Almost half of American real estate agents struggled to make rent in the second half of 2023. Is this the best time to enter the industry?

A recent report from Alignable, which tracks the state of the U.S. economy, found that 45% of self-owned real estate agents had difficulty paying rent in November. It's no secret that the real estate industry has struggled for much of this year, but will that open doors for you?

Even in a down market where there seems to be little upside, those who are prepared to enter at the right time and have a well-thought-out plan for success are often rewarded in the end. It's not easy, but making good money is never easy. Benzinga looks at how and why you can turn this situation to your advantage.

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Choose your location and industry carefully

When you hear that the real estate industry is struggling, remember that the United States is large and there are several sectors of the real estate industry. Even when the majority of markets and industries are struggling, there are always sectors and markets that are popular. Bigger markets like Los Angeles and San Francisco are certainly facing challenges, but this country is bigger than that.

Check out Zillow's top 10 real estate markets for 2024. You might be surprised by what it contains. Buffalo, New York, tops the list, followed by Cincinnati and Columbus, Ohio. You'll also see a lot of other Midwestern and Southern cities that you weren't expecting. Do you live in one of those areas? They're at the top of the list because they have a lot of affordable housing, and that's what Americans want more than anything these days.

There may be a shortage of agents compared to the number of people wanting to buy or sell in these markets. If so, now is the perfect time to get into business and consider how you can benefit from the rapid growth of these markets. Also, consider that real estate licenses are issued at the state level. This means you may be able to trade in markets other than where you live or are licensed.

Sectors to avoid

America's commercial real estate sector faces significant challenges. For years past, renting office space or representing commercial buildings has been lucrative for high-performing agents, and will continue to be so. However, office vacancy rates are currently at record highs, a trend that is expected to continue until at least 2024. So, regardless of your location, it can be difficult to jump into the commercial sector.

Requires time, money, and careful planning

Real estate agents and brokers typically work as independent contractors, and most brokerages employ agents on a flat commission basis. This means that you will not be paid unless the transaction is completed. Because of this, becoming a full-time real estate agent is usually a transition over time.

Unless you have residual income, you'll likely need to work on the side until you can support yourself as a full-time agent. It's also important to consider that in addition to a real estate license, there are other costs such as liability insurance and membership in a local real estate agent association.

To get an estimate of these costs, talk to an agent in your area or a broker at the company you want to work for. You should also set aside enough time to study for and pass your real estate license exam. Depending on state requirements, the schooling and licensing process can take several months.

If you succeed, you can become big.

Don't get me wrong, real estate can be a difficult profession. However, as with all things, the degree of risk increases with the upside potential. Successful real estate agents can make huge amounts of money in a relatively short period of time. You'll also get an inside look at the world of real estate investing and how to invest the proceeds into your own little real estate empire.

That has always been the appeal of the real estate game. It's high risk and high risk. If such opportunities energize you, you may find that 2024 is the perfect time to transition into a career in real estate.

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