Number of real estate teams growing, NAR survey shows
WASHINGTON — Teams are becoming more common in the real estate industry, according to a new survey by the National Association of Realtors. The survey states that an increasing number of Realtors consider themselves a member of a real estate team.
The NAR’s 2018 Teams Survey found that 26 percent of respondents are members of a real estate team, while 73 percent are not members of a real estate team.
The definition of a real estate team varies. Some states describe a “team” as two or more real estate salespeople or licensees who work together to provide real estate services or who hold themselves out to the public as a member of a team.
Real estate teams are an appealing option, as they help increase sales productivity by letting individual team members thrive with their own strengths and skill sets.
“The transformation of the real estate landscape continues to change the way Realtors do business,” said Bob Goldberg, CEO of the National Association of Realtors.
“Over the past few years, Realtors have continued to embrace changing technology and business tactics that are modernizing the industry,” he said. “Real estate teams are an increasingly popular business model in response to consumer demand for a wide range of specialties from their Realtor, as they expect constant support throughout the real estate transaction.”
The median year that real estate teams were established was in 2014, and Realtors typically joined their current real estate team in 2016, the report states. Nearly 30 percent of Realtors have two people on their real estate team, with a median number of four team members.
Among respondents that are not currently on a real estate team, 16 percent said they have previously been on a team, while 84 percent have never been a member of a real estate team. Of the Realtors that are not currently on a real estate team, 9 percent said they have strongly considered the prospect, and 30 percent have briefly considered joining or starting a real estate team.
The survey asked Realtors to choose from a list of activities to explain their primary functions on a team. The most common answer was agent (88 percent), followed by broker (50 percent), marketing (47 percent), administrative (47 percent) and transaction coordinator (34 percent).
“This growing trend not only helps our members share workloads and responsibilities, but also allows Realtors to benefit from the experience of fellow professionals,” said NAR President Elizabeth Mendenhall, a sixthgeneration Realtor from Columbia, Missouri, and CEO of RE/MAX Boone Realty.
“The synergies of a well-functioning team are often an incentive to relinquish some of the independence of a solo practitioner and offer many attractive features for both licensees and their customers,” she said.
The most common compensation arrangements within a real estate team are fixed commission split (38 percent), graduated commission split (22 percent) and 100 percent commission split (13 percent).
As real estate teams become a fixture of the contemporary real estate environment, it is important to understand that real estate teams will attract the attention of real estate regulators. In recent years, 24 states have statutes or formal regulations in place that address real estate teams.
“These regulations may continue to be relatively minimal, limited largely to advertising rules,” Mendenhall said. “Yet as teams continue to develop and as the practice continues to evolve, it is possible that more extensive regulations will also develop and evolve.”
ABOUT THE SURVEY
In July 2018, the NAR invited a random sample of 50,436 active Realtors to complete the Real Estate Teams survey. A total of 3,483 usable responses were received for an overall response rate of 6.9 percent. At the 95 percent confidence level, the margin of error is plusor-minus 1.66 percent.