About half of all licensed agents are members of this industry group, which is meeting in Washington, DC this week for a semi-annual conference.

“To put that in perspective,the median realtor income had fallen by 35 percent during the housing downturn, but with the help of sustained increases in both home sales and prices, it’s recovered to the highest level since 2006,” says Paul Bishop, NAR’s vice president of research.

The median gross income of a realtor in 2012 was $43,500, a far cry from the peak of $52,200 in 2002, but the biggest annual gain in over a decade.

“Interestingly, the peak wasn’t during the bubble years, because there were way too many people in the business,” notes NAR president Gary Thomas, a California-based Realtor.

The real estate business is unique, in that most come to the field after other careers, or as a side-business to other jobs. Just six percent of agents now report real estate as their first career.

No surprise then, that the typical age of a realtor is 57; just two percent of them are under 30 — which given the crash is not surprising. 25 percent of realtors are over aged 65.

“I have not seen new people being drawn to the business, but I am seeing agents change firms in pursuit of better split agreements,” says Rick Ambrose, a real estate agent in Morristown, New Jersey. “Quite a few realtors have left the business or become ‘referral agents,’ so they could maintain their license while doing something else.”

With incomes rising, many will likely return to the business. While online real estate sites are gaining traction by the moment, most buyers and sellers, around 89 percent according to the NAR, still use a real estate agent to navigate the process.

—By CNBC’s Diana Olick; Follow her on Twitter @Diana_Olick or on Facebook at facebook.com/DianaOlickCNBC

Questions? Comments? RealtyCheck@cnbc.com

Article source: http://www.cnbc.com/id/100732611

Institutional investors are especially drawn to REITs because they provide not just earnings growth, but strong dividend growth. REITs are required to distribute at least 90 percent of taxable income to shareholders in the form of dividends. Also, real estate is relatively inexpensive right now.

(Read More: The Other Housing Recovery: Agents’ Pay)

“Physical real estate is attracting institutional investors because there is a positive spread between how much it costs to finance real estate versus the income generated,” added Goldfarb.

On a total return basis, the FTSE NAREIT All REITs Index gained 5.80 percent in April and the FTSE NAREIT All Equity REITs Index gained 6.33 percent, while the SP 500 was up 1.93 percent.

While almost all sectors of U.S. REITs have delivered double-digit gains year-to-date, some are outshining others. Health care was the industry’s top-performing major sector, with a 23.77 percent total return, according to the NAREIT report. Lodging was up 17.51 percent, and retail was up 17.34 percent, led by shopping centers.

An improving economy is clearly sending consumers back on vacation and back to the malls. Health care has been a consistent leader, as Baby Boomers fuel the aging population.

(Read More: Map: Tracking the US Real Estate Recovery)

A product of the real estate recovery, Mortgage REITs were up nearly 19 percent and Home Financing REITs were up over 17 percent. Commercial financing is driving much of the former, but these sectors are benefitting from a potential thaw in mortgage credit in residential as well.

“There are signs that conditions are beginning to loosen,” according to analysts at Capital Economics, who also noted that mortgage demand is on the rise.

Article source: http://www.cnbc.com/id/100734766

© Copyright NATIONAL ASSOCIATION OF REALTORS®

Headquarters: 430 North Michigan Avenue, Chicago, IL 60611

DC Office: 500 New Jersey Avenue, NW, Washington, DC 20001-2020

1-800-874-6500

Article source: http://feedproxy.google.com/~r/RealtororgResearchHeadlines/~3/a8qdrLyYFFU/quiz-member-know-thyself

WASHINGTON (May 13, 2013) – The business activity and income of Realtors^® are up for the second year in a row following nine years of decline, according to the 2013 National Association of Realtors^® Member Profile. 

The study’s results are representative of the nation’s Realtors^®; Realtors^® are members of NAR and account for about half of the approximately 2 million active real estate licensees in the U.S.*  Many non-member licensees are inactive or part time.  Realtors^® go beyond state licensing requirements by subscribing to NAR’s Code of Ethics and Standards of Practice and committing to continuing education.  NAR members also have access to professional resources to better serve their clients’ needs. 

Paul Bishop, NAR vice president of Research, said growth in the housing market has improved the earnings of real estate professionals.  “The median gross income of a Realtor^® rose to $43,500 in 2012 from $34,900 in 2011, which is only the second gain in the past 10 years,” he said.  “To put that in perspective, the median Realtor^® income had fallen by 35 percent during the housing downturn, but with the help of sustained increases in both home sales and prices, it’s recovered to the highest level since 2006.”

Members licensed as brokers typically earned $54,900 in 2012, while the median for sales agents was $34,000.

Median gross income tends to increase with experience; NAR members in the business for 16 years or more earned $57,300.  Realtors^® working 60 hours a week or more earned $85,700, and 21 percent of all members earned a six-figure income.

There are two sides to every real estate transaction – one each for the seller and the buyer.  Among Realtor^® members the median number of transaction sides or commercial deals handled in 2012 was 12, up from 10 transaction sides in 2011.

NAR President Gary Thomas, broker-owner of Evergreen Realty in Villa Park, Calif., said the real estate business is cyclical.  “Realtors^® have some way to go to surpass the peak income recorded back in 2002.  Interestingly, the peak wasn’t during the bubble years because there were way too many people in the business,” he said.  “To help smooth out the peaks and valleys associated with residential sales, many Realtors^® are diversified into related services.  As a result, changes in Realtor^® income don’t exactly parallel changes in home sales and prices.”

Eight out of 10 NAR members focus on residential sales and 73 percent have secondary real estate specialties.  Eighteen percent of residential specialists also offer commercial property management, 17 percent relocation services, 15 percent commercial brokerage, 8 percent counseling and 7 percent land development.  Smaller percentages were also in residential appraisal, residential property management, auctions, international or commercial appraisal.

For Realtors^® who have other primary specialties, 37 percent listed residential brokerage as a secondary business.

Repeat business and referrals are important to the success of Realtors^®.  Repeat business accounted for a median 21 percent of activity in 2012 and is higher for those with more experience – for members in the business 16 years or more, repeat business was 40 percent of their activity.  Referrals accounted for an additional 21 percent of all business.

Several factors limit potential clients in completing transactions.  Members said the biggest impediment was difficulty in obtaining a mortgage, cited by 29 percent of respondents, followed by difficulty in finding the right property, 25 percent.

The typical NAR member has 13 years of experience and works 40 hours per week; 57 percent are women, who account for 52 percent of brokers and 63 percent of sales agents.  Ninety-four percent of Realtors^® are certain they will remain in the business for at least two more years.

Thirty-nine percent of Realtors^® hold at least one out of six certifications in specialized training.  The most popular area of training, driven by an elevated level of distressed homes in recent years, is the Short Sales and Foreclosures Resource Certification (SFR), held by 23 percent.

The second most popular Realtor^® certification is e-Pro, held by 17 percent of members to help them better serve the online needs of clients, followed by REPA (Real Estate Professional Assistant), 7 percent.

 In addition, 36 percent of Realtors^® have obtained at least one professional designation.  The most popular is GRI (Graduate Realtor^Ò Institute), held by 21 percent of respondents; ABR^® (Accredited Buyer Representative^®), 15 percent; and CRS^® (Certified Residential Specialist^®), 11 percent.  Smaller shares hold one of 14 other designations.

Twenty-two percent of Realtors^® belong to one or more of NAR’s affiliated institutes, societies or councils; the most common is CRS (Council of Residential Specialists), identified by 12 percent.

The survey shows the typical NAR member is 57 years old; only 2 percent of all Realtors^® are under 30 years of age and another 4 percent are 30 to 34 years old; 25 percent are 65 or over.

Most members – 56 percent – are licensed as sales agents; 27 percent are brokers, 18 percent broker associates and 4 percent appraisers (some hold more than one license).  Fourteen percent of members have one personal assistant, while 4 percent have two or more personal assistants.

Sixty-four percent of NAR members have a personal website, operational for a median of eight years, and 94 percent report their firm has a Web presence.  Fifty-six percent of the respondents use social or professional networking sites and 12 percent have a blog.  Realtors^® use a variety of communications methods, with 92 percent preferring e-mail for current clients or customers, followed by telephone at 90 percent and text messaging, 74 percent.

Sixty-eight percent of respondents are compensated through a split commission arrangement, 18 percent receive all of the commission and another 4 percent receive a commission plus a share of profits; 10 percent received some other form of compensation.  Eighty-three percent of members work as independent contractors for their firms.  The vast majority of Realtors^® receive no fringe benefits, although 22 percent are covered by errors and omissions insurance; only 4 percent receive health insurance through their firm.

Most members begin their careers in other fields and bring a wide range of expertise and experience to the profession; only 6 percent report real estate is their first career.  Previous full-time careers include management, business or financial, 19 percent; sales or retail, 15 percent; office or administrative support, 9 percent; and education, 7 percent.  Thirteen other categories were each 4 percent or less; 16 percent were “other.”

Respondents worked for a firm with a median of 23 brokers and agents, typically with one office, and had been with that firm for seven years.  Fifty-six percent of members are affiliated with an independent firm, and 40 percent are with a franchised company; 3 percent are other.  Ten percent of Realtors^® report their firm was bought by or merged with another during the past two years, down from 11 percent in the 2012 study.

Nearly nine out of 10 Realtors^® are homeowners.  They often invest in real estate and own other homes in addition to their primary residence – 36 percent own at least one residential investment property and 10 percent own at least one commercial property.  In addition, 13 percent own at least one vacation home.

NAR members are active in the political process – 94 percent of respondents participated in the last national election and 86 percent voted in the last local election.  They are well-educated, with 50 percent holding at least a bachelor’s degree; 15 percent are fluent in other languages.  Four percent of all their business comes from clients whose primary language is not English.

The 2013 National Association of Realtors^® Member Profile is based on a survey of 58,068 members, which generated 4,883 usable responses, representing an adjusted response rate of 8.4 percent.  Survey responses were weighted to be representative of state-level NAR membership.  Income and transaction data are for 2012, while other data represent member characteristics in early 2013.  The study can be ordered by calling 800-874-6500, or online at www.realtor.org/prodser.nsf/Research.  The profile costs $14.95 for NAR members and $149.95 for nonmembers.

The National Association of Realtors^®, “The Voice for Real Estate,” is America’s largest trade association, representing 1 million members involved in all aspects of the residential and commercial real estate industries.  For additional commentary and consumer information, visit www.houselogic.com and http://retradio.com.  

*Data from the Association of Real Estate License Law Officials shows there are approximately 2 million active real estate brokers and sales agents in the U.S. out of nearly 3 million licensees.  To be considered active, a licensee generally was involved in at least one real estate transaction in the previous year.

Article source: http://feedproxy.google.com/~r/RealtororgResearchHeadlines/~3/lda92iGI-C8/nar-member-survey-shows-realtor-business-and-income-continue-to-improve

When Fannie Mae was bleeding cash back in 2008, the government took it into conservatorship, which allowed Fannie Mae to draw funds from the Treasury to stay afloat. In return, the government took senior preferred shares of the company. Fannie Mae now has to pay nearly all of its profits, save a small capital cushion, to the government in dividends. This doesn’t pay back the draw; it is just a dividend.

The difference this quarter is that the dividend is huge. Thanks to the company’s new profitability, Fannie Mae is able to take a tax credit from years ago worth over $50 billion, according to its earnings release:

As a result of actions to strengthen its financial performance and continued improvement in the housing market, Fannie Mae’s financial results have improved significantly over the past five quarters. Based on analysis of all relevant factors, Fannie Mae determined that the release of the valuation allowance on its deferred tax assets was appropriate.

Therefore, Fannie Mae will pay the Treasury $59 billion by the end of this quarter, bringing its total tally of dividend payments to $95 billion—close to the $117 billion it originally drew. Again, the money does not go to pay back that draw. So where does it go?

(Read More: Fannie Mae Should Be Abolished, Says Barney Frank)

“It’s up to the Treasury to decide what to do with it,” said Fannie Mae CEO Timothy Mayopoulos in a conference call with reporters.

With Fannie Mae and its smaller cohort, Freddie Mac, turning so much profit, the push to dismantle them becomes far more complicated. Unlike several years ago, they are now making the government money at the same time that the feds should be winding them down.

“There is a risk that policy makers will look at our profitability and conclude that they don’t need to take action to reform the housing finance system,” said Mayopoulos. “That would be a mistake.”

As of now, Fannie Mae, Freddie Mac and the Federal Housing Agency—all government sponsored entities (GSEs)—provide the bulk of the nation’s housing finance. The private market has yet to dive back in with both feet. Fannie and Freddie are still crucial to the housing recovery, but should the government reap all the rewards rather than mortgage holders or investors?

“It seems strange that everyone else who borrowed from U.S. Treasury in the crisis is allowed to pay back, but the GSEs are neither allowed to rebuild capital nor repay. Shouldn’t we get to reform rather than use them as a budget tool?” asks Joshua Rosner, an analyst at Graham Fisher.

Lawmakers are busy debating how to create a private housing finance system with at least a modest government back-stop. Simultaneously, Washington is fighting a wider budget battle, owing to an enormous federal deficit. The two are now intimately connected, and Fannie’s new profitability is the link.

“If Fannie and Freddie this year effectively ‘pay back’ all the bailout money they received since late 2008, I think we need to think long and hard about the need to continue collecting money from the firms. Is it punishment for past sins? Or is it because the government needs cash cows?” asks Guy Cecala of Inside Mortgage Finance.

“And while it may sound like crazy talk, we probably also need to at least discuss whether Fannie and Freddie should be taken out of conservatorship once they pay back the money Treasury advanced them and they are in fact solvent,” he added. “Unfortunately, the current Treasury agreement treats them as wards of the state regardless of how much money they return to the government or how much money they earn.”

The housing crash was a game-changer for housing finance in the United States. That said, the recovery of both the overall housing market and the companies that fund it will necessitate new thinking as well.

—By CNBC’s Diana Olick; Follow her on Twitter @Diana_Olick or on Facebook at facebook.com/DianaOlickCNBC

Questions? Comments? RealtyCheck@cnbc.com

Article source: http://www.cnbc.com/id/100724407