Realtor income declined in 2007 compared to the previous year, and those with two years of experience or less had an annual median income near the poverty line, according to the latest membership profile released by the National Association of Realtors.
Overall median Realtor income was $42,600 in 2007, down 10.7 percent from $47,700 in 2006, according to the member survey data. Realtors’ median income had also fallen 3.2 percent in 2006 compared to 2004, and fell 5.6 percent in 2004 compared to 2002.
A rush of newcomers joining the profession has contributed to this drop in median income, the association reported — NAR membership grew 89.6 percent from 1998-2006, reaching a record 1.36 million in 2006 before falling 1.5 percent to 1.34 million last year. Membership was 1.24 million as of April 30, 2008.
The membership profile report is based on a survey that generated 9,997 responses, with income and transaction data based on 2007 statistics and other survey findings representing member characteristics in early 2008.
The typical member is 52 years old, female, works 40 hours per week and specializes in residential brokerage, according to the survey results.
Six percent of respondents said they are not certain whether they will remain active as Realtors, while 77 percent said they are confident they will remain in the business over the next two years, according to the report.
While Realtors who have spent two or less years in the business had a median income of $10,500 in 2007, those with three to five years of experience had an income of $34,600, those with six to 15 years of experienced earned $52,000, and those with 16 or more years of experience earned $69,500.
Federal guidelines established this year provide that the federal poverty threshold is $10,400 for a single person living in most U.S. states.
Realtors who are licensed as sales agents earned $31,000 in 2007, while those licensed as real estate brokers earned more than twice as much, with a median income of $65,200. About 61 percent of Realtors are licensed as sales agents, while 24 percent hold a broker’s license, 16 percent are broker associates, 3 percent have an appraiser license, and 1 percent maintain another type of license.
The previous NAR membership survey (see Inman News) found that those Realtors with two or less years of experience had an annual median income of $15,300 per year in 2006, those with three to five years of experience earned $44,200, those with six to 15 years of experience earned $64,600, and those who worked as Realtors for 16 or more years earned $76,200.
In 2006, the median income for sales agents was $34,600 and the median income for brokers was $73,700.
In the latest survey, about 77 percent of respondents said that real estate is their only occupation.
About 60 percent of respondents have a personal Web site, which they have maintained for a median of four years; 89 percent report their company has a Web site, and 73 percent have a home office.
About 92 percent of Realtors report that they use e-mail daily or almost every day, while 88 percent use computers and 82 percent own cell phones.
About 34 percent of respondents use "smart" phones with wireless e-mail and Internet features; 27 percent use digital cameras; 19 percent use GPS devices; 18 percent use instant messaging; and 15 percent use handheld portable digital assistant (PDA) devices 19 that do not have a phone capability.
Women account for 52 percent of brokers and 71 percent of full-time sales agents. About 14 percent of Realtors are 65 and older, 6 percent are 30-34, and 5 percent are under 30, according to the report.
About 87 percent are white, 5 percent are Hispanic, 4 percent are African American, 3 percent are Asian, and 1 percent are Native American.
Thirty percent of Realtors work 20 to 39 hours per week, while 20 percent work fewer than 20 hours per week, and 15 percent work at least 60 hours per week, according to the survey report.
Real estate is the first career for about 5 percent of Realtor members, and about 18 percent of respondents report prior careers in management, business and financial companies; 16 percent formerly worked in sales or retail; 10 percent worked in office or administrative support; 6 percent worked in education, and 5 percent reported that they were previously homemakers.
Survey respondents reported that they had worked at their current real estate company for four years, on average.
Respondents report that about 30 percent of their business is from referrals or repeat business from past clients, and that rises to 47 percent for Realtors with 16 or more years of experience.
About one-third of respondents reported that they had clients who are foreign nationals and 15 percent are fluent in multiple languages.
According to the survey, 76 percent of respondents specialize in residential real estate. Also, 27 percent of respondents report a secondary specialty in relocation; 19 percent in commercial brokerage, 16 percent in land development, and 15 percent in counseling.
About 5 percent of NAR members report that they also offer mortgage brokerage services, while 4 percent offer relocation services. Respondents also cited title insurance or processing, real estate instruction, and home warranty services as among the ancillary services that they offer.
Sales agents handled a median eight transaction sides last year, compared with 10 in the 2006 survey. There are two sides in every transaction — the seller’s side of the transaction and the buyer’s side.
The typical residential sales member was involved in selling five homes listed by other agents last year, and in selling "one of his or her own listings" in 2007, with other agents selling three of that member’s listings.
The median sales or leasing volume declined from $1.6 million in 2007, down from $1.9 million in 2006, according to the report. About 43 percent of Realtors offer both buyer and seller agency to buyers, with 9 percent offering exclusive buyer agency services.
About half of respondents are affiliated with an independent company that does not offer franchises; 33 percent are with an independent franchised company; 9 percent work for a franchised subsidiary of a national or regional company; and 5 percent are with a nonfranchised subsidiary of a national or regional corporation, according to the report.
The median firm has 25 licensees and two offices, and 10 percent of respondents reported that their firm was bought by or merged with another during the past year.
About 14 percent of Realtors have a personal assistant, 4 percent have two or more, and 27 percent of those with 16 or more years of experience have at least one personal assistant.
Realtors are largely politically active, with 95 percent of respondents reporting that they are registered to vote and 91 percent voting in the latest national election.
About 44 percent hold at least a bachelor’s degree. Forty-one percent own at least one investment home, 17 percent own at least one vacation home, and 13 percent own at least one commercial property.
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