Five years of sinking prices and anemic sales have taken their toll on the entire residential real estate business, including the number of agents and brokers serving consumers.
As 2011 ends, the number of Realtors stands at just slightly over one million, down 25 percent from its peak of 1,363,493 in July 2007. Realtors’ ranks declined 5.4 percent in 2011, from 1,079,687 at the end of November 2010 to 1,021,338 a year later.
States losing the greatest percentage of Realtors during 2011 were Oregon (-10.35 percent), Georgia (10.28 percent), Minnesota (-9.94 percent), New Mexico (-9.28 percent) and South Carolina (-8.47 percent). The District of Columbia has lost the least in 2011, only 0.12 percent, according to membership data from the National Association of Realtors
The total number of licensed agents and brokers also has declined, from about 2.6 million in 2006 to about 2.3 million today.
During the housing boom from 2002 t0 2006, the number of professionals grew rapidly. In California, for example, in 2006 there was a real estate agent for every 52 adults in the state, a 57 percent increase over the previous 5 years. Today, the number of licensed agents in the state has fallen to about the same level as 2004.
The agents signed up during the boom five years ago earned less than more established ones. “One way to see that there are too many Realtors is to look at the breakdown of pay,” wrote BusinessWeek’s Peter Coy in 2006. “While the top quarter or so is making good money, there’s a huge army of Realtors at the bottom who would make more money with a full-time job at McDonald’s. Nearly a third earned under $25,000 in 2004, according to a National Association of Realtors study. By the way, a lot of the lowest-paid Realtors are the newbies who don’t have references and repeat clients. The median income for people who had been in the field for two years or less in 2004 was $13,000.”
Many of the agents who left the business over the past five years were also younger than those who have survived. As a result, the median age of Realtors is increasing, from 54 years in 2010 to 56 years this year.
Despite the thinning of the ranks, the median income of Realtors dropped almost 35 percent over the last eight years. The median income for Realtors last year was $34,100, a 4.5 percent decline from 2009. Realtor income has fallen every year since 2002 when the peak income hit $52,200.