As the economy suffered through the recession and housing took a particularly hard hit, REALTOR® incomes have also been affected, as 84 percent of NAR members are paid on a commission basis.
It is important to note what the NAR member does within their office and firm provides variation to the member. Broker-owners and managers who do not sell typically had the highest incomes—13 percent of broker-owners who do not sell had gross annual incomes above $250,000 in 2010.
Sales agents are typically the newest members to real estate and typically had the lowest income—28 percent of sales agents had gross annual incomes less than $10,000 in in 2010.
REALTOR® membership has fallen from 1.4 million in 2007 to roughly 1 million today. The adjustment is a healthier move away from the surplus who entered the business during the boom/bubble years. But the decline also reflects the tough housing years of the recent past. Interestingly, the number of real estate licensees fell much more sharply than overall REALTOR® membership, implying that non-REALTORS® were further squeezed. It is hoped that there are not an overabundance of entrants into the profession when the real estate market does indeed recover so that existing members get some income boost rather than a diluted recovery due to too many being in the business.
Lawrence Yun is Chief Economist and Senior Vice President of Research at NAR. He directs research activity for the association and regularly provides commentary on real estate market trends for its 1 million REALTOR® members.