Thinking about becoming a real estate agent in Iowa? Getting your license and starting your own business is both exciting and daunting. There’s so much to learn about the licensing process, finding a brokerage, generating leads and building your business from the ground up.
We get it. Our team has helped hundreds of new agents get started in real estate, which means we’ve answered a lot of questions about how to get licensed and get started. To help you learn more about becoming an Iowa real estate agent, we’ve compiled the top 10 most frequently asked questions we receive. This includes everything from how to get licensed to getting started as an agent to generating leads.
Your Top 10 FAQs About Becoming an Iowa Real Estate Agent
Let’s dive into your top 10 FAQs! Do you have a question you don’t see answered here? Feel free to reach out to find out more about getting your real estate license and becoming an Iowa real estate agent.
1. How do I get started as a real estate agent?
Before you can act as a real estate salesperson, you need to have an Iowa real estate license. Licenses are issued by the Iowa Real Estate Commission (IREC) through the Iowa Professional Licensing Bureau (IPLB). There are nine steps to become a licensed REALTOR® in Iowa:
- Submit your background check to the IREC.
- Interview brokerages.
- Complete the 60-hour pre-licensing course.
- Pass the state real estate licensing exam.
- Complete the three additional 12-hour courses.
- Commit to a brokerage.
- Sign up for E&O insurance.
- Complete your license application.
- Join your local MLS and REALTOR® association.
All of these steps must be completed for you to become a licensed REALTOR®.
We recommend interviewing brokerages early on in the process, not only because it takes time to set up meetings and decide which one is the best fit for you, but also because the brokerage you choose can help guide you through the licensing process.
If you’re still not sure if real estate is right for you, or just want to know more about working as an agent, reach out to brokerages to set up informational meetings. These are great opportunities to ask questions, learn more about compensation plans and find out what a day in the life of an agent looks like.
Once you’ve completed all nine steps and your license is issued by the IREC, you can actively work with buyers and sellers.
Looking for more information about the licensing process? We broke down all nine steps for a complete guide to getting your real estate license. Click the button to learn more.
2. How long does it take to get licensed?
The licensing process can take quite a bit of time. From submitting your background check to submitting your application, it can take 3-12 months to get your license. Each step of the process varies in how long it takes to complete and it depends on your other commitments, flexibility and availability.
The background check takes the longest at 8-10 weeks as the search goes through the Iowa Division of Criminal Investigation, the Federal Bureau of Investigation, Iowa Courts Online and the Iowa Sex Offender Registry. But it does not need to be complete for you to work on the other steps which is why we recommend submitting it as soon as you start the licensing process.
Course completion time varies, depending on where you take your classes and how (in-person or online). You could complete all education requirements in as little as two weeks or as long as six months.
Interviewing brokerages takes as long as you want it to take. You may interview one brokerage and feel like they’re the best fit right away or you might take the time to interview everyone in town. It’s really up to you!
Be prepared to invest time in the licensing process. Some people do this while working a full-time job while others jump headfirst into it. Do what’s best for your schedule and personal situation.
3. How much does it cost to become a real estate agent?
Getting your real estate license is both an investment of your time and money. Start-up costs can be high, especially for those new to the industry so it’s important for you to know as much as possible.
Although it can take 3-12 months to get licensed, you’ll soon discover the fees associated with each step will add up quickly. If possible, we recommend continuing to work during the licensing process in order to cover the cost.
Fees can vary but you can expect to pay about $1,575-$2,300 to get licensed. Your total may vary depending on your course provider, if you purchase additional study materials for the exam, if you take the exam more than once and what your local REALTOR® association charges for dues and entrance fees.
Common Real Estate Agent Expenses
The most helpful thing you can do for yourself as you start your career in real estate is to budget. The costs don’t stop once you have your real estate license- in fact, they’ll keep adding up. Real estate agents should expect to shoulder a lot of business expenses, even if some are covered by their brokerage. We recommend new agents have at least six months of savings to live off of when they first get into the business.
Annual business expenses vary, but you’re looking at a median cost of $5,000-$6,290+ to get your business up and running. This includes brokerage fees, administrative expenses, marketing, technology, transportation, health insurance, MLS fees, clients costs and more.
Keep in mind that you will likely make very little income in your first year or two as you work to build up your client base. The National Association of REALTORS®’s (NAR) income data reporting shows that agents with less than two years of experience make a median gross income of $8,900.
Altogether, you can expect to pay about $6,575-$8,590 to get licensed and launch your business.
Want to learn more about the costs of getting started in real estate? We broke down the fees associated with building your business as a new agent, from licensing to start-up costs. Click the button below to learn more.
4. How much can I earn as a real estate agent?
Most real estate agents are compensated with commissions from each transaction they close. The 2020 NAR® Member Profile reported the median gross income of REALTORS® in 2019 was $49,700.
Income is usually directly related to experience for real estate agents. The more you work in the industry, build your network and earn referral business, the more you will earn. The 2020 NAR® Member Profile also found that agents with 16 years or more of experience earned a median gross income of $86,500 while agents with two years of experience or less earned a median gross income of $8,900.
The amount of time and effort you put into your business will also directly impact your income. The same report found that agents who worked less than 20 hours a week earned a median gross income of $10,000 while those who worked 60 hours or more had a median gross income of $113,000. This of course will vary based on your market, experience, the effort and time you put into building your business and your compensation plan with your brokerage.
Every compensation plan is a little different, so be sure to ask about it when you start interviewing brokerages. Here at CENTURY 21 Signature Real Estate, we believe in being transparent about our compensation plans. You can find out more about our commission structures and your earning potential with us by clicking the button below.
5. How do I take the pre-licensing courses?
The 60-hour pre-licensing course is an intensive and immersive class that everyone is required to take before sitting for the real estate licensing exam in Iowa. There are several options available to you for taking the 60-hour pre-licensing course. You can take the course in a classroom setting, either during the week or on weekends, or you can take the course online.
In-person classes- These can take one to six weeks to complete and cost about $300-$500, depending on where you take it and if it takes place during the week or on weekends.
Online classes- These are self-paced and you can take up to six months to complete them. These range in cost from $299-$574, depending on which course provider you take it with and if you purchase additional study materials.
We recommend taking your 60-hour pre-licensing course with the Iowa Association of REALTORS®, but you can take your class with any IREC-approved course provider.
You should only take courses that are taught by accredited instructors and approved by the IREC. Courses taught by unapproved or non-accredited instructors are not considered valid by the IREC. You will not be able to sit for the real estate licensing exam without a certificate of completion from a valid course provider. Don’t waste your time and money!
Want to learn more about the 60-hour pre-licensing course? Check out this complete list of IREC-approved course providers with everything you need to know, including the cost, pros and cons of each course type, and more.
6. Will I receive training/mentorship/coaching when I join a brokerage?
This is a common question and for good reason. Real estate is an entirely new world for most people and one of the best ways to learn the industry is by shadowing or working with an experienced agent.
When you interview brokerages, make sure you ask what kind of training or coaching programs they offer and if they have any kind of mentorship program for new agents. Each brokerage is different. Some will have formal, structured training programs for agents in their first year or two while others offer informal guidance and you may have to approach experienced agents on your own.
You should also join professional real estate agent organizations (like the National Association of REALTORS®) for the opportunity to connect with other professionals. Local organizations (like the Iowa Association of REALTORS®) will provide a good opportunity for you to meet agents from brokerages across your market and many offer networking events, volunteer opportunities and professional development programs.
7. What does a day in the life of a real estate agent look like?
You could ask five different agents this question and receive five different answers. Every day looks different when you’re a REALTOR®! Your day-to-day activities could include showing houses, writing offers, holding open houses, negotiating for your clients, attending inspections, doing paperwork, communicating with your clients’ lenders, attending closings, meeting with appraisers, working with third-party repairmen to solve problems, staging homes, coordinating photography, answering client questions at all times of the day, and of course, spending a lot of time in the car!
This doesn’t even include your behind-the-scenes administrative work such as creating a budget, tracking your expenses, creating a marketing plan, creating marketing materials and distributing them, managing your social media and email marketing, planning and holding client events, engaging in lead generation tactics, answering emails and phone calls, updating your database, creating market reports, processing your own paperwork and more.
The best way to learn more about what a real estate agent does day-to-day is to talk to one! Reach out to anyone you know who works in real estate or have friends set you up with someone they know. Ask if you can grab a coffee together and have an informational meeting so you can learn more about what life is like as a real estate agent.
8. Do I need to have prior experience?
You do not have to have prior experience in sales or real estate before becoming an Iowa real estate agent. In fact, many brokerages do not require it. However, interest in both is essential for your success in the industry.
Some brokerages (but not all) will train you in lead generation tactics, client management, marketing, and real estate laws and guidelines. When you interview brokerages, ask about their training programs and what support and guidance they can offer you in your first couple of years.
9. Can I use my Iowa real estate license in other states?
We often hear this question because many states offer real estate license reciprocity. This means you can more easily get your real estate license in another state that your state has a reciprocity agreement with so that you don’t have to take classes or an exam again.
You cannot sell real estate in other states with just your Iowa real estate license. If you are interested in working in other states, you need to contact the Real Estate Commission in that state to find out how to get a real estate license.
Iowa has a licensing reciprocity agreement with Arkansas, Georgia, Louisiana, Massachusetts, Minnesota, Mississippi and North Dakota. If you have an active Iowa real estate license, it’s easier to get a real estate license in those states. They will typically ask for a certificate of license history from the IREC and require you to be licensed through a brokerage based in that state. You may also have to submit a background check. Each of those seven states has slightly different reciprocity requirements so be sure to double-check with their Real Estate Commissions first.
10. How do I get leads/find clients?
Generating leads is one of the biggest challenges a new real estate agent faces. A successful real estate business is one that is constantly fueled by a steady stream of incoming leads. But how do you find clients without feeling like a salesperson? Nobody wants to be the stereotypically pushy solicitor constantly asking people to buy or sell with them. It makes potential clients feel uncomfortable and leaves you feeling just as bad.
Every brokerage is different in how they help new agents generate leads. Some will teach you to prospect by making cold calls with scripts, others will provide your leads for you and still others will help you develop a lead generation plan that you are comfortable with and want to engage in.
For some new agents, cold calls and leads provided by your broker may work for them. But for others, these aren’t lead generation activities that you’re comfortable with or that comes naturally to you. There is no one-size-fits-all approach to building a real estate business so before you commit to a brokerage, talk to them about their lead generation training.
At CENTURY 21 Signature Real Estate, we use multiple tools to help agents develop clarity around their strengths, interests and skills so they can build custom lead generation strategies that work for them. One of these is the agent archetypes concept which will help you build a lead generation strategy you believe in that includes a marketing plan and systems tailored to your goals.
Most agents approach lead generation sporadically and don’t have an intentional plan, systems or budget. We believe you should never be dependent on your broker, the market, Zillow or third-party sites for your leads. That’s why our team works closely with our new agents to help them develop a strategic plan so they can own the top of their sales funnel and maintain a steady stream of incoming leads.
Real estate is an exciting industry if you want to break free from the rat race, earn a great living, control your own schedule and ultimately make a difference in the lives of the people in your community. The licensing process and building up your business takes a big investment of your time, money, energy and effort but can pay off in a remarkable way.
We offer a free, online video course for anyone who wants to learn more about how to build their real estate business in the first year. You’ll learn everything from planning and budgeting for the first year, lead generation, taking a relational approach to sales, working your database, what systems and tools to use and more. Click below to sign up today.