5 Steps for How To Become a Real Estate Agent in Colorado
Updated December 19, 2022
Real estate agents have an important job that involves working with buyers and sellers to complete property transactions. Since real estate agents need to be knowledgeable about federal and state property laws, they need to become licensed in the state in which they work to perform their jobs. Learning about real estate agents and how to become one in the state of Colorado is a helpful first step toward starting your career in this state.
In this article, we explain what real estate agents do, outline the steps for how to become a real estate agent in Colorado and cover some details about their salaries, job outlooks and skills.
What does a real estate agent do?
A real estate agent is a property specialist who assists buyers and sellers with finding and marketing properties or completing transactions. These professionals use their knowledge of property laws and estate valuations to match clients with properties that suit their needs or to help sellers use the best strategies for selling their properties. Some real estate agents work in a specific market, such as commercial real estate or residences. Others may work in a further subspecialty like luxury properties or farmland. Here are some typical daily responsibilities for real estate agents:
Meeting with clients to understand their needs and goals when buying or selling real estate
Coordinating communication with multiple parties including clients, home inspectors and legal agencies
Helping clients navigate legal processes by educating them about property laws and assisting them with paperwork
Maintaining databases with contact information for current, former and potential clients
Finalizing closing and helping clients file paperwork to complete transactions
Planning and hosting events like open houses, private house tours, estate sales and marketing events
Developing marketing strategies and promotional materials such as fliers, blog posts and social media pages
Related: How To Start in Real Estate
How to become a real estate agent in Colorado
To become a real estate agent in Colorado, you need to earn your broker license. Here are the five steps to earn your license and start your real estate career in this state:
1. Establish your career goals and know the pre-licensing requirements
If you're looking to become a real estate agent in Colorado, it can help to develop a career plan. Setting goals and creating a timeline for completing each of your licensing requirements can help you assess your progress. Since it takes time to meet the licensing requirements, planning early and determining how to complete each step of the progress can make it easier to pursue your goals. When you have a well-established plan for earning your license, it may help you manage your work-life balance needs and stay focused on achieving your goals.
Additionally, knowing the pre-licensing requirements in the state of Colorado helps you ensure your eligibility. In Colorado, candidates need to be at least 18 years old before they can start the licensing process. Some pre-licensing education courses may prefer or require you to have a high school diploma or its equivalent. Research the enrollment requirements for each training program before you apply.
2. Complete your pre-licensing education
Real estate agents in Colorado need to complete a 168-hour pre-licensing training course. This course introduces students to core concepts in property law and real estate practices. For example, students learn about national and state laws, contracts, valuation and property management. Depending on your needs and preferences, you may choose to take the training course online or in person. Research education programs and pick the one that best suits your availability and goals.
During your education, you need to complete several courses and pass a final exam for each. These exams can have as few as 20 questions or as many as 50. You also need to pass a comprehensive final, which has 100 state-specific questions and 100 national questions. After completing your coursework and passing your exams, you can qualify to take the Colorado Real Estate License exam.
3. Pass the Colorado Real Estate License Exam
You become eligible to take the licensing exam after you complete your pre-licensing education requirements. This exam has two parts, including an 80-question national section and a 74-question state portion. Test takers have 120 minutes to complete the first part and 110 minutes to complete the second. In Colorado, you have the option of taking the test remotely or in person through a testing center. If you choose to take the remote version of the exam, you may need to use an online proctoring system provided at your local testing center.
4. Find a sponsoring broker and become insured
After passing the exam, the next step is to find a principal broker to sponsor you. A principal broker is a real estate professional who has advanced credentials that allow them to own a private real estate firm. New agents need a sponsoring broker to provide mentorship, employment and guidance as they become established in the field. Before you can get your license, you need to show evidence of sponsorship. Since standard real estate agents don't have the right level of credentials to own independent firms, they need to work under the direction of the principal broker.
Additionally, Colorado requires real estate agents to acquire errors and omissions insurance. This is a type of insurance that protects you against claims made by clients. Unlike traditional liability insurance, errors and omissions insurance provides specialized liability protections for salespeople and businesses. You can apply for this insurance online.
5. Finalize your licensing application
Once you've completed your education, passed the licensing exam, secured sponsorship and filed for insurance, you can complete your licensing application. Submit your application online and upload proof that you've met all the licensing requirements. As part of your application, you likely also need to submit a background check. Your background check requires you to submit your fingerprints for identification. After filing all of your records, the real estate division of Colorado processes your application and approves it.
Related: 15 Tips for New Real Estate Agents
How much do real estate agents make in Colorado?
The average salary for real estate agents in Colorado is $110,524 per year. This salary average can vary based on your setting of employment, level of education, years of employment and market specialty. Real estate agents often earn their salaries based on commission. This means that agents who sell more, sell high-priced properties or earn a higher commission percentage are likely to earn more. For example, a real estate agent who works in a market like luxury property sales is likely to earn more than one who sells standard residences because luxury properties typically cost more.
For the most up-to-date salary information from Indeed, click on the link provided.
Related: How Much Do Real Estate Agents Make?
What's the job outlook for real estate agents?
The U.S. Bureau of Labor Statistics projects a 4% increase in the job outlook for real estate agents between 2020 and 2030. This outlook may differ depending on your geographic location and market specialty. Some real estate markets may fluctuate more with economic conditions than others. For example, buyers may be more likely to purchase residences when the economy is strong, which may increase the demand for real estate agents in this market. Agents can account for periods of lower demand by applying their skills in a related role, like in property management, home inspection or property law.
Skills for real estate agents
Real estate agents need a combination of soft and technical skills. Here are some important skills for these professionals:
Real estate agents need exceptional communication skills to work effectively. Professionals in this role work with a variety of people. Not only do they communicate directly with clients, but they also coordinate contact with professionals in other agencies like home inspectors, property managers and legal agents. Real estate agents apply good verbal, non-verbal, listening and writing skills to perform in their roles. They listen to understand their clients' needs, express their own ideas and expectations and maintain communication through channels like email, social media and phone calls.
Clients often require real estate agents to negotiate property pricing on their behalf. Agents understand how to calculate the value of a property, and they use their knowledge to negotiate contracts that help their clients get the best possible value for the property they wish to buy or sell. For example, a broker may negotiate a price decrease for a residential property that needs additional maintenance from the purchaser.
Effective problem-solving skills allow real estate agents to overcome challenges effectively. For example, they can apply their problem-solving skills to identify new sources of potential clients, resolve contract or title disputes or manage the expectations of their clients. Real estate agents use their knowledge of the industry to collect information about the challenges they face and then determine the best solution for the problem.
Real estate agents use their knowledge of local and federal property laws to make effective decisions. They educate their clients about laws and advise based on legal regulations for purchasing, selling or transferring property titles. Understanding both federal and local property laws is important for helping clients through the transaction process. Some properties may require more extensive legal knowledge, such as when working with historic properties, those that don't meet inspection standards or inherited properties. Real estate agents may need to work with external legal agencies, and having a foundation of legal knowledge can help them work together well.
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