Agents are not being mentored effectively
“Agents today, and for the last three decades, are simply not being mentored worth a tinker’s damn,” wrote investment expert, Jeff Brown in a recent column on AGBeat. He continued, “This isn’t theory or projection of some late to the party model. Young and/or new agents are being lied to, plain and simple.”
With the old school era of apprenticeship having already died, the new school era of being thrown into the deep end has taken hold, leading to a high failure rate. According to the National Association of Realtors, first year Realtors earn less than minimum wage, and the average Realtor has a median gross income of the Realtor alone was only $34,100 which has slid 4.5% from 2009. That’s only $17 per hour if an agent limits themselves to 40 hours per week.
Applying the Pareto principle
Some would argue that the low income rates are a result of low production which is the ultimate result of poor training, not necessarily because of a poor economy. Many would argue that the Pareto principle applies strongly in real estate. In the early 1900s, Vilfredo Pareto observed that 80% of Italy was owned by 20% of the citizens which led him correlate this 80/20 principle to his garden where he also noticed that 20% of the pea pods in his garden contained 80% of the peas. This 80/20 principle is commonly known in the business world, with leaders typically noting that 80% of your complaints come from 20% of your customers and in reverse (and most pertinent to this topic), 20% of Realtors typically earn 80% of the sales of any team, franchise, or even in the industry as a whole.
The Pareto principle will never change, but it is conceivable that being mentored puts one in the 20% category of income earners rather than the 80% category. The mentorship guide below shares advice on mentorship from some of the industry’s brightest talent, all of whom are in the 20% of real estate professionals that are earning 80% of sales.