In a recent email exchange with the now infamous Bawld Guy, I suggested that the broken link I sent him was Truncated by Omission. In the Dave Barry vein, I had to add that this would be a great name for a rock band. Others that come to mind are Manhattan Transfer Forces Sale, REO Speedwagon (wait, that’s a real one, but I don’t think they meant Real Estate Owned), and NAR and the Sunshine Band, the latter being responsible for the modern-day remix “Tiny Bubbles”. Give me 100 aspiring rock stars, and I will give you, at best, one success story and one one-hit wonder. Can anyone say “Right Said Fred”?
Sounds just like real estate, if you ask me. Our industry is full of one-hit wonders. Most recently, the guy who cleans our spa called it to Steve’s attention that he is a licensed real estate agent. Don’t get me wrong, I adore Mark, but I had to once again roll my eyes at this little revelation. I am one exasperated exhalation away from from calling our California Governator to insist that real estate licenses be issued at birth. Let’s just cut through the red tape. Everyone seems to get licensed eventually, because it (the licensing part) is easy, and it appears at first blush to be the swiftest path to entrepreneurial nirvana. It is not the fact that you have one, however, but what you are able to accomplish once you get one (Greg scooped me here). So, bring ’em on, I say.
In San Diego, our Sports Arena is now the iPayOne Arena, named after the blockbuster bunch that brought us 251 sales (listing and sale sides) out of 58,706 total sides in San Diego County this year to date (according to our Sandicor MLS). For those without a calculator at their disposal, this equates to approximately a 0.4% market share. I guess you get what you pay for. Absent a local professional basketball team, our Sports Arena has been relegated to a venue for the annual Barney On Ice extravaganza and the upcoming, much anticipated Dancing with the Stars redux.
I decided to take a microcosm of San Diego, one zip code, to do a little investigative reporting of our local one-hit wonders. But, is this truly representative of our entire real estate industry? Alas, time and laziness dictate this approach and, while some may question my scientific theory, I decided this was the most expedient way to delve deeper into the waters of real estate despair. My one zip code, a community of approximately 12.000 homes, racked up a total of 278 sales year to date. That is 556 transaction sides. It turns out that 342 unique agents participated in these sales, with a whopping 254 (nearly half) involving agents with only one sale in this zip code to their credit. Now, at any angle from which I view my spreedsheet, I just see a whole bunch of agents competing for a moderate amount of business, too many of whom will be gone from next year’s charts. Granted, many of the one-time offenders are established and successful in other areas and may have just happened to make a sale in this particular area. Many more, however, both experienced and new to the business had a very bad year.
My message here is not that there are too many agents (although there are), but that there are too few great ones. Our industry has, is, and will continue to evolve, but never will a license in and of itself deem one competent to compete (yes, Ardell, it is a competition) and excel in this profession. This is not a hobby, a garage band endeavor, but a career that requires, when done right, inherent intelligence, ongoing education, perseverance, total devotion, and fire-in-the-belly commitment. I predict that the pie will be sliced a lot differently next year. Already I am seeing a movement away from “Uncle Jim is my agent” and back to veteran representation. Longer market times and an all around tougher market are starting a long overdue Darwinian Cleansing (another good rock band name, by the way). If until now, your clients have consisted of only you and Crazy Cousin Harry-once removed, a career change may be in your not-to-distant future. And that is music to my ears.
(Note: If anyone even dares to use the Fat Lady Sings metaphor, I will hunt you down like a dog. A Bloodhound, perhaps?)
NoVaNewBuyer says:
Did you mean “Right Said Fred” of “I’m Too Sexy” fame?
December 13, 2006 — 10:57 am
Kris Berg says:
That, I did. Off to fix it. You win the Know Your Pop Culture award. 🙂
December 13, 2006 — 10:59 am
sdcellar says:
REO (in this case) = Ransom Eli Olds. Same guy of Oldsmobile fame. Just thought you’d like to know.
And you’re right, the field does seem to suffer from a lack of great agents. It’s a shame that the bad ones drag down the perception of agents in general. I think things like these blogs help though.
December 13, 2006 — 2:27 pm
Maureen Francis says:
I anxiously awaited the disappearance of the one hit wonders in my market this year. If it should have happened anywhere already, it is in Michigan, where we are ahead of the rest of America on a ‘correction.’ But, believe it or not, it’s not what we are seeing. The mortgage people left the business in MI this year. They apparently understand economics better than hungry Realtors. But the Realtors? My office is growing just at the time that sales are, well, down at least 30% from last year, which was down 30% from the year before. If anything, mediocrity is rewarded today. Agents who have made this their sole means of support and have done well are struggling. I’m talking 25 year veterans. But the retirees who are dabbling and the physicians wives who ‘just like to look at houses’ are fine with picking up one sale a year. Afterall, that is just play money for them–something that more than covers their business expenses and gives them something to talk about at cocktail parties. Your spa guy might know my lawn guy. He has his license AND he does mortgages.
December 14, 2006 — 6:17 am
Phil Hoover says:
Kris ~
Interesting post, and it ties in with what’s going on up here in Boise.
To no one’s surprise, local law enforcement is now asking for a real estate license when making traffic stops.
Seems that not everyone HAS a driver’s license :o)
December 15, 2006 — 9:35 am
Brian Brady says:
Kris:
If you think that real estate licensees are plentiful, try swinging a dead cat on the boardwalk in PB without hitting a “loan originator”. I remember when we mortgage originators were sort of the “blue collar” cousins to stockbrokers. Today, it seems that every one with a dream in SD learns how to fill out page one of the 1003, e-mail some wholesale lenders, hide 4 points rebate in an option ARM, and leverage their way into a neg-cash flow rental property with the commission.
I’m looking forward to an encore of 2006 next year so the dedicated professionals in our respective industries get back to selling and financing homes sans hype.
December 16, 2006 — 12:53 am
Kris Berg says:
Brian, Isn’t that the truth! In my last office, there was an agent who spent 80% of his day bragging about how much he made the previous year on loan originations. He did all of three real estate transactions last year to my knowledge, and all were office referrals. Looking forward to 2007.
By the way, welcome to Arizona. 🙂
December 16, 2006 — 9:23 am
Brian Brady says:
Thanks, Kris I went “against the grain”; moved from AZ to SD in 2003. So the welcome is apreciated.
December 16, 2006 — 2:49 pm