On a recent episode of my real estate talk show #OfficeHours, we dove into the “State of the Union in Real Estate.” Obviously, I am asked all the time whether or not real estate is a good career since I do own and operate a real estate school as its CEO. In this post, I’d like to rehash some of the statistical data to show you why now is a fantastic time to consider a real estate career.
Key Takeaways from The Show:
The way consumers shop for real estate is dramatically different
People deciding to sell their home on their own (FSBO) is near all-time lows
Statistics show more people are using real estate agents than in past generations
A career in real estate is here to stay
The Evolution of Real Estate Search
In recent research reports by both The National Association of Realtors® and Zillow®, statistical data was compiled by experts WAY smarter than me and with WAY more access to resources to find out who was buying and selling homes, and whether or not they chose to use a real estate agent. As technology has taken over our daily lives, mainly by way of the cell phone, the way consumers are shopping for homes is much different now than say 10 years ago. Since almost everyone in our great country has some sort of a smartphone, they are picking up and looking at real estate sites and apps almost all the time. But depending on who you ask, you might get a whole bunch of varying opinions and thoughts on whether this is helping or hurting professionals who maintain a real estate career.
For YEARS, the real estate industry did everything possible to put a digital blockade in front of the consumer keeping them from being able to access real estate listings and real estate data. The concern by the persons making those tough decisions was that if the consumer had access to the listings and to the data, that they wouldn’t need a real estate agent near as much. Taking a step back, you could see why they would be concerned. Many of the powerful agents and brokerages at the time (circa 2007) built their businesses with MLS books, private MLS website access – and therefore one of the most important value propositions of the real estate agent was to be able to show you houses for sale on the market. That doesn’t make them bad people or poor professionals, although it has shown to have made them very, very wrong.
Along comes 2007 and some guy named Steve Jobs at a little ol’ company named Apple Computers invented something called the iPhone. I remember the opening presentation like it was yesterday as he said: “it’s an iPod, a phone, and an internet device – get it?.” Little did we all know what sort of impact that was really going to have on the world, but specifically the real estate industry.
Along with being able to easily access the web more effectively from a mobile device, text your friends and use this whole “SMS” thing, the real game changer was the ability for a whole new industry to develop around mobile-ready platforms and apps. So as consumers became almost immediately attached to their iPhones, one of the immediate desires was easily finding and searching for real estate listings. The consumers wanted it, the world was probably ready for it, but as an industry, we basically said “no!” Not even a “not yet,” just NO to the consumer.
While the big boys in the real estate industry were building walls, others in the tech community were working to break them down. Spencer Rascoff, the co-founder and current CEO of Zillow, first showed his pension for consumer access to information by helping to found Hotwire.com. As you may be familiar, Hotwire was one of the earliest companies that intended to take the visibility of booking travel out of the hands of travel agents and into the transparent new internet universe. Like all companies in a capitalist world, Zillow was born out of answering the need for consumers to provide easy to use and beautiful access to real estate listings and information when and how they wanted it. Turns out, over the past ten years Zillow was more on the right side and the big real estate industry was on the wrong side.
The difference? One was listening to what the consumer wanted, the other was trying to keep the consumer away from what they wanted. Well, it’s easy to help you understand how THAT is going to go.
All the while, the real estate industry has continued to chug along. There are more people pursuing a real estate career than ever, and the industry is still going very strong. So did companies like Zillow hurt real estate careers, help them, or something else?
Real Estate by the Numbers
Considering what we have looked at so far, I think it is now important to look at the numbers. If you are considering a real estate career, it’s important to look at a snapshot of the industry you are about to enter. Here are a few important real estate statistics that might help bring home the point:
- 89% of home-sellers worked with a real estate agent to sell their home
- 88% of home-buyers purchased through a real estate agent
- Only 8% of sales nationwide in 2016 were FSBO (For Sale by Owner)
- The number of consumers working with an agent has grown comparatively than in 1981
- 98% of buyers used an online tool or resource at some point during the process
In a nutshell, after looking at the numbers a professional real estate career is looking better than before the iPhone, or heck even the internet on the scale we know it today. More people are choosing to work with real estate agents, and the technological access of listings and information is enhancing the industry it isn’t exactly harming it.
Why a Real Estate Career is Still a Good Idea
The reason is simple, as hopefully, the statistics were able to display above. MORE people are using real estate professionals when choosing to buy or sell, not less. MORE real estate transactions involve at least one real estate professional, not less. The MORE access to listings and real estate information provided to consumers, the more the consumer needs assistance from a real estate professional to assist in breaking down this wealth of information, analyzing it, and assisting with the best moves forward.
Just as the website WebMD did not put doctors out of business, no real estate website at this time is taking away the need in a real estate career. In fact, in my opinion, this open and transparent state of the economy is helping us prove our worth and perform exactly as the consumer needs us to. So if someone were to tell you “I don’t think a real estate career is a good idea anymore,” why not send them a link to this post and show them the numbers.
Until next time! You can watch the full #OfficeHours episode mentioned above by clicking below.