A real estate agent in Phoenix scaled from $250K to $1.5M in annual revenue while cutting her hours in half. The shift from solo practice to building a team meant less direct income at first, but after 4-5 years she takes home more than half her revenue instead of 60%. The Business Freedom Index measures income per hour to design the life you actually want.
When you're a solo agent, you're selling 25 homes a year, you probably don't do any lead generation, you probably don't have any administrative staff, you probably don't have a physical office. So the con is that you have to make sure you have the right economic model in place. You have to make sure that you're looking at your financials, you have good tracking systems in place, all the things that we teach our members in real estate B school. Yet if you're not prepared to do that, you have to make sure you get those systems in place ahead of it. I'd say another con is that you, you are going to be disappointed by people that these, they have no financial freedom, they have no freedom of time, they're still selling real estate, they have no plan to exit the business or at least step back from the business where they can earn more residual income versus kind of income that's active related to showing homes and taking listings. Are you achieving the kind of freedom you want, you know, making the kind of money you want and having the impact outside of your business, in your family and in your community? If you like these videos, give me the thumbs up, subscribe to the channel and make sure you turn notifications on and leave me comments as well. So this pros and cons conversation about being a real estate agent versus being a real estate business owner, I want to have this discussion in the context of one of our members, Cody Riddle out of Phoenix, Arizona. When I met Coty, she was like 18 years in the business, a real estate agent, traditional real estate agent. 18, 18 years in. You know, this was after the Great Recession, so she got beat up pretty bad and she was down and out and she fell out of love with real estate and yet she was traditionally successful. She's still doing about 250 to 300,000 top line GCI, probably taking home about $150,000, working, you know, six, sometimes seven days a week, you know, evenings, weekends. Didn't have much leverage administratively, you know, showing homes to buyers. The pros of that situation was that, you know, she, she obviously was able to overcome and survive in her market. The, the shift that Great Recession decimated, you know, so the pro of being a real estate agent is that, you know, she didn't have many people to tend to, so she had a sense of independence in that she didn't have many people to lead or manage. She, she was able to play the role of a real estate agent at the highest level. So as a real estate agent, there's only, you know, a handful of skill sets that you need to be really, really good at. And if you're doing, you know, 25, 30 transactions a year, mostly referral, your business is not all that complicated. So that's another pro of being a top agent, right? Not a complicated business, you know, only a handful of skill sets, and it's pretty manageable. And you're not sort of overwhelmed thinking of all the different capabilities you need to build out. Those are the cons of, you know, kind of going the real estate team route. But let me go through the cons of being a real estate agent. You know, if you look at the hours that you put in, either you're super busy and you're having to work seven days a week, or you're not super busy, the money's not there, and you're stressed out, wondering where the next deal is going to come from. You know, either way, this continuum of money, freedom and impact, if you're not busy as a solo agent and you're not producing, the money's not there. You don't have freedom because you're stressed. Even if you have time, you're stressed. And that's a bondage in and of itself. And you can have the impact in your family because you're not present because you're stressed. So and so it's this vicious cycle between money, freedom and impact that are the cons of being a solo agent, even at the top level. If you look at the journey that Coty made, and it took her about four to five years to go from, you know, $300,000 in that sort of solo agent mindset, 18 years in the business, honestly fell out of love with real estate to where she is now. This year, she'll do over 1.5 million of GCI. She will take home more than half of that. She will work probably 50% less hours than she did as a solo agent. She works mostly on the listing side of the business, which is more sort of. You can control the hours of that side of the business. She just took five days off to do a Grand Canyon rim to rim run, right? Her husband, you know, just went hunting for five, six days on a guy's trip. You know, they have freedoms now that they didn't have before. And so the pros of building a real estate team, building a real estate business is this, you know, you get to choose the things that you do in the business. So it's this series of delegations and elevations where you create these voids in your business. And you have people to come and fill those voids. So the pro is that you have more time to do the things that you love outside of the business. Another pro, in my opinion, is that this journey allows you to learn different skills. So the reason we fall out of love with something and we're sort of done with it is because we've either mastered it or it's not giving us the same satisfaction that it once gave us. So 18 years in the business, it's easy to think how you can fall out of love with doing that same thing over and over again. So the pro of building a real estate team or this journey, these stages of growth, is that every stage is going to make you uncomfortable in a good way because you're learning new skills and you're challenging yourself. So that's another pro. I would say another pro is that you're able to make more money per hour worked. We call that the business freedom index.
Right.
If you're making, say, $150,000 a year and you're putting in 3,000 hours to earn that 150, that's $50 an hour. You know, how can we 5x your income? It's a combination of things. You can make more money and work less hours. So we can go from $50 an hour to $250 an hour. We can make $500,000 a year working 2,000 hours.
Right.
That's the math that we do at real estate B school. It's not always working more hours just to make more money. It's deciding the kind of money you want to make, the hours that you want to work, and how do we design this business around what you want to achieve. So that's another pro. I would say another pro is your ability to impact others. So your ability to serve your team members and allow them to achieve at a level that they never thought was possible. You know, Coty has agents on her team that came from earning 35 to $40,000 in the service industry, you know, being a bartender or a waitress or a waiter. And now they're making six figures on her team.
Right.
They're working probably less hours in the in real estate than they were in the service industry. And definitely more predictable hours. They're not working the 4pm to 2am grind. That is the service that comes along with a whole bunch of bad habits and, you know, things that you probably don't want to get involved in if you want to live a bigger life. And she's able to double that person's income and have them work a more predictable work week.
Right.
So that's a major pro for building a real estate business. I'd say the cons to building a real estate business are there's a little bit, at least more perceived risks. Risk, right. So if you go from 250,000 to 2.5 million of GCI, chances are you're going to have some overhead running that business.
