2015 profile of real estate firms
DESCRIPTION
2015 NAR Profile of Real Estate Firms includes statistics on real estate offices, and real estate firm sales.TRANSCRIPT
2015 Profile of Real Estate Firms
2015 OFFICERS President Chris Polychron, CIPS, CRS, GRI President-Elect Tom Salomone First Vice President Bill Brown Treasurer Michael McGrew, CRB, CRS Immediate Past President Steve Brown, ABR, CIPS, CRS, GREEN Vice President Charlie Oppler, AWHD Vice President Mike Ford, GRI Chief Executive Officer Dale Stinton, CAE, CPA, CMA, RCE
NAR RESEARCH STAFF
Lawrence Yun, Ph.D. Chief Economist and Senior Vice President Caroline Van Hollen Senior Research and Strategic Thinking Coordinator Paul C. Bishop, Ph.D. Vice President Stephanie Davis Administrative Coordinator
Nadia Evangelou Research Economist Ken Fears Director, Regional Economics and Housing Finance Danielle Hale Director of Housing Statistics Jed Smith, Ph.D. Managing Director, Quantitative Research Scholastica Cororaton Research Economist Michael Hyman Research Data Specialist George Ratiu Director, Quantitative and Commercial Research Hua Zhong Data Analyst Jessica Lautz Director, Survey Research and Communications Meredith Dunn Research Communications Manager Brandi Snowden Research Survey Analyst Amanda Riggs Research Survey Analyst
2015 Profile of Real Estate Firms
Highlights
Characteristics of Real Estate Firms
Eighty percent of real estate firms have
a single office, typically with two full-
time real estate licensees.
Eighty-three percent of firms are
independent non-franchised firms, and
15 percent are independent franchised
firms.
Eighty-two percent of firms specialize in
residential brokerage.
Thirty-five percent of firms are LLCs, 26
percent are sole proprietorship, 27
percent are S-Corps, and 10 percent are
C-Corps.
The typical residential firm has been
operating for 13 years, while the typical
commercial firm has been operating for
20 years.
Business Activity of Firms
Firms with only one office had a median
brokerage sales volume of $4.1 million
in 2014, while firms with four or more
offices had a median brokerage sales
volume of $250 million in 2014 up from
$187.5 million in 2013.
Firms with one office had a total of 18
real estate transaction sides in 2014,
while firms with four or more offices
typically had 900 real estate transaction
sides in 2014 up from 790 in 2013.
Firms typically had 30 percent of their
customer inquiries from past client
referrals, 25 percent from repeat
business from past clients, and 10
percent from their website, five
percent through social media, and one
percent through open houses.
Firms typically had 35 percent of their
sales volume from past client referrals,
30 percent from repeat business from
past clients, and 10 percent from their
website, five percent through social
media, and one percent through open
houses.
Many firms have the capability to offer
in-house ancillary services to real estate
clients. The most common in-house
service is business brokerage.
Benefits
The most common benefit that firms
offer to independent contractors,
licensees, and agents is errors and
omissions/liability insurance at 36
percent.
While this is also the most common
benefit for salaried licensees and
agents, only 25 percent have this
benefit.
Among administrative staff, 34 percent
receive vacation/sick days, 33 percent
have errors and omissions/liability
insurance, and 10 percent have health
insurance.
Forty-two percent of senior
management has errors and
omissions/liability insurance, 21
percent have vacation/sick days, and 15
2015 Profile of Real Estate Firms
percent have health insurance.
Future Outlook of Firms
Forty-four percent of firms reported
they are actively recruiting sales agents
in 2015.
Sixty-eight percent of firms expect
profitability (net income) from all real
estate activities to increase in the next
year.
Forty-five percent of firms expect
competition to increase in the next year
from non-traditional market
participants.
Forty-one percent of firms expect
competition during the same time
period to increase from virtual firms,
while only 16 percent expect
competition will increase from
traditional brick and mortar firms.
Profitability, keeping up with
technology, maintaining sufficient
inventory, and local or regional
economic conditions are among the
biggest challenges cited for firms in the
next two years.
2015 Profile of Real Estate Firms
Summary
Eighty percent of real estate firms have a single
office, typically with two full-time real estate
licensees and 82 percent specialize in
residential brokerage. Thirty-five percent of
firms are LLCs, 26 percent are sole
proprietorship, 27 percent are S-Corps, and 10
percent are C-Corps. Fifty-eight percent of firms
cover a geographic market area of a
metropolitan area or region, 29 percent cover a
rural area or small town, eight percent cover a
resort area or small town, and five percent
cover a multi-state area. Only one percent are
nationwide firms.
Eighty-three percent of firms are independent,
non-franchised companies and 15 percent are
independent franchised companies. The typical
residential firm has been operating for 14 years,
while the typical commercial firm has been
operating for 20 years. Franchised firms are
typically larger companies, thus 42 percent of
firms with four or more offices are franchised
companies. Franchised firms are also more
common among residential real estate firms as
17 percent of residential firms are franchised
compared to only six percent of commercial
real estate firms.
Eighty-eighty percent of firms reported that the
number of mergers and acquisitions for the firm
has remained the same from 2004 to 2009 and
2010 to 2015. However, nine percent of firms
indicated that mergers and acquisitions have
increased in that time period
While the typical firm has two full-time real
estate licensees, larger firms reported having a
median of 125 full-time real estate licensees,
three part-time licenses who work less than 30
hours a week, nine non-licensee full-time staff,
and one non-licensee part-time staff. The
typical firm did not have a new licensee or a
licensee who left the firm, but those who had
four or more offices typically had 15 new
licensees join their firm in 2014 and six
licensees who left their firm in the same year.
Firms with four or more offices also saw a gain
in staff who are not licensees—typically two
staff members.
The typical residential real estate firm’s
brokerage sales volume was $5.6 million in
2014, while the typical commercial real estate
firm’s brokerage sales volume was $4.4 million
in 2014. There was a wide range for the median
brokerage sales volume by the number of
offices at a firm. Those with only one office had
a median brokerage sales volume of $4.1
million in 2014, while those with four or more
offices had a median brokerage sales volume of
$250 million in 2014. Similarly, those with one
office had a total of 18 real estate transaction
sides in 2014, while those with four or more
offices typically had 900 real estate transaction
sides in 2014.
Many firms have the capability to offer in-house
ancillary services to real estate clients. The most
common in-house service is business brokerage,
followed by relocation services, and home
improvement. Among firms with four or more
offices, 49 percent offer relocation services, 36
2015 Profile of Real Estate Firms
percent offer business brokerage, 25 percent
offer title or escrow services in house, and 22
percent offer mortgage lending. The typical firm
makes less than one percent of their net
revenue from ancillary services. However, those
with four or more offices typically make five
percent of their net revenue from these
services.
Firms typically had 30 percent of their customer
inquiries from past client referrals, 25 percent
from repeat business from past clients, and 10
percent from their website, five percent
through social media, and one percent through
open houses. Firms typically had 35 percent of
their sales volume from past client referrals, 30
percent from repeat business from past clients,
and 10 percent from their website, and five
percent through social media. Firms report their
current competition is most likely to come from
traditional brick and mortar firms, followed by
non-traditional market participants, and finally
virtual firms.
The most common feature on firm’s websites
are property listings, agent/staff profiles,
mortgage/financial calculators, information
about the home buying and selling process, and
community information/demographics. Firms
provide or encourage use of specific software.
The most common software that is provided or
encouraged to use by agents/brokers is multiple
listing services, comparative market analysis,
electronic contracts/forms, and e-signature.
The most common benefit that firms offer to
independent contractors, licensees, and agents
is errors and omissions/liability insurance at 81
percent. However, many share the cost of the
insurance with their employees. Only 20
percent of firms offer their independent
contractors, licensees, and agents health
insurance and in most cases the employee pays
for the benefit. Among salaried licensees and
agents, administrative staff, and senior
management there are a larger share of firms
who pay for errors and omissions/liability
insurance, vacation/sick days, and health
insurance.
Forty-four percent of firms reported they are
actively recruiting sales agents in 2015. This is
more common among residential firms (49
percent) than commercial firms (34 percent)
and more common among firms with four
offices or more (89 percent) than firms with one
office (36 percent). Eighty-eight percent of firms
reported the reason for recruitment is growth
in primary business followed by the desire for
younger agents at 37 percent. Larger firms are
much more likely to recruit for the desire for
younger agents and to replace agents who are
leaving the firm.
Sixty-eight percent of firms expect profitability
(net income) from all real estate activities to
increase in the next year. Commercial real
estate firms are more optimistic as 75 percent
expect profitability to improve, as well as large
firms with four or more offices—79 percent
expect profitability to improve.
Forty-five percent of firms expect competition
to increase in the next year (mid-2015 to mid-
2015 Profile of Real Estate Firms
2016) from non-traditional market participants.
Forty-one percent of firms expect competition
during the same time period to increase from
virtual firms, while only 16 percent expect
competition will increase from traditional brick
and mortar firms.
Profitability, keeping up with technology,
maintaining sufficient inventory, and local or
regional economic conditions are among the
biggest challenges sited for firms in the next
two years. Commercial firms are more likely
than residential firms to site state and local or
regional economic conditions, while residential
firms are more likely to site recruiting younger
agents, competition from non-traditional
market participants, and agent retention.
When firms are asked to predict the effect of
generations on the industry for the next two
years, the most common concern was Gen Y’s
ability to buy a home due to stagnant wage
growth, a slow job market, and their debt to
income ratios—54 percent of firms cited this as
a concern. This was followed by Baby Boomers
retiring from the real estate industry and
conversely the recruitment of Gen Y and Gen X
into the real estate profession. Firms with four
or more offices were most concerned with Baby
Boomers retiring and the recruitment of Gen Y
and Gen X into the industry, both at 59 percent.
CHARACTERISTICS OF REAL ESTATE FIRMS
Exhibit 1-1 YEARS IN REAL ESTATE BUSINESSExhibit 1-2 YEARS IN REAL ESTATE BUSINESSExhibit 1-3 NUMBER OF OFFICESExhibit 1-4 NUMBER OF OFFICESExhibit 1-5 OFFICE OPENINGS AND CLOSINGSExhibit 1-6 CHANGE IN MERGERS/ACQUISITIONS FOR FIRM FROM 2004-2009 TO 2010-2015Exhibit 1-7 SHARE OF INDEPENDENT AND FRANCHISED FIRMS Exhibit 1-8 FIRM TYPE BY RESIDENTIAL AND COMMERCIAL FIRMSExhibit 1-9 FIRM TYPE BY NUMBER OF OFFICES AT FIRMExhibit 1-10 LEGAL ORGANIZATION OF REAL ESTATE FIRMSExhibit 1-11 STAFF AT FIRMS BY NUMBER OF OFFICES AT FIRMExhibit 1-12 CHANGE IN STAFF AT FIRMS BY NUMBER OF OFFICES AT FIRMExhibit 1-13 FIRM'S PRIMARY SPECIALTY AREAExhibit 1-14 PERCENT OF FIRM'S REVENUE FROM PRIMARY REAL ESTATE BUSINESS ACTIVITYExhibit 1-15 OTHER REAL ESTATE BUSINESS ACTIVITIES AMONG FIRMExhibit 1-16 GEOGRAPHIC MARKET AREA OF FIRM
2015 National Association of Realtors® Profile of Real Estate Firms
CHARACTERISTICS OF REAL ESTATE FIRMS
Exhibit 1-1YEARS IN REAL ESTATE BUSINESS(Percentage Distribution)
All FirmsOne year or less 7%2 to 3 years 84 to 5 years 86 to 7 years 78 to 10 years 1211 to 14 years 815 years or more 49
One year or less 7% 2 to 3 years
8%
4 to 5 years 8%
6 to 7 years 7%
8 to 10 years 12%
11 to 14 years 8%
15 years or more 50%
YEARS IN REAL ESTATE BUSINESS (Percentage Distribution)
2015 National Association of Realtors® Profile of Real Estate Firms
CHARACTERISTICS OF REAL ESTATE FIRMS
Exhibit 1-2YEARS IN REAL ESTATE BUSINESS(Percentage Distribution)
All Firms Residential Firms Commercial FirmsOne year or less 7% 8% 6%2 to 3 years 8% 8% 4%4 to 5 years 8% 8% 3%6 to 7 years 7% 7% 7%8 to 10 years 12% 13% 13%11 to 14 years 8% 8% 6%15 years or more 49% 47% 61%
Median (years) 14 13 20
7% 8% 8% 7%
12% 8%
49%
8% 8% 8% 7%
13%
8%
47%
6% 4% 3%
7%
13%
6%
61%
%
10%
20%
30%
40%
50%
60%
70%
One year orless
2 to 3 years 4 to 5 years 6 to 7 years 8 to 10 years 11 to 14 years 15 years ormore
YEARS IN REAL ESTATE BUSINESS (Percentage Distribution)
All Firms Residential Firms Commercial Firms
Median (years):
All Firms: 14 Residential Firms: 13 Commercial Firms: 20
2015 National Association of Realtors® Profile of Real Estate Firms
CHARACTERISTICS OF REAL ESTATE FIRMS
Exhibit 1-3NUMBER OF OFFICES(Percentage Distribution)
All Firms1 office 80%2 offices 93 offices 34 or more offices 9
1 office 79%
2 offices 9%
3 offices 3%
4 or more offices 9%
NUMBER OF OFFICES (Percentage Distribution)
2015 National Association of Realtors® Profile of Real Estate Firms
CHARACTERISTICS OF REAL ESTATE FIRMS
Exhibit 1-4NUMBER OF OFFICES(Percentage Distribution)
All Firms Residential Firms Commercial Firms1 office 80% 78% 85%2 offices 9% 9% 10%3 offices 3% 3% 2%4 or more offices 9% 10% 3%
Median (offices) 1 1 1
80% 78%
85%
9% 9% 10%
3% 3% 2%
9% 10%
3%
%
10%
20%
30%
40%
50%
60%
70%
80%
90%
All Firms Residential Firms Commercial Firms
NUMBER OF OFFICES (Percentage Distribution)
1 office 2 offices 3 offices 4 or more offices
Median (offices):
All Firms: 1 Residential Firms: 1 Commercial Firms: 1
2015 National Association of Realtors® Profile of Real Estate Firms
CHARACTERISTICS OF REAL ESTATE FIRMS
Exhibit 1-5OFFICE OPENINGS AND CLOSINGS(Medians)
All Firms Residential Firms Commercial Firms
Number of offices affiliated with your firm at
year-end in 2014 1 1 1Number of new offices opened in 2014 0 0 0
Number of offices acquired through purchase or
merger with another firm in 2014 0 0 0
Number of offices acquired through purchase or
merger with another firm from 2013-2008 0 0 0Number of offices closed in 2014 0 0 0
2015 National Association of Realtors® Profile of Real Estate Firms
CHARACTERISTICS OF REAL ESTATE FIRMS
Exhibit 1-6CHANGE IN MERGERS/ACQUISITIONS FOR FIRM FROM 2004-2009 TO 2010-2015(Percentage Distribution)
All FirmsIncreased 9%Decreased 3Stayed the same 88
Increased 9% Decreased
3%
Stayed the same 88%
CHANGE IN MERGERS/ACQUISITIONS FOR FIRM FROM 2004-2009 TO 2010-2015
(Percentage Distribution)
2015 National Association of Realtors® Profile of Real Estate Firms
CHARACTERISTICS OF REAL ESTATE FIRMS
Exhibit 1-7SHARE OF INDEPENDENT AND FRANCHISED FIRMS (Percentage Distribution)
All FirmsIndependent, non-franchised company 83%Independent, franchised company 15Subsidiary of a national or regional
corporation, franchised company 1Subsidiary of a national or regional
corporation, non-franchised company 1
Independent, non-franchised company
83%
Independent, franchised company
15%
Subsidiary of a national or regional corporation, franchised company
2%
Subsidiary of a national or regional corporation, non-franchised company
1%
SHARE OF INDEPENDENT AND FRANCHISED FIRMS (Percentage Distribution)
2015 National Association of Realtors® Profile of Real Estate Firms
CHARACTERISTICS OF REAL ESTATE FIRMS
Exhibit 1-8FIRM TYPE BY RESIDENTIAL AND COMMERCIAL FIRMS(Percentage Distribution)
All Firms Residential Firms Commercial FirmsIndependent, non-franchised company 83% 81% 92%Independent, franchised company 15% 17% 6%
Subsidiary of a national or regional
corporation, franchised company 1% 1% 1%Subsidiary of a national or regional
corporation, non-franchised company 1% 2% 1%
* Less than 1 percent
83% 81%
92%
15% 17% 6%
1% 1% 1% 1% 2% 1%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
All Firms Residential Firms Commercial Firms
FIRM TYPE BY RESIDENTIAL AND COMMERCIAL FIRMS (Percentage Distribution)
Subsidiary of a national or regional corporation, non-franchised company
Subsidiary of a national or regional corporation, franchised company
Independent, franchised company
Independent, non-franchised company
2015 National Association of Realtors® Profile of Real Estate Firms
CHARACTERISTICS OF REAL ESTATE FIRMS
Exhibit 1-9FIRM TYPE BY NUMBER OF OFFICES AT FIRM(Percentage Distribution)
All Firms One office Two offices Three offices Four or more offices
Independent, non-franchised company 83% 89% 69% 59% 46%
Independent, franchised company 15% 11% 28% 37% 42%
Subsidiary of a national or regional
corporation, franchised company 1% * 1% 2% 4%Subsidiary of a national or regional
corporation, non-franchised company 1% 1% 2% 2% 8%
* Less than 1 percent
Number of Offices at Firm
83% 89%
69%
59%
46%
15% 11%
37%
42%
1% % 1% 2%
4%
1% 1% 2% 2% 8%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
All Firms One office Two offices Three offices Four or more offices
FIRM TYPE BY NUMBER OF OFFICES AT FIRM (Percentage Distribution)
Subsidiary of a national or regional corporation, non-franchised company
Subsidiary of a national or regional corporation, franchised company
Independent, franchised company
Independent, non-franchised company
2015 National Association of Realtors® Profile of Real Estate Firms
CHARACTERISTICS OF REAL ESTATE FIRMS
Exhibit 1-10LEGAL ORGANIZATION OF REAL ESTATE FIRMS(Percentage Distribution)
All FirmsLLC 35%Sole proprietorship 26S-Corp 27C-Corp 10Partnership 2 LLC
35%
Sole proprietorship 26%
S-Corp 27%
C-Corp 10%
Partnership 2%
LEGAL ORGANIZATION OF REAL ESTATE FIRMS (Percentage Distribution)
2015 National Association of Realtors® Profile of Real Estate Firms
CHARACTERISTICS OF REAL ESTATE FIRMS
Exhibit 1-11STAFF AT FIRMS BY NUMBER OF OFFICES AT FIRM(Medians)
All Firms One office Two offices Three offices Four or more offices
Number of full-time real estate licensees 2 2 10 25 125Number of full-time licensees who are
independent contractors 2 2 10 24 130Number of part-time real estate
licensees (work fewer than 30 hours a
week) who are salaried 0 0 0 0 0Number of part-time licensees (work
fewer than 30 hours a week) who are
independent contractors 0 0 1 2 3
Number of full-time staff (non-licensees) 0 0 1 3 9
Number of part-time staff (non-
licensees) 0 0 0 0 1Number of part-time staff (non-
licensees) who work fewer than 30
hours a week 0 0 0 0 1
Number of Offices at Firm
2015 National Association of Realtors® Profile of Real Estate Firms
CHARACTERISTICS OF REAL ESTATE FIRMS
Exhibit 1-12CHANGE IN STAFF AT FIRMS BY NUMBER OF OFFICES AT FIRM(Medians)
All Firms One office Two offices Three offices Four or more offices
Number of licensees who joined firm
in 2014 0 0 2 4 15
Number of licensees who left firm in
2014 0 0 1 1 6
Number of staff (non-licensees) who
joined firm in 2014 0 0 0 0 2
Number of staff (non-licensees) who
left firm in 2014 0 0 0 0 1
Number of Offices at Firm
2015 National Association of Realtors® Profile of Real Estate Firms
CHARACTERISTICS OF REAL ESTATE FIRMS
Exhibit 1-13FIRM'S PRIMARY SPECIALTY AREA(Percentage Distribution)
All FirmsAuction *International *Counseling *Relocation 1%Commercial Appraisal 1%Commercial Property Management 1%Land/Development 1%Residential Appraisal 2%Commercial Brokerage 4%Residential Property Management 7%Residential Brokerage 82%
* Less than 1 percent
1%
1%
1%
1%
2%
4%
7%
82%
% 10% 20% 30% 40% 50% 60% 70% 80% 90%
Auction
International
Counseling
Relocation
Commercial Appraisal
Commercial Property Management
Land/Development
Residential Appraisal
Commercial Brokerage
Residential Property Management
Residential Brokerage
FIRM'S PRIMARY SPECIALTY AREA (Percentage Distribution)
2015 National Association of Realtors® Profile of Real Estate Firms
CHARACTERISTICS OF REAL ESTATE FIRMS
Exhibit 1-14PERCENT OF FIRM'S REVENUE FROM PRIMARY REAL ESTATE BUSINESS ACTIVITY(Percentage Distribution)
All FirmsNone *1 to 4 percent *5 to 10 percent 1%11 to 20 percent 1%21 thru 50 percent 4%51 thru 75 percent 11%76 thru 100 percent 83%
Median (percent) 98%
* Less than 1 percent
1% 1% 4%
11%
83%
%
10%
20%
30%
40%
50%
60%
70%
80%
90%
None 1 to 4 percent 5 to 10percent
11 to 20percent
21 thru 50percent
51 thru 75percent
76 thru 100percent
PERCENT OF FIRM'S REVENUE FROM PRIMARY REAL ESTATE BUSINESS ACTIVITY (Percentage Distribution) Median:
All Firms: 99%
2015 National Association of Realtors® Profile of Real Estate Firms
CHARACTERISTICS OF REAL ESTATE FIRMS
Exhibit 1-15OTHER REAL ESTATE BUSINESS ACTIVITIES AMONG FIRM(Percent of Respondents)
All FirmsCommercial Appraisal 2%Auction 4%International 6%Residential Appraisal 6%Counseling 10%Commercial Property Management 11%Land/Development 16%Relocation 19%Residential Brokerage 28%Residential Property Management 37%Commercial Brokerage 41%
2%
4%
6%
6%
10%
11%
16%
19%
28%
37%
41%
% 5% 10% 15% 20% 25% 30% 35% 40% 45%
Commercial Appraisal
Auction
International
Residential Appraisal
Counseling
Commercial Property Management
Land/Development
Relocation
Residential Brokerage
Residential Property Management
Commercial Brokerage
OTHER REAL ESTATE BUSINESS ACTIVITIES AMONG FIRM (Percent of Respondents)
2015 National Association of Realtors® Profile of Real Estate Firms
CHARACTERISTICS OF REAL ESTATE FIRMS
Exhibit 1-16GEOGRAPHIC MARKET AREA OF FIRM(Percentage Distribution)
All FirmsMetropolitan area or region 58%Rural area/Small town 29Resort/Recreation area 8Multi-state area 5
Nationwide 1
Metropolitan area or region
57%
Rural area/Small town 29%
Resort/ Recreation area 7%
Multi-state area 5% Nationwide
1%
GEOGRAPHIC MARKET AREA OF FIRM (Percentage Distribution)
2015 National Association of Realtors® Profile of Real Estate Firms
BUSINESS ACTIVITY OF FIRMS
Exhibit 2-1 FIRM'S REAL ESTATE BROKERAGE SALES VOLUME BY RESIDENTIAL AND COMMERCIAL FIRMS, 2014Exhibit 2-2 FIRM'S REAL ESTATE BROKERAGE SALES VOLUME BY NUMBER OF OFFICES AT FIRM, 2014Exhibit 2-3 FIRM'S TOTAL REAL ESTATE TRANSACTION SIDES BY RESIDENTIAL AND COMMERCIAL FIRMS, 2014Exhibit 2-4 FIRM'S TOTAL REAL ESTATE TRANSACTION SIDES BY NUMBER OF OFFICES AT FIRM, 2014Exhibit 2-5 ANCILLARY SERVICES OFFERED AT FIRMS BY NUMBER OF OFFICES AT FIRMExhibit 2-6 ANCILLARY SERVICES OFFERED AT FIRMS TO TYPES OF CLIENTS Exhibit 2-7 PERCENT OF NET REVENUE OF FIRM MADE ON ANCILLARY SERVICES BY NUMBER OF OFFICES AT FIRMExhibit 2-8 PERCENT OF CUSTOMER INQUIRIES GENERATED FROM SOURCESExhibit 2-9 PERCENT OF FIRM'S SALES VOLUME WAS GENERATED BY SOURCEExhibit 2-10 WHERE DOES CURRENT COMPETITION COME FROMExhibit 2-11 FEATURES ON FIRM'S WEBSITE BY RESIDENTIAL AND COMMERICAL FIRMSExhibit 2-12 FIRM PROVIDES OR ENCOURAGES AGENT/BROKER USE OF SPECIFIC SOFTWARE, BY RESIDENTIAL AND COMMERCIAL FIRMSExhibit 2-13 FIRM PROVIDES OR ENCOURAGES AGENT/BROKER USE OF SPECIFIC SOFTWARE, BY NUMBER OF OFFICES AT FIRM
2015 National Association of Realtors® Profile of Real Estate Firms
BUSINESS ACTIVITY OF FIRMS
Exhibit 2-1FIRM'S REAL ESTATE BROKERAGE SALES VOLUME BY RESIDENTIAL AND COMMERCIAL FIRMS, 2014(Percentage Distribution)
Residential Firms Commercial FirmsNo transactions 4% 1%Less than $5 million 44% 56%$5 million to under $10 million 16% 14%$10 million to under $25 million 12% 14%$25 million to under $50 million 7% 6%$50 million to under $100 million 4% 4%$100 million to under $250 million 4% 3%$250 million to under $500 million 2% 2%$500 million to under $1 billion 2% *$1 billion or more 2% *
Median (millions) $5.6 $4.4
* Less than 1 percent
4%
44%
16%
12%
7%
4%
4%
2%
2%
2%
1%
56%
14%
14%
6%
4%
3%
2%
%
%
% 10% 20% 30% 40% 50% 60%
No transactions
Less than $5 million
$5 million to under $10 million
$10 million to under $25 million
$25 million to under $50 million
$50 million to under $100 million
$100 million to under $250 million
$250 million to under $500 million
$500 million to under $1 billion
$1 billion or more
FIRM'S REAL ESTATE BROKERAGE SALES VOLUME BY RESIDENTIAL AND COMMERCIAL FIRMS, 2014
(Percentage Distribution)
Commercial Firms Residential Firms
Median (millions):
Residential Firms: $5.6 Commercial Firms: $4.4
2015 National Association of Realtors® Profile of Real Estate Firms
BUSINESS ACTIVITY OF FIRMS
Exhibit 2-2FIRM'S REAL ESTATE BROKERAGE SALES VOLUME BY NUMBER OF OFFICES AT FIRM, 2014(Percentage Distribution)
One office Two offices Three offices Four or more offices
No transactions 6% 1% * 2%Less than $5 million 54% 24% 9% 7%$5 million to under $10 million 16% 13% 10% 7%$10 million to under $25 million 11% 19% 23% 9%$25 million to under $50 million 6% 14% 11% 6%$50 million to under $100 million 3% 11% 11% 7%$100 million to under $250 million 2% 9% 22% 12%$250 million to under $500 million 1% 5% 6% 12%$500 million to under $1 billion 1% 5% 6% 12%$1 billion or more 1% 3% 5% 12%
Median (millions) $4.1 $19.5 $43.2 $250.0
* Less than 1 percent
Number of Offices at Firm
6%
54%
16%
11%
6%
3%
2%
1%
1%
1%
1%
24%
13%
19%
14%
11%
9%
5%
5%
0
9%
10%
23%
11%
11%
22%
6%
6%
5%
2%
7%
7%
9%
6%
7%
12%
12%
12%
12%
% 10% 20% 30% 40% 50% 60%
No transactions
Less than $5 million
$5 million to under $10 million
$10 million to under $25 million
$25 million to under $50 million
$50 million to under $100 million
$100 million to under $250 million
$250 million to under $500 million
$500 million to under $1 billion
$1 billion or more
FIRM'S REAL ESTATE BROKERAGE SALES VOLUME BY NUMBER OF OFFICES AT FIRM, 2014
(Percentage Distribution)
Four or more offices Three offices Two offices One office
Median (millions): One Office: $4.1 Two Offices: $19.5 Three Offices: $43.2 Four or More Offices: $250.0
3%
2015 National Association of Realtors® Profile of Real Estate Firms
BUSINESS ACTIVITY OF FIRMS
Exhibit 2-3FIRM'S TOTAL REAL ESTATE TRANSACTION SIDES BY RESIDENTIAL AND COMMERCIAL FIRMS, 2014(Percentage Distribution)
Residential Firms Commercial FirmsNo transactions 5% 3%1 to 10 23% 43%11 to 20 16% 24%21 to 30 10% 10%31 to 40 5% 3%41 to 50 5% 6%51 to 100 12% 4%101 to 250 11% 3%251 to 500 5% 3%501 to 1000 4% 1%1001 or more 6% 1%
Median 28 12
5%
23%
16%
10%
5%
5%
12%
11%
5%
4%
6%
3%
43%
24%
10%
3%
6%
4%
3%
3%
1%
1%
% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%
No transactions
1 to 10
11 to 20
21 to 30
31 to 40
41 to 50
51 to 100
101 to 250
251 to 500
501 to 1000
1001 or more
FIRM'S TOTAL REAL ESTATE TRANSACTION SIDES BY RESIDENTIAL AND COMMERCIAL FIRMS, 2014
(Percentage Distribution)
Commercial Firms Residential Firms
Median:
Residential Firms: 28 Commercial Firms: 12
2015 National Association of Realtors® Profile of Real Estate Firms
BUSINESS ACTIVITY OF FIRMS
Exhibit 2-4FIRM'S TOTAL REAL ESTATE TRANSACTION SIDES BY NUMBER OF OFFICES AT FIRM, 2014(Percentage Distribution)
One office Two offices Three offices Four or more officesNo transactions 8% 1% 3% 3%1 to 10 29% 9% 4% 4%11 to 20 17% 8% 3% 2%21 to 30 11% 8% * 2%31 to 40 5% 4% 3% 2%41 to 50 5% 4% 4% 3%51 to 100 11% 19% 9% 5%101 to 250 9% 18% 30% 11%251 to 500 3% 13% 12% 10%501 to 1000 2% 10% 22% 11%1001 or more 1% 6% 13% 48%
Median 18 10 225 900
* Less than 1 percent
Number of Offices at Firm
8%
29%
17%
11%
5%
5%
11%
9%
3%
2%
1%
1%
9%
8%
8%
4%
4%
19%
18%
13%
10%
6%
3%
4%
3%
%
3%
4%
9%
30%
12%
22%
13%
3%
4%
2%
2%
2%
3%
5%
11%
10%
11%
48%
% 10% 20% 30% 40% 50% 60%
No transactions
1 to 10
11 to 20
21 to 30
31 to 40
41 to 50
51 to 100
101 to 250
251 to 500
501 to 1000
1001 or more
FIRM'S TOTAL REAL ESTATE TRANSACTION SIDES BY NUMBER OF OFFICES AT FIRM, 2014
(Percentage Distribution)
Four or more offices Three offices Two offices One office
Median: One Office: 18 Two Offices: 10 Three Offices: 225 Four or More Offices: 900
2015 National Association of Realtors® Profile of Real Estate Firms
BUSINESS ACTIVITY OF FIRMS
Exhibit 2-5ANCILLARY SERVICES OFFERED AT FIRMS BY NUMBER OF OFFICES AT FIRM(Percentage Distribution)
Offer this service
in-house
Offer this service
outsourced or with a
business relationship
Do not currently
offer this service
Do not currently
offer this service,
but plan to in the
future
Business brokerage 32% 7% 54% 7%
Relocation services 16 15 60 9
Home improvement 5 24 63 7
Mortgage lending 5 39 50 6
Home warranty 4 43 46 6
Title or escrow services 4 36 54 7
Homeowners insurance 2 28 62 7
Settlement services 3 27 63 7
Other insurance 2 19 72 8
Home inspection 1 36 56 6
Moving services 1 21 70 8
Securities services * 7 84 9One office
Business brokerage 30% 7% 56% 7%Relocation services 13 14 64 9Home improvement 5 24 63 7Mortgage lending 3 37 54 7Home warranty 4 41 49 7Title or escrow services 2 34 57 7Homeowners insurance 1 27 65 7Settlement services 2 26 65 7Other insurance 1 17 74 8Home inspection 2 36 56 6Moving services 1 19 72 8Securities services * 6 85 8Two offices
Business brokerage 36% 11% 47% 6%Relocation services 22 21 49 8Home improvement 4 30 60 6Mortgage lending 5 46 44 4Home warranty 4 51 40 6Title or escrow services 5 41 49 6Homeowners insurance 1 34 59 6Settlement services 3 33 58 6Other insurance 1 27 65 8Home inspection 1 39 55 5Moving services 1 27 66 7Securities services 8 11 79 9
Three offices
Business brokerage 36% 8% 55% 2%Relocation services 27 15 53 5Home improvement 3 24 67 6Mortgage lending 10 45 39 6Home warranty 7 44 44 6Title or escrow services 8 37 46 9Homeowners insurance 6 26 57 11Settlement services 6 29 60 5Other insurance 3 18 71 8Home inspection * 35 60 5Moving services * 18 76 7Securities services 3 3 90 3Four or more offices
Business brokerage 36% 8% 50% 6%Relocation services 49 16 30 5Home improvement 4 15 73 8Mortgage lending 22 51 23 4Home warranty 7 60 29 4Title or escrow services 25 34 36 5Homeowners insurance 8 31 52 10Settlement services 15 29 50 5Other insurance 5 18 69 9Home inspection * 26 66 8Moving services 1 24 66 9Securities services 1 4 84 11
* Less than 1 percent
2015 National Association of Realtors® Profile of Real Estate Firms
BUSINESS ACTIVITY OF FIRMS
Exhibit 2-6ANCILLARY SERVICES OFFERED AT FIRMS TO TYPES OF CLIENTS (Percent of Respondents)
Offer this service in-
house to current clients
Offer this service in-
house to past clients
Do not currently
offer this service
Business brokerage 23% 12% 71%
Relocation services 12% 10% 79%
Home improvement 8% 10% 82%
Mortgage lending 10% 12% 80%
Home warranty 10% 11% 80%
Title or escrow services 9% 10% 81%
Homeowners insurance 6% 8% 85%
Settlement services 7% 8% 84%
Other insurance 4% 6% 86%
Home inspection 6% 8% 84%
Moving services 4% 6% 87%
Securities services 1% 3% 91%
23%
12%
8%
10%
10%
9%
6%
7%
4%
6%
4%
1%
12%
10%
10%
12%
11%
10%
8%
8%
6%
8%
6%
3%
71%
79%
82%
80%
80%
81%
85%
84%
86%
84%
87%
91%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Business brokerage
Relocation services
Home improvement
Mortgage lending
Home warranty
Title or escrow services
Homeowners insurance
Settlement services
Other insurance
Home inspection
Moving services
Securities services
ANCILLARY SERVICES OFFERED AT FIRMS TO TYPES OF CLIENTS (Percent of Respondents)
Offer this service in-house to current clients Offer this service in-house to past clients
Do not currently offer this service
2015 National Association of Realtors® Profile of Real Estate Firms
BUSINESS ACTIVITY OF FIRMS
Exhibit 2-7PERCENT OF NET REVENUE OF FIRM MADE ON ANCILLARY SERVICES BY NUMBER OF OFFICES AT FIRM(Percentage Distribution)
All Firms One office Two offices Three offices Four or more officesNone 55% 59% 48% 51% 25%1 to 4 percent 9% 8% 15% 15% 18%5 to 10 percent 17% 15% 25% 17% 26%11 to 20 percent 6% 6% 6% 13% 12%21 to 50 percent 6% 5% 2% * 16%51 to 75 percent 1% 1% * 2% 1%
76 to 100 percent 6% 7% 4% 2% 1%
Median (percent) * * 1 * 5
* Less than 1 percent
Number of Offices at Firm
55%
59%
48%
51%
25%
9%
8%
15%
15%
18%
17%
15%
25%
17%
26%
6%
6%
6%
13%
12%
6%
5%
2%
16%
1%
1%
2%
1%
6%
7%
4%
2%
1%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
All Firms
One office
Two offices
Three offices
Four or moreoffices
PERCENT OF NET REVENUE OF FIRM MADE ON ANCILLARY SERVICES BY NUMBER OF OFFICES AT FIRM
(Percentage Distribution)
None 1 to 4 percent 5 to 10 percent 11 to 20 percent
21 to 50 percent 51 to 75 percent 76 to 100 percent
2015 National Association of Realtors® Profile of Real Estate Firms
BUSINESS ACTIVITY OF FIRMS
Exhibit 2-8PERCENT OF CUSTOMER INQUIRIES GENERATED FROM SOURCES(Medians)
All Firms One office Two offices Three offices Four or more officesPast client referrals 30% 30% 30% 25% 30%Repeat business from past clients 25% 25% 30% 25% 27%Website 10% 10% 15% 15% 15%Social Media 5% 5% 10% 9% 5%Open house 1% * 5% 5% 5%Other 10% 8% 10% 10% 10%
* Less than 1 percent
Number of Offices at Firm
30%
25%
10%
5%
1%
10%
30%
25%
10%
5%
8%
30% 30%
15%
10%
5%
10%
25% 25%
15%
9%
5%
10%
30%
27%
15%
5% 5%
10%
%
5%
10%
15%
20%
25%
30%
35%
Past client referrals Repeat business frompast clients
Website Social Media Open house Other
PERCENT OF CUSTOMER INQUIRIES GENERATED FROM SOURCES (Medians)
All Firms One office Two offices Three offices Four or more offices
2015 National Association of Realtors® Profile of Real Estate Firms
BUSINESS ACTIVITY OF FIRMS
Exhibit 2-9PERCENT OF FIRM'S SALES VOLUME WAS GENERATED BY SOURCE(Medians)
All Firms One office Two offices Three offices Four or more officesPast client referrals 35% 38% 30% 25% 30%Repeat business from past clients 30% 30% 30% 30% 30%Website 10% 10% 10% 10% 10%Social Media 5% 5% 5% 5% 5%Open house 1% * 5% 5% 5%Other 10% 10% 10% 10% 10%
* Less than 1 percent
Number of Offices at Firm
35%
30%
10%
5%
1%
10%
38%
30%
10%
5%
10%
30% 30%
10%
5% 5%
10%
25%
30%
10%
5% 5%
10%
30% 30%
10%
5% 5%
10%
Past client referrals Repeat business frompast clients
Website Social Media Open house Other
PERCENT OF FIRM'S SALES VOLUME WAS GENERATED BY SOURCE (Medians)
All Firms One office Two offices Three offices Four or more offices
2015 National Association of Realtors® Profile of Real Estate Firms
BUSINESS ACTIVITY OF FIRMS
Exhibit 2-10WHERE DOES CURRENT COMPETITION COME FROM(Medians)
All Firms One office Two offices Three offices Four or more officesTraditional brick and mortal firms 90% 90% 90% 90% 90%Non traditional market participants 10% 10% 5% 7% 5%Virtual firms 5% 5% 5% 5% 5%
Number of Offices at Firm
90% 90% 90% 90% 90%
10% 10%
5%
7%
5% 5% 5% 5% 5% 5%
All Firms One office Two offices Three offices Four or more offices
WHERE DOES CURRENT COMPETITION COME FROM (Medians)
Traditional brick and mortal firms Non traditional market participants Virtual firms
2015 National Association of Realtors® Profile of Real Estate Firms
BUSINESS ACTIVITY OF FIRMS
Exhibit 2-11FEATURES ON FIRM'S WEBSITE BY RESIDENTIAL AND COMMERICAL FIRMS(Percent of Respondents)
Commercial Firms Residential Firms All FirmsLink to commercial information exchange (CIE) 22% 4% 5%Live agent chat 1% 7% 7%Appointment scheduler 4% 17% 16%
Current mortgage rates 6% 20% 19%Links to real estate service providers 11% 21% 20%Home valuation/comparative market analysis tools 10% 28% 26%Links to mortgage lenders' websites 10% 33% 30%Links to state/local government websites 24% 37% 35%School reports 13% 47% 43%Virtual tours 17% 47% 44%Customer reviews/testimonials 40% 52% 50%Community information/demographics 33% 59% 55%
Information about the home buying and selling process 19% 62% 57%Mortgage/financial calculators 26% 64% 59%
Agent/staff profiles 71% 79% 78%Property listings 90% 96% 95%
5%
7%
16%
19%
20%
26%
30%
35%
43%
44%
50%
55%
57%
59%
78%
95%
4%
7%
17%
20%
21%
28%
33%
37%
47%
47%
52%
59%
62%
64%
79%
96%
22%
1%
4%
6%
11%
10%
10%
24%
13%
17%
40%
33%
19%
26%
71%
90%
% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Link to commercial information exchange (CIE)
Live agent chat
Appointment scheduler
Current mortgage rates
Links to real estate service providers
Home valuation/comparative market analysis tools
Links to mortgage lenders' websites
Links to state/local government websites
School reports
Virtual tours
Customer reviews/testimonials
Community information/demographics
Information about the home buying and selling process
Mortgage/financial calculators
Agent/staff profiles
Property listings
FEATURES ON FIRM'S WEBSITE BY RESIDENTIAL AND COMMERICAL FIRMS (Percent of Respondents)
All Firms Residential Firms Commercial Firms
2015 National Association of Realtors® Profile of Real Estate Firms
BUSINESS ACTIVITY OF FIRMS
Exhibit 2-12FIRM PROVIDES OR ENCOURAGES AGENT/BROKER USE OF SPECIFIC SOFTWARE, BY RESIDENTIAL AND COMMERCIAL FIRMS(Percent of Respondents)
All Firms Residential Firms Commercial FirmsMultiple listing 86% 88% 79%Comparative market analysis 80 83 69Electronic contracts/form 78 81 68E-signature 73 77 53Contact management 52 55 47Document preparation/Management 52 53 42Transaction management 35 37 30Social media management tools 35 37 22Graphics/Presentation 33 34 38
Home visualization (e.g. virtual tours or virtual staging) 31 34 12Customer relationship management 31 33 28Property management 26 21 31Video 27 29 16QR Code 21 22 9Marketing automation 18 20 7Loan analysis 16 17 19Agent rating 10 11 3
2015 National Association of Realtors® Profile of Real Estate Firms
BUSINESS ACTIVITY OF FIRMS
Exhibit 2-13FIRM PROVIDES OR ENCOURAGES AGENT/BROKER USE OF SPECIFIC SOFTWARE, BY NUMBER OF OFFICES AT FIRM(Percent of Respondents)
All Firms One office Two offices Three offices Four or more officesMultiple listing 86% 85% 88% 85% 91%Comparative market analysis 80 80 80 83 86Electronic contracts/form 78 76 84 86 89
E-signature 73 71 81 87 90Contact management 52 48 68 75 82
Document preparation/Management 52 49 63 69 72Transaction management 35 31 48 59 63Social media management tools 35 30 44 54 64Graphics/Presentation 33 29 42 54 60
Home visualization (e.g. virtual tours or virtual staging) 31 27 41 48 57Customer relationship management 31 27 43 55 62Property management 26 25 31 25 31Video 27 23 39 47 64QR Code 21 18 29 34 45Marketing automation 18 15 28 28 48Loan analysis 16 15 20 17 26Agent rating 10 8 12 20 26
Number of Offices at Firm
2015 National Association of Realtors® Profile of Real Estate Firms
BENEFITS
Exhibit 3-1 BENEFITS RECEIVED BY INDEPENDENT CONTRACTORS/LICENSEES/AGENTSExhibit 3-2 BENEFITS RECEIVED BY SALARIED LICENSEES/AGENTSExhibit 3-3 BENEFITS RECEIVED BY ADMINISTRATIVE STAFFExhibit 3-4 BENEFITS RECEIVED BY SENIOR MANAGEMENT
2015 National Association of Realtors® Profile of Real Estate Firms
BENEFITS
Exhibit 3-1BENEFITS RECEIVED BY INDEPENDENT CONTRACTORS/LICENSEES/AGENTS(Percentage Distribution)
Employee Pays Firms Pays Both Pay Not Offered
Dental care 11% 1% 1% 88%Disability insurance 8 2 * 90Errors and Omissions (E&O)
Insurance/Liability Insurance 27 36 18 19Health insurance 17 2 1 80Life insurance 9 1 * 91Long-term care insurance 10 * * 90Pension plan/401(k)/SEP 9 1 1 90Vacation/sick days 9 2 * 89Vision care 10 1 1 89
*Less than 1 percent
2015 National Association of Realtors® Profile of Real Estate Firms
BENEFITS
Exhibit 3-2BENEFITS RECEIVED BY SALARIED LICENSEES/AGENTS(Percentage Distribution)
Employee Pays Firms Pays Both Pay Not Offered
Dental care 7% 2% 2% 89%Disability insurance 6 3 1 90Errors and Omissions (E&O)
Insurance/Liability Insurance 11 25 7 58Health insurance 9 4 4 83Life insurance 6 1 1 93Long-term care insurance 6 1 1 92Pension plan/401(k)/SEP 5 1 3 91Vacation/sick days 5 11 1 84
Vision care 6 1 2 91
2015 National Association of Realtors® Profile of Real Estate Firms
BENEFITS
Exhibit 3-3BENEFITS RECEIVED BY ADMINISTRATIVE STAFF(Percentage Distribution)
Employee Pays Firms Pays Both Pay Not Offered
Dental care 7% 4% 4% 84%Disability insurance 6 6 2 85Errors and Omissions (E&O)
Insurance/Liability Insurance 4 33 3 60Health insurance 9 10 9 73Life insurance 6 3 2 89Long-term care insurance 6 2 2 90
Pension plan/401(k)/SEP 6 3 7 84
Vacation/sick days 3 34 1 62
Vision care 7 3 4 86
2015 National Association of Realtors® Profile of Real Estate Firms
BENEFITS
Exhibit 3-4BENEFITS RECEIVED BY SENIOR MANAGEMENT(Percentage Distribution)
Employee Pays Firms Pays Both Pay Not Offered
Dental care 8% 5% 4% 83%Disability insurance 7 6 2 85Errors and Omissions (E&O)
Insurance/Liability Insurance 9 42 5 44Health insurance 9 15 7 70Life insurance 7 8 2 84Long-term care insurance 8 3 2 88Pension plan/401(k)/SEP 7 4 6 83Vacation/sick days 5 21 1 74
Vision care 8 4 3 85
2015 National Association of Realtors® Profile of Real Estate Firms
FUTURE OUTLOOK OF FIRMS
Exhibit 4-1 FIRM ACTIVELY RECRUITING SALES AGENTS IN 2015 BY RESIDENTIAL AND COMMERCIAL FIRMSExhibit 4-2 FIRM ACTIVELY RECRUITING SALES AGENTS IN 2014 BY NUMBER OF OFFICES AT FIRMExhibit 4-3 REASON FOR FIRM TO ACTIVELY RECRUIT SALES AGENTS BY RESIDENTIAL AND COMMERCIAL FIRMSExhibit 4-4 REASON FOR FIRM TO ACTIVELY RECRUIT SALES AGENTS BY NUMBER OF OFFICES AT FIRM
Exhibit 4-5
EXPECTATION ON PROFITABILITY (NET INCOME) FROM ALL REAL ESTATE ACTIVITIES FROM MID-2015 TO MID-
2016 BY RESIDENTIAL AND COMMERCIAL FIRMS
Exhibit 4-6
EXPECTATION ON PROFITABILITY (NET INCOME) FROM ALL REAL ESTATE ACTIVITIES FROM MID-2015 TO MID-
2016 BY NUMBER OF OFFICES AT FIRMExhibit 4-7 EXPECTATION OF LEVEL OF COMPETITION IN THE NEXT YEAR (MID-2015 TO MID-2016) Exhibit 4-8 BIGGEST CHALLENGES FACING FIRM IN NEXT TWO YEARS BY RESIDENTIAL AND COMMERCIAL FIRMSExhibit 4-9 BIGGEST CHALLENGES FACING FIRM IN NEXT TWO YEARS BY NUMBER OF OFFICES AT FIRMExhibit 4-10 PREDICTION OF GENERATIONS EFFECT ON THE INDUSTRY IN THE NEXT 2 YEARS BY RESIDENTIAL AND COMMERCIAL FIRMSExhibit 4-11 PREDICTION OF GENERATIONS EFFECT ON THE INDUSTRY IN THE NEXT 2 YEARS BY NUMBER OF OFFICES AT FIRM
2015 National Association of Realtors® Profile of Real Estate Firms
FUTURE OUTLOOK OF FIRMS
Exhibit 4-1FIRM ACTIVELY RECRUITING SALES AGENTS IN 2015 BY RESIDENTIAL AND COMMERCIAL FIRMS(Percentage Distribution)
All Firms Residential Firms Commercial FirmsFirm is recruiting 44% 49% 34%Firm is not recruiting 52% 48% 63%Not Applicable 5% 2% 4%
44%
49%
34%
52%
48%
63%
5%
2%
4%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
All Firms
Residential Firms
Commercial Firms
FIRM ACTIVELY RECRUITING SALES AGENTS IN 2015 BY RESIDENTIAL AND COMMERCIAL FIRMS
(Percentage Distribution)
Firm is recruiting Firm is not recruiting Not Applicable
2015 National Association of Realtors® Profile of Real Estate Firms
FUTURE OUTLOOK OF FIRMS
Exhibit 4-2FIRM ACTIVELY RECRUITING SALES AGENTS IN 2014 BY NUMBER OF OFFICES AT FIRM(Percentage Distribution)
All Firms One office Two offices Three offices Four or more officesFirm is recruiting 44% 36% 71% 78% 89%Firm is not recruiting 52% 59% 28% 20% 9%Not Applicable 5% 5% 1% 2% 2%
Number of Offices at Firm
44%
36%
71%
78%
89%
52%
59%
28%
20%
9%
5%
5%
1%
2%
2%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
All Firms
One office
Two offices
Three offices
Four or more offices
FIRM ACTIVELY RECRUITING SALES AGENTS IN 2015 BY NUMBER OF OFFICES AT FIRM (Percentage Distribution)
Firm is recruiting Firm is not recruiting Not Applicable
2015 National Association of Realtors® Profile of Real Estate Firms
FUTURE OUTLOOK OF FIRMS
Exhibit 4-3REASON FOR FIRM TO ACTIVELY RECRUIT SALES AGENTS BY RESIDENTIAL AND COMMERCIAL FIRMS(Percentage Distribution)
All FirmsResidential FirmsCommercial FirmsGrowth in primary business 88% 89% 85%Desire for younger agents 37% 37% 28%Replace agents leaving firm 33% 34% 17%Expand into new markets 32% 32% 36%Expand into new lines of business/specialty areas 13% 12% 40%
88%
37%
33%
32%
13%
89%
37%
34%
32%
12%
85%
28%
17%
36%
40%
% 25% 50% 75% 100%
Growth in primary business
Desire for younger agents
Replace agents leaving firm
Expand into new markets
Expand into new lines of business/specialty areas
REASON FOR FIRM TO ACTIVELY RECRUIT SALES AGENTS BY RESIDENTIAL AND COMMERCIAL FIRMS
(Percentage Distribution)
Commercial Firms Residential Firms All Firms
2015 National Association of Realtors® Profile of Real Estate Firms
FUTURE OUTLOOK OF FIRMS
Exhibit 4-4REASON FOR FIRM TO ACTIVELY RECRUIT SALES AGENTS BY NUMBER OF OFFICES AT FIRM(Percentage Distribution)
All Firms One office Two offices Three offices Four or more officesGrowth in primary business 88% 87% 87% 89% 91%Desire for younger agents 37% 31% 38% 47% 57%Replace agents leaving firm 33% 24% 39% 47% 61%Expand into new markets 32% 26% 37% 42% 41%Expand into new lines of
business/specialty areas 13% 13% 16% 11% 11%
Number of Offices at Firm
88% 87% 87% 89%
91%
37%
31%
38%
47%
57%
33%
24%
39%
47%
61%
32%
26%
37%
42% 41%
13% 13% 16%
11% 11%
%
25%
50%
75%
100%
All Firms One office Two offices Three offices Four or more offices
REASON FOR FIRM TO ACTIVELY RECRUIT SALES AGENTS BY NUMBER OF OFFICES AT FIRM
(Percentage Distribution)
Growth in primary business Desire for younger agents
Replace agents leaving firm Expand into new markets
Expand into new lines of business/specialty areas
2015 National Association of Realtors® Profile of Real Estate Firms
FUTURE OUTLOOK OF FIRMS
Exhibit 4-5
(Percentage Distribution)
All Firms Residential Firms Commercial FirmsIncrease 68% 69% 75%Stay the same 27% 25% 22%Decrease 6% 6% 3%
EXPECTATION ON PROFITABILITY (NET INCOME) FROM ALL REAL ESTATE ACTIVITIES FROM MID-
2015 TO MID-2016 BY RESIDENTIAL AND COMMERCIAL FIRMS
68% 69% 75%
27% 25% 22%
6% 6% 3%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
All Firms Residential Firms Commercial Firms
EXPECTATION ON PROFITABILITY (NET INCOME) FROM ALL REAL ESTATE ACTIVITIES FROM MID-2015 TO MID-2016 BY
RESIDENTIAL AND COMMERCIAL FIRMS (Percentage Distribution)
Increase Stay the same Decrease
2015 National Association of Realtors® Profile of Real Estate Firms
FUTURE OUTLOOK OF FIRMS
Exhibit 4-6
(Percentage Distribution)
All Firms One office Two offices Three offices Four or more officesIncrease 68% 66% 68% 74% 79%Stay the same 27% 28% 27% 21% 18%Decrease 6% 6% 5% 5% 3%
Number of Offices at Firm
EXPECTATION ON PROFITABILITY (NET INCOME) FROM ALL REAL ESTATE ACTIVITIES FROM MID-2015
TO MID-2016 BY NUMBER OF OFFICES AT FIRM
68% 66% 68% 74%
79%
27% 28% 27% 21%
18%
6% 6% 5% 5% 3%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
All Firms One office Two offices Three offices Four or more offices
EXPECTATION ON PROFITABILITY (NET INCOME) FROM ALL REAL ESTATE ACTIVITIES FROM MID-2015 TO MID-2016 BY NUMBER OF OFFICES AT
FIRM (Percentage Distribution)
Increase Stay the same Decrease
2015 National Association of Realtors® Profile of Real Estate Firms
FUTURE OUTLOOK OF FIRMS
Exhibit 4-7
(Percentage Distribution)
Traditional brick and
mortar firms Virtual firms
Non-traditional
market participantsIncrease 16% 41% 45%Stay the Same 70% 54% 49%Decrease 15% 5% 6%
EXPECTATION OF LEVEL OF COMPETITION IN THE NEXT YEAR (MID-2015 TO MID-
2016)
16%
41% 45%
70%
54% 49%
15%
5% 6%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Traditional brick and mortarfirms
Virtual firms Non-traditional marketparticipants
EXPECTATION OF LEVEL OF COMPETITION IN THE NEXT YEAR (MID-2015 TO MID-2016)
(Percentage Distribution)
Increase Stay the Same Decrease
2015 National Association of Realtors® Profile of Real Estate Firms
FUTURE OUTLOOK OF FIRMS
Exhibit 4-8BIGGEST CHALLENGES FACING FIRM IN NEXT TWO YEARS BY RESIDENTIAL AND COMMERCIAL FIRMS(Percent of Respondents)
All Firms Residential Firms Commercial FirmsProfitability 51% 51% 46%Keeping up with technology 46 47 53Maintaining sufficient inventory 46 49 37Local or regional economic conditions 37 37 43Competition from nontraditional market participants 36 38 19Recruiting younger agents 34 37 29State and local legislation and regulation 33 31 35Competition from traditional brick and mortar firms 32 34 30Competition from new virtual firms 22 23 13Agent retention 22 24 12Off market listings (pocket listings) 19 21 17Liability in a digital world (contracts, signatures, etc.) 18 18 11Protecting client data 14 15 13Listing data security 13 13 10Piracy/scraping 10 11 5Industry consolidation 6 6 11Drones and regulation of drones 5 5 1
2015 National Association of Realtors® Profile of Real Estate Firms
FUTURE OUTLOOK OF FIRMS
Exhibit 4-9BIGGEST CHALLENGES FACING FIRM IN NEXT TWO YEARS BY NUMBER OF OFFICES AT FIRM(Percent of Respondents)
All Firms One office Two offices Three offices Four or more officesProfitability 51% 50% 53% 54% 58%Keeping up with technology 46 47 46 43 42Maintaining sufficient inventory 46 45 48 39 54Local or regional economic conditions 37 37 42 35 33
Competition from nontraditional market participants 36 35 40 35 44Recruiting younger agents 34 29 52 47 61State and local legislation and regulation 33 32 38 40 34Competition from traditional brick and mortar firms 32 31 32 39 38Competition from new virtual firms 22 21 24 28 25Agent retention 22 17 38 39 49Off market listings (pocket listings) 19 19 18 15 26
Liability in a digital world (contracts, signatures, etc.) 18 18 21 15 18Protecting client data 14 14 20 10 20Listing data security 13 12 18 10 18Piracy/scraping 10 9 17 11 15Industry consolidation 6 6 7 13 7Drones and regulation of drones 5 4 8 1 6
Number of Offices at Firm
2015 National Association of Realtors® Profile of Real Estate Firms
FUTURE OUTLOOK OF FIRMS
Exhibit 4-10
(Percent of Respondents)
All Firms Residential Firms Commercial FirmsGen Y ability to buy a home (stagnant wages, slow job
market, debt load, etc. ) 54% 57% 39%Baby Boomers retiring from real estate as a profession 41% 41% 46%Recruitment of Gen Y and Gen X real estate professionals 38% 39% 35%Gen Y view of homeowership (sharing generation) 35% 35% 27%Baby Boomers relocating to other states in retirement 24% 24% 23%Retention of Gen Y and Gen X real estate professionals 24% 25% 18%
PREDICTION OF GENERATIONS EFFECT ON THE INDUSTRY IN THE NEXT 2 YEARS BY RESIDENTIAL AND COMMERCIAL
FIRMS
54%
41%
38%
35%
24% 24%
57%
41% 39%
35%
24% 25%
39%
46%
35%
27%
23%
18%
%
10%
20%
30%
40%
50%
60%
Gen Y ability to buy ahome (stagnantwages, slow job
market, debt load,etc. )
Baby Boomersretiring from real
estate as aprofession
Recruitment of Gen Yand Gen X real estate
professionals
Gen Y view ofhomeowership
(sharing generation)
Baby Boomersrelocating to other
states in retirement
Retention of Gen Yand Gen X real estate
professionals
PREDICTION OF GENERATIONS EFFECT ON THE INDUSTRY IN THE NEXT 2 YEARS BY RESIDENTIAL AND COMMERCIAL FIRMS
(Percent of Respondents)
All Firms Residential Firms Commercial Firms
2015 National Association of Realtors® Profile of Real Estate Firms
FUTURE OUTLOOK OF FIRMS
Exhibit 4-11PREDICTION OF GENERATIONS EFFECT ON THE INDUSTRY IN THE NEXT 2 YEARS BY NUMBER OF OFFICES AT FIRM(Percent of Respondents)
All Firms One Office Two Offices Three Offices Four or More OfficesGen Y ability to buy a home (stagnant wages, slow job
market, debt load, etc. ) 54% 55% 49% 47% 50%Baby Boomers retiring from real estate as a profession 41% 39% 46% 52% 59%Recruitment of Gen Y and Gen X real estate professionals 38% 34% 47% 60% 59%Gen Y view of homeowership (sharing generation) 35% 35% 35% 35% 27%Baby Boomers relocating to other states in retirement 24% 24% 20% 15% 20%Retention of Gen Y and Gen X real estate professionals 24% 21% 29% 29% 44%
Number of Offices at Firm
54%
41%
38%
35%
24% 24%
55%
39%
34% 35%
24%
21%
49%
46% 47%
35%
20%
29%
47%
52%
60%
35%
15%
29%
50%
59% 59%
27%
20%
44%
%
10%
20%
30%
40%
50%
60%
70%
Gen Y ability to buy ahome (stagnant wages,slow job market, debt
load, etc. )
Baby Boomers retiringfrom real estate as a
profession
Recruitment of Gen Yand Gen X real estate
professionals
Gen Y view ofhomeowership (sharing
generation)
Baby Boomersrelocating to other
states in retirement
Retention of Gen Y andGen X real estate
professionals
PREDICTION OF GENERATIONS EFFECT ON THE INDUSTRY IN THE NEXT 2 YEARS BY NUMBER OF OFFICES AT FIRM
(Percent of Respondents)
All Firms One Office Two Offices Three Offices Four or More Offices
2015 National Association of Realtors® Profile of Real Estate Firms
2015 Profile of Real Estate Firms
Methodology In July 2015, NAR invited a random sample of 138,669 REALTORS® who are executives at real estate firms to fill out an online survey. A total of 4,555 useable responses were received for an overall response rate of 3.3 percent. All information in this report is representative of member characteristics in 2015 while sales and lease transaction values and other statistics where noted are of calendar year 2014.
The primary measure of central tendency used throughout this report is the median – the middle point in the distribution of responses to a particular question or, equivalently, the point at which half of the responses are above and below a particular value.