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More Realtors, Lenders are leaving the business

More Realtors, Lenders are leaving the business
by Kaushik Sirkar, Chandler AZ REALTOR
Chandler Arizona Real Estate

I'm going to go really, really basic for a second. Lets say you have 10 apples for sale with 5 salespeople marketing them. 50 people want to buy apples. Those 10 apples will sell pretty darn quickly and on average each salesperson will earn 2 commissions.

How if you have 50 apples for sale with 25 salespeople marketing them? And 10 people want to buy apples? Who knows which ten apples will sell. Many apple (the fruit, not the company!) salespeople will go without any commissions whatsoever.

Is it readily apparent how this applies to the Real Estate market? I like to think so....the first example is somewhat akin to the home sales situation in 2004/2005 whereas the second situation is much more representative of current conditions (obviously varying by local market).

Why am I writing about this? I just read this article in the East Valley Tribune. It details one agent who has been forced to get another job to pay the bills. Despite being an agent since 1991 and having a database of over 500 clients, this agent can no longer consider Real Estate her primary source of income. Not trying to pick on this individual in particular - but is this a shock? Come on, look at the market....use the apple analogy from above....

Were you an agent earning hundreds of thousands of dollars a few years ago? Well, I hoped you saved some of that money if you are caught between a rock and a hard place today....

Thanks for Reading :)

Kaushik Sirkar, Chandler AZ REALTOR
Chandler Arizona Real Estate

Posted by Kaushik Sirkar on 09/25/2007 04:25 PM

Comments (7)

This post has been included in Arizona Information

7 Comments on More Realtors, Lenders are leaving the business

SEP

2007

Honestly, I am glad they are leaving, as one bad apple makes the rest of the barrell look bad.

Kaushik- although some agents came into the field during the good times just to "get rich quick" , and have now left, not everyone should be lumped into that category. I have seen many good agents get another job because they have kids to feed, and mortgages to pay..........using your analogy, some of those salesmen won't be getting a sale :)

Kaushik - how's it going? I'd like to modify your post by taking it one step further with yet another scenario. Imagine 50 apples for sale with 15 people marketing them and 10 people ready to buy. That's what I see as the final step. Once demand dies, those who came in for quick riches or perhaps some of those who looked for supplemental income will fall by the wayside. Yes, the demand will likely be lower than the available agents, but it's not quite as gloomy as you might think. Just my opinion.

SEP

2007

Kaushik-we are seeing more and more of this in our market and the Daytona News Journal wrote a very nice article of some realtors reality. I agree, while the money was incredible, I too hope that they saved for these times. I think it is safe to say...those still in the business saved but then again maybe not. Also thank you so much for the comment you left on my post.

The deal isn't always the deal. This is the market the millionarie agent is made in. In that apple market there may be 10 willing to buy today. A smart apple seller will maintain a database of people whom he/she has ever met knowing that at some point in time they will or will know someone who is in the market for a darn apple. So, to the apple seller I say grow your database of "Mets" and market to them a minimum of 24-33 times a year. At any one time 17-34% of all people in the database will be in the market for an apple, be there.

Folks this is a slow down, bad market - but I love it and this IS when the millionaire Realtor (and LO) is created.

Cheers

Paul Dunn
The Mortgage Planners
www.mtg-plan.com
Tucson Arizona

OCT

2007

Good words of advice, Paul. Hopefully I'll be a millionaire realtor and LO before long!

As the market gets tough- We need to become an expert in that market. You need a reason to make those few buyers call you! When the Agent pool shrinks there is more opportunity out there. All the more reason to become an expert. AR provides the backbone to get the message out.

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