Demands of Market, Technology Changing the Work of Agents
The life of a California real estate agent during the late 1980s seemed like an effortless exercise in making money.
It did not take much time or work to sell a product that seemed to go up in value no matter how much a buyer paid. No wonder real estate schools were bursting at the seams with new students and brokers were racing to open and expand offices and sign up scores of new agents. Sales commissions soared along with property values.
How times have changed.
The punishing real estate recession of the 1990s has decimated the ranks of real estate agents as sales plunged, brokers merged and offices closed. Even those who lived through the Dark Ages of California real estate to see some promising signs in the market today must work harder for their money and cope with dramatic changes in the way they do business.
“It’s not an easy market,” said Fred C. Hampton, an agent in the Los Feliz office of Prudential Jon Douglas. “Those of us who have been around since 1989 are the survivors.”
Selling real estate now requires agents to deal with ever more demanding customers and with sophisticated technology. Sprawling corporations have squeezed out small brokers and disclosure laws have raised the risks and responsibilities of selling property.
Many agents did not survive. Since 1990, membership in the California Assn. of Realtors has dropped by more than 30% to slightly fewer than 100,000 by the end of last year. Real estate employment in California is expected to continue falling this year--as it has since 1990--and should show only modest gains next year, according to the UCLA Business Forecasting Project.
As the demands of the job intensify, a new breed of agent is entering the field, said Rick Snyder, president of the state realty group and a San Diego-area broker. Instead of retired workers looking for a part-time career, the profession has seen growing numbers of highly educated recruits who view real estate as a full-time, long-term profession, Snyder said.
“Many of the applicants that we are starting to see are coming out of college with a four-year degree,” Snyder said. He looks for someone who is computer-literate and has a good grasp of real estate economics.
Keven Wolfgram, for example, became an agent last year.
“I wanted a little more control over my business,” said the 33-year-old former mortgage banker, who earned a degree in business from UCLA. Wolfgram worked and split commissions with an established agent before joining a Century 21 brokerage in Whittier earlier this year.
“My first day in I put a buyer into escrow,” he said.
Wolfgram conceded, however, that the transition has been rough at times, as he has struggled to build up a roster of clients.
A customer can be “familiar with 10 agents and have thousands available to them,” said Wolfgram, who doesn’t hesitate to promote himself to the manager of a restaurant he patronizes or to fellow churchgoers. “It’s making yourself stand out among the crowd that is a challenge.”
The challenges are also great for veteran salespeople wrestling with change. Hampton, at Prudential Jon Douglas, started his career in the late 1970s working for a small brokerage where new property listings arrived on a weekly basis through the mail. The basic purchase contract was only a page long.
Now Hampton is one of more than 4,000 agents in a newly merged corporation. A network of powerful computers provides up-to-the-minute information about what’s available for sale in the region. Customers and agents must now wade through an eight-page purchase contract packed with complex legal and financial statements.
“The difference between when I started and now is night and day,” said Hampton, who along with his business partner is planning to buy a laptop computer to take with him on customer calls. “There is a lot more you have to know.”
Newcomers to real estate should be prepared to wait for a payoff. Many real estate experts recommend building up ample savings because it can take months to earn that first commission check. In addition, agents, who must be licensed by the state and work primarily as independent contractors for a broker, must spend heavily on everything from advertising and insurance to flags and signs.
Hampton’s partner, Hattie Ramirez, worked as a limousine driver, freelance writer and office temp to supplement her agent commissions after starting her real estate career in 1989.
“The first couple of years were not fun for me,” she said. “Only in the last year has my dedication and persistence paid off.”
In fact, Ramirez expects to make enough money this year to do what many of her clients have already done: buy a house.
Jesus Sanchez covers real estate for The Times. He can be reached at (213) 237-7114 or via e-mail at jesus.sanchez@latimes.com
