By Mike Bodeen · 19 January 2021
Gotta admit, it looks pretty easy! Fill out some forms, stick a sign on the house, place flowery information into the computer, the offers roll in, the seller picks one, and you’re done with a big fat payday in your pocket! Sign me up.
Ugh, I guess I already am, except my job doesn’t look like that.
I was prompted to write this article today based on some recent stats I saw in the Cromford Report about the numbers of real estate agent members in the Arizona Regional Multiple Listing Service (ARMLS) compared to the number of available listings currently. Those numbers:
5422 – The number of active home listings on ARMLS located in Phoenix.
5,556 – The number of Broker’s offices in the ARMLS database
44,500 – Active agents paying dues to belong to the ARMLS system
For every active listing there are 8 MLS members. So, there’s approximately one (1) listing per office (rounded), and one listing per 8 members. As the Cromford Report recently stated: “We have reached a rather strange milestone – there is on average of less than 1 active listing per office.”
Hmm.
Each year, I’m asked by different folks what I think about “getting into real estate.” I tell them all the same thing: As important as intelligence is, as important as ethics is, as important as the company you’d go to work for is, there are two ingredients YOU MUST HAVE to be able to be a success in real estate. The first? call them leads, clients, or customers, it’s who you know! The second is, don’t quit your day job, or, you better have an income stream for a year (at least).
A real-life example was a nice, courteous young man who came to The Bodeen Team two years ago through our firm, HomeSmart, and asked if we would mentor him? Lane (not his real name) had all the right stuff.
“The first? Call them leads, clients, or customers, it’s who you know!”
Lane was young, intelligent, honest, and had a genuine desire to succeed in the industry and work hard. He was an Uber driver by day to help mitigate expenses, plus he had some family back in San Diego who would help him financially to get started. So, for Lane, the #2 box was checked.
We agreed to mentor Lane, but like with everyone, we disclosed the odds (basement low) of succeeding. What does success look like in residential real estate? If it’s a career, and you don’t require the income of a spouse or significant other, success means making ends meet. That’s why there are relatively few agents who are in that category, and many part-timers or agents who don’t have to bring in all the household income.
Lane’s only drawback is that he knew NO ONE in Arizona. I suggested he try the San Diego area where he knows some people and has family, but San Diego was financially out of reach for him to own, or even rent a home. He thought Phoenix/Scottsdale would be a better start for him.
Unfortunately, after two months, a number of open houses held to try and procure clients, Lane went to work with another Realtor group who would make him a part of their team. That strategy is not a bad one. It’s an active way to learn the business, but you still need the leads as agents, and most owner/brokers will be harping on you to “get leads.” So, you’re back to where you started – needing leads.
After about a year, Lane had not done any deals on his own, though he may have participated with other agents and received some compensation from them. I hope it works out for him.
I’m fortunate. I’ve been in my profession for decades in Arizona, and I absolutely love what I do – meeting great folks that I’m privileged to work with – it’s the best career going – bar none!
But truth be told, I wouldn’t start over today.
Market data referenced in this article comes from The Cromford Report.