Wednesday, October 31, 2012
It's Eight O'Clock...Do You Know Where Your Local Realtors Are?
Long ago, when Your Humble Narrator toiled in the mass media trenches, he was assigned to write a feature on a husband and wife realty team. They'd been a fixture in town for years, were considered progressive employers, and had a good reputation. "Not a problem," Your Humble Narrator replied. "Sounds like a piece of cake."
My 45 minutes with the Dynamic Duo of Realty passed pleasantly enough, covering all the usual bases of what they thought it took to succeed in the housing marketplace.
At some point, the male half had to take a call, and his wife weighed in with a pungent observation of her own: "When we interview anybody who wants to come here, we require them to have at least three months of savings."
"And you require that, because..." I asked.
"Well, look at this way: you might take a year to sell your first house," she responded. "That's how it was for me. You've still got to pay your bills, what else are you going to live on?"
"Fair point," I agreed. "So it's not just about showing houses, and taking 'em on tours, eh?"
"Not quite, no." She pursed her lips, paused briefly, and went on. "A lot of people come through here, thinking, 'This sounds like such a nice job, showing people houses, and making money doing it.' Well, it's not like that."
She pursed her lips yet again. "You're working nights, you're working weekends, you're working Sundays, and all this time, you're showing a house that may not sell. It's a tough business."
I remember hearing those comments around 2001-02, a good six or seven years before the Housing Bubble burst, and your local realtor had ample grounds for slitting their wrists.
Judging by a couple of articles that The Reckoner has come across, the profession hasn't gotten much more fun, such as this cheery observation from "Business Insider" ("The 19 Jobs Where You're Most Likely To Kill Yourself"): http://www.businessinsider.com/most-suicidal-occupations-2011-10#10-real-estate-sellers-are-138-times-more-likely-to-commit-suicide-than-average-10
According to the National Association of Realtors, members' incomes have decreased from $52,200 in 2002, to $34,100 in 2010, although the association stated that realtors' median incomes rose slightly, by $800, from 2010 to 2011.
Obviously, your prospects depend greatly on where you're plying your trade, as this article about the "6 Most Stressful American Citieis" in Realtor magazine suggests:
Notice something missing? All three states profiled (Florida, Michigan and Nevada) continue to struggle with high foreclosure rates, as this "CNN Money" article makes clear:
You'd think that foreclosure would amount to a major stressor by itself -- what's scarier, being put in that situation, or reading a trade publication that doesn't even acknowledge the problem?
At any rate, while the "CNN Money" article suggests that there's some improvement on the horizon, nobody should feel ready to break out the marshmallows quite yet. For realtors, there's definitely a lot of hard work ahead in most markets before anybody can say that the worst is over.
Even without the backdrop of foreclosure rates and other social issues to consider there's still the reality of living on commission. As my interviewees noted so long ago, you don't get a dime until the sale goes through -- if it goes through.
And that's before we raise those nettlesome issues of health and retirement benefits, which is a "YP" (Your Problem), not an "MP" (My Problem), at least from Uncle Sam's point of view. Nowadays, you might be waiting six months for that first paycheck, as this gent from the Seymour Herald suggests: http://www.seymourherald.com/blog/2012/08/21/the-reality-of-realty/
I did some checking online recently, and it seems that my interviewees are still active in the business. Having seen the toxic trends that we've all witnessed over the last five years, I'd love to go back and get their reflections now...and, while I'm unsure how candidly they'd speak, one bet seems certain...
...I suspect that they'd probably require more than three months' savings for any new realtor coming aboard. --The Reckoner