http://www.rismedia.com/index.php/article/articleview/13478/1/1/

"Real Estate Latecomers May Have Tough Road Ahead

RISMEDIA, Feb. 15 ­ (KRT) ­ When Brandon Realtor Connie Johnson hosted an orientation for prospective Tampa Bay area Realtors last month, she gazed into a mass of 165 freshly licensed agents hungry for advice.

Johnson didn’t want to be a downer, but hadn’t they heard the news? The bloom may not be off the real estate rose, but its petals are definitely showing the first signs of wilt."

"Realtors with two years of experience or less earned median incomes of $12,850 last year, according to the national association. That’s almost equal to the U.S. poverty level of $12,830 for a family of two."

With the regular job market picking up and with unemployment at 4.7% (and falling), most people would choose the security of a paycheck, benefits & career mobility with a traditional company rather than as a real estate agents which doesn't offer any of that.

It is going to be a tough sell when the corporate sector offers so many more opportunities and where there are an abundance of high paying jobs

I want to know where these income stats come from. Are they from full time agents? There are many agents who are members of NAR, but have no intention of selling. If they count towards the stats, then we have disrepancy in the number of actual agents out there who want to make a living a this...versus someone who has a license to purchase their own house.

I keep seeing stats that say, "The average REALTOR® makes 24k per year, 18k per year", etc. The numbers never really say where this comes from and if they surveyed the salaries of professional agents versus part-time, some-time, assistant, or other people who have licenses, but are not as productive.

I am an instructor and REALTOR for the OKMAR here in Oklahoma City and maybe I am being a little naive but honestly think that the new (young) blood that is coming in will dominate this market because of their tech savvy. They embrace new trends in technology that reach today's buyers and sellers that most "veterans" brush off as "trendy Hodge podge trickery".

I do think that the average person over the age of 35 with very little computer, web browsing and/or website knowledge that's just now getting into the RE field has a SIGNIFIGANT disadvantage as far as their longevity and prosperity in this business (It still shocks me how many agents (old and new) that I meet that doesn't have their website or e-mail on their biz cards)

Anyhow, just my .02 but I think that $12K per year is a little off the mark. Heck, I know agents that screwed around in this business and made $15,000...IN OKLAHOMA! That's like one deal on one of the coasts.

That figure is probably derived from the blended
figure.In other words some make no sale,some a little,some alot then they average it out.

If you think there is no business then you are right there isn't,people are going to need to buy and sell no matter what the market is because life happens and changes situations.

There will always be a need to buy and sell,if agents choose to think there will not be enough business to go around then that is your choice and you are defeating yourself with your negative thinking.

I realize that you say average person but in my experience age is not a predictor. I am 36 and lived, breathed, and slept computer for longer then an 18 year old has been alive. I embrace all new technology more readily then a lot of the 20 somethings in my area. I have found that some people have no idea what to do with a computer and others that are very tech savvy and age is not a common denominator. I find in my area being up on technology is not very common. Case in point...our broker had a class with handouts on jumpdrives...what they are and how to use them...I was the only one beside the guy explaining it that was using one...out of a 100 agents. And I would say 25% are under 30.

"Median" means the middle number in a series of numbers, half are above that figure and half are below.

The numbers, BTW, came from NAR

I can beat that but it's cool to see other "geezers" like myself:

- I'm 36 and had my first PC at age 12. That's be 1981 or so. I wrote my own programs in BASIC. I was offered a job at a computer store in a mall because none of the salesguys knew how to demonstrate computers.

- I had Internet access before there was a World Wide Web in college in 1990. I had an email address and used USENET and learned enough UNIX to get around. Back then few college students had Internet access or even knew what it was.

This oklahome.com guy is a little over-smug and is underestimating the competition.

I might have you beat, Jim. I am 45 and have been on the internet since 1981, when I was a new transfer student to MIT and it was still called the Arpanet.

I, too, started programming at an early age...in FORTRAN at terminals with inch-wide punch tapes. Only later did I graduate to IBM punch cards.

After college graduation, I worked for Symbolics. The very first company to have its own domain name. In fact, I've worked for three of the first 100 registered .com domains.

And I worked as a UNIX sysadmin for three years from 1990-93 for one of the Baby Bell's research sites. Things have certainly changed a lot since then!

When i come across someone like that and I know what a BBS is/had my own/wrote my own modem strings etc. their attitude changes usually because they don't know what I'm talking about.

If you got smug out of what I said, I respectfully think you're off base. What I said was that people JUST NOW GETTING INTO THE BUSINESS that ON AVERAGE have no computer skills, are going to have a hard time competing in this industry given the very technology driven aspect that is carried in this business.

Somehow this seemed to have gotten turned into, "Everyone over 35 doesn't know computers and is doomed to fail in real estate." which is not what I said.

You guys obviously have, Tech-"knowledge"-y. But think of how many people get their RE license everyday, that never visit this board or others because they haven't grasped things like, Search Engines, Forum Groups, Blogs, etc. They never realize that there is a large support group out there (like this board) that offer very insightful aspects to the industry like how to start gaining clients, how to get listings, buyers, marketing yourself and all those things that your RE course didn't teach on how to be successful and your broker doesn't have time to do.

I will guarantee that there are more "wash outs" in this industry than we know and I would stake half of my earnings that says a lot (not all) of it's because they were technoligally challenged when it came down to it.

Yes most people do wash out. lol That is just the odds of our proffesion. A good worker who is determined can succeed if you have a plan and try real hard. I have seen PHDs wash out. Yes they passed the license part but had no salesmanship. You must be a people person. We build bridges between people that is our job amongst many other duties.

Totally agree "TerrinVA". Well put.

But you can have an 18 year who is technologically challenged just as easy as you can have a 35+.

I gave my 65 year old father a computer in 2 years he was upgrading the computer and learned most of the basic funtions such as e-mail and how to google. He also leaned how to burn Cds. My Dad was 80 when he passed but was on the computer everyday.We all got his 20 e-mails a day it was a big joke at the Memorial service.

hi all,
i believe it is a good thing for the RE industry to be difficult. it is almost like the law of the jungle "only the strong survive" so to speak. i thinks it weeds out the uninformed and inept and the industry as a whole is better off for it. on the other hand, i think there is a shadow of impropriety on the companies who exploit these flaws in new agents.
in regards to techy thing, i'm 42 and have been using computers since the early 80's but i'm far from knowing as much as i should so i try to learn new things every day in a futile atempt to stay abreast of development.
steve

It may be a good thing for the industry to be difficult... but it would be better if the industry did a better job in letting those interested in joining it.. how difficult it was. Or possible making the requirement more realistic and functionally based rather than just under qualified/ unprepared agent mills.

Well, ever since I joined the industry they have been telling new recruits that most fail in the first 6 months. But year after year I watch the new inductees grow and grow, and the new member orientation is offered each month at a larger and larger venue...
At least our state legislature changed requirements - new licensees must go through a very specific CE class plus everyone who renews must take specific classes. So no more taking meaningless CE classes just to get your credits.
--A

Well hopefully they have a regular traditional 9-6 job with salary and benefits.

I am sure that 90% of those new recruits are probably in real estate part time only.

I agree with you completely. I did my homework before I entered this industry and made sure I had the capital to get through the first year without earning a dime, but I remember in agent training, the training instructor said how many people are prepared not to earn any money their first year? There were only two of us who raised their hands. The instructor looked at us in disgust, like we were the ones who were on another planet. He went on to say that it was a myth and that if we worked hard we'd earn a good living the first year. Well, I worked really hard and I didn't earn a dime the first year. I'm now in my second year and doing very well, but it's clear from my experience that new recruits are deliberately misled.

Nick, what I am saying is that despite the warnings that most will fail, thousands still try. And they do fail, and they often are in it part time, but it doesn't dissuade newbies from trying. And at least we are making sure that if they stay in long enough for the first two years to renew their licenses, they have been properly trained.
--A

The real estate schools (and the instructors that work there) have absolutely no motivation to tell the truth. If students learned in their very first class that they were likely to fail in their first year......why would most of the students return for their second class? The job of the RE schools & instructors is to keep the classrooms full. Coming clean with those stats regarding first-year washout rates would surely have a negative impact on their bottom line.

The instructors will just teach their lessons and tell you what a great field this is to work in. I've often wondered if some of those instrutors are there because there were really good.....or if they needed a teaching job because they couldn't make it in this field.

East Texas Realtor, I truly believe most people enter this business without a lot of thought. They look at people they know who are real estate agents and say to themselves, "Hey, I'm brighter than that person and he's earning a decent living, I can do that, too!" They don't realize that there are a set of skills, personal characteristics, sphere of influence/network, business plan, and start-up capital behind most successful agents. From the outside it looks a lot easier than it really is to break into this field and make a really good living from it. And, now that we are coming off a real estate cycle, it will get tougher for those trying to break into the field.

I have actually had friends of mine tell me, "Man, I need to become a Real-a-ter! You've got no boss. You get to stay home, play on the computer, look up houses, meet the people there, open the door and pick up a big check!"

- Whew! Didn't know that my job was that easy! (Now, where did I put that EASY button...)

Totally agreeing with you.

That is almost word for word what the instructor at the RE school said on the first day of class.

Just like we give consumers agency disclosure forms to sign upon our first face-to-face meeting with them (or at least that's what we do here in Connecticut), anyone who signs up for a real estate course should be required BEFORE the first class to sign a disclosure form that states:

I have read the NAR statistics that show that 85% of agents do not renew their real estate licenses for the second year.

I am aware that I am essentially starting my own business and that instead of investing capital upfront, I'm investing time and effort.

I realize that it may take six months to a year before I see any substantial income and even perhaps longer.

I understand that there are a number of start-up expenses in terms of real estate license fees, etc. (a Good Faith Estimate of these would be attached)

Just kidding, of course, but we do this for real estate clients so they are forewarned about the laws of agency and costs of borrowing money. Is it really such a crazy idea?

HI

"Trample the weak, hurdle the dead".

Yup, that pretty much sums it up for me.

John

This industry is changing rapidly and new people who are tech savvy have an advantage over those. Age doesn't equate to tech savvy but it definitely is an advantage for younger people. My last thought on this is competence is blind to age and the consumer is most interested in competence.

JohnS, That's pretty harsh, don't you think? I haven't found this industry for the most part to be as nasty and competitive as I expected. I'd say 95% of my experience so far in this industry has been positive. I think some of my outlook is due to the fact that I had a realistic expectation of how tough the real estate business is. It certainly isn't for the faint of heart, but for the most part, I've been impressed with the kindness and helpfulness of other agents, reasonableness of my clients, and adherence to the ethics and laws of the real estate profession. It's much better than I expected given that it certainly could be a "dog eat dog" environment.

SheldonJ, I don't know if the consumer is most interested in competence. In my experience the consumer is most interested in a real estate agent they can trust and who gives them great service.

Well, I won't tell my age, but I am not what I would consider tech savvy. I started this career knowing very basic things, like how to turn the computer on and off without causing TOO much damage, and checking my emails... Now I can do a bit better than that and have built my own website, use Microsoft publisher to make my own flyers, etc, track my BPOs and REO listings on a modified MSWorks spreadsheet, etc. I don't feel that lacking tech-knowledge was a disadvantage when I started, as a had people-knowledge instead, and that got me several sales within the first several months. I think what puts newcomers at the disadvantage and causes them to give up is the unrealistic view of both what Realtors earn, and what we have to do to earn it. There's the impression that we answer the phone, show a house, and cash a huge check. The public has no idea of the stress involved in getting from that first phone call to that check in hand. They don't realize the expenses we have (E&O, fuel, licensing, advertising, etc), and they get upset when they interview and are told by prospective brokers how much of that money the broker gets to keep (after all, all the broker does is let the agents make money for him, right?). There just isn't enough honesty in this business, so people think it's easy and they'll get rich in their first year. I like the idea of a disclosure for prospective agents, and may make one up for those who want to start working for us!

I must be jaded 'cause I just laughed my butt off at that one!!!! Thanks!

Isn't real estate going to be a tough sell for younger people (especially recent college grads) and those who are 'tech savy'??

The job market has come a long way from the 'jobless recovery' of 2001-2004 and unemployment is well under 5% with job growth averaging over 200,000 a month and with many companies offering packages that were as good or better than in 1999 or 2000??.

How is the industry going to sell a profession which is 100% commission and where you typically need to go for 1-5 years before making any real money?? Plus the fact that prices will 'only' rise at the rate of inflation and sales growth should average around 10% in most regions..

Plus don't forget about the huge opportunity cost and lost promotional opportunities and a career track at a regular corporate job or having to explain to HR or Hiring managers at a later date what possessed you to take a real estate sales job (where you have less than 10% chance of suceeding).
They will see their friends rapidly climbing the ladder while they are working 60 hours a week for a year or two and making no money

HI
It wasn't meant to be harsh, it was meant to be funny. Ha Ha

John

Ah, I needed to see the smiley face! It WAS funny! Thanks.