The ranks of real estate agents in the Sacramento area exploded in last decade’s housing boom, only to shrink dramatically in the bust.
Now, a few newcomers are getting into the business, seeing it as a good time to gain experience as the market recovers. Unlike those who grabbed an opportunity to make a quick buck in the boom, today’s new agents are having to earn their commissions by knocking on doors to drum up business and writing multiple offers over a period of months for buyers struggling at a time of tight inventory and tight credit.
“It’s better to start out at something like this, learn it when it’s hard, and then you’ll learn the skills to make a living at it,” said Chris Little, president of the Sacramento Association of Realtors and a broker in east Sacramento. “If you just want to be an order taker, you start out when it’s going gangbusters and you don’t have to do anything.”
Thousands of new agents earned their licenses in the mid-2000s. At the peak of the market, MetroList, the multiple listing service for the greater Sacramento region and the northern San Joaquin Valley, counted about 25,000 subscribers – an indicator of the number of agents in the area.
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Now there are approximately 16,500 subscribers, a 34 percent drop, said MetroList’s president and CEO, Tom Beede.
The Sacramento Association of Realtors said it had about 3,000 member agents in 2000. Its membership includes most of the agents in Sacramento County. By 2005, the number of agents who were SAR members jumped to more than 7,600, then fell steadily to 5,325 in August, the group reported.
Yet even as overall figures fell, new agents signed up with area brokerages.
Statewide, about 2,800 individuals took the state’s agent licensing exam in June, 1,100 more than the same month a year before, the California Bureau of Real Estate reported.
Locally, “we are seeing an increase in people joining the association – 50, 60, 70 people every month are becoming Realtors,” Little said.
Take Pat Quan, with Coldwell Banker in El Dorado Hills. A former software salesman, Quan, 52, became an agent about a year ago and has closed more than a dozen transactions representing both buyers and sellers.
He said he had thought about starting his own small business for years. In 2012, when the market started rising from the abyss of falling prices and foreclosures, he decided it was the right time to enter real estate.
“My analogy is you buy stocks when they’re cheap, not when they’re expensive,” he said.
Quan said he was drawn to real estate by the low cost of entry and the fact that he wouldn’t have to “go to the same building every day.” Plus, he could drum up business by beating the bushes, not by waiting for customers to find him.
He said he has enjoyed good results from the old-fashioned but grueling method of knocking on doors. One El Dorado Hills family liked him so much after he met them that they selected him to sell their home over two other agents whom close friends had recommended, he said.
A key factor was that Quan thought the family should ask 10 percent more than the other agents had suggested. They were not as up to speed on rising price trends as he was, he said.
“As it turns out, it sold almost at exactly what I priced it at, about $400,000,” Quan said.
Robert Zargaryan, 49, joined Sacramento’s Lyon Real Estate last summer, also as a second career after working in insurance. He said he especially enjoyed helping a young couple buy a home in Sacramento County’s semi-rural Vineyard area. They had wanted to live in the community for years but couldn’t buy into the area when prices were higher, he said.
“Young couples have flocked to the market that before they couldn’t afford,” Zargaryan said. “Other people are losing their homes; that’s the negative part of it.”
The Lyon agent said he represented a buyer who, despite months of effort, was unable to qualify for financing, a common experience when so many would-be buyers have flawed credit records stemming from the recession and housing collapse.
“I still think it’s a great business,” Zargaryan said. “Attitude is No. 1. You have to keep positive. And with the market stabilizing, I think it’s a good time to be an agent.”