Redfin Releases National Survey on the State of the Real Estate Profession
Tuesday, July 30th, 2019
Redfin (www.redfin.com), the technology-powered real estate brokerage, released findings today from a national survey of real estate agents. The comprehensive survey sought to uncover the state of the real estate agent profession in the United States in terms of career fulfillment and growth, commissions, income, feelings about technology, and the pervasiveness of racial bias and sexism in the industry.
"As a company that has long aspired to be the best employer in real estate, Redfin commissioned this survey to understand, at a time when billions in private and public capital is being invested in U.S. real estate brokerages, how the life of an agent has changed, and what we can do to attract a new generation of talent to our profession," Redfin CEO Glenn Kelman said. "What we learned is that agents love the customer relationships and entrepreneurial independence of being an agent but question whether internet technology has made them more productive, and still worry about finding enough customers to earn a steady living."
Among the key findings:
Nearly half of respondents have a second job; a third outside of real estate.
Millennials were the customers agents were least likely to identify as easy to serve.
41% of agents who advertised on lead-generation sites had a positive return on investment.
33% of agents said the internet had increased the amount of work associated with a sale compared to 32% who claimed a decrease.
21% of agents would recommend their career to others.
Of agents with five years of experience or more, 49% said commissions have remained about the same over the past five years, 31% said commissions had declined.
33% of non-white agents believe bias is pervasive, compared to 18% of white agents.
13% of female agents report sexism or harassment from customers, 6% from colleagues.
The survey was done in March; 500 U.S. agents who sold at least one home in the last year participated. Respondents were affiliated with a wide variety of brokerages and were not aware that Redfin commissioned the survey. More than 80 percent of respondents had four or more years of experience. Respondents reported a median of 7 to 9 closed sales in 2018, and a median income between $25,000 and $50,000 after work-related expenses, similar to findings from the National Association of Realtors.
Career Satisfaction: Agents Like Serving Customers, Dislike Prospecting
Relationships with customers and entrepreneurial independence are what agents enjoy most about their job, with 86 percent of respondents selecting those responses. Eighty-one percent said their favorite thing about being a real estate agent was helping people whose lives are in transition. And 99 percent of respondents said they're proud of the service they provide.
But just one in five real estate agents would recommend their career to others. The most disliked parts of the job include income unpredictability (42%) and difficulty finding customers (38%).
Sixty percent of experienced agents said their incomes had increased in the past five years, while 14 percent said it decreased. Nearly half of all respondents worked other jobs to supplement their income.
Agents Feel the Internet Has Decreased Productivity while Increasing Costs
The findings also revealed that agents are spending more money than they were five years ago on the costs of finding customers like advertising and online lead-generation, despite their increased pervasiveness. The survey findings also suggest that the internet has not led to increased productivity for agents, most of whom said the internet has either caused them to spend more time and effort to close a sale (33%) or hasn't affected the amount of time they spend (33%).
Meanwhile, commissions have been mostly stable, according to agents with five-plus years' experience, 49 percent of whom reported no major change.
More than half of respondents said Gen-Xers were the easiest clients to serve. Millennials and Baby Boomers were deemed the toughest, with just 23 and 25 percent of respondents indicating that those generations were easy to serve.
"The lessons for the broader industry are first that rumors of the agent's demise are greatly exaggerated. But we should also pay heed to agents' broad frustration with technology, their struggle to make new lead-generation channels profitable and to meet the demands of a new, more fickle set of young homebuyers," wrote Kelman.
Racism and Bias in the Industry
Redfin asked several questions about diversity and racial bias in the industry with input from Elizabeth Korver-Glenn, assistant professor of sociology at the University of New Mexico, who has focused her research on how real estate agents connect with customers of different races and ethnicities. Professor Korver-Glenn has researched how white agents often have privileged access to listings, lenders, builders and other resources that benefit white clients, unwittingly perpetuating the segregation that exists in many neighborhoods across the U.S.
Asked about the races and ethnicities of their last 10 clients, the survey found white agents were far more likely to work with white clients compared to non-white agents. White agents said an average of two of their clients were not white, compared with an average of four non-white clients served by non-white agents. Non-white agents were also nearly twice as likely to agree with the statement 'bias is pervasive' at 33 percent compared with 18 percent of white agents.
"Our hope has been that the internet will mitigate some of the effects caused by the differing social networks of white and non-white agents," wrote Kelman. "We've found that a white customer who might have hired a white agent from her social network is perfectly comfortable hiring an agent of color on Redfin.com, particularly when we can show that agent's reviews and sales performance."
To read the full white paper, complete with charts and methodology, please visit: https://www.redfin.com/blog/the-next-generation-of-real-estate-agents/
Kelman will also present the findings in a keynote at Inman Connect on July 24, 2019 at 10:05 AM PDT.