Red-hot real estate market doesn’t need more agents, experts say

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The coronavirus pandemic has pushed a wave of potential homebuyers into the housing market, many of whom want more space and are keen to take advantage of historically low mortgage rates.

However, this does not mean that, according to some experts, the industry needs more agents.

The “low supply of apartments and high competition” will make it even more difficult for new agents to complete transactions, a Redfin spokesman told FOX Business.

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“The reality is that a lot of people are getting into real estate right now, but most new brokers are unlikely to break even in the first year,” the spokesman said.

The industry was very competitive even before the pandemic.

“The industry is highly competitive even in normal times, with some doing very well and making six-figure income while others are challenged to build reputations and customer bases,” Lawrence Yun, chief economist for the National Association of Realtors, told FOX Business .

In Vienna, Virginia, outside of Washington, there is a real estate sign advertising an “Under Contract” house. (Reuters / Larry Downing) ()

In today’s environment, “homes sell fast while inventory is hard to come by,” Yun said.

This means that agents who are good at receiving bids will still do well, “while those who work primarily with buyers will do a lot of work and rework in a bidding situation with multiple bids,” Yun added.

However, the “fierce competition” spanned the whole country.

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“Good luck to everyone, but the reality is that not everyone will succeed,” said Yun.

The National Association of Realtors estimates that 1.5 million brokers are involved in all aspects of residential and commercial real estate, “hence 1.5 million individual business plans that involve about 11 million transactions per year,” Yun said.

However, some experts argue that there is next to no time to get into the industry.

“While the market is extremely active and inventory is low, that doesn’t mean you can’t get deals,” Adam Mahfouda, CEO of Oxford Property Group, told FOX Business.

In fact, Mahfouda argued that “It is a good time to develop relationships with buyers, and good brokers who genuinely care about their clients’ interests might even deter a client from buying in a bull market where bidding wars are rife.” are.”

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In addition, agents who are active in today’s market also benefit from a correct price of the offers, as they are then sold very quickly.

“That being said, many companies (like ours) that have independent contractor relationships with their agents versus employment relationships also provide their agents with leads, benefits, training, and more,” he added. “So you don’t really have to be an employee to benefit from these benefits.”