(NewsNation) — Elevated mortgage rates, low inventory and high prices have Americans feeling historically pessimistic about the housing market. Now, realtors are fleeing the industry.
The number of full-time real estate agents and brokers fell to 440,000 in 2023, down more than 70,000 from the year before, according to the Bureau of Labor Statistics.
As recently as 2019, when the average long-term mortgage rate was around 4%, 543,000 people worked full-time as real estate agents.
April Strickland, a real estate broker in Gainesville, Florida, recently told the Washington Post that today’s business environment is the most challenging she’s ever seen, even slower than the years after the 2008 financial crisis.
“Quite frankly, realtors are running out of money,” Strickland said.
Last year, sales of previously occupied homes sank to their lowest level in 28 years, according to the National Association of Realtors.
The sluggish market is the result of several challenges — mortgage rates are more than double what they were just a few years ago, the supply of homes remains low and prices are at record highs.
An analysis by the Consumer Federation of America in January found that nearly half of the real estate agents sampled had sold one or no homes the previous year. Part of that is because many realtors work sporadically and have another job, the report noted.
New rules stemming from a $418 million antitrust settlement may also have real estate agents rethinking their careers.
In March, the National Association of Realtors agreed to settle more than a dozen lawsuits that accused NAR of imposing rules that inflated real estate commissions. As a result, realtors will face new rules that could change how they get paid.
For example, starting in August, real estate databases will no longer include offers of compensation for buyers’ agents, the Washington Post noted. That means those agents can no longer count on a cut of the seller’s earnings.
According to a report from the investment bank Keefe, Bruyette & Woods, as much as 30% of the industry’s commissions could disappear, the Wall Street Journal reported.