|This article was published on: 07/01/2005|
2005 NAR Member Profile
Earnings On the Upswing
Practitioners see incomes rise with sales boom, although new licensees lag.
BY ROBERT FREEDMAN
Your income went up in 2004 along with the boom in home sales, data from the soon-to-be-released 2005 NAR Member Profile shows. Median gross personal income last year for all REALTORSŪ was up an average 7.2 percent from the last year that the data was tracked, in 2002. Existing-home sales rose 20.5 percent during the same period.
Within the average income increase are big disparities, however.
Brokerage managers saw the biggest gains—those who manage and don’t sell saw their incomes reach a median $86,000, a 26 percent increase over $68,300 in 2002, and those who manage and sell saw their incomes rise to $82,200, a 19 percent increase over $68,900 in 2002. Broker-owners who sell also saw a solid 13 percent increase to $89,100 from $78,700 in 2002. Broker-associates saw a 1 percent gain to $67,900 from $67,000 in 2002.
But the median income of sales associates actually declined about 8 percent to $38,300 from $41,600 in 2002, largely because of the influx of new licensees who typically take years to get up to speed in their earning potential, say NAR research analysts. Between 2003 and 2005, NAR membership grew about 26 percent, from 876,195 to 1,102,250 members.
For sales associates who’ve been in the business a while—between six and 10 years—income in 2004 was a median $57,100 and for associates with more than 26 years in the business, the median was $83,400.
The lion’s share of real estate professionals continue to split commissions with their brokerage—a median 69 percent of all practitioners, down slightly from 73 percent in 2002. The median for practitioners who have a year-end commission split agreement was 71 percent, which is 8 percentage points higher than the 63 percent in 2002.
The percentage of practitioners working under a 100 percent commission plan dropped a bit, too, to about 17 percent from 20 percent in 2002, while alternative types of arrangements saw a small increase. For example, practitioners earning a salary plus share of the profits doubled from 2 percent to 4 percent.
The number of practitioners using personal assistants hasn’t changed much with 19 percent of sales associates saying they use one or more—slightly lower than the 21 percent who said they use one or more assistants in 2002. Most of these assistants are compensated by a set salary or hourly.
Practitioners continue to see a significant share of their consumer contacts generated through their Web presence, although the number of leads they’re getting from the Internet hasn’t improved much over the last two years. Some 36 percent of sales associates say they’re getting up to 10 inquiries a year from their personal Web site, and 15 percent say they’re getting up to 20 inquiries a year. Both of those numbers are up a few percentage points from 2002. But the number of practitioners seeing a big volume of inquiries is dropping. Associates who say they get 51 inquiries or more a year is 6 percent, down from 16 percent in 2002.
The 2005 NAR Member Profile is scheduled for release by the end of July. You will be able to read highlights and purchase the report on REALTOR.org's Research page.
Percentage distribution in medians for all REALTORSŪ, unless otherwise noted.