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I have heard it so often: “Ten percent of all agents do 90% of the business.” There are numerous variations on this theme – 20-80, 7-93, and so on. What bothers me is that these numbers are espoused by some of the industry’s leading figures. They are a gross distortion of the truth. More importantly, it denigrates the hard-working members of our profession who make up the vast majority of unit sales.

A small minority of mega-agents is likely promulgating this myth. It caters to their obvious self-serving interests. Arguably, real estate is the most overpopulated profession around.

My cousin Rachel who is a Realtor in Baltimore is a case in point. Her husband does well. Her real estate ambitions are to do four ends per year so that she can afford to pay for trips to visit her children who are dispersed all over the U.S.

Rachel is among the approximately 68% of all real estate professionals who do four deals or less in the U.S. (Canada is not much different). Does that make her a poor agent? Is she less capable than some mega-agent with a support staff of 15 people? Not at all. She has her goals and ambitions, which she meets consistently. She often refers business to others. She premeditates that her life is about more than just real estate.

There are thousands upon thousands of Rachels who make up the backbone of the real estate community. This vast army of honest, hard-working real estate professionals is what real estate is all about. Their numbers vastly overwhelm the overachievers and uber-producers. By it’s inherent commission nature there are very few boards that require a full-time commitment. In the few boards that do require full timers it is perhaps possible to find a figure approaching the myth, as there tend to be fewer agents participating, (much to the joy of the active agents I should add).

Compounding the 90 -10 myth is that many of the “icon agents” who form teams, usurp the achievements of their team members. They credit themselves as owners of the deals on which their team members slaved. This achievement theft shows them as better mega agents than they are, and robs hundreds of agents of a performance records and likely skews overall production results.

It is interesting to compare Canadian versus U.S. results. I randomly picked four large American and Canadian cities in the chart below.

In column B, find the total deals. (Sales X 2, listing end and selling end)
In column C, find the closest I could come to 90% of the participants.
In column D, find the number of deals these 90% of participants did.
In column E, find the percent that the 90% constitute.
In column F, find the percent that the 10% constitute.

graph
I have tried to compare cities as evenly as possible. Working on this comparison I noticed the disparity of the US to Canadian ratios – which is something I will put my mind to and welcome your comments on.

So the next time someone gives you the 90-10 myth tell them that just about 90% of the people get this fact wrong by 30%.

Leon d’Ancona is the President of IMS Incorporated, a leading provider of real estate intelligence, and a monthly contributor to REM Magazine. For more information, please visit http://www.realestatestatistics.com/imsstats/speaker/.

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