Florida Mortgage Brokers Consider Career Options in Slow Market
We all know what sort of effect current market conditions have on buyers: it provides them with leverage during the Florida mortgage loan process and helps them make better offers.
While such a set-up is a positive for potential owners, it’s not as appealing if you’re an agent or Florida mortgage broker in the state; many are opting out of the profession.
The number of new real estate agents in the Sunshine State grew by the thousands over the past five years as property values and sales rocketed, providing good commissions for even inexperienced residential real estate brokers.
But now that sales have plummeted and prices are either flat or down, some agents are jumping off the bandwagon and into new careers.
Effect of Florida home mortgage market on brokers
Carole Enneking moved from The Keys to Boca Raton in 2000 to start a career in real estate and sold more than $2 million in property a year during the boom years. She used to set appointments for buyers with sellers and arrive with Florida home loan contracts at $5,000 to $10,000 above the asking prices to guarantee sales.
Not any more.
“All of a sudden, the bottom fell out,” Enneking says. “There’s an overabundance of inventory and no one to sell to. You can’t just walk into a house and sell it now.”
Although she still works for Prudential, Enneking only takes sales by referral now. She’s supporting herself by selling the Lilly Pulitzer clothing line and taking online classes at Kaplan University, with the goal of becoming a psychologist.
University of Phoenix adjunct professor Bruce Fraser says several students at its Broward County campus are leaving real estate careers to become nurses.
Overall, the pool of sales for real estate agents to draw from has been shrinking. A total of 2,281 existing single-family homes sold in the Orlando housing market this past July, down from 3,137 in July 2005.
Statewide, a total of 14,451 existing single-family homes sold in July, down 33 percent from 21,691 homes sold the previous July.
Florida mortgage broker reaction
When Michael Morris of West Palm Beach started seeing his property sales income decline because his clients couldn’t afford to buy homes, he began helping people find apartments with Florida Rent Finders.
The commission from signing five sizable rental deals is about equal to selling a moderately priced home, he says.
Major ebb and flow among the ranks of real estate agents is nothing new, says Frank Kowalski, past president of the Florida Association of Realtors and president of Metro-Dade Realty in Miami.
The down markets of the early 1980s and early 1990s also were accompanied by an exodus of agents, who were replenished and then some when the market came back. FAR membership declined from 84,633 in 1987 to 65,285 in 1995. It wasn’t until 2002 that it surpassed the prior high, but it has since reached 161,531 members as of Aug. 31.
“There are cycles where they think it’s easy money - and they find it’s not,” Kowalski says. “And when the market shifts, they can’t adjust.”
However, the recent influx of agents was bigger than ever because of the record increase in property values, he says. That means the adjustment could be similarly large if sales don’t start improving soon.
As always, it goes back to the demand for Florida home loans. As buyers come, agents will remain right where they are.
