There are more than a million real estate agents in the U.S. right now, but if some of the industry’s leaders are right that number is poised to get much smaller as less productive agents are pushed out of the field.
Speaking at Inman Disconnect Tuesday in Palm Springs, Paul Boomsma — president of Leading Real Estate Companies of the World — speculated that the number of agents in the U.S. will likely drop by at least a third in the future. At the upper end, he suggested agent ranks could be winnowed by as much as 70 percent.
“But the agents that remain will be really well educated,” he added.
Boomsma arrived at those numbers during a conversation at a Disconnect event Tuesday morning with other members and leaders of the real estate industry. Recounting the conversation to a larger group of attendees several hours later, Boomsma said the group took an informal poll in which everyone agreed that “we’re definitely losing some agents” in the future.
Significantly, several other attendee groups independently arrived at essentially the same conclusion at simultaneous Disconnect events. Katie Smithson, director of enterprise services at real estate software company W+R Studios, said that at her Tuesday morning event there was a sense among attendees that in the future agents will face a kind of “survival of the fittest” scenario.
“Long term what you’ll see happen is maybe some of those lower producing agents go away,” she said.
Brian Boero, president of real estate marketing company 1000watt, described a similar conversation at yet another event, saying that attendees expressed concern about the “hundreds of thousands of agents who aren’t good, the tens of thousands of brokers who are struggling to survive who aren’t strong.”
“We’re all still feeding from this same trough in real estate and sooner or later there’s not enough food to go around,” he said. A moment later, Boero wondered “how much longer we can carry the water” for the people “who should be moved out of the industry.”
Adam Contos, CEO of RE/MAX, said those concerns came up during a Disconnect discussion that he led as well. Recounting that conversation Tuesday afternoon, Contos said that there was a sense that agents need to raise the bar, and that those who fail to do so might end up leaving the industry.
“How many agents are we going to end up with in the marketplace,” Contos asked.
What exactly could lead to this winnowing of agent ranks is anyone’s guess, though the industry leaders gathered in Palm Springs see the winds of change blowing in many directions. Perhaps most ominously, Errol Samuelson — Zillow’s chief of industry development — told Disconnect attendees Tuesday morning that his company’s research indicates a recession on the horizon. That isn’t altogether surprising given indicators such as a softer housing market, but it does add a foreboding economic component to predictions that agent ranks will shrink.
At other points during Disconnect Tuesday, several real estate professionals predicted that agents could be ushered out of the industry by new technology or iBuying, which could make it harder to limp along with just a few transactions a year.
The upside to all of this, however, is that while many Disconnect attendees seemed to agree that weaker agents would eventually drop out of the industry, they also suggested stronger and smarter agents can survive. In particular, Boero said that during the conversation he led the consensus was that ultimately a “big tent” industry would prevail. There will be room for agents. And iBuyers. And there will be room for teams.
“We’re all going to continue to coexist,” he argued. “We all kind of thought there’s room for everybody.”