Admittedly, there isn’t very much fun about sifting through 70+ pages of statistics and graphs. Those that know me well know that I would rather watch soccer than sit and read stats for a couple of hours. Ok, that’s an exaggeration. I really hate studying stats, but I’d never watch soccer. That’s ridiculous.
That being said, outside of political advocacy, one of the few things that the National Association of Realtors does very well is compile some pretty good stats. If you’re an agent and you don’t read their Profile of Buyers and Sellers, you are missing out on some pretty good info that could help shape your strategic plans. But why would you want to know about the “average” Realtor?
Knowing your competition might allow you to exploit areas of weakness, opportunity, and/or underserved markets.
So, on your behalf, I sat down with the 2015 Member Profile and here are, in no sensible order whatsoever, some of the things that caught my attention:
- This may sound crazy, but one of my biggest surprises of this survey was that only 65% of Realtors use social media. I may be showing my age, but how can that possibly be true? I seriously can’t even imagine a world where an agent wouldn’t use social media in some fashion.
- This stat shows me that if I was over 50 years of age, I’d get really social savvy. For agents under 50, this stat goes up to 80 percent. If you could market to the over 50 crowd that is in the social sphere, I think there could be real opportunity there.
- In 2014, the typical agent did 11 transactions for around $1.7 million in production and made $45k. All three of those are down year over year from 2103. I’m going to go out on a limb and suppose that has something to do with strong member increases and not market conditions. Either way, I never really pay that much attention to these kinds of stats because, like in everything else in your life, the 80/20 rule applies and you aren’t the 80 are you?
- The typical agent received 20 percent of their business from repeat clients and 20 percent from referrals from past clients. If that’s the case, I think that there are a lot of agents doing things wrong. It would also explain the drastic drop in the statistics around repeat business from the Profile of Buyers and Sellers. I would love to see this (combined) number closer to 75 percent.
- Only 5 percent of Realtors reported that real estate was their first career. Nothing really of significance here other than it makes me sad. I’d love to see more universities with residential real estate concentrations.
- Only 18 percent of Realtors have assistants. If that doesn’t prove the 80/20 principle, I don’t know what will. Just a thought: there might be a larger crowd in the 20 percent if more agents had assistants doing the things that keep the agents from their business development. More on assistants here.
- In 2014, 26 percent of agents did more than 20 transactions. Again, the 80/20 rule lives.
- I’ve always thought there was something of a “war of attrition” in real estate and that if you could just hold out long enough you would likely be successful. The stats seem to somewhat back that up, even though the numbers are just kind of disappointing overall.
- More agents reported that finding the right property was a bigger obstacle to closing deals than was financing. I find this both encouraging and concerning. It’s encouraging because it would seem to imply that financing is becoming more widely available to all buyers. It’s concerning because short supply has long-term economic impacts that can be harmful if the shortage remains in place for an extended period of time. I have enormous concerns for Texas in this regard. The fortunate thing about this particular category in the profile is that 20 percent of agents reported no factors getting in the way of them closing business. That’s really encouraging.
- 69 percent of agents still belong to a commission-split model of brokerage. However, if you look at the higher-earning and more experienced agents, they tend to be associated at a higher rate with fee-based or 100% commission model brokerages. Maybe (and I might be biased given that I own a 100% commission brokerage) the younger agents should pay attention to their wise elders.
- Members allegedly brought in three inquiries and two percent of their business from their website. I know that those are small numbers, but I highly doubt the accuracy of these numbers. That’s not on the NAR for the inaccuracy, but rather the agents answering the survey not really reporting correctly. In today’s world, these agents might be getting some business from some websites, but only the truly tech savvy have websites that generate real business. My cynical side is guessing that the agents that reported this as they got business from a website and not necessarily their website. Could’ve been Zillow, their broker, or anywhere else on the ole’ interwebs. Mind you, this question was being answered by a member population with an only 2/3 adoption rate of social media.
- In the frequency of use of communications and tech products, there really weren’t a lot of surprises. But, this is where I think you can find some real opportunities if you look at what isn’t being used. In this case, blogs and podcasts were at the bottom of the list. So, how can you use a blog and/or podcast to grow your market share?
- Similarly, the most underutilized tool in the business software category is the greatest opportunity for any agent. The amazing thing (to me, anyway) is that every marketing/tech/web guru out there has been preaching this tool for a decade. VIDEO!!! If you aren’t using video, start right now. Record a video of how you liked/hated/fell asleep to this post and send it to me. Just do it. We’ve talked about video on here before.
- In the preferred method of communication with clients category, again, the losers show you where the greatest opportunity lies. The bottom three? Blog, podcast, and video chats! Facetime your clients. Record videos from your phone and send them instead of a lame email. Use blog posts in your CRM to communicate with past clients. Same thing can be done with recorded podcasts.
- In the information on Realtor websites category, the two low scoring features that jumped out at me were live chat and appointment scheduler. Those are easy things to put on a website and wouldn’t you want a hot prospect to be able to instantly communicate with you or schedule a time to get together?
- Shockingly (or maybe not), is that more agents reported, by over 10 percent, that they put their listings on third-party aggregators like Zillow, Trulia, etc. over their own local MLS. If that’s not a wake-up call to every single MLS/Association Executive in the country, I don’t know what is. Wake up, dummies!!! Put together a good, consumer website where buyers and sellers can connect with your members. Your failure to do so is the biggest threat to the industry.
- Newspapers suck. Less than 20 percent of agents put their listings on their local paper’s site. Even online, newspapers are useless.
Demographics and Misc.
- If you’re under 40 and thinking about a career in real estate, go for it. Only 11 percent of agents fit that description.
- 85% of Realtors are white. That is nuts! If you aren’t white and thinking about a career in real estate (especially if you are not white and under 40), you should jump all over that.
- Similarly, 85% of Realtors only speak English. So, if you’re white, learning another language might behoove you. Spanish seems to be the language of choice and since only 8 percent of Realtors are hispanic, it would make sense to habla.
- As I mentioned, Realtors tend to be involved in their communities, particularly politically. 96% of agents are registered to vote and 91% actually did in the past election.
- They are also involved charitably. 70% of agents said that they volunteer in their community.
- Realtors tend to put their money where their mouth is. 85 percent own their own home and more than half either own a vacation/second home or investment real estate.
I’d love to see the NAR do a Member Profile of Agents Who Really Produce. I think that would not only be far more telling, but it would give a lot more insight into how producing agents do their business. It could potentially shape how local, state, and national associations set up member benefits and tools. If nothing else, it would be a great tool for new, ambitious agents.
I know, this is a long post, but I promise, despite the boredom you’re encountering now, that it really is the meat and potatoes of the report. Now, go take a nap and when you wake up you’ll be ready to take on the world.