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Thursday, Jun 8, 2023


Jane Singer is part of a mass movement: She’s getting into real estate. The current boom in home sales is again driving people into the business, part of a cyclical pattern that occurs when prices and with them commissions start heading up. While real estate experts caution that becoming a broker is not as easy as it used to be, it hasn’t stopped people like Singer, who recently received her license. “I was encouraged by the strength of the market,” said Singer, who added that she had considered a career change for several years. She is an associate with Bradbury Realtors of Studio City. Indeed, area trade schools report sharp increases in the number of students studying for their real estate license. At the Real Estate Institute in Westminster, enrollment is up 35 percent from a year ago, said proprietor Pat Wen. Enrollment is up 47 percent for L.A.-area students of Allied Business Schools, a Laguna Hills-based correspondence school, according to marketing manager Jay Achenbach. And enrollment is up “about 50 percent” at Paramount Properties School of Real Estate in Northridge, according to branch manager Steve Glassman. “We had to expand our school and bring in extra tables and chairs. It’s unbelievable,” Glassman said. Jim Link, executive vice president of the Southland Regional Association of Realtors, which represents both the San Fernando and the Santa Clarita valleys, says membership in the group increased by about 300 during 1997, for a total of 5,800. That increase, however, “at this point is fairly minimal,” said Link. Statewide, the total number of licensed salespeople and brokers has been on the decline since 1991, when there were 375,986 licensees, according to the state Department of Real Estate. At year-end 1997, the number was 300,751. Although more people are now going for their licenses, there also have been more people dropping out of the industry, according to Daniel Garrett, assistant commissioner of legislation and public information at the state agency. The declining numbers may reflect the less-than-robust home sales market of earlier years as well as the fact that being a sales agent is far more demanding than in the past. Sales agents and brokers must satisfy continuing-education requirements, and they must also be up-to-date in terms of legal and legislative developments, according to June Barlow, vice president and general counsel of the California Association of Realtors. The sales transaction itself has become “enormously complicated,” according to Barlow. “When I first started working here 15 years ago, the sales agreement was a two-page purchase contract, most of which were blank lines. Now it’s a six-page contract, most of which is jam-packed with terms,” she said. Sales agents must also be up-to-date about disclosures, including seven different types of natural-hazard disclosures, such as informing buyers that their house is located in an area that is prone to mudslides, brush fires, or floods. They must also disclose the presence of lead paint, if it exists, in houses built before 1978. Also, today’s home buyers are better informed than in the past. “Customers are coming into the transaction with more knowledge, so the kind of expertise they expect from their Realtor is much higher,” Barlow said. “They want to know, ‘How will this purchase fit in with my investment portfolio?’ You can’t just sit there and say, ‘buy now!'” In addition, real estate companies expect more productivity out of salespeople, and may be less tolerant of part-time workers who produce only a few sales a year, according to Leslie Appleton-Young, chief economist of the California Association of Realtors. “First it was the 80-20 rule, in which 20 percent of the agents do 80 percent of the sales, then it turned into the 90-10 rule,” Appleton-Young said. “The point is, fewer agents continue to do more of the business. Companies are finding that they cannot keep non-productive people on their payrolls as perhaps they could in the past.” Beyond the need for added expertise, the other rub about real estate is that the industry is cyclical. How, then, are real estate instructors preparing their students against the inevitable downturn in the market? One method is to encourage students to learn how to do more than sell houses. “Real estate is not just sales. There is property management, escrow and title insurance and mortgage lending,” said Wen, who noted that a third of his graduates go into mortgage lending. Similarly, Achenbach said, many of his students have multiple disciplines in real estate, including appraisal, property inspection, and a growing field of “real estate assistants” who assist busy salespeople. He adds that enrollment levels are “way up,” in some cases higher than those of real estate licensees, for people who enrolled in courses about appraisal and inspection. Singer, the new sales agent, acknowledged that starting out in the business is “difficult, because you have to build a client base and you have to build referrals.” She added she is convinced, however, that “if you work hard, are resourceful, and you’re honest, you can do well.”

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