Too Many Agents?

What follows are excerpts from an article regarding the influx of new agents in recent years and the impact that the revolving door has had on the views of the profession.
These last few years, here in the Hamptons all it took was to pass "the mirror test" to get a desk. Today, it will take brokerage skills and what I call "the Three C's" - Confidence, Commitment and Closing skills! md

Too Many Agents, Not Enough Work?
by Al Heavens - REALTY TIMES


Is the market oversupplied with real estate agents?

Survey after survey has a shown that a very small number of agents and brokers handle a very large percentage of the residential business, which means that a lot of Realtors -- probably the ones newest to the business -- are being left in the cold.
...
When the membership of the National Association of Realtors began to grow in 2001, many of the newcomers were attracted by the mistaken belief that the average agent was earning hundreds of thousands of dollars a year by doing virtually nothing.

They'd see all the sold signs, multiply the number by a 6 percent commission, and think it would be easy to make a living. What they didn't realize was that they should divide that number by 4, because...Net commission is more like 1.5 percent.
...
For all but 6 percent of today's agents, real estate is a second career. I've spent the last several years attending gatherings of real estate agents during which I'd hear someone say he or she is a real estate agent, "But I used to be a teacher." That person seems to be apologizing for being in real estate because it is incongruous with his or her self-image. Mentioning present and former careers in the same breath seems to say that these newcomers are just killing time until a real job comes along. ... this revolving-door attitude robs real estate of professionalism. A lot of people in other fields believe they can moonlight as real estate agents to supplement their incomes. Having people going in and out of that revolving door doesn't result in professionalism by any stretch of the imagination.

...there is only so much business to be had. A decline in business in beach towns has forced many agents to wait on tables at restaurants this summer to supplement their incomes, for example.

How quickly the market will heat back up is an unknown. But the experts are saying it may not happen soon enough to prevent a shakeout of the industry many of them have been predicting for several years.

Published: August 31, 2006


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Realty Times - Real Estate News and Advice