Is Commercial Real Estate More Lucrative Than Software Sales?
Compared to software sales, a commercial real estate agent makes around $90k per year. However, many agents do not earn as much as they could. The average salary for a commercial real estate agent is only over $50k, whereas a software salesperson earns somewhere between $100k and 150k per year. Many investors who are looking for a lucrative career should consider commercial real estate.
As a real estate broker, you will be working with potential buyers and sellers. You will receive a commission for completing deals and will have to master networking and real estate market analysis. Depending on your goals, you can focus on specific regions and property types. For example, if you are good at networking, you could concentrate on building connections in certain cities or selling apartments or hotels. This type of networking is similar to how you might break into investment banking. In addition, you will need to learn about the real estate market and identify the types of buyers and sellers you would like to focus on.
The main difference between a software company and a commercial property is in the cash flow. A software company will typically pay dividends, while a commercial property will pay cash flow. However, the cash flow calculation for real estate is a little different. The investment pays for itself by generating income and expenses. Rent is the gross income of the property, while expenses include landscaping, turnover, and management fees. You will need to account for these costs in order to determine the Net Operating Income, or NOI, for the commercial property you plan to invest in.