The coronavirus pandemic has pushed a surge of potential homebuyers into the housing market, many of whom desire more space and want to capitalize on historically low mortgage rates.
Still, this doesn’t mean the industry needs more agents, according to some experts.
The “low supply of homes and high competition” will make it even harder for new agents to close transactions, a Redfin spokesperson told FOX Business.
“The reality is that many people are getting into real estate right now, but most new agents will barely break even in their first year,” the spokesperson said.
Even before the pandemic, the industry was very competitive.
“The industry is highly competitive even in normal times with some doing extremely well and earning a six-figure income, while others face challenges in building up a reputation and client base,” National Association of Realtors chief economist Lawrence Yun told FOX Business.
In today’s environment “homes are selling quickly while inventory is hard to obtain,” Yun said.
This means agents who are good at getting listings will still do well “while those working principally with buyers will do a lot of work and re-work in a multiple offer bidding situation,” Yun added.
However, the “fierce competition” spans the nation.
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“Best of luck to all, but the reality is such that not everyone will succeed,” Yun said.
The National Association of Realtors estimated that there are 1.5 million realtors involved in all aspects of the residential and commercial real estate, “hence 1.5 million individual business plans where around 11 million transactions occur in a year,” Yun said.
However, some experts argue that it’s as good as a time as any to break into the industry.
“While the market is extremely active and inventory is low, that doesn’t mean you can’t close deals,” CEO of Oxford Property Group Adam Mahfouda told FOX Business.
In fact, Mahfouda argued that “it’s a great time to form a relationship with buyers, and good agents who really care about their client’s interest might even discourage a client from purchasing in a bull market where bidding wars are prevalent.”
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Additionally, agents working in today’s market will also benefit if listings are priced correctly because that means they are selling really quickly.
“That being said many companies (like ours) who have independent contractor relationships with their agents vs. employment relationships also supply their agents with leads, benefits, training, and more,” he added. “So you don’t really need to be an employee to benefit from these perks.”