Brokerages are finding it tough to attract younger agents
According to the 2013 Imprev Thought Leader Survey, recruiting younger real estate agents is the top challenge for survey respondents comprised of top real estate executives at leading franchises and independent brokerage firms responsible for nearly one in three residential real estate transactions last year.
In an improving market, agents and brokers are increasingly busy which respondents indicate is a challenge not only because their time is restricted, but because top talent they seek to convert has become too busy to even discuss the possibility of switching brokerages.
Veterans aren’t aging out of the industry
Imprev notes that “the aging of the real estate workforce has been well documented,” citing National Association of REALTORS® data which reveals that the average real estate agent is 57 years old, though the average American worker is 41 and the typical age of a first-time buyer is 31.
“Over the last five years the average age of real estate agents has almost moved in lock-step with the calendar,” which is also supported by NAR research, said Imprev CEO, Renwick Congdon.
Research indicates that veteran agents are opting out of retirement and are unlikely to switch firms, leaving firms struggling to attract top producers, particularly veterans.
Why the need for agents?
When new talent isn’t coming in, brokerages’ bottom line is impacted. Imprev’s study found that the biggest obstacle to profitability is the need for more agents, even more than the physical space costs and commission splits.
While these challenges remain, one in three respondents cite too few quality prospects as one of their biggest recruiting challenges, indicating a talent gap in the industry.
Other highlights from the Imprev Thought Leader Survey:
According to Imprev:
- Competitive challenges: Nearly half (49 percent) cited competitors offering “a better commission split,” followed by competitors offering lower costs for affiliation
- (46 percent); having more market share (23 percent); offering signing bonuses (22 percent); and providing more leads to agents (21 percent). Trailing those concerns were: offering more marketing support (16 percent); having better brand recognition (14 percent); and providing better technology (10 percent).
- Profitability challenges: Other profitability challenges the executives said they face included support-staff costs (31 percent); the “impact of discount brokers” (22 percent); and technology costs (18 percent). Fewer than one in 10 executives (9 percent) cited “benefit costs” as a top profitability concern.
- More recruiting challenges: The No. 2 recruiting challenge the executives face is not able to find enough time to recruit (44 percent). Respondents also cited an inability to get their teams to help recruit (28 percent) and finding “prospects that fit your culture” (27 percent) as other significant recruiting challenges.
July 8, 2013 at 8:42 am
Our industry is focused on the wrong demographic for new agents. People over 50 are the best untapped workforce for our industry. Many of them have grown children not needing time off for parenting, are not pressured by needing to make a steady pay check due to pensions from prior occupations, and are actually grateful to have a job that does not discriminate due to their age. The Boomers and above group 47-67 fit into our demographic perfectly and want to work every day if for no other reason to have a place to socialize and be useful which is how many of us prospect in the first place.. Anyone can be taught technology but experience is something earned over time. More patient, better focused, can accept failure and move on because they have done so in many areas of real life, etc. When I entered the business 23 years ago most of my mentors and brokers were 50, 60, and even 70 years old. They were treated with respect and we watched their every move so we could emulate their success. The above study revealed that these new young guns recruiters were concerned with “(46 percent); having more market share (23 percent); offering signing bonuses (22 percent); and providing more leads to agents (21 percent). Trailing those concerns were: offering more marketing support (16 percent); having better brand recognition (14 percent); and providing better technology (10 percent)” What they failed to mention was the need for training and a business plan to carry them through the ups and downs of a challenging and rewarding industry which is why 80% of their new agents fail in the first 18 months. Change your focus to train and retain rather than having to constantly be recruiting might be a better plan. Add to that more focus on the not so “old” generation and you just might find yourselves with a long range plan and profitable business model.
Pingback: RE Buzz - Real Estate News Roundup - July 16, 2013 - spake.com