and develop new properties.

Who Does Well
If you have the right skills and are undaunted by the vicissitudes of the industry, real estate can afford a phenomenally challenging and rewarding career. People skills are paramount in real estate. Everyone, from brokers to investment fund partners, relies on the relationships they forge throughout their careers to find clients and understand the subtleties and caprices of the market. Project management skills are as critical to the tasks of ongoing asset and property management as they are to coordinating large-scale deals. Finally, people who endure in the industry have the fortitude to see themselves through the famine of down markets.

Most real estate professionals work independently, contracting their services. Those who succeed in real estate are generally ambitious and entrepreneurial. Real estate brokers and agents need to be familiar with the communities and home prices in their area, to find homes that will best meet their clients' needs. Those who succeed are able to network, form connections, and get things done quickly. Creativity, unconventionality, and social skills are also important. Appraisers need analytical minds. Property managers need to be organized, resourceful, and diplomatic, because they often oversee more than one property at the same time and regularly deal with residents, prospective tenants, and maintenance staffs. Virtually all real estate professionals need to know zoning laws and regulations, as properties and property transactions are heavily regulated. Requirements
Real estate agents and brokers must have a deep understanding of local tax laws, zoning regulations, school districts, contracts, building repair, utilities, transportation, business, architectural styles, and much more. They must know how to use computers. The Internet in particular is a growing part of the real estate trade. People are increasingly using it to buy and sell houses, and a real estate professional who is not Web-savvy will be left in the dust.

Licensing
All 50 states require real estate agents and brokers to be licensed. To get a license, a prospective agent must be 18 years old, hold a high school diploma, and pass a written test. Most states also require prospective agents to complete courses in real estate. Brokers need between 60 and 90 hours of class time plus 1 to 3 years of experience selling real estate as an agent or a bachelor's degree in real estate. As transactions become more complex, more firms are looking to hire college graduates. Classes in real estate, business, statistics, and economics will give you a competitive edge.

All 50 states require appraisers to be licensed. There are national organizations that offer real estate appraisers professional certification in residential appraising, commercial appraising, and agricultural appraising. Appraisers often start their real estate careers as real estate agents, where they acquire vital knowledge about the market. However, it's increasingly common for college graduates with course work in business, economics, finance, architecture, law, or engineering to enter the appraisal profession directly as appraisal assistants.

Other Requirements
Property managers often go further if they hold a college degree in business, accounting, finance, or real estate. Many property managers enter the industry as real estate agents, a career that offers helpful experience in showing properties and in understanding the ins and outs of the industry's laws and regulations. Those who wish to pursue careers as asset managers should take courses in finance, taxes, and real estate in general.

Developers should have a strong understanding of business in general and the real estate industry in particular. A college degree with course work in architecture, labor management, business, law, economics, and engineering is helpful, if not necessary. Most developers have previous real estate experience, but they can also enter the field as assistants working for development firms. Job Outlook
Unlike much of the rest of the economy, the real estate industry has been doing quite well. Though the robustness varies between sectors, with the residential side of real estate doing best, the industry is hardly in the hangdog state that nearly every other part of the economy has been in.

Nevertheless, without solid connections in the industry, you may have a hard time establishing yourself. Real estate veterans rely on the advice of contacts to help make recruiting decisions. Rather than using traditional recruiting processes, firms often bring on new talent through personal networks and word of mouth. It's even harder to break into the elite club of real estate investment finance.

If you don't aspire to join the elite ranks of real estate investment management, you still have before you a wealth of rewarding positions in property management, real estate services, and residential brokerages, as well as very challenging development roles in corporate real estate. Beware though: Skills in one real estate market aren't necessarily transferable to other markets. Select your location carefully. And once you're in, be prepared to ride the roller coaster of a cyclical industry. Although the real estate industry is in a protracted boom period right now, veterans assure us that busts will come, and those busts won't be pretty. Career Tracks
Real estate isn't a single career, but a number of activities involving property transactions. The following descriptions of career tracks provide a general overview of the roles those going into real estate might choose.

Real Estate Agentsand Broker Salary
agents and brokers sell other people's property for a commission. They generate lists of available properties, determine competitive and fair prices for properties, learn as much as possible about a property's features (e.g., whether a home has a garage or is close to a school), market them through advertisements and open houses, meet with potential buyers, show homes to clients, help buyers finance their purchases, and assist in drawing up contracts. The primary distinction between sales agents and brokers is one of licensing. Brokers have typically undergone a more rigorous licensing process that requires greater work experience, training, and examination than that of the agent. Unlike agents, brokers can practice real estate independently.

Appraisers
Real estate appraisers estimate the value of properties for taxation or valuation purposes using a series of standard methodologies. They gather statistics and information about the property, using blueprints, records, and survey drawings. Though they are relatively immune to the cycles of the industry, appraisal positions are somewhat insular within the industry and don't offer the mobility across functions as do other positions.

Most appraisers specialize in either residential or commercial property. Residential appraisers generally determine mortgage rates or work with corporate relocation firms. Commercial appraisers counsel their clients on buying versus leasing properties, help building owners determine market rents, analyze their investments, and appeal property-tax assessments, in addition to determining mortgages on commercial properties such as restaurants and car washes.

Property Managers
Property managers manage and lease properties for owners. Their day-to-day duties include a broad spectrum of activities: leasing or managing the leasing out of property to tenants, handling tenant complaints and relations, maintaining building occupancy levels, maintaining desired lease rates, preparing reports for property owners, preparing budgets, hiring service employees, collecting rents, paying bills, negotiating contracts, and maintaining and repairing property. Most people starting out begin as on-site managers. With experience, on-site managers can become assistant property managers. Property managers are gradually given charge over more complex properties.

Many people transfer from property management to asset management. Asset managers help an organization make decisions about purchasing, developing, and selling properties. They assess property values, research taxes, zoning, and population growth, negotiate contracts, and review holdings to determine which properties are no longer turning a profit.

Corporate Real Estate Managers
Corporate real estate managers are professionals who work for large businesses such as Krispy Kreme and McDonald's, picking sites that provide maximum visibility and population density. To be successful, corporate real estate managers must know a great deal about a company's products and customers. They should also understand zoning, utilities, building codes, and market values.

Developers
Real estate developers oversee the entire process of developing and building a property, from buying the land and preparing it for development to hiring architects to saying yea or nay to the color of the carpet. Developers come up with estimates of the time and money required to complete a development. They manage the labor force involved, help locate equipment and workers, and bring the construction plan to life. Developers usually start out in entry-level jobs at development firms and work their way up.

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