Real Estate

The U.S. Department of Labor reports that there are 127,200 real estate brokers and 462,600 real estate sales agents employed in the United States. Property, real estate, and community association managers hold approximately 429,600 jobs, and property appraisers and assessors hold 77,600 jobs. There are more than 2 million active real estate licensees in the United States, as estimated by the Association of Real Estate License Law Officials.

The National Association of Realtors included the following statistics in its “Quick Real Estate Statistics” from various industry sources:

• In 2020, approximately 5.64 million existing homes and 822,000 newly constructed homes were sold in the United States. This was an increase over home sales in 2018, during which time 5.34 million existing homes and 667,000 newly constructed homes were sold.
• The U.S. Energy Information Administration released findings from its Commercial Buildings Energy Consumption Survey which showed that there were 5.9 million commercial buildings in the United States in 2018 (the most recent data available), comprising more than 97 billion square feet of floor space.
• The United States Census Bureau reported in its American Community Survey that in 2018, there were approximately 119.7 million occupied housing units in the United States. The typical home size was 1,900 square feet. The average age of home owners was 45 years old and they had lived in the current home for an average of eight years.
• Nearly 65 percent of families owned their primary residence in 2019, as reported by the Federal Reserve's Survey of Consumer Finances.

The National Association of Realtors also reported results from a survey of its members, which revealed that 64 percent are licensed as real estate agents and many specialize in residential brokerage. Most of those surveyed worked an average of 30 hours per week in 2022. The median gross income of realtors was $56,400 in 2022, which was an increase over the previous year’s income of $54,300. Of those surveyed, approximately 30 percent had some college education, 12 percent held an associate degree, 31 percent had earned a bachelor’s degree, and 12 percent had a graduate degree and above. The majority of realtors (89 percent) were independent contractors, while only 4 percent were employed by a real estate company.

According to a market research report by the real estate company T3 Sixty, the largest companies in the U.S. real estate industry today by sales volume include Anywhere Real Estate (formerly Realogy Holdings Corp.), kwx, RE/MAX Holdings, HomeServices of America, and Compass. Factors that continue to affect the real estate industry include population growth, the state of the economy, employment rates, and interest rates. When the economy is strong, the demand for property increases, and likewise property values rise. Large real estate companies have more financial resources and broader geographic reach than small companies. On the other hand, small companies have knowledge of local or regional markets and can effectively focus their business on those areas. In 2021, approximately 20 real estate firms accounted for more than 60 percent of the total real estate sales for that year.

The National Association of Realtors collected data from commercial realtors for its report October 2023 “Commercial Real Estate Market Insights,” which gives an overview of market performance, sales and rental transactions, as well as current economic challenges and future expectations. The results showed that the U.S. economy was growing faster than expected but the Federal Reserve's tightening of monetary policy was creating uncertainty in the real estate market. One ongoing concern has been the continued rise in vacancy rates and slow rental growth in the commercial real estate market. Other highlights from the NAR's report on the third quarter of 2023 included:

• Construction firms had a 17 percent increase in multifamily unit deliveries in the third quarter of 2023 compared to the same quarter in 2021.
• Mortgage rates were nearly 8 percent, resulting in the increased growth in the multifamily segment due to high demand for apartments.
• Vacancy rates reached an "unprecedented" 7 percent in the third quarter of 2023, which caused a nearly 1 percent decline in rent growth.
• There was a more than 13 percent vacancy rate in the office space sector, compared to about a 12 percent vacancy rate the previous year. However, artificial intelligence (AI) companies are now seeking offices for their staff, as the demand for AI is growing.
• In September 2023, existing-home sales rose in the Northeast but declined in the Midwest, South, and West. Overall, however, all four regions reported declines in year-over-year sales.
• Since 2019, the price of homes has risen by nearly 30 percent, while available homes for sale has decreased dramatically, resulting in "double trouble" for the residential market.
• The primary challenges for real estate professionals is housing affordability, maintaining sufficient inventory, and keeping up with technology.

A report in Realtor.com found that mortgage rates had jumped from 3 percent, which was a historic low, in 2021, to more than 7 percent by October 2023. There is a slowdown in home sales, with costs for homes remaining high, which is "challenging affordability at a time when overall budgets continue to be squeezed." In the second quarter of 2023, the average value of owner-occupied homes was $489,185, with more than 84 million households who own their primary homes. There has been a significant increase in the cost of financing the average home that is for sale, averaging at about $2,430, which is nearly 28 percent more than the average mortgage payment in 2022, and nearly double what was typically paid by home buyers in 2021.

The U.S. Commerce Department released its "Characteristics of New Housing" report in 2022, which showed that 1,022,000 single-family homes, 368,000 multifamily units, and 12,000 multifamily buildings had been constructed in 2022. There were 641,000 single-family homes sold in 2022; their median size was 2,383 square feet, most were detached homes, and the median sales price of those sold was $457,800.

The economy is slowly strengthening since the pandemic and builders have been focusing on buyers with higher incomes and better credit rather than turning their attention to first-time home buyers with budgets for smaller homes. Also of note is that many homes are part of home owners associations (HOAs). According to the Foundation for Community Association Research, about 29 percent of Americans live in homes (e.g., condos, townhouses, housing cooperatives, and even detached homes) that are part of HOAs. According to a Wall Street Journal article, "New Home Buyers’ Wish List: More Bedrooms, Bathrooms, Patios," this increased interest in HOAs could indicate that "more U.S. home construction [is] being handled by large, publicly traded builders, who tend to favor building in big subdivisions and master-planned developments, which often have HOAs."