Garden State Real Estate Academy wants to be the best real estate school in New Jersey and Pennsylvania. To do so, we not only teach the essentials for getting a new real estate license; we also take advantage of the vast experience our highly successful real estate agents turned superstar instructors. With their expertise, you can learn exactly what makes a good real estate agent and how to carve out your own corner of the real estate market.
If you are looking to jump into the real estate industry by getting your New Jersey real estate license or Pennsylvania real estate license, we’re the real estate school nearby to help!
Once you are a qualified real estate agent in the state you wish to operate, you don’t have to limit yourself to the local real estate market. You can actually expand your horizons far beyond the state in which you hold a real estate license.
Real Estate Referrals: How Do They Work?
According to real estate law, you can only take an active role in a real estate transaction (buying and selling real estate) in the state where you are licensed. However, the best real estate agents think outside of these limitations. In fact, you can earn a referral commission by helping friends, family, and clients find a great real estate agent anywhere in the country.
Say you hold a New Jersey real estate license. Your brother in North Carolina tells you he is moving to Florida, but is unsure how you can help. Well, you can help by finding great real estate agents in both his current location and his future location! With your broker’s approval, you can then arrange for those other real estate agents to pay you a referral fee when one sells your brother’s home in North Carolina and when the other finds him a new home in Florida.
Let’s look at some examples of some of my own successful referrals:
Debbie was a buyer of mine in New Jersey. While attending the inspection of the new home I had helped her buy, she introduced me to her dad, who would be living in the in-law suite. In the small talk that followed, Debbie’s father mentioned he currently lived in Arizona and was planning to return the following week to find a Realtor® and put his home on the market.
I asked if he had a real estate agent in mind to list his home, and he rolled his eyes and said that was the task he was not looking forward to once he returned home. I then asked if he would like me to help him find a good agent licensed in Arizona who had a great track record of selling homes like his, and he said how grateful he would be if I could do that.
As it turned out, Debbie’s dad lived in a 6,000-square-foot home in a luxury suburb of Scottsdale. I called my company’s office in Scottsdale and asked the broker who the best two agents were with expertise in that neighborhood. I then spent an hour interviewing each agent, asking them such questions as:
- How many homes in this price range have you sold in the last year?
- What is your ratio of homes listed to homes sold?
- What specific marketing plans do you use?
- What is your average ratio of list price to sold price for homes you have sold in this neighborhood?
- And so on
I called Debbie’s dad and gave him my report, suggesting that one – Elise – seemed to have the edge, in my opinion. I followed up by sending Elise the seller’s name and contact details after she and her broker had signed a referral agreement giving us a 25% share of her ultimate commission. Of course, I disclosed this to Debbie’s father.
Truthfully, I then completely forgot about it! Three months later, out of the blue, I got a commission check from the Arizona broker for my share, which was $4,900.
Not bad for an hour’s work.
James was my seller. He was an airline captain. As part of the seller consultation, real estate professionals should always inquire as to why the client needs to sell. In James’s case, it was because he had been promoted to training captain at the United Airlines training center outside Chicago.
As an experienced agent, my next question was whether he had found a new home there. He replied that he and his wife planned to fly out the next weekend to look around. I asked if it would save him time if I found him a real estate agent in the Chicago area and he enthusiastically said yes. This would enable James to communicate his needs to the agent and have a series of potential homes lined up to hit the ground running.
After interviewing three agents, I found one who was not only very competent and knowledgeable in the area, but his wife was a United flight attendant!
My commission was $3,825.
Lucille is a real estate agent in Bangor, Maine. As I pulled out of my driveway one day en route to a speaking engagement in Monmouth County, she called to introduce herself. Her boyfriend’s parents had a $3 million home on the Jersey Shore and had just ended a frustrating experience where a local real estate agent had made a lot of unfilled promises and had been unable to find a buyer during their six-month listing. Lucille said she found me because my profile had shown that I specialized in luxury homes and was a member of my company’s luxury homes division.
I felt like Lucille was in the Spanish Inquisition! For one hour she grilled me on how I market my listings and what specifically I would do for these sellers. She obviously could not afford to recommend an agent to her future in-laws who would be as bad as the last one. As I arrived at my destination, the interview ended and the following day, she sent me the referral form.
The house sold in less than a month. I was only too happy to pay a 25% referral fee for a $3 million sale which I otherwise would never have known about without Lucille’s call.
Perhaps my favorite example of a referral that ends with everybody grateful was with the music director of the local Presbyterian church, Angela. After selling her home, I asked where she would be going and she said she wanted to find a home in West Virginia. Again, I asked if she would like me to find a good local agent, and she gladly accepted.
As I told the sales manager of the Charleston office about my client, he said that his #2 agent was music director of the local Presbyterian church! The agent and I had a great conversation and I knew he was the right real estate agent to refer to Angela. Before she had finished her first home inspection trip to Charleston, he had recruited her to be his assistant music director. Talk about a match made in heaven!
It’s Not Just About the Money
On average, I probably earned $15,000 a year in referral fees for outgoing referrals such as those I described above. This is all incremental income for real estate agents! You can talk to agents who have been licensed for 20 years and will discover they have never made a single referral during their real estate career. What a wasted opportunity!
But I don’t want to over-emphasize the money. As Realtors®, our primary goal is to provide a service for our clients. Each one of those referrals was for a client who was really grateful for my role as matchmaker.
When you get your new real estate license and put together your contact list, don’t just include names of people in your immediate vicinity. Think of the whole world – or at least, the United States – as your territory!
If you are thinking of getting your real estate license, Garden State Real Estate Academy is the top-rated real estate school in New Jersey. If you need a license to buy and sell real estate, you can choose from daytime or evening classes at www.GSREA.com and click on “Salesperson” licensing classes.
For information on the Garden Real Estate Academy’s upcoming New Jersey licensing classes, click here: https://www.gsreacademy.com/pre-licensing-courses/
If you need to earn a real estate license in a state other than New Jersey, Garden State Real Estate Academy also offers online self-study real estate licensing classes in 21 states through our partnership with The CE Shop. And while New Jersey does NOT allow self-study pre-licensing classes, we do offer self-study pre-licensing classes other states, which you can find by clicking here: https://gsreacademy.theceshop.com/pre-licensing.
David C. Forward is a licensed real estate broker and instructor who was first licensed as a Realtor® 34 years ago. During his career, David and his business partner sold more than 500 homes in South Jersey and David has won numerous awards for real estate sales. He is now School Director of Garden Real Estate Academy and a much-requested public speaker who has addressed audiences on six continents. His 20th book, Zero to Hero: Winning Strategies for New Real Estate Agents to become SuperStars in Their First Year, was released this month.