Hous­ing boom leads to in­flux of re­al­tors

The Hamilton Spectator - - SPEC HOMES - ALEXAN­DRA POSADZKI

More peo­ple look­ing to make ‘easy money’ sell­ing real es­tate

Dave Hamil­ton was look­ing for a get­rich-quick scheme when he got his real­tor’s li­cence in 2010.

“My dad al­ways said, ‘If you’re go­ing to sell some­thing, sell some­thing ex­pen­sive,’ ” the Toron­to­nian said.

“I have a cousin who sells cars and I know what he makes per car. You can make a lot more than that per house.”

But Hamil­ton quickly re­al­ized that sell­ing homes was a lot more work than he had an­tic­i­pated.

After clos­ing about half a dozen deals in his first year, Hamil­ton took on a part­time job at a bar.

He worked at that bar for sev­eral years be­fore re­turn­ing to the real es­tate in­dus­try on a full-time ba­sis last year.

To­day, Hamil­ton is a sales rep­re­sen­ta­tive at the Condo Store Re­alty Inc., and he says in just the first months of this year he has closed around 50 deals. But many re­al­tors are not so lucky, he says.

As Toronto house prices have risen, so has the num­ber of peo­ple look­ing to make easy money by sell­ing real es­tate.

There are just shy of 80,000 re­al­tors li­censed to prac­tice in the prov­ince, ac­cord­ing to the Real Es­tate Coun­cil of On­tario. That’s up more than 26 per cent com­pared to five years ago, when there were nearly 63,000 agents.

In Toronto, 48,000 re­al­tors be­long to the city’s real es­tate board — up from 34,000 in 2012, ac­cord­ing to data from the Toronto Real Es­tate Board.

Part of the in­cen­tive is the low bar­rier to entry, Hamil­ton said. It takes just six months and costs around $2,500 to get your real es­tate li­cence, mak­ing it a tempt­ing side hus­tle. Re­al­tors cau­tion, how­ever, that new­com­ers ex­pect­ing to rake in big bucks with­out ex­pend­ing much ef­fort are likely to be dis­ap­pointed.

“It’s a very, very tough time to get into the mar­ket for a lot of re­al­tors,” said Shawn Zigel­stein, a sales rep­re­sen­ta­tive with Royal LePage Your Com­mu­nity Re­alty.

“Yes, peo­ple are try­ing to cap­i­tal­ize. They say, ‘Oh, I’m go­ing to go get my real es­tate li­cence, make my­self a ton of money and walk away,’ but they don’t re­al­ize that 90 per cent of the busi­ness is done by 10 per cent of the agents.”

Eugene Mezini, a bro­ker with Royal LePage Real Es­tate Pro­fes­sion­als, said it’s typ­i­cally re­la­tion­ships that give es­tab­lished re­al­tors an edge. For in­stance, in the pre-con­struc­tion condo space where Mezini has worked for the past seven years, devel­op­ers typ­i­cally have a ros­ter of agents who they en­list when­ever they have prop­er­ties hit­ting the mar­ket.

“There are a lot more agents than when I joined but it’s not re­ally a lot more com­pe­ti­tion from what I’ve seen,” Mezini said.

“It’s still the same peo­ple do­ing all the busi­ness and get­ting big­ger and big­ger. It’s not like their mar­ket share is erod­ing. Their mar­ket share is ac­tu­ally grow­ing.”

Although a hot mar­ket can seem like a bless­ing for agents, who typ­i­cally earn a com­mis­sion of 5 per cent of a home’s price, Hamil­ton said in some ways it’s tougher.

Rep­re­sent­ing a buyer in to­day’s fiercely com­pet­i­tive mar­ket, where bid­ding wars abound, re­quires much more work than it did pre­vi­ously, he said.

An agent may have to pre­pare nu­mer­ous un­suc­cess­ful of­fers be­fore fi­nally man­ag­ing to help a client snag a home.

Zigel­stein’s ad­vice for those con­sid­er­ing a ca­reer in the real es­tate in­dus­try is to go at it full time. That’s what Zigel­stein says he did 13 years ago, when he got his real­tor’s li­cence, quit his job in the restau­rant in­dus­try and went knock­ing on doors.

“It is very dif­fi­cult to break in if you’re work­ing a full-time job and then you say, ‘I’m go­ing to do real es­tate on the side,’ ” Zigel­stein said.

“Be­cause at that point, how pro­fes­sional are you go­ing to be? How knowl­edge­able are you go­ing to be?

Es­pe­cially with mar­ket con­di­tion that we’re see­ing right now.”

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