The most frequently pressed number in a voicemail system: "0" for Operator
Now that I am a consumer in the real estate market, having moved from New Jersey to Texas (like so many others) and therefore having placed my house in the hands of a Realtor, I get to have some cool experiences. I wanted to share one of them with you all, especially the real estate professionals, because it struck me that this is probably not a perspective you get often from your buyers or sellers.
Tools. They’re great. I know many of you use tons of them. But you are going to want to consider how the consumer on the receiving end might perceive them. I got an email today from my agent, Sue Adler — or more precisely, I did not get an email from my agent, Sue Adler — which triggered this post.
Done correctly, tools can and do help you work more efficiently, more effectively, stay in touch better, and improve customer service. But more often than not, tools can make you seem impersonal and distant, like you just don’t care. And that’s probably not a good thing in something like a real estate transaction.
One of the most valuable pieces of data in our industry, I think, is the annual Power Broker Report and Survey conducted by RISMedia. The 2008 edition is no exception, and is available here. I highly recommend it if you’re interested in our industry as a whole.
I like to play with the numbers as soon as I can get my hands on them. I’ll probably be writing about one or more aspects of this over the next few weeks, but thought I would share some interesting tidbits.
I only looked at the top 750 brokerage companies in the survey report because the numbers started getting wacky. For example, the #961 company did 13 transactions totalling $70,000 in volume in 2008. That just doesn’t sound right — either there’s a data entry error, or that company ain’t in business no mo’.
Plus, I excluded the top three companies: NRT, HomeServices of America, and Long & Foster, simply because they are such outliers that they really skewed the results. For example, #3 Long and Foster more than doubled the sales volume of the #4 company, Prudential Douglas Elliman.
In any case, here are some numbers to chew on:
- The average number of transactions in 2008 was 1,894; the median, however, was 931.
- The average sales volume in 2008 was $498.2m; the median was $208.6m.
- Assuming a 2.5% GCI rate, the average GCI for the Top 750 was $12.5m, with the median coming in at $5.2m.
- Assuming a 26.7% company dollar retained (taken from the 2007 REALTrends Brokerage Performance Report), the average Company Dollar was $3.33m, with the median at $1.39m.
- The companies in the Top 750 employ an average of 271 agents; the median number comes in at 128 agents.
- The average GCI per agent is $53,444, while the median GCI per agent is $38,031.
- The average Company Dollar per agent is $14,269; the median is $10,154.
- In total, the top 750 companies added 43,906 agents in 2008, while 51,753 agents “left” — a net loss of 7,847 agents. (Note that there’s a pretty good likelihood that many of the 51K agents who “left” went to another company, and forms a portion of the 43.9K number.)
- Similarly, 293 offices were opened in 2008, while 355 offices were shuttered, a net loss of 62 offices among the Top 750 companies (less the top 3 outliers).
- Regardless of the above disclaimer about outliers, among the Top 15 companies ranked by sales volume, the #1 company (NRT) did more than #2 – #14 combined: $132B vs. $131.8B.
- If you take the Top 15 companies by Sales Volume and re-rank them by GCI Per Agent, the only company to appear on both lists is Keller Williams Realty, Oklahoma City, who is #7 on Sales Volume and #6 on GCI/Agent with $403K in GCI produced per agent. This would make them the most efficient large brokerage in the country. (At least, based on calculation assumptions.)
- The second most efficient company in the Top 15 by Sales volume is Alain Pinel Realtors, who is #9 in sales volume and #28 on GCI/Agent with $115K in GCI produced per agent. Incidentally, the #1 company, NRT, is 158th in GCI/Agent with $65K GCI per agent according to this report.
- Without question, Keller Williams dominates the Top 750 list in terms of brokerages represented under its brand. 337 of the top 750 are Keller Williams franchises. Coming in second is RE/MAX with 141 of the top 750. Coldwell Banker comes in third with 50 franchises.
There are more interesting tidbits, and there are conclusions to be drawn from the information. But for now, I thought some of the above was pretty interesting.
More to come.
-rsh
