What Does it Take To Get Your License?

  • The first step is to process through your options and commit to this adventure. Are you ready for a change of focus, knowledge, schedule, and more? This really is a lifestyle change for most people and it is important for you and those closest people in your life to be ready for and committed to that change.

  • Once you are mentally prepared, we can help with the knowledge you will need. South Dakota requires 116 hours of pre-license education. We offer all of that in a single package that combines home-study and 40 hours of live classroom time.

  • Depending on your learning style and comfort with testing, you will want to take at least some time to review material and prepare for your state exam. This may be on your own or through additional tutoring offered by Prepare.

  • The state exam for South Dakota has two parts - the national knowledge portion and the SD state law portion. You will initially take the two parts in one sitting. Should you pass one part but not the other, you can retest over just the portion you still need to pass.

  • As a new licensee, you will be working under a responsible broker for at least two years. Perhaps you already know who that person will be because they talked you into this whole thing. If not, interview with offices to find the right fit. Try different sized companies, independent and franchises, being on a team or go it as a single agent. Find the company where your commission split will be an investment rather than an expense. We prepare you largely for the state exam. Your company should continue to prepare you for the daily work of an agent.

  • Once you have passed both parts of the state exam, you need to apply for your license. Hopefully you have found a broker to work with and they will need to sign your application. If you aren't quite ready to go active yet, you can still apply for your license and put it on inactive status. The application will involve a credit check and a criminal background check with fingerprints.

  • Depending on where you land and with which company, you will probably be joining the Realtor Association. There are local, state, and national associations and you will by default be a part of all three. Your local association can provide education, networking, MLS access, advocacy, and more.

  • As soon as your license is issued by the SD Real Estate Commission, you are able to get to work prospecting, showing, writing offers, and generally taking care of your people's needs. And of course, you will need to keep learning.

  • Now that you have your license, you will be renewing that license in two years or less. During that first licensing period, you will need to attend 30 hours of approved continuing education. These are classes that will continue to prepare you for the daily adventures of real estate agents.

FAQs

How much does it cost to get my license?

With Prepare Real Estate Academy, the core pre-license class costs $1200. This may be all you need for exam preparation, but additional services are available. Each attempt at your state exam will cost $98. Upon passing your exam, you will need to apply for your license. Currently, this includes an application fee of $225 and a criminal background check fee of $43.50. You will need E&O insurance. The current cost through the SD Real Estate Commission is $187. If you will be in a location and company where you will join the Realtor Association and MLS, this will have additional cost that depends on the specific local association.

Do I really have to work under a broker?

According to SD state law, you need to work under a responsible broker for at least two years and then take a specific broker education course before you are able to operate as your own real estate company. There is an exception available if you apply to and are turned down by at least three companies in your area, but this is a rarity. While you will share your commission with your broker, you should be getting more than a desk for that commission split. See what your broker offers for supervision, training, mentoring, office services, and more.

Will I make a decent living as an agent?

While we all ride the tides of the market, many agents continue to make a good living through the highs and lows. The great thing about real estate is that your income largely depends on your skill and effort. Even working under a responsible broker, you are most likely an independent contractor and therefore the owner of your own real estate business. Within the bounds of the law, ethics, and company policies, you have the freedom to make your business, and thus your success, what you want it to be.

How long does it take to get licensed?

While we can talk about minimum timeframes, this really is up to you. With Prepare’s hybrid model, you have 76 hours of home-study to complete before attending our live class sessions. The live portion of the course is 40 hours and typically is taught in one week, Monday through Friday. The time between completing the core pre-license class and your test depends on how long you want to study and better prepare for the exam. This may be as little as a couple of days depending on your study style and available times for testing. If you pass your exam on the first time, your application and background check process can take up to four weeks before you receive your license. Of course, all of this can be extended depending on your schedule, time commitment, and individual needs.

What can I do with a real estate license?

Upon completion of Prepare’s core pre-license class, you are qualified to test and apply for your broker associate license. This license is valid anywhere in South Dakota and allows you to represent clients in most types of real estate transactions - purchase, list, residential, commercial, tenant representation, or property management. What you can do and what you should do are probably two different answers. Sioux Falls is definitely a different market from even Mitchell, and residential is very different from commercial real estate. Whichever direction you decide to go, make sure you are a knowledgeable professional able to handle the best interests of your clients. This means you will probably be specializing in both location and property type.

Is real estate right for me?

Oof, that’s a big question. So let me ask you a few questions? Do you care about people? Are you ok with a flexible and variable work schedule? Are you ok with variable income? Can you be detailed enough to accurately fill out legally binding contracts and manage contractual timelines for the sake of your clients? Are you able to be the calm even in your clients’ emotional storms of finances and housing? Do you enjoy problem solving towards solutions that make everyone happy? I’m not saying you need to say ‘absolutely yes’ to all of these, but the more of these that excite you the better of a fit real estate will be for you. Part of the freedom in real estate is that you have the ability to largely make your business what you want it to be. If this excites you, real estate may be for you. If you still aren’t sure, we are happy to sit down and have a conversation with you about your future plans before you commit to class.

What are the costs after I get my license?

A quote I heard a long time a ago says “You have to spend money to make money.” As a small business owner, there are expenses you will incur in running your business. Many of these will vary depending on your business style and what your brokerage offers. Some things you may be investing in include signs, lockboxes, marketing mailings, advertising, continuing education, desk rent at your office, and business systems (email, web host, CRM, etc.). Talk to brokers you are considering working for. Some may provide some signs, lockboxes, and even some of the office systems to get you started.

How soon do I start making money after I get my license?

In most cases, you are going to be paid based solely on commission. Even if you sign a client and get an accepted purchase contract your first day of being licensed, most transactions take at least 30 days to close. So it will be a minimum of a month before you get paid. A common rule of thumb is to be prepared for 6 months of living expenses when you go into real estate. In the mean time, you may supplement your income if other agents pay you for helping with showings or open houses. You may even consider a part-time job to help cover living expenses while your real estate career takes off.

Should I join a team or work as a solo agent within a company?

This is kind of like asking if you should eat chicken or beef. Each has its own benefits and challenges. Working on a team, your team leader will take a share of your commissions on top of what the brokerage takes. They may set goals and expectations for your performance. But the team may also provide training, support, an office assistant, leads, team events for clients, and help covering when you are busy or out of town. Whether this is right for you is entirely your choice. Like finding the right brokerage to work for, you should also spend time asking a lot of questions of any team you are considering being a part of.