Article originally written and July 31, 2024 by Mike DelPrete. Check it out here!

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10% of Agents Changed Brokerages in the Last 12 Months

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Real estate is a high churn business, with over 144,000 agents changing brokerages in the past 12 months.

Why it matters: For brokerages, this highlights the critical importance of recruiting and retention – and knowing which types of agents are the most likely to move.

Context: The joke is that the median number of houses sold per agent each year is zero – and the truth isn’t too far away.

• Approximately half (47 percent) of the 1.4 million agents in this analysis sold zero houses in the past 12 months.
  
• These non-producers may be on teams, which was true for about 26 percent of agents in 2018 according to The National Association of Realtors.

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Agent churn is when an agent changes brokerage; it does not include agents new to or exiting the industry, and the time period is the last 12 months (June 2023–June 2024).

• Including non-producers, 10 percent – or around 144,000 agents – changed brokerage in the past 12 months.
  
• And lower producers in the $1–$10M range were the most likely to churn.

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Excluding non-producers, some of whom were part of a team, 14 percent of the remaining “active” agents changed brokerages in the past 12 months.

• It’s notable that the highest producing agents, $50 million and above, churn at higher than 10 percent – a significant shift in revenue (and a recruitment and retention opportunity).

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Tenure matters: The longer an agent has been in the industry, the less likely they are to change their brokerage.

• The newest agents – those in the industry between 12 and 23 months – were the most likely to switch brokerage, while agents in the industry 12+ years were the least likely to change.

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Agent churn is also correlated to office size.

• The largest brokerage offices, with over 500 agents, are churn machines with the highest percentage of agents joining and leaving; agents are 33 percent more likely to leave a big office vs. a small one.
  
• Keep in mind, the publicly reported agent counts of brokerages obfuscate true churn; a two percent increase in agent count may be the result of 12 percent joining and 10 percent leaving.

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The bottom line: Any business forecasting a minimum of 10 percent churn of its most productive employees or its total revenue is in for a challenging year ahead.

• By its very nature, real estate is a high churn business, which represents a massive shift in potential brokerage revenue each year.
  
• This is a risk and an opportunity – the constant movement of agents means that brokerages can’t stand still and always need to be offering the best proposition to current agents and prospective recruits.

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Disclaimer and Sourcing: This article is a result of a collaboration between myself and Courted, an AI-powered agent recruiting and retention platform. For this article, Courted provided the initial statistical analysis, which I used to develop my insights and conclusions. It is important to note that Courted did not provide any raw data to me. All interpretations, opinions, and conclusions expressed in this article are my own, and were developed based on summarized statistical analysis across 82 MLSs.

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About the author: Mike DelPrete

Mike is a global real estate tech strategist, and a scholar-in-residence at the University of Colorado Boulder. He is internationally recognized as an expert and thought-leader in real estate tech. His evidence-based analysis is widely read by global leaders, and he is a sought-after strategy and new ventures consultant. His research and insights have featured in the New York Times, Wall Street Journal, Financial Times, and The Economist.

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