Why it’s time to truly recognize real estate agents
Last week, I met with a woman who wants to be a real estate agent. Her background and recent experience includes sales, marketing and a little teaching. She might like real estate sales. My conversation with her got me to thinking about what real estate agents actually do and about Agent Appreciation Month.
Like most people who have never been a real estate agent, she had all kinds of preconceived notions about what it would be like. She had this vision of selling houses and touring interesting historic properties and being a neighborhood expert.
The biggest surprise to her was when I told her that she will spend most of her time looking for work, but we call that “prospecting.” She won’t be spending a lot of time working with clients until she is established, and even then, she will need to prospect.
The average day in the life a real estate agent isn’t all about listing houses or about selling them — it is more about finding someone who wants to buy a house or sell a house so that you have the opportunity to sell a house.
The early years are particularly tough, and the survival rate is low as new agents slowly go broke. Agents who have spouses with good jobs and health insurance probably have an edge.
Where I work, there are at least 200 qualified, experienced real estate agents for every house on the market. There isn’t any reason to work with a new real estate agent, yet people do. It is hard to see real estate agents as unsung heroes.
In most cases, people do not start businesses or train for jobs with low demand, but real estate agents are an exception. There is always room for more agents, and anyone can succeed, but many do not.
New real estate agents charge just as much as experienced agents charge even though experience is all we really have to offer.
After the housing market crash, the number of Realtors declined. It had peaked in 2006 and then went down as members retired or got jobs. Membership numbers are back up to an all-time high yet as home sales continue to decline.
Interest rates are low, and homebuyers are plentiful. The demand for homes is high, but the supply is low because there is little new construction and few existing homeowners want to sell. In fact, people just are not moving as often as they used to. Right now, I would describe the local housing market as broken rather than robust.
Just 9.8 percent of Americans moved in the year ending in March 2019, according to the U.S Census data. That was the smallest share since the Census Bureau started tracking it in 1947.
I explained to the future real estate agent that the concentration of real estate agents and companies is high in her neighborhood because that is where the large national franchises have offices. They tend to locate in areas with the most expensive housing.
I told her that there is always business to be had, but the competition among agents is fierce. It is best to prospect where there are fewer established, experienced practitioners and to become a specialist rather than a generalist. I also told her that her friends, family and contacts will be her greatest source of business.
They will work with her because they know and trust her. If she has enough contacts, she will be off to a good start building a client base.
We often paint a picture of the hard-working real estate agent. The agents I know who actually make a living at it do work hard, but it isn’t listing appointments that are gobbling up all of their time. Doing the work required to get each listing appointment is part of the daily grind.
Working with buyers these days is downright exhausting. It is like a never-ending fire drill. We have to be ready to run out the door on a moment’s notice when a house hits the market. If our buyer wants to make an offer, there is an excellent chance that it won’t be the only offer on the house.
Homebuyers and sellers often work during the day. Offers are generally negotiated into the night. Real estate starts at about 8:30 p.m. and if all goes well, we are done before midnight.
A real estate agent misses her son’s baseball game because that one buyer finally wants to make an offer and chooses to do so during the game. She doesn’t miss it because she is too busy. She misses it because if she doesn’t make the offer, she may never get paid for the many hours she has worked with the buyer.
It’s Agent Appreciation Month at Inman News. There are a lot of people who should appreciate real estate agents: the many people who work in Realtor associations, the brokers who get a cut from every sale, the executives who work in glass office towers and the franchisors.
There are companies that make for-sale signs and business cards and marketing materials for real estate agents. Companies that create software, hardware and websites and people who write for the industry; the real estate portals that agents help support so that consumers can search for our listings and become leads.
There are teachers and trainers and speakers, and I would imagine that real estate agents buy a lot of books about sales and marketing and magical ways to get rich as a real estate agent.
Agent Appreciation Month is the perfect time to recognize real estate agents as the people who spend the money that fuels the innovation and disruption in the industry.