Realtors, Realtors Everywhere

Boston Condos for Sale and Apartments for Rent

Realtors, Realtors Everywhere

There will be fewer Boston condo for sale agents, which is a good thing. As the old saying goes, “What goes up, must come down.”

Hat tip to Greg for sending this article.

When real estate broker April Strickland looks at her local housing market in Gainesville, Fla., she sees a mismatch. Industry data shows that only a few hundred homes are sold each month, she said, yet there are more than 1,500 local Realtors.

Strickland has seen the ups and downs of the housing market since 1995, when she started managing her parents’ rental properties as a teenager. But she says the business environment of the past two years is the most challenging she can remember — slower even than the years following the 2008 financial crisis.

“Quite frankly, Realtors are running out of money,” Strickland said.

An industry that swelled with newcomers in 2020 and 2021 has recently experienced a harsh slowdown — leaving the field no choice but to downsize, experts say. One widely cited analysis predicts that as many as 80 percent of the country’s real estate agents could find a new line of work.

“Many industry leaders think there are way too many agents and would like to reduce the number so the professionals can service more clients, thus allowing a reduction in commission levels in order to maintain current incomes,” said Steve Brobeck, a senior fellow at the Consumer Federation of America.

By some measures, the exodus has already begun.

The Bureau of Labor Statistics recorded 440,000 full-time real estate agents and brokers in 2023, about 72,000 fewer than the year before.

Realtors will soon face new rules that could result in sweeping changes to how they do business and how they get paid.

Under the new rules starting in August, real estate databases no longer will include offers of compensation for buyers’ agents. That means those agents can no longer count on a cut of the seller’s windfall. Investment bank Keefe Bruyette & Woods has estimated that as much as 30 percent of the total U.S. commissions revenue might be lost as a result. They forecast that changes to the commission structure could cause 60 to 80 percent of U.S. Realtors to leave the profession.

CUNY Baruch College’s Sonia Gilbukh and Yale School of Management’s Paul Goldsmith-Pinkham estimated that about 56 percent of agents would exit the market if one side’s commission remained at 3 percent while the other became competitive, Gilbukh said in an email describing the study. A 2015 paper in the Rand Journal of Economics by Panle Jia Barwick and Parag Pathak predicted that a 50 percent reduction in commissions would result in 40 percent fewer agents.

Experts see a silver lining in a potential exodus of Realtors: Those who remain might be more experienced and competent. “This will be good for consumers because agents on average will be better at their job and will charge more competitive commissions,” Gilbukh said.

A “Realtor glut” has persisted since the industry’s pandemic high point, said Brobeck, who also sees a departure of real estate agents as probably a good thing for home buyers.

Gilbukh, the CUNY researcher, believes that only the most experienced agents will be able to keep charging high commissions.

Agents that survive the upcoming transition are likely to be better connected within their industry, having deeper relationships with professionals such as contractors, electricians, plumbers and appraisers, and “overall better poised to advise their clients,” Gilbukh said.

The proposed NAR deal was met with fear throughout the industry when it was announced in March, Strickland said. But the panic has given way to a “wait-and-see” attitude, she said.

She characterized the NAR deal as a positive thing overall:

“It will eliminate people who quite frankly aren’t up to snuff, who can’t do the work, who don’t want to educate themselves and learn new ways or working. … This will be a good pivot for our industry.”

Link to free article

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Realtors, Realtors Everywhere

January 2022 there were 1.599,135 Realtors. This January there are 1,548,058. In Minnesota, there were 22,711 members in January 2022, this year there are 21,950. National membership fell by almost 3% from December 2022.

Some of the Realtors that have left the industry have retired.

The NAR is predicting that there will be fewer home sales in 2023 than there were in 2022 which was down from 2021 and that there will be an uptick in 2024.

It is likely that there will be fewer Realtors before the year is over. At the same time, the low unemployment numbers indicate that there are plenty of jobs.

Not all real estate agents are Realtors. Not all real estate licensees sell real estate nor do all Realtors, yet when we do the math there are more than enough Realtors, yet there is always room for more.

Most real estate agents are independent contractors and work on a 100% commission basis with no benefits. Commissions are not guaranteed and are only paid after the successful closing of a home sale.

A person needs a real estate license to sell real estate for others for a fee but does not need to be a member of the National Association of Realtors.

Realtors, Realtors Everywhere

When I first started selling Boston condos and renting Boston apartments within a year of when I started, I knew all the Boston real estate companies working in downtown Boston. Today, I couldn’t tell you how many Boston Beacon Hill agents are out there.

Who are these Boston Real Estate Relators?

When I look at pictures of Realtors in advertising I most often see advertising pictures of Realtors they’re usually young men and young women. They are dressed in suits and if there are more than two in the picture, there is a young man and a young woman with darker skin.

Who we really are is a group of the is 66% woman and typically around 56 years of age and probably white. You would never guess that there are more women Realtors than male Realtors. But its true.

Most Boston real estate agents are independent contractors which means they control their own schedule and where they work ad even how many hours they work.

For Boston real estate sales positions there are no glass ceilings. There is some age discrimination but it isn’t as bad on the job as it is in other aspects of life. Real estate sales positions have always attracted an older demographic because there are no benefits, like vacation pay or health insurance.

During times of high unemployment, we see an increase in the number of Realtors. Membership also increases during times when home sales are up as they have been during the last two years. Real estate companies are always “hiring”. Real estate agents should interview a few brokers and choose wisely.

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Realtors, Realtors Everywhere

The number of Realtors has increased in the last year by 4.8%. Realtor is not an occupation. It denotes people who belong to the National Association of

Realtors and right now there are 1.45 million of us, which is an all-time high. Not all members are real estate salespeople. Some are in real estate-related careers, some are retired, real estate agents.

Considering that about 4.8 million or maybe 5 million houses/condos will be sold in the US this year it seems possible that right now there are more Realtors than there are houses for sale. I can’t find a number for how many real estate licensees there are in the US.

In the local market, I am sure there are more Boston real estate brokers and agents than there are homes for sale. There are real estate offices that have 50 agents and 20 listings.

Getting a real estate license is fairly easy to do and inexpensive. It takes about six weeks. New agents start out charging the same rates that experienced agents charge.

Failure Rate for Boston Real Estate Agents

The failure rate among real estate agents is very high. Everyone knows someone who “tried it out” and then quit. If you plan on working with a real estate agent to sell your home you should be able to negotiate a lower commission. Being a buyer’s agent right now is extra tough because each buyer may need to make an offer on a few houses before one works out.

The current housing market is unique. I feel strongly that we will need to build more housing preferably affordable housing to end what I believe is a housing crisis.

Boston Real Estate and the Bottom Line

If you were planning on getting a real estate license this year and go into real estate sales expect a lot of competition from experienced and inexperienced agents. Real estate agents are self-employed and without benefits and have bills to pay even when there isn’t any money coming in.

Boston Condos for Sale

Realtors, Realtors Everywhere

Original Real Estate Blog Post

We are approaching the final quarter of 2020 and speeding into the 2021 real estate market with 1.4 million Realtors in tow. Now Realtors are those state licensed real estate agents that are members of the National Association of Realtors, but I’ve never met one that isn’t a member. Realty companies typically make it a requirement for their agents to be Realtors and abide by NAR’s code of ethics.

Number of Real Estate Agents in the U.S.

2006 – 1.35 million
2007 – 1.33 million ↓
2008 – 1.19 million ↓
2009 – 1.11 million ↓
2010 – 1.06 million ↓
2011 – 1.00 million ↓
2012 – .99 million ↓
2013 – 1.04 million ↑
2014 – 1.09 million ↑
2015 – 1.16 million ↑
2016 – 1.23 million ↑
2017 – 1.30 million ↑
2018 – 1.35 million ↑
2019 – 1.39 million ↑
2020 – 1.4 million – record high!

Orginal Boston Real Estate Blog Post

I appreciate Tom’s concern, outlined below, but things aren’t quite so bleak. It’s true that if you do the math, and divide the 65,000 single family homes and condos sold so far this year by the 40,000 licensed real estate agents, you get at the 1.6 houses per agent number he quotes. However, of those 40,000 licensed real estate agents, probably a quarter or more work in real estate part-time, or less.

That shouldn’t detract from the main gist of the story, of course. I agree, there has been a huge number of new agents entering the business over the past year or two (or more). As Tom so eloquently puts it, many of these new agents will be faced with low pay and lots of work, over the first couple of years, and a high percentage will probably give up, if the market should cool.

This will mean less competition for those able to weather the storm.

By Tom Witkowski, Boston Business Journal

A 46.1 percent increase in the number of Realtors in Massachusetts since 2001 means there is now one Realtor for every 1.6 houses sold in the state so far this year. That number is on track to fall far short of the 2.9 houses sold for every one Realtor four years ago.

Many new agents have flocked to real estate sales, attracted by the flexible schedule and potential of financial success. The robust Massachusetts market has also brought soaring home prices, which have translated to skyrocketing commissions for some.

Complete article: Realtor surplus

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