2:31 Minute Read.
There are 3 numbers every Michigan real estate agent needs to know:
46,880 / 66 / 25
Ever wonder how you compare with other agents in the real estate industry? Many brokers will pat you on the back, say “good job!” and encourage you to give your best effort – but they are shy about sharing internal business numbers. So, how do your efforts compare with other agents?
“Money isn’t the only measurement.”
Here are the facts.
Using the most recent information available, Forbes published average incomes for real estate agents in each state. Nationally, real estate agents earned an average income of $41,289 per year. As you would expect, Michigan agents were neither at the top or bottom of that list. Income averages for local agents fit snuggly somewhere in the middle of the list at $46,880 per year. At the top were agents located in New York and Texas. Their income averages are $102,310 and $72,480 respectively. Sounds good until you factor in their cost of living. Then add quality of life in each state and IMHO Michigan outweighs them all. I love summers in Michigan. Last year, I think it occurred on a Thursday. ;)
Extrapolating those averages, it's fair to say area agents handle on average about $1.5M or about 6 transactions in real estate each year. Funny, I remember calculating that number about 20 years ago and remember it being the same back then - about 6 transactions per agent per year.
So, how do your numbers compare?
At our brokerages, that average holds true –however, there are wide wings on that bell curve. Many of our agents consistently earn far above $200k per year. The largest commission check I paid an agent last year was north of $70,000 for one transaction. And yes, I was a little jealous that it wasn’t mine.
Money isn’t the only measurement of success. How your client feels about you may be a better marker of your future success. The NAR 2018 Profile of Home Buyers and Sellers indicate that around 2/3rds of clients were extremely happy with their agents and would recommend them to others or use them again in future transactions. Do more than 66% of your clients love the work you do for them?
Most of us have been around long enough to watch many agents come and go. Some start this business with a bang, spending lots of money on advertising and doing plenty of business. Unfortunately, some of them build a reputation of poor service, dishonesty and shady dealings. Those agents don’t last long.
In addition to that 66% number, let me throw out another data point - 25%.
Only 25% of Americans have a favorable (high to very high) view of real estate agents. And that’s sad. Nurses, medical doctors and pharmacist enjoy the highest favorability. Members of Congress, car salespeople and lawyers fare worse than us – but not by much.
I hope you can compare your track record to these numbers and be far more successful at building your reputation with clients.
Time for a personal story: I was reluctant when starting my career in real estate. Salespeople have always carried a certain stigma and I didn’t want to be associated with it. My wife Ruthie brought wisdom to the conversation about our future plans. She said, “Few occupations have more earning potential and any negative connotation is just proof that we need to bring more “Salt and Light” to the industry.” Well said. And that’s what we’ve tried to do all these years.
Beyond income, it’s the effort you put forth and the care you deliver to clients that defines your success. You are never handed success. You must build it.
Come join us…