To all the agents in the house,
I spoke yesterday with Daryl Fairweather, who is the chief economist at Redfin, about who the winners and losers are of the present high-demand, low inventory housing market. To hear her complete answer to this question, well, you can listen Wednesday to the "Houses in Motion" podcast that's part of the HousingWire Daily podcast feed.
But Fairweather presented one answer I have not thought of very much - inexperienced real estate agents are losing.
"New agents - like new buyside agents - it's hard for them to get up to speed in such a wild housing market," Fairweather said. "Imagine starting your job, and it's like the most intense housing market in history. So, it's been difficult for agents, and there's been a lot of agent burnout."
Fairweather said that there has been high turnover in the past year among newer agents at Redfin, which is one of the few brokerages to pay agents a salary.
Tracking turnover is not easy. Most brokerages share just aggregate agent numbers, and many of the agents who do leave simply jump to another brokerage. That said, the National Association of Realtors noted in its 2021 member survey that the majority of agents with less than two years of experience earn an income that (assuming their agent income is the majority of their annual earnings) puts them below the poverty line.
"New members entering the field can be noted by the differences in income by experience, function, and hours worked per work," the report read. "Fifty-nine percent of members who have two years or less experience made less than $10,000 in 2020."
One cold takeaway from this: "Good."
Agents, just a couple of weeks ago, I asked in this newsletter if there were too many of you and if the saying that "20% of agents do 80% of the work" was true. The resounding answer to both questions was "Yes!"
Maybe an extraordinary market weeds out less professional agents, looking for a quick pay day.
Another thought is that brokerages and senior agents must better train and support newcomers. Part of making real estate more professional, argue brokers such as Michael Lissak of Virtual Realty, is implementing a formal education or apprenticeship program.
Agents, what do you think? Have you seen more newcomers drop out than usual this year? And what, if anything, should change to help those new to home deals?
Please email your thoughts anonymously to mblake@housingwire.com.
Sincerely,
Matthew Blake
Senior Real Estate Reporter
.jpeg?width=1116&upscale=true&name=FAMB-Newsletter970x250%20(1).jpeg)
EmoticonEmoticon