Per the most recent count, Columbus REALTORS® has over 7,400 members, not counting affiliates. Depending upon the source, the percentage of real estate agents that fail in the business within the first five years ranges between 85–90 percent. It’s staggering when you think about it, nearly nine out of 10 agents can expect to fail. Being the eternal optimist, I choose to see the glass half full and I believe that count can be greatly reduced.
As education director for our brokerage in Columbus, I introduced hundreds of new agents to basic “real estate terms and principles” before introducing them to the cultural demands of the company. It didn’t take long to understand that there is a huge gap between passing the state exam and the daily practice of real estate. Newly licensed, wide-eyed agents generally go from zero to sixty in terms of their introduction to real estate practices. Many brokerages, if they hire new agents at all, either don’t have the staff or take the time needed to gradually guide new agents into the day to day practice of real estate. Most new agents go directly from passing the exam into a full immersion program at the brokerage. So much of what is put in front of them is like learning a foreign language. Recruiting newly licensed agents is often done at the school during a ritualistic style “career night.” Sometimes the students have just started classes that day and don’t know what they don’t know. Because students must align with a brokerage in order to take their exam, they often choose simply by brand recognition, intriguing commission plans or just plain personality choices. It’s only after the agent arrives at the brokerage with minimal understanding of real estate it starts to break down.
I believe there is a huge void which can be greatly mitigated through interim training on the “fundamentals” of real estate. Time and again, there has been great confusion between the role of the Division and the Association. Learning abundant acronyms, understanding real estate terminology, abiding by the rules of etiquette, learning to write a business plan, developing a personal marketing strategy, are just a few of the topics needed to be introduced early on. Long before corporate culture, contract writing, negotiating, etc. is taught, a whole host of other items should be discussed and understood by the agent. I would call this training a “preliminary understanding of the real practice of real estate.”
The schools have done a fine job of preparing students to take and pass the state exam. A great deal of time is correctly devoted to the things that form the moral and ethical boundaries of our industry. Principles and Practices, Law, Finance, and Appraisal establish the foundational parameters under which one should operate. While heavy emphasis is placed upon conduct, ethics, litigation etc., and forms a moral basis of understanding, they are not expected to teach the real-world fundamentals one will need when practicing real estate.
I believe we need to bridge the gap between formal education and understanding the day to day practice of owning and operating a small business. Serious real estate agents must commit to a lifetime of education, choose to make it a full-time career, have a written business plan, understand the financial investment, prepare for fluctuating income patterns, and so much more. With a clear understanding of their why and clearly defining the real demands of our industry, we should be able to reduce the rate of attrition while raising the standards of new real estate practitioners.
It is incumbent upon all of us to take the time to properly train our new agents. We need to fill in the missing pieces and to be crystal clear on our expectations and theirs. We were all there once and know that with great coaching, training and mentoring we will not only hire, we will retain exceptional REALTORS®.