The peak influx of newly licensed sales agents during the recently past real estate boom occurred during the Third Quarter of 2005. Incidentally, the boom in home sales and mortgage financing peaked in the same period.
The net number of sales agents licensed between July 2002 and June 2007 increased by 174, 869, bringing the total number of sales agents from 214,998 to 389,867 during the period. The rate of entrants as sales agents by the First Quarter of 2008 dropped to 21% of the peak quarter.
The pace of new entrants as sale agents generally slips in the fourth quarter of each year. However, a surge of licensing occurred in the Fourth Quarter of 2007 as rules for required education to obtain a sales license eliminated the issuance of a conditional license to enter the profession. Three courses are now required prior to applying for a sales agent’s license — Principles, Practice, and an elective such as Legal Aspects or Finance.
A forecast for 2008 is iffy, since the first quarter is probably distorted by the prior surge of potential licensees taking the exam before the educational hurdle was raised. But it seems 4,000 to 5,000 new agents quarterly will be more than sufficient to meet the public’s need for professional assistance. The excessive licensing of sales agents during the past five years will melt away by expirations and a normalized demand for real estate — until 2014 and entry of the “Y” generation as 30-year-old first-time home-buyers.