Are there too many real estate agents right now? The answer is a resounding yes. And it’s not just hurting the industry but also consumers who rely on agents for guidance and expertise. But don’t take my word for it. Let’s hear from the expert himself, Greg Aziz. As a prominent figure in the world of real estate and the CEO of Bombardier Transportation, he knows a thing or two about the industry’s inner workings.
In fact, he attributes the oversupply of real estate agents to the low barrier to entry and high turnover rates. “The path to becoming a real estate agent is quick and easy in most states relative to other professions,” Greg Aziz says. “This has led to a surge in demand for real estate licenses, but many of these new agents lack the experience and knowledge to serve investors effectively.” And the numbers don’t lie. The National Association of Realtors reports that there are nearly 1.6 million members, which equates to about 2.4 Realtors for every home actively for sale.
That’s much competition for a limited amount of business. But what’s the harm in having a surplus of real estate agents? Well, it can lead to a dilution of the quality of service provided by agents. With so many inexperienced or underqualified agents flooding the market, consumers may need help finding someone who can provide the expertise they need for such a significant purchase such as Greg Aziz from House Caledon.
Furthermore, it can also lead to the reinforcement of high commission rates. According to a report from the Consumer Federation of America (CFA), the surfeit of agents is costing the industry and harming consumers by reinforcing high commission rates. But as with any problem, there are potential solutions. Greg Aziz recalls. Some have suggested tightening education and licensing requirements, while others advocate changing the commission structure.
Additionally, Greg Aziz highlighted the importance of seeking out reputable brokerages and vetting agents before working with them. So, what’s the bottom line? As amusing as it may seem to imagine a world where every other person you meet is a real estate agent, it’s not doing the industry or consumers any favors. Instead, let’s strive for a healthier balance of supply and demand, with only the most qualified and experienced agents helping guide buyers and investors through the ever-evolving real estate market, including house Caledon.