Denver a lucrative market for real estate agents

 

 

Metro Denver's hot housing market has made it one of the best places in the country to work as a real estate agent, according to a new ranking from SmartAsset, a personal finance website.

SmartAsset looked at median annual pay for agents, the rate of home price appreciation, the percentage of homes turning over in a market and the number of sales per agent in 113 cities.

Based on those four measures, Denver ranked third after Reno, Nev., and Lincoln, Neb., and moved up from eighth in last year's survey.

"The last couple of years have been phenomenal, especially if you list properties," said John Sullivan, co-owner of Re/Max of Cherry Creek.

Denver agents not only made more than agents in Reno and Lincoln, but they did so on fewer transactions, a reflection of the area's higher home prices.

Median annual pay in Denver of $63,300 was $11,050 more than that made by agents in Reno and was achieved with one-quarter of the transactions averaged in Reno, according to SmartAsset.

Agents working each side of a deal in Denver divvy up a commission that can range from 5.5 percent to 6 percent of the sales price and higher home prices have made transactions more lucrative.

Sullivan said the median pay in his office, which works areas with higher-priced homes, is running closer to $125,000 a year.
The real estate brokerage industry follows the 80/20 rule, where the top fifth of players transact the vast majority of sales and earn most of the pay, Sullivan said.

Many newbies come and go after completing only a few or sometimes no sales. It is also important to note that while life has gotten easier on the listing side, buyer's agents are having to put in a lot more work to land a home for clients.

The robust market likely will make it easier for veteran agents to retire and has attracted younger entrants, including more people with college degrees, Sullivan said.

Looking just at median annual pay for real estate agents, Denver ranked third after Albany, N.Y., at $79,720 and Montgomery, Ala., at $78,560, according to SmartAsset.