The average real estate professional made $1900 less last year than in 2013 because home sales declined and Realtor membership increased. The 2015 National Association of Realtors Member Profile also found the average Realtor is older than ever.
“After gradually climbing for three consecutive years, the decline in existing-home sales in 2014 resulted in a slight reduction in business activity and income last year since home sales didn’t surpass year-over-year levels until October, which is likely the reason the typical member had 11 transactions last year versus 12 in 2013,” said Lawrence Yun, NAR chief economist.
“Slightly fewer transactions resulted in the median gross income of a Realtor falling to $45,800 from $47,700 in 2013,” he said.
Last year continued the recent trend of more new members to NAR. NAR membership at the end of 2014 stood at 1.1 million, up 5.5 percent from 2013. Although median years of experience in real estate remained at 12 years for the second straight year, more members (17 percent) reported they have been in the business for two years or less (13 percent in 2013).
As expected, median gross income and number of transactions generally increase with experience. Last year, Realtors in business for more than 16 years earned $68,200 and made 13 transactions. Those with three-to-five years earned less than half that amount ($37,400) and had 10 transactions. Incomes also varied by license type, as members licensed as brokers in 2014 earned $65,300 ($66,300 in 2013), while the median earnings for sales agents decreased $1,100 from the previous year to $33,900.
The average Realtor is also growing older, the study found. The median age of members rose to 57 years from 56 last year and 52 in 2008. Only two percent of all Realtors are under 30 years of age; 18 percent are between ages 30 and 44, and 25 percent are 65 and older.
Some 58 percent of Realtors are women, who account for 53 percent of brokers and 63 percent of sales agents. More than three-quarters (77 percent) of all members cite real estate as their only occupation, and 84 percent (82 percent in 2014) are certain they will remain in the business for at least two more years.
Sixty-nine percent of respondents are compensated through a split commission arrangement, 17 percent receive all of the commission and another four percent receive a commission plus a share of profits; 11 percent received some other form of compensation. Percentage split-commission was more popular with sales agents (78 percent). Furthermore, members with less experience more often had percentage split-commission arrangements, as well as those who had lower personal earnings.
Eighty-three percent of members work as independent contractors for their firms. The vast majority receive no fringe benefits, although 36 percent (33 percent in 2013) are covered by errors and omissions insurance by their firm. Only five percent receive health insurance through their firm — unchanged from a year ago.