“I want to work in the real estate industry.” Because the amounts involved are large and every company has an image of doing big work, this is a phrase I often hear in career change consultations. However, the real estate industry is one where your way of earning, your way of working, and the impact of AI change completely depending on where you are involved in the flow of a single property.
This article is a written summary of the content of the 8th episode of Saku-Reach Radio. As the third in a series of industry explanations, I have taken up the real estate industry, which I joined as a new graduate and where I spent my five years as a company employee.
Conclusion: The real estate industry is a collection of three sectors with different positions
It is said that there are about 130,000 companies nationwide that have licenses to conduct real estate transactions, making it an industry with more companies than the number of convenience stores. On the other hand, Japan’s population is declining, and according to a survey by the Ministry of Internal Affairs and Communications, the number of vacant houses nationwide is about 9 million, the highest ever. It is an industry where it is no longer sustainable just to keep building new buildings, and how to utilize existing buildings is becoming increasingly important.
And I believe that companies in the real estate industry are broadly divided into three categories based on their position in the flow of a single property.
The first is the developer, who creates the property.
The second is the brokerage, which connects property owners and residents.
And the third is management, which takes care of and operates the property.
1st: Developer
Developers are companies that acquire land, build condominiums, office buildings, commercial facilities, etc., and then sell or lease them. In short, they are companies that do urban development. Mitsui Fudosan, Mitsubishi Estate, Sumitomo Realty & Development, Tokyu Land Corporation, and Nomura Real Estate Development are called the five major developers, and railway companies like JR East are also developers that do urban development.
There are two main ways they earn money: profit from building and selling (capital gains) and income from holding and leasing (income gains). By the way, developer employees do not build the buildings themselves; they are like urban development producers who bring together many people—landowners, government officials, construction companies, banks, and tenants—to shape a single project.
In the AI era, I believe that the part of just building and selling houses will shrink, while the parts that can create value for buildings and cities needed in the future, such as urban redevelopment, logistics warehouses, and data centers, will grow. However, mid-career hiring by major developers is almost exclusively for those who can contribute immediately, and honestly, it is a very narrow gate.
2nd: Brokerage
Brokerage is a job that stands between people who want to buy and sell houses, or rent and lease rooms, and connects them until the contract is signed. Many of the real estate agencies you often see in front of train stations are brokerage companies, and major ones include Mitsui Fudosan Realty and Tokyu Livable.
The way they earn money is through brokerage fees received when a contract is finalized, and the upper limit is set by law. It is a completely performance-based business where if a deal is not closed, there is zero revenue. And, just between us, rental brokerage companies often receive advertising fees from landlords in addition to brokerage fees, and if the conditions are the same, I think the honest truth is that they would want to prioritize introducing properties with higher advertising fees.
Brokerage sales often hire people with no experience, and it is a realistic option as an entry point for those who want to gain experience as sales professionals. However, in the AI era, I believe that brokerages that only find and show properties will shrink, while brokerages that handle complex transactions involving inheritance or large sums of money will remain.
3rd: Management (Property Management)
Management is a job where you take care of properties from owners, collect tenants, manage rent, and maintain the building, operating the property on behalf of the owner. Representative companies include Daito Trust Construction and Starts Corporation.
There are two main ways they earn money: management consignment, where you receive a portion of the rent, and subleasing, where you rent the entire building. It is a business of building up profits little by little every month while maintaining a relationship with the same property for decades. In my 4th and 5th years as a company employee, I was in sales, getting properties entrusted to us by major corporations, wealthy individuals, and investment funds. What I felt then was that the true value of management boils down to how much you can increase the value of the owner’s assets.
I don’t think the job of management itself will disappear, but routine tasks like responding to tenants and managing rent will be replaced by AI. Therefore, I think the most important criterion is whether you can be involved in a position where you can propose how to utilize the owner’s assets, rather than being in charge of tasks.
If I were to enter the real estate industry now
At the end of the broadcast, based on what I have discussed so far, I talk about where I would choose to go if I were to enter the real estate industry now. To write just the conclusion, I would choose a developer, or the area of office buildings and commercial facilities within management that deals with corporations, wealthy individuals, and investment funds. And I believe that the real estate industry is a field where those who have nothing can easily rise up, as you can move from small to large companies once you gain experience. Please listen to the broadcast to hear the reasons why.
Continue on YouTube
In this video, I provide a thorough 32-minute explanation of each job type, what kind of background makes it easier to change jobs, and exclusive insights I have witnessed firsthand in the field.
On the SakuReach channel, we talk about job changes and careers, telling the truth without sugarcoating. Please subscribe to the channel so you don’t miss any new videos.
▼SakuReach (Job Site)
Coming Soon | Opening shortly.
Information about the opening will be announced on YouTube and our official X account.
▼SakuCareer Match (Career & Job Change Consultation)
https://sakucareer-match.jp/
▼SakuReach_Official X
https://x.com/sakureach
▼Representative Director_Official X
→ You can also consult directly with the CEO regarding job postings.
https://x.com/sakufuri_ceo
