That’s information that came from a study by the CFA (Consumer Federation of America).
Summary of the study:
- The recent study found that 70% of agents in the U.S. sell five or fewer homes in a year, and 49% sell only one or no homes at all.
- The study’s findings are far below the 12 sales per year for the median agent suggested by the NRA’s (National Association of Realtors) annual member survey, likely due to bias.
- The study’s author, CFA senior fellow Stephen Brobeck, concludes that “the residential real estate industry is clearly a part-time industry.”
- Brobeck also argues that it is too easy to become a licensed agent and that low barriers to entry lead to a large gap in knowledge and competency between the most and least experienced agents.
- He offers a few potential solutions, including state mandates for broker supervision of inexperienced agents, post-licensing education, and higher standards for earning Realtor status.
Key takeaways:
- The residential real estate industry is dominated by part-time agents who sell few homes.
- It is too easy to become a licensed agent, which leads to a large gap in knowledge and competency between agents.
- There are a number of potential solutions to these problems, but it is unclear whether any of them will be implemented.
Additional thoughts:
- The study’s findings are based on a relatively small sample of agents, so it is possible that they do not accurately reflect the entire industry.
- The study does not take into account the reasons why some agents sell few homes (e.g., they may be new to the industry, they may be working part-time, or they may specialize in a niche market).
- The study’s recommendations are likely to be controversial, as some people believe that the real estate industry should be self-regulated.
For more about the study, go to: The Real Estate Agent Glut
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