Securing top talent was the number one business worry for the nation’s top real estate brokerage executives who responded to a recent Imprev Thought Leader Survey. More than 90% of those who responded to the poll cited “securing top talent” as the leading “crucial business concern,” followed by “developing the next generation of agents,” “agent compensation,” and “staying ahead of the competition.”
When these real estate executives were asked to identify their company’s “single biggest challenge” today, recruiting (42 percent), profitability (19 percent) and competition (14 percent) were named as their principal challenges.
“Real estate leaders revealed how deeply the industry’s fate is tied to recruiting,” said Renwick Congdon, CEO of Imprev. “It’s a thread that runs throughout the survey results,” Congdon added.
These were among key findings from a Thought Leader Survey released this week by Imprev of Bellevue, Washington during CMLS Boston 2012, the annual conference for the Council of Multiple Listing Services, which runs through Friday. The Seattle-area technology company provides marketing products and platforms for the real estate industry.
Congdon noted several top executives commented on the “aging population of REALTORS®” along with the growing challenge of recruiting the “next generation” of management. According to the National Association of REALTORS®, the median age of its members increased rapidly in just five years from 51 in 2006 to 56 in 2011. While the American workforce continues to age, the real estate industry skews significantly older: the Bureau of Labor Statistics pegs the mean age of the overall workforce at 40.8 in 2006 and just 42 in 2010 (latest available data).
Congdon notes concern is mounting in the industry about an eventual “knowledge walkout.” Virginia-based blogger and real estate brokerage manager J.J. Stakem last year wrote about this phenomenon, citing a 2006 article in CIO magazine (“Beating the Boomer Brain Drain Blues” by Susannah Patton). It discussed the knowledge walkout that occurred in the aerospace industry in the 1990s.
The article noted that in 1997 nearly 12,000 Northrop Grumman workers exited with only 1200 remaining, taking “with them years of experience and in-depth knowledge.” A senior executive at Northrop Grumman commented about the knowledge loss, saying,
“In an exit interview, you can capture certain things, but not a lifetime of experience.”
“As the real estate brokerage industry ages, we may experience a knowledge walkout,” Congdon noted. “Being aware of the possibility, and the impact it could have on a generation of homebuyers, will help the industry in recruiting and training the next generation of leaders,” he said.
Reasons to Stay or Go
The survey specifically asked real estate executives to identify why real estate agents join or leave their company. More than three out of four respondents said “brand and reputation” was the top reason they believe agents join their firm (78 percent), followed by “better technology” (75 percent) and “culture fit” (75 percent), then “training and education” (73.4 percent).
The top reasons agents left their company: “better compensation” topped the list (60 percent), followed by “culture fit” (30.8 percent), “administration and support services” (12.3 percent) and “more leads and referrals” (10.8 percent).
Imprev created the new Thought Leader survey, said Congdon, “to provide impartial information for top real estate executives to share with the entire industry.”
“It seems that most real estate-related surveys are totally self-serving,” Congdon explained, “but because we work with a wide variety large and small real estate leaders, we can take a broad approach to the data, and help everyone gain better insight into what leaders are thinking.”
The survey polled more than 850 top real estate brokerage executives at leading franchises and independent brokerage firms responsible for more than a third of all U.S. residential real estate transactions last year.
For more information, visit www.imprev.com.