49% of Real Estate Agents Polled Only Sold 1 House or Less in 2023
49% of Real Estate Agents Sold Few or No Homes in 2023, Study Finds The Consumer Federation of America report highlights concerns about agent "glut" and lack of training
A new study by the Consumer Federation of America (CFA) reveals a troubling trend in the real estate industry: a significant majority of agents are selling very few homes. According to the report, titled "A Surfeit of Real Estate Agents 3: Abundant Jobs, Inadequate Mentorship, and Few Sales," nearly half (49%) of agents across four major U.S. metropolitan areas sold either zero or only one home in 2023. The study examined data from 2,000 agents working for five major brokerages in Orlando, Florida; Tucson, Arizona; Minneapolis, Minnesota; and Central Pennsylvania.
Agent "Glut" and its Implications
The CFA report attributes this low sales volume to an "agent glut" in the market. With over 1.5 million agents nationwide (New Jersey has 61,129 licensed agents!) selling between 5 million and 6 million homes per year, many agents struggle to secure enough clients to make a living solely through commissions. This "glut" of agents, according to the CFA, often leads to inexperienced and inadequately trained individuals entering the field, as obtaining a real estate license can be relatively easy in many states.
"Consumers do not benefit from the failure of companies to adequately train and oversee new agents," said Stephen Brobeck, a CFA senior fellow and the report's author, in a statement to Inman News. "Incompetent agents impose costs on consumers ranging from missed sales opportunities to disadvantageous sale prices to problematic homes."
Part-Time Agents and Unequal Opportunities
The report highlights the fact that the real estate industry has become largely part-time, with many agents holding other jobs and working sporadically. This, combined with the low barrier to entry, creates an uneven playing field where experienced full-time agents often struggle to compete against a larger pool of part-time individuals with limited sales experience.
"In our sample of 2,000 agents, 246 (12.3%) sold six to ten properties the previous year. Of this number, 137 (55.7%) were women," the report notes, raising concerns about gender disparities within the industry.
Raising the Bar and Protecting Consumers
The CFA report proposes several solutions to address these issues, including:
Improved industry standards and consumer awareness: Consumers should be encouraged to consider an agent's recent sales experience and customer evaluations before hiring them.
Increased regulation and supervision: State legislatures should require closer broker supervision of new agents and consider mandating post-licensing education and competency exams.
Differentiation within the "Realtor" designation: The National Association of Realtors could raise the bar for membership to distinguish experienced full-time professionals from part-time agents.
By implementing these recommendations, the CFA believes the real estate industry can improve its standards, enhance consumer protection, and ultimately benefit both agents and homebuyers/sellers.
Sources: Consumer Federation of America, Inman News
