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For the past decade, the country has experienced a real estate boom that affected much more than the number of houses that were being purchased and sold. The boom in real estate led resulted in a boom in real estate agents. With so many houses on the market, there was an increased need for real estate agents to sell those houses. The profession became attractive as many people saw it as a way to become successful in a relatively short period of time. With the bursting of the real estate bubble looming on the horizon, many people wonder what it means for real estate agents.
Across the country there were stories of real estate agents making record sales volumes. As housing prices continued to increase, many people saw dollar signs in their future as a real estate agent. Real estate schools saw enrollment numbers skyrocket. States were inundated with the number of people applying for real estate licenses. Becoming a real estate agent was the thing to do if one wanted to get rich quick.
At the booms peak between the years of 2002 and 2004, membership in the National Association of Realtors increased by over 25 percent. More than one million people today are real estate agents.
When forecasts for home sales began to drop in 2006, so did the many real estate agents’ commission. The effect of the sales drop was felt in places like Florida and California where the real estate market has been surfing for years.
During the time of the real estate boom, many new real estate agents found they didn’t have to work nearly as hard as their predecessors to make a decent living from their profession. Once the market began to slow, however, this was not the case. In 2005, newcomers to the real estate agent profession only saw an average annual income of $12,850, which is well below the poverty line. These new real estate agents are hurt the most by the real estate recession. For the first time ever, these new agents are finding themselves having to work hard to find clients and close deals. Some are not prepared for the work cut out for them. Among many, there is talk of changing professions to make the money needed to survive.
It seems that the seasoned agent is virtually resistant to the slowing market. Over time these people have developed the negotiation skills necessary to be successful in a softer market. These experienced real estate agents are the ones that will be sought, not those who are new to the profession. In this market, agents will have to do a little more work to find and close deals. Placing a for sale sign in the front yard won’t be enough.
Because of the slowing market, there are fewer people seeking to get a real estate license. In many places, class enrollment has dropped by more than 50 percent. The National Association of Realtors does not expect membership to increase this year.
Keywords: Real Estate Agent
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