Why Are SF Real Estate Agents Are Dropping Like Flies?

I just found this half-written post in my “drafts” and realized that I could really use an extra hour or two each day.  I started to write it after reading an article the other day on SFGate.com that brought to my attention that the number of real estate agents has started to shrink.  In fact, the California Association of Realtors has had a 16 percent drop in membership from 192,660 at the end of 2007 to had 161,600 members in February – just a few months later. 
Now – it wasn’t so much the fact that there are agents dropping like flies drop that surprised me – it’s that some of the agents mentioned in the article were Zephyr agents!  Agents that I ACTUALLY KNOW!  In Fact, one of the agents mentioned in the article, Jaime Gutierrez, was actually in the same training class that I was in at Zephyr when I first started my career as a Realtor.  
Now, I’m not sure why things didn’t work out for Jaime, or the other agents in the article, or why they have worked out for me.  But I do know of at least three theories that may help solve the case of Why San Francisco Real Estate is Causing Agents to Drop Like Flies!” 

1)  The Get Rich Quick Theory – If you ask your friends, I’m willing to bet that a large proportion of them have either taken a class in real estate, or have thought about doing so.  Many people I have met have the impression that helping people buy or sell San Francisco Real Estate is an easy way to get rich quick. 

With the exception of a few crazy years when SF real estate prices were soaring through the roof and selling a home required no marketing ability, no negotiating skills and no commitment to going above and beyond the call of duty for your clients - there is no such thing as “get rich quick in San Francisco real estate”. 

Not to mention the fact that in the San Francisco real estate market – an agent has to SPEND a good bit of money in order to make money.  Everything from business licenses and insurance to advertising to professional insurance to medical insurance to equipment expenses and much much much more cut into our bottom line.  So while we might gross $150K per year, it’s possible to net something closer to $30K after all of our expenses have been accounted for (and that’s even before taxes).   

2)  The Selling Real Estate is Easy Theory – I get the feeling that a lot of people think that as an agent, you get your real estate license and then you go out and sell.  I also get the feeling that most people don’t realize that helping people buy and sell real estate involves a lot more than an episode of House Hunters will lead you to believe. 

First – clients don’t just fall in your lap and everyone isn’t just knocking down your door to buy or sell their home.  Helping people buy and sell homes is work.  Finding clients is work.  Negotiating sales is work.  Navigating through contracts and escrows is work.  Marketing properties is work.  It’s all WORK! 

I probably average a 60-80 hour work week.  I work 7 days a week most weeks, and I don’t even count things like writing this blog (the blog is like more or a hobby) or real estate conversations with random people as “work”.  If I added that in, my work week would be more like 80-90+ hours.

2)  The Anyone Can Do It Theory – I get the feeling that a lot of people think that as an agent, you get your real estate license and then you go out and make money.  What they don’t realize is that while the better real estate companies do offer you training, they don’t offer you clients.  The agencies that do offer you clients offer you drastically reduced pay.  The only thing that all agencies offer you is a desk and a phone and an email address.  The rest is up to you.  And remember – if you don’t sell anything, you don’t make any money!

It takes a decisive character, a desire to work hard, the need to help people, the ability to think fast, incredible attention to detail and an infallible commitment to your clients’ best interests to really become a good real estate agent.  The ability to “chat people up” just isn’t enough to make you a good agent.  And in a normal real estate market (ie. one where people aren’t throwing hundreds of thousands of dollars above the asking price at every property on the market like a few years ago) you have to be a good real estate agent in order to survive as a San Francisco Realtor.

I love San Francisco real estate.    I love helping people buy and sell homes.  I love that I am able to do something I enjoy so thoroughly, and that I get paid to do it.  But not everyone is cut out to work in this industry.  Not everyone wants to work so hard.  Helping people buy and sell SF Real Estate is at times, utterly exhausting.  And for those that find fullfilment in this crazy business, this career can bring absolute happiness.  For those that don’t, well… they can always go back to their “regular” jobs. 

Luba