Some interesting statistics on the real estate industry

Every year in Australia, hundreds of people complete compulsory state and territory Government Registration Courses to enter the real estate industry ether as sales staff, property managers or support staff.To many people, the real estate industry may seem ideal career in that you do not need any tertiary qualifications to commence a career that can eventually be very highly paid. It is still one of those careers where you can start at the bottom and work your way up, and where successful salespeople regularly take home perhaps three or four times the average Australian salary, even when the economy is not so robust.

With this in mind, you would think that everyone in the real estate industry would be happy and therefore there would be no vacancies. However, it is estimated that 80% of sales staff never renew their Government issued certificate of registration by the second year of their career.The reason for such a high turnover rate, I feel, that is mainly due to the fact that the fact that real estate sales staff must work as a ‘business unit’ themselves in an agency. Although initially they are heavily supervised and monitored, they have to generate their own income by canvassing home owners for listings and then obtain properties for sale and market them to qualified buyers and then negotiate the best sale price for the owner.

Although the hours in real estate are quite flexible, most sales staff work hours that would be considered by most as quite unsociable, particularly at night and on weekends, and although most sales staff receive a salary plus commission, if they don’t list and sell properties, they will only earn the base income which doesn’t really compensate for working such unsociable hours.The industry is also very highly competitive.

A recent survey by Macquarie Relationship Banking showed the following snapshot of the earning potential of sales staff in the real estate industry in Australia.  

1.      The average agency splits 40% of the agency income with the sales staff involved in the listing and sale of a property. 

2.      In a small agency – less than 10 sales staff - gave their staff 38% of the commission income to the agency. 

3.      In a medium size agency – 11 to 19 staff – the split of the agency commission to the sales staff was 42%. 

4.      In a large agency with 20 staff or more, the commission split was 46%. 

5.      35% of sales staff in larger agencies earned over $150,000 per annum in commission income whilst only 9% of sales staff in smaller agencies earned over $150,000. 

6.      19% of sales staff in medium size agencies earn $150,000 or more. 

7.      1% of sales staff earn over $1M in commission and 2% earned over $500,000 perannum. 

8.      The average top earning sales staff across Australia was $304,091. 

9.      Almost half of the real estate salespeople in Australia – 47% - earn between $50,000 to $100,000 per year.

Statistics for the real estate industry are not revised on a regular basis; however the most recent survey by the Australian Bureau of Statistics (ABS) in August 2007 showed that 95,400 people were employed in the real estate sector, of whom 17,900 worked part-time. By state and territory, people working in real estate numbered: New South Wales 35,300; Queensland 24,000; Victoria 17,800; Western Australia 10,400; South Australia 5,800; Tasmania 1,300; Australian Capital Territory 600; Northern Territory 200 Separate 'count of business' data shows that at June 2007, there were 36,198 people working as non-employing agents, with their own Australian Business Number (ABN) acting as sub contractors. There were 14,835 real estate agencies which employ people. Total income from all sources to real estate agents in the year to June 2005 was $18,612 million with an operating profit before tax of $3,279 million.

The most recent ABS survey into Australian Real Estate Services was conducted in 2002-03 and the results are summarised below. Business activities covered in the survey included valuing, purchasing, selling by auction and private treaty, and managing or renting real estate for others. In 2002-03 the industry generated total income of $7,524.7 million and industry value added of $4,784.1 million. Those working in franchised agencies comprised 53% while those in non-franchised agencies comprised 47% of all estate agents. Females comprised 45%, and males comprised 55% of employed real estate agents in June 2003.

From my perspective, real estate is an extremely rewarding profession for those who take it seriously and work hard to keep their clients happy. It allows you to meet hundreds of different people, help them with some very important undertakings, and be rewarded for it both emotionally and financially.

Posted by Reality Bytes - Real Estate Training Blog on 14/10/2009 at 2:36 PM | Categories:

2 Comments

Glenn Twiddle

Glenn Twiddle wrote on 19/02/2011 5:55 AM

Been looking everywhere for some decent stats.

Thanks a million,

Glenn Twiddle
Natalia

Natalia wrote on 08/10/2013 3:49 PM

This is so interesting!
I live in Australia and I saw a realestate agent in a wealthy looking suit and a suped-up car walking down my street the other day.
I think I have finally found what I want to do...

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