By Lee Howard
RISMEDIA, July 24, 2008-(MCT)-The number of real estate agents and brokers licensed in the state of Connecticut has dropped in recent months, but not as quickly as the sales of single-family homes, leaving some longtime pros wondering whether too many salespeople are chasing too few dollars.”If people have only one, two or three sales a year, it really takes away from those who work at it full time,” said Norm Krayem, owner of Realty Estates in Groton and a local Realtor for 35 years. “It makes you wonder whether those who aren’t doing well should, in fact, pull out.”
Some agents have left the field since real estate sales went into hibernation last year as foreclosures mounted and buyers and credit suddenly dried up. According to statistics supplied by the real estate division of the state Department of Consumer Protection, about 200 brokers and more than 1,300 salespeople have left the field statewide in the past 10 months.
The combined loss was about 6 percent during the period from Sept. 6, 2007, to July 10 of this year, but this statistic may overrepresent the reductions because a few people are still renewing their licenses several months after the official deadline. And license-renewal numbers are actually up, from 6,876 last year to 7,313 this year, meaning the losses are coming mostly in potential new agents who decided against joining the field.
Robert J. Kennedy, executive vice president of the Connecticut Association of Realtors, said he was surprised at the increase in license renewals. He added that association memberships are holding steady at about 19,000 statewide.
“Connecticut has been very lucky,” Kennedy said. “We have escaped the dramatic changes that have been experienced in other parts of the country, and that has been reflected in the stability of our membership.”
Membership, he added, would likely decrease if the real-estate slump continues for another year or two. But many people, he and others said, are willing to give the business another year in hopes of a turnaround.
The Eastern Connecticut Association of Realtors, an affiliate of the statewide group, reported locally that membership is down from about 1,500 last year to 1,300 this year. While this represents a 13 percent decrease in agents, the region has experienced up to a 40 percent drop in monthly sales volume this year compared to last.
With less money up for grabs, said agents, top Realtors with established client bases may be making less money, but they’re pulling in a higher percentage of the local real-estate business than ever.
“There used to be an 80-20 rule, which said that 80 percent of the business is done by 20 percent of the agents,” said John Bolduc, executive vice president of the local Realtors group. “Now it’s more like 90-10. Ten percent of the agents do about 90 percent of the sales.”
But many real estate agents, like Ruth Smith of Niantic, work in the field part-time as they juggle family responsibilities. Smith, who is married with two children, got her real-estate license last year and so far has sold only one property and has one other listed for sale.
“I was looking for flexibility — that was the big reason I got into it,” said Smith, who works for Stebbins Assist-2-Sell Buyers & Sellers Realty in Groton. “I didn’t give up an income to do this. Anything I sell, it’s all gravy.”
The costs associated with opening a real-estate business are much less than in other fields, Smith said. Most of what agents need — a phone, fax and computer with Internet access — are already available in people’s homes, and there is only the initial $450 license cost and $300 license-renewal and $308 continuing-education fees that must be paid.
Still, with homes moving slowly, any fee can seem expensive, and agents say the high cost of gas only adds to their woes — especially as buyers, faced with a glut of houses on the market, spend more time comparison shopping.
“At some point, if you don’t get a return on your hours, you’re losing money,” Krayem, past president of the Connecticut Association of Realtors, pointed out.
Geoff Hausmann, a top agent with RE/MAX Property Consultants in Groton, said many Realtors have taken other jobs to compensate for lost income in real estate. Others, now that the easy money is over, have left the field entirely.
“No one is doing that much business; you just make people think you are,” Hausmann said. “Am I hurting? Of course I am. I wish I was doing the business I was doing two years ago. But you do what you can do.”
“You’re working harder and you’re working smarter,” said Ed Stebbins of Assist-2-Sell. “It’s taking more time to do less.”
Hausmann, Stebbins and others said agents who got into the field five or six years ago and never saw a real-estate downturn are particularly at risk to leave the field.
“When everything is going well, everyone gets into it, and when things stop, the professionals still survive,” said Bruce Baratz, owner of Baratz Realty in New London.
“A lot of people in this business only do one or two sales a year,” Bolduc, the local Realtors Association official, said. “But there are still a number in the business that make six-figure incomes.”
But Krayem, for one, worries that the current real estate slump — which he sees extending until 2010 — cannot sustain the number of agents currently at work in southeastern Connecticut.
“A lot of agents are going to be hurting,” he said. “The more agents, the smaller the pie you have to eat from.”
Krayem may fret that dabblers in real estate make it harder for full-timers to make a living, but he encourages people like Smith, who are serious about making real estate a career, to hang in as they continue learning the trade.
“Realtors tend to be optimistic people,” he said. “They feel the turnaround is right around the corner.”
Smith remains similarly upbeat even as the real-estate downturn takes a toll on other agents.
“I don’t need to make a million dollars; I’m just trying to supplement my income and do something I enjoy,” Smith said. “It can’t get much slower. But the fact that it’s slow gives me a chance to learn the industry without being overwhelmed.”
Distributed by McClatchy-Tribune Information Services.
