Real estate: A dying profession?

With a large percentage of agents set to retire in the coming years, and few youngsters seeking real estate as a career, will there be any agents left in to sell your next house? Or, with the rise of technology, will you even be needing a real estate agent?

In an industry where our leading agencies still seem to hire and attract the same types of people to their teams, and a society still skeptical of real estate agents, Chris Hannam, Ray White Whangarei’s newest (and youngest) Director, in charge of Growth and Recruitment knows he has his work cut out for him if he’s to change people’s perceptions and encourage more young people to the profession.

With the average age of real estate agents in New Zealand being in their late 50s, and the profession regarded by many as a second career, it is hard to deny that real estate looks like a dying profession.

There are over 14,000 active salesperson licenses in NZ, and less than 1 in 10 of these are held by agents under the age of 30.

Why are young people so under represented in this industry? Chris puts it down to: income, trust, perception, and an industry structure and business model that has failed to progress with the times.

Being new to a primarily commission based industry makes it hard for many to support themselves financially until they start earning a regular income – then add to this the level of self-investment needed for marketing and ongoing training. Chris believes that few young graduates look toward real estate as a career due to high levels of debt already hanging over their heads.

Perception and youth can be another sticking point for some contemplating joining: ‘Can an agent be too young to be taken seriously?’

“We do not think age has anything to do with success. It’s your attitude, your skill-set and your focus … not people’s perception of your abilities because you are young. Many young recruits have a far better grasp on current technologies, and market trends – which is crucial for working in real estate today. The agent may not own or have purchased their own home – but they have been trained in the processes, the legalities and have the marketing nous, desire and skill-set to complete many successful sales – plus, our agents also have the strength of the team and management support “. Australia is making progress on breaking down these walls with a younger and more dynamic demographic, so there’s no reason we can’t do the same’ said Directer Chris Hannam who entered the profession in his 20s.

“Youth can be your greatest asset in this industry … I have seen many young agents perform better simply because they have more time to dedicate to their work, more enthusiasm and a positive drive… The advantages clearly, outweigh any disadvantages.

We see cadetships as a vital part of our progression and adaptation to the changing real estate industry in which we work.

Fortunately, the success of our recruitment over the last few years has come down to the strength of our team – it is rare to see top salespeople working alongside new recruits and sharing listings, open homes and all the work involved in managing a successful sale. At the end of the day our cadet program, which includes a retainer, relies on our team’s trust and a mutual respect (because ‘yes’ the retainer essentially comes from the pockets of other team members)”

With the rise of the technology savvy consumer and digital technologies – will we even be using real estate agents?

“You might think it would become a do-it-yourself model… and that with the rise of the internet that the role of the real estate agent is dying… but the process of purchasing a home is still a transaction between people and, a successful seamless sale relies on someone managing the process – someone with a specific skill-set. We are still confident that real estate professionals with skills and knowledge of finance, investment, strategic planning, marketing and networking will survive any technological disruption…. and that a skilled agent who is a good negotiator will always be able to add value to the process … beyond what their commission removes. ”

The Ministry of Business, Innovation and Employment put the average income for real estate agents at about $79,000 a year, and expects the number of agents to grow by 3.4% by 2020 due to the current construction boom; our ageing population selling their properties to move into retirement homes; and real estate agents retiring to create vacancies. So where are they going to come from?

“We must support and encourage more younger people to this profession, and break the current dated recruitment models” says Chris who sees an urgent need for a shift in the industry.

“It is hard to overcome the negative perceptions around the industry, but something needs to change dramatically… and fast… or consumers will be left with poorly trained, inexperienced ‘agents’ handling their largest possible financial transaction – which could potentially cost them thousands – whether it be selling for well below market value, or making other costly mistakes along the way.”

“It is time to step up and inspire, motivate and connect with young people – We need to highlight the opportunities available to smart young professionals – enhance their entrepreneurial spirit and show them the path to transform this industry (and themselves)… Age won’t affect your business, unless you let it. Most people who have bought or sold a house know many agents are not very good. They don’t answer their phone, they don’t return calls and they simply don’t follow up. If you can do the basics, and take care of your clients you’re already ahead of the game.”

Chris’ advice for those joining the industry: ” Have confidence, choose an agency- one that aligns with your values, teaches you the right ways to start out as an agent and supports you on that journey. Any person can be great in this industry if they focus on the right things – too many pick an agency that pays them the highest commission split or fewer costs. This often sets them up for failure as they miss out on the vital skills, training and assistance they need. Be humble and learn from those who have experience, be accountable, stay motivated, and have a goal. ”

Find out more about becoming a Real Estate Agent in New Zealand on the Yudu website
> Yudu

Chris Hannam joined the Ray White Whangarei & Tutukaka management team in 2019 as an owner and director and heads the role of ‘Growth and Recruitment’. His diverse skill-set has seen him work with the Royal New Zealand Navy, before working offshore in the security sector and going on to establish an international security company. Moving into sales he worked for a number of large corporates including Fuji Xerox, Ricoh, and Konica Minolta before launching his real estate sales career with McGrath in Australia. In 2013 he moved back to New Zealand and joined the Ray White team – specalising in residential, coastal and lifestyle sales, and quickly rising to the top of his field – acknowledged as their Rookie of the Year and reaching Ray White Elite status selling over $67.5 million worth of properties.