With more than 1,000 Inman posts, Bernice Ross is a long-time contributor whose weekly column on real estate trends, luxury, marketing and other best practices publishes every Monday.
Part-time agents — they’re everywhere at almost every major brand. Although working part-time can be a pathway to becoming a successful full-time agent, the huge majority of new and part-time agents wash out of the business.
What steps can the industry take to help part-timers succeed? Or, is it best to just say “no” to part-timers?
The real estate industry is currently on track to close 5.49 million existing home sales or just slightly under 11 million sides, according to the National Association of Realtors (NAR). Two million individuals currently hold real estate licenses.
Given that the 80-20 rule is in play (and it may very well be the 90-10 rule), 80 percent of the transactions, about 8.8 millions sides, are being conducted by approximately 400,000 licensees.
That leaves only 2.2 million sides for the other 1.6 million licensees, or 1.4 sides per licensee. This fact alone makes the odds of new and part-time agents succeeding exceptionally low, especially given the on-going inventory shortage.
Going for quality, not quantity
I’ve often heard Keller Williams Founder Gary Keller say, “The quality is in the quantity.” One can hardly argue with their proven business model that has created the largest brand in the country and that does billions of dollars of transactions every year.
On the other hand, there is a growing trend to double down on quality rather than quantity. Since 2006, I’ve been involved eight different studies on new and experienced agent success at both the corporate and state association level.
Based on that research, there seems to be an increasing number of brokers are opting to leave the big brands in order to launch either a boutique or team-style brokerage model where there is a focus on collaboration, professionalism, and production standards. The brokers making this move not only feel that is best for their business — it’s the right thing for their clients.
Lindsay Bacigalupo, the owner broker of Engel and Völkers of Minneapolis, explains:
“We made the decision to require all of our agents to be full-time and to meet minimum production requirements because it was best for our clients. There are so many part-time agents who are not educated, who lack experience, and for whom real estate is not their full-time job. We want our agents to be with other agents who love what they’re doing, who are good at it, and who care about their clients.
When someone buys a home, it’s one of the biggest assets they’ll ever own. It’s the place they call home. If you’re going to be helping them manage that transaction, you can’t do it part time. You can’t sell three houses a year and expect to be the best negotiator, to know the market, to correctly price a home, or help a buyer win the property in a multiple offer situation. We’re excited to have a company where we can surround ourselves and our advisors with really great people.”
Erica Ramus, the broker-owner, Ramus Realty Group and an Inman contributor, made a similar argument:
“Real estate is not a hobby. I only hire full-time agents. If I do hire a part-timer, they must have a path to the transition and have a deadline when they will be leaving their other job. If they don’t hit that deadline, they’re not a perfect fit for our office. This is a full-time, serious profession. We’re dealing with large sums of money, huge transactions, and major transitions in people’s lives. It’s not something you do on the weekend for fun or for extra money.”
Top factors influencing new and experienced agent success
Although there are a variety of factors that influence agent success, the Texas Association of Realtors new agent research conducted in 2012 and 2015 plus a number of studies I reviewed for that research, confirmed the five factors below are pivotal to the success of both new and experienced agents:
- A learning mindset
- Emotional resilience
- Has a behavioral profile suited to commissioned sales.
- Understanding that real estate is a business (not a job), where they’re responsible for creating their own leads.
- Adequate capitalization
Inadequate capitalization is the primary reason agents are forced to work part-time. It’s also the reason that not only new and part-time agents fail — it sinks teams and brokerages as well.
Brokers and managers are the gatekeepers who can change the business
The broker plays a pivotal role in this process, not only by whom they hire, but what happens after the agent comes on board. Good training is a must, but the broker must also take the responsibility for doing everything possible to help any agent they hire succeed.
“We probably lose 30-40 percent of the new agents that come in the business, either from not setting good mutual expectations up front, or thinking that part-time person was going to pour more of themselves into real estate and create an exit strategy from their current job. If that doesn’t happen, I don’t want it to be because they fell through the cracks —t hat’s something we’re really trying to prevent.
When my managers ask me about hiring part-time agent, here’s what I say: ‘I don’t have a problem with you hiring part-time agents provided that you, as their leader, are willing to commit to helping them succeed. Are you willing to meet with them one night a week? Will you conduct live training on Saturdays or offer training on Zoom? Unless you are willing to pour your energy into helping them succeed, you’re doing them a tremendous disservice.'”
Time to speak the hard truth
Managers and brokers need to tell new and part-time agents the hard truth about what it takes to succeed in real estate — a full-time commitment, emotional resilience, lifelong learning, and willingness to prospect and generate your own leads.
They also need to take responsibility for the agents they hire to make sure those agents have access to the training and support they need to succeed. Otherwise, they are indeed doing those agents a tremendous disservice.
Bernice Ross, President and CEO of BrokerageUP and RealEstateCoach.com, is a national speaker, author and trainer with over 1,000 published articles. Learn about her broker/manager training programs designed for women, by women, at BrokerageUp.com and her new agent sales training at RealEstateCoach.com/newagent.