Where do you want to be this year? Where do you want to be in five, ten years from now? What about after that?
These are a few questions you will want to ask yourself as your business grows and you start establishing your recruiting benchmarks for the year.
We have written in the past about the hiring process, the importance of human resources and about building brokerage culture. All of these aspects will get you to where you want to be.
But, where is that exactly?
In this article, we are going to take a look at real estate agent recruiting stats and statistical benchmarks for 2020. We will take you through the process of what to consider before recruiting, how to recruit and goals you should be aiming for.
Things to consider before recruiting
The real estate market is highly competitive and to succeed you need to lead a team of go-getters. According to NAR, 42 percent of firms are actively recruiting, with 47 percent of these being residential firms and 28 percent as commercial firms. Needless to say, competition is tough.
Once a new recruit joins your team, you will want to keep them there instead of taking their knowledge and leads elsewhere.
We wrote about the importance of building a brokerage culture, but in order to succeed, you need to learn how to scale your growth quickly.
In order to scale your business, you need to look at it from a logical angle.
- Track your growth.
- Build your brokerage culture to maintain employee loyalty.
- Go beyond job boards.
- Interaction over the transaction, in business and in hiring.
- Go beyond compensation to retain remarkable employees.
- Slow and steady. You got this.
As you can see, it takes time to keep people in one place. Remember this chart of statistics when recruiting new real estate agents. Whether it’s the fear of change or previous loyalty, getting someone comfortable with coming on board could take a little bit of time.
Now, before you start growing your team and stepping up those recruiting benchmarks for 2020, take a minute to understand your competition and clientele.
This Realtor article shows how the competition is tough:
According to the U.S. Bureau of Labor Statistics, 91 percent of brokerage owners have been in the business for over five years. Of that, 19 percent have spent five to nine years, 29 percent at 10 to 19 years, a staggering 27 percent have spent 20 to 39 years and 16 percent have spent over 40 years in the business. That means most of these other brokerage owners have seen a lot of years, a lot of ups and downs and have come through the other side.
One thing to note, as you probably see in yourself, brokerage owners are driven.The data company Foresight Information Services found that 91 percent of brokerage owners expect to recruit more agents and hire more staff in the next year with 78 percent expecting their bottom line to grow.
Brokerage owners also put in a staggering average of 52.7 hours per week, according to JP Morgan Chase Institute. And 40 percent are putting in 60-plus hours per week with a third of that time is spent outside the office.
That amount of work seems to bring in the rewards as NAR 2018 Member Profile states that the median sales volume was $1.8 million. That is a high bar to reach, but as a brokerage owner, that’s what you should be aiming for.
Think outside the box
You will need to get creative if you want to recruit successful agents for your team. The only way that you will be able to scale your business is if you use tools and leverage to help you. And, shameless plug alert, SmartSetter can do just that. According to our statistics, the average agent is able to recruit 1.11 agents per year. With SmartSetter, agents recruit up to 19 agents per year with some recruiting as high as 250 agents per year. If the tools are there, you should use them.
We also have more articles on the recruiting process and what kinds of things you can do to ensure you get a solid team. Remember, you want to keep your team together and to do that you will also need to build a steller brokerage culture.
Now that you have your team assembled, here are a few statistics from previous years to provide a few goals.
A few benchmarks to consider for 2020
You aren’t the only one looking to grow your business this year.
According to NAR, 42 percent of firms reported that they were actively recruiting sales agents. It was more common in residential firms over commercial firms and the most common for firms with four or more offices (84 percent) than firms with one office (36 percent).
The reason for rapid recruitment? Eighty-six percent of firms said that the main reason was growth in their primary business. A desire to expand into new markets followed closely behind with 31 percent.
Of all of these firms, 86 percent were independent non-franchised firms and 11 percent were independent franchised firms. That means a lot of hustle out there.
If you’re finding a few challenges in the business, you aren’t alone. Keeping up with technology, competition from nontraditional market participants and housing affordability were some of the biggest concerns from respondents going forward in the next two years.
Around 58 percent of firms were concerned about whether Millennials could buy a home.
Thirteen percent of all firms had real estate teams with a median of three people.
All of this means there is plenty of competition out there. Recruiting a stellar team and keeping them happy should be a top priority.
Going into this year will be interesting as there’s a lot going on. However, remember to set your goals, adjust them as needed and work as hard, if not harder, as every brokerage owner out there.
The best thing you can do is to use the tools out there as leverage in order to scale your business. At SmartSetter, we provide the tools you need to find new recruits so you can do what you do best. On average, a broker recruits only 1.11 agents per year. With SmartSetter, the average is 19 recruits per year with some of our clients recruiting 250 per year.
Once you have your team assembled, don’t forget to read our articles on how to keep them.