2012 NAR Member Survey Shows Rising Incomes
2012 NAR Member Survey Shows Rising Incomes
The income and business of REALTORS® is growing after many years of decline, according to the 2012 National Association of REALTORS®Member Profile.
Paul Bishop, NAR vice president of research, said member income rose for the first time since 2002. “The median income of a REALTOR® rose 2.3 percent to $34,900 in 2011, which is the first overall gain in nine years,” he said. “Many REALTORS® have persevered through very difficult market conditions and understand the cyclical nature of the business, but have never had to endure a cycle like the one that is presently waning. The good news is home sales are rising, overall activity is expected to be notably better this year and individual prospects are much brighter given there are fewer REALTORS® than several years ago.”
Members licensed as brokers typically earned $48,400 in 2011, while the median for sales agents was $27,200.
Higher median income was reported by experienced NAR members in the business for 16 years or more, who earned $50,200. REALTORS® working 60 hours a week or more earned $80,900, and 17 percent of all members earned a six-figure income.
The typical NAR member has 11 years of experience and works 40 hours per week; 60 percent are women, who account for 55 percent of brokers and 66 percent of sales agents. More than nine out of 10 REALTORS® are certain they will remain in the business for at least two more years.
NAR President Moe Veissi, broker-owner of Veissi & Associates Inc., in Miami, said REALTORS® go the extra mile. “REALTORS® bring value to their clients by raising professional standards with specialized knowledge and expertise, which includes training for designations and certifications offered by NAR,” he said.
“Our members are tapping into resources that give them an edge up on challenging conditions, whether it’s helping a buyer negotiate a distressed sale or find a loan, or in helping a seller with effective marketing. Beyond that, we’re fighting for both home owners and buyers in Washington and beyond because homeownership matters to the well-being of this nation,” Veissi said.
Thirty-two percent of REALTORS® hold at least one out of six certifications in specialized training. The most popular area of training, driven by the ongoing elevated level of distressed homes on the market, is the Short Sales and Foreclosures Resource Certification, held by 18 percent.
The second most popular REALTOR® certification is REPA (Real Estate Professional Assistant), 15 percent, followed by e-Pro, held by 11 percent of members to help them better serve the online needs of clients.
In addition, 33 percent of REALTORS® have obtained at least one professional designation. The most popular is GRI (Graduate REALTOR® Institute), held by 19 percent of respondents; ABRR® (Accredited Buyer Representative®), 15 percent; and CRS® (Certified Residential Specialist®), 10 percent. Smaller shares hold one of 14 other designations.
The survey shows the typical NAR member is 56 years old; only 2 percent of all REALTORS® are under 30 years of age and another 4 percent are 30 to 34 years old; 22 percent are 65 or over.
Repeat business and referrals are important to REALTOR® business. Repeat business accounted for a median 19 percent of activity in 2011 and is higher for those with more experience – for members with 16 years or more in the business, that number rises to 38 percent. Referrals accounted for an additional 20 percent of business activity.
Most members – 57 percent – are licensed sales agents; 27 percent are brokers, 18 percent broker associates, 3 percent appraisers, and 1 percent other (some hold more than one license). Fourteen percent of members have one personal assistant, while 4 percent have two or more personal assistants.
There are two sides to every real estate transaction – one each for the seller and the buyer. Among REALTOR® members the median number of transaction sides or commercial deals handled in 2011 was 10, up from eight transactions sides in 2010. The median brokerage sales volume was $1.3 million, up from $1.1 million in 2010.
Several factors limit potential clients in completing transactions. Members said the biggest impediment was difficulty in obtaining a mortgage, cited by 30 percent of respondents.
Sixty-nine percent of respondents are compensated through a split commission arrangement, 17 percent receive all of thecommission and another 3 percent receive a commission plus a share of profits; 11 percent received some other form of compensation. Eight out of 10 members work as independent contractors for their firms. Seventy-two percent of REALTOR® receive no fringe benefits, although 23 percent are covered by errors and omissions insurance; only 6 percent receive health insurance.
Eight out of 10 NAR members focus on residential sales and 72 percent have secondary real estate specialties. Fifteen percent also offer relocation services, 14 percent commercial brokerage, 14 percent commercial property management, 9 percent counseling and 8 percent land development. Smaller percentages were also in residential property management, residential appraisal, auctions, international or commercial appraisal.
Residential brokerage was listed as a secondary business for the 10 percent of respondents who have other primary specialties.
Twenty-one percent of REALTORS® belong to one or more of NAR’s affiliated institutes, societies or councils; the most common is CRS (Council of Residential Specialists), identified by 11 percent.
Most members begin their careers in other fields and bring a wide range of expertise and experience to the profession; only 5 percent report real estate is their first career. Previous full-time careers include management, business or financial, 18 percent; sales or retail, 15 percent; office or administrative support, 10 percent; and education, 7 percent. Twelve other categories were each 5 percent or less; 17 percent were “other.”
Sixty-two percent of NAR members have a personal website, operational for a median of six years, and nine out of 10 report their firm has a Web presence. Fifty-four percent of the respondents use social or professional networking sites and 10 percent have a blog. REALTORS® use a variety of communications methods, with 93 percent preferring e-mail for current clients or customers, followed by telephone at 89 percent.
Respondents worked for a firm with a median of 23 brokers and agents, typically with one office, and had been with that firm for six years. Six out of 10 members are affiliated with an independent firm, and 38 percent are with a franchised company. Eleven percent of REALTORS® report their firm was bought by or merged with another during the past two years, the same as in the 2011 study.
Nine out of 10 REALTORS® are homeowners. They often invest in real estate and own other homes in addition to their primary residence – 53 percent own at least one residential investment property and 29 percent own at least one commercial property. In addition, 19 percent own at least one vacation home.
NAR members are active in the political process – 93 percent participated in the last national election and 82 percent voted in the last local election. They are well-educated, with 48 percent holding at least a bachelor’s degree; 16 percent are fluent in other languages.
The 2012 National Association of REALTORS®Member Profileresults are representative of the nation’s REALTORS®, who are members of NAR. REALTORS® account for about half of the 2 million active real estate licensees in the U.S. REALTOR® members go beyond state licensing requirements by subscribing to NAR’s Code of Ethics and Standards of Practice, commit to continuing education and have access to professional resources to better serve the needs of clients. This year's results are based on a survey of 58,823 members, which generated 6,245 usable responses, representing an adjusted response rate of 10.8 percent. Survey responses were weighted to be representative of state level NAR membership. Income and transaction data are for 2011, while other data represent member characteristics in early 2012. The study can be ordered by calling 800-874-6500, or online at www.realtor.org/prodser.nsf/Research. The profile costs $19.95 for NAR members and $149.95 for nonmembers.