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What is a real estate consultant?

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What is a real estate consultant?

  • 16 Jun 2023

First, let's compare real estate consultants and financial advisors. Put simply, real estate consultants are professionals who specialize in helping buyers and sellers make informed decisions about their real estate transactions. For example, they can help conduct a financial analysis for a particular property or assist with strategic planning when trying to build your portfolio.

Since their role in a transaction is more geared toward asset management, these consultants tend to work with real estate investors rather than residential buyers and sellers. For someone trying to become a real estate mogul, for instance, bringing a consultant on board can be a great way for them to develop a comprehensive real estate investment strategy and set goals for growing a flourishing real estate business.

How is a real estate consultant different from a real estate salesperson?

When talking about real estate consultants, people often wonder how a real estate consultant is different from a real estate salesperson. These two types of real estate professionals serve two different functions in the real estate transaction. While a real estate consultant is involved more with helping investors make decisions about what to do with their real estate assets, a buyer's agent or listing agent is more involved in managing the day-to-day processes necessary for completing a real estate transaction.

A real estate consultant might use their expertise to help their client decide whether selling a real estate asset or adding more real property to their portfolio is a good idea from a financial standpoint. However, once the decision is made, a real estate agent might help the same client figure out the appropriate valuation for the property, handle marketing for the property, and play a key role in any contract negotiation.

What are the pros and cons of real estate consulting?

Now that you understand the role this type of consulting plays in the real estate industry, it's time to look closer at the pros and cons of taking on a real estate consultant job. Like any profession, starting a career as a real estate consultant will have its ups and downs.

Pros

Like any consulting business, a career in real estate consulting tends to be what you make of it. There's really no set way to be a real estate consultant, which means you'll have a lot of freedom but will also face a lot of personal responsibility. For instance, since you'll be running your own business, you can decide whether you want to work for individual real estate investors or institutional investors at a member firm. In addition to picking your own clients, you'll also have the freedom to set your own hours and fee structure.

That said, while you probably won't get a salary unless you're working as part of an existing brokerage, the pay rate associated with this job could be considered another benefit. According to PayScale, the average real estate consultant salary is $63,332 per year. However, according to their research, the salary range can go up to $104,000 per year.

Cons

The downside of choosing to become a real estate consultant is that there may not be many official job openings to be found. As mentioned, this career is best suited for someone ready to take on the challenge of owning their own business and doing their own marketing. Unlike a traditional real estate agent, a real estate consultant's services are rather niche and may not be offered by every brokerage.

Additionally, this career can be dependent on the state of the real estate market. If your particular market is slow, investors likely aren't going to be interested in adding more real property to their portfolios. So if you go this route, be prepared for business to wax and wane over time.

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