Exploring Side Gigs 101: Is Real Estate a Good Side Hustle?
So, you've caught the real estate market bug and wonder if dipping your toes in the real estate and property management waters can add some zeros to your bank account. We get it; the allure of the real estate world is undeniable, especially when we hear tales of those colossal commission checks.
But what's the real story regarding many real estate side hustles? Let's examine the earnings you can get in this exciting market.
How Can I Make Extra Money in Real Estate?
The real estate world is as vast as it is exciting. Even if you're just stepping onto this playing field, there are countless opportunities to earn extra cash.
The key to real estate investment success is understanding your local market. Know the neighborhoods, the property values, the expected rents, and the demand.
Once you have a broader understanding of your market, you can choose the areas that fit you best. For example, you can start as a real estate agent and offer properties for rent or sale.
The Main Real Estate Roles You Can Pursue
Real estate is vast and offers a multitude of career opportunities. Let's dive into some of the most significant roles in the sector:
Real estate agent/broker: Agents assist clients in buying, selling, and renting properties. Brokers are licensed to manage their own real estate businesses.
Commercial real estate agents: They focus on commercial properties like offices, retail spaces, and warehouses.
Real estate appraiser: Appraisers estimate the value of properties. This is vital for sales, investment, taxation, and loans.
Property manager: These professionals manage rental properties, handling everything from finding tenants to maintenance.
Leasing agent: Leasing agents work on behalf of landlords to find tenants for vacant rental units, whether in residential or commercial spaces.
Real estate developer: Developers buy land, finance deals, build or have builders construct projects, then sell or lease the properties.
Real estate consultant: Consultants advise on property investment, market trends, and property management.
Real estate photographer: Specializes in photographing properties in their best light for listings.
Is real estate a suitable side hustle for beginners?
For beginners considering real estate as a side hustle, starting with clear goals and a willingness to learn is crucial. Real estate can be a suitable side income for beginners, but it depends on the individual's desire to learn, initial capital availability, and risk tolerance.
Real estate investing might not be suitable if you're looking for quick, easy money. But if you're seeking long-term wealth-building and are prepared to invest time and resources, real estate can be incredibly rewarding.
While the industry offers diverse entry points and the potential for significant returns, it also comes with a learning curve and requires a considerable time commitment. Beginners should approach it with caution, conduct research, and seek mentorship from experienced real estate investors and other professionals.
Pros of Real Estate as a Side Hustle
Real estate as a side hustle can be a strategic move. Whether you're looking for monetary benefits, a potential future career, or merely the thrill of the deal, real estate offers a world of opportunities.
These are the main advantages you can get as a real estate agent:
Flexible work hours
Unlike many side hustles that require specific hours, real estate offers adaptability. You can schedule property showings, meetings, and open houses during weekends or evenings, aligning your extra income activities with your day job.
Diversified income stream
Putting all your financial eggs in one basket in an unpredictable economy can be risky. A serious real estate investment business offers an additional income stream, acting as a financial pillow. Even a single successful transaction per month can substantially supplement your primary income.
Learning while earning
Real estate provides a platform to develop valuable skills—negotiation, market analysis, and customer relationship management—all while making a profit. This dual benefit can be especially appealing for those keen on self-improvement without sacrificing earnings.
Minimal initial investment
Unlike starting a full-blown business, the real estate industry requires a relatively low initial financial investment. Licensing fees, some marketing costs, and continuous education are the primary expenses, offering a lower barrier to entry.
Test the waters
Are you considering a full-time real estate career but unsure if it's right for you? Taking it up as a side hustle offers a low-risk environment to assess your passion and aptitude for the field before making a more significant commitment.
Cons of Real Estate as a Side Hustle
While real estate as a side hustle has its allure, entering it with eyes wide open is essential. It's not just about showing beautiful homes or closing lucrative deals; it requires patience and significant time investment.
These are the main cons of a real estate side hustle:
Real estate doesn't always work around your schedule. You may need to handle a client's urgent request or negotiate a deal during your main job's hours, leading to conflicts and stress.
Real estate isn't a plug-and-play side hustle. Acquiring a real estate license, understanding the market dynamics of rental properties, and building a network require significant upfront time, which can be taxing when juggling a primary job.
Slow financial returns
Unlike some side hustles with immediate returns, real estate might require months to secure your first commission. There's an ebb and flow to income, which can be frustrating when balancing expenses.
The real estate market can be volatile. Economic downturns, changes in local job markets, or even global events can influence property prices. This unpredictability can be particularly daunting for side hustlers without the bandwidth to constantly monitor the market.
How Much Money Do Real Estate Agents Make?
Most real estate agents, whether full-time or part-time, operate on a commission basis. This means their earnings are directly tied to the sale price of the properties they handle. Typically, a property sale involves a commission of around 5-6%, which is then shared between the buyer's and seller's agents and divided with their respective brokerages.
The average income of a real estate professional
Based on the list we provided above, we can mention that real estate professionals in different roles make:
Real estate agents: According to the U.S. Bureau of Labor Statistics, in May 2022, the national mean wage for real estate agents hovered around $31.66 per hour, translating to a tidy $65,850 annually.
Commercial real estate agent: Potential income varies widely, but many commercial agents earn more than their residential counterparts, with six-figure incomes common.
Real estate appraiser: In 2019, the median annual wage was around $57,010. Experienced appraisers or those in high-value markets can earn considerably more.
Property managers: The median annual salary was approximately $58,760 in 2019, which can increase with more extensive property portfolios.
Leasing agent: Base salaries often range from $30,000 to $45,000, but one can earn considerably more with commissions.
Real estate developer: Highly variable. Some earn modest incomes, while successful developers can achieve millions or even billions over their careers.
Real estate consultant: Income can vary, but seasoned consultants charging hourly rates or a percentage of the property deal can earn six-figure incomes.
Real estate photographer: Earnings vary based on market demand and quality of work, but it's possible to earn between $30,000 to $100,000 or more annually.
Other Side Hustle Ideas to Maximize Your Income While You Learn Real Estate
If you want to find supplemental income ideas related to Real Estate or prefer to try something different, the following options can be rewarding and easy to handle as a side hustle.
Paid surveys: We highly recommend ForthRight. Its user-friendly interface, combined with its consistent payout record, makes it notable. Just sign up on their platform to start completing surveys. Make the most of your free time and get started with online surveys. It's the perfect side hustle to complement your real estate ventures!
Sell your data: While sharing your browsing habits might seem unconventional, platforms like Survey Savvy and The National Internet Observatory have legitimized the concept. These aren't just any data collectors. So, if you're in the real estate sales sector and seeking a side hustle that requires minimal effort, why not monetize your online presence? Your browsing data can provide valuable insights and earn you some extra cash.
Money is Calling Your Name!
So, you've taken a stroll through the exciting world of real estate side hustles, and let's be honest—it's tempting, right? Every door you open could lead to a treasure chest of opportunities.
Sure, there might be a few bumps along the way, but imagine the thrill when you strike gold! So, if you hear the distant chime of coins and the whisper of dollar bills, it's time to pick up the phone. Why wait?
Don't stop here; more valuable insights are up next on DataRich!