Real Estate Agent Podcast Episode 63: Women in Real Estate
Companies employing an equal number of women and men managed to produce up to 41% higher revenue than companies without that equal mix.
About This Episode
Income and power inequalities between men and women are unfortunately quite common in many industries, and real estate is unique in that a majority of residential agents are female. In this episode, we take a look at the past year of pandemic life, as well as why women make up the majority of REALTORS®.
A few links mentioned in the show:
- More info on Rachel Nichols and Lyndsy Yim
- Women’s Council of REALTORS®
- CREW Network
- Diversity study
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JON: Hello and welcome to Shop Talk: The Real Estate Show. I’m Jon Forisha, and on this episode we cover one full year of the COVID-19 pandemic, as well as the many opportunities afforded to women in real estate.
JON: March 13, 2020 was an unusual day for many Americans. It was a Friday the 13th, and if you’re a superstitious person then that alone might have made you drive a bit more carefully than usual. The reason I mention it a year later is that it was the last day I worked in an office. That day was the cherry on top of a very odd week in which COVID-19, the virus that first popped up in China and spread across the world with alarming ease, really made itself known in America.
JON: Very quickly, mention of it shifted from some distant threat only encountered if you happened to travel abroad to something responsible for cancelling every sporting event, concert, and convention. Around that time in mid March 2020, coronavirus was the only thing we were talking about, and a growing collective anxiety fueled our endless speculation.
JON: Over the last year, time was easier to track by what was trending on Netflix than by actual months. Our quarantined lives looked alarmingly similar day after day, and boredom took hold for many. In real estate, however, the picture has been surprisingly rosy. Just as with appliances, home decor, and furniture, the real estate industry has seen unprecedented growth in the last year thanks to everyone’s growing distaste for their own surroundings. They want to move and they want to move now, and prices reflect that around the country.
JON: A year after the pandemic, there is finally a light shining at the end of this tunnel, as now three vaccines have been approved by the FDA and are making their way into the arms of essential workers, and soon all the rest of us. What will happen next to real estate is anyone’s guess, but we’re optimistic. The economy hasn’t taken quite the beating that many people predicted it would a year ago, and as businesses start to re-open and life starts to look a little bit more like it did before wearing masks became second nature, we expect for more inventory to hit the market.
JON: Much has been said about the exodus from big cities like New York or San Francisco, and in the coming months we’ll see if those who left actually do stay away. Already cities like Austin Texas have seen an influx of high-earning residents who have driven their real estate market to insane levels never before seen, and it’s possible that our post-pandemic world will have more stories like it. Upwork predicts that 26.7% of the workforce now works remotely, and if you’re not tied to an expensive city for work, then the whole country is your oyster. It’s possible that formerly sleepy real estate markets might be the next big thing, as long as they have affordable homes and a fast internet connection.
JON: Despite whatever market is the next one to boom, suffice it to say that real estate is doing fine and houses will remain in demand. As this last bizarre year fades into our memories and many industries are forever changed, ours is one that will endure. When there’s been so much uncertainty and fear, the knowledge that real estate will persist is a comfort not to be taken lightly.
JON: After the break, we talk about the growing role that women play in real estate, and why adding diversity to your business is a great idea on many levels.
JON: Did you hear what I said a moment ago? 26.7% of the workforce now works remotely, and many companies have publicly stated they aren’t going back. It’s been estimated that COVID-19 has sped up the adoption of digital technology by 5-10 years. If you’re not working in an office anymore, why should you learn there? Take charge of your career and complete your real estate education from the comfort of your home, on your couch, by the pool, wherever you want. The CE Shop’s online and mobile-friendly courses are the best way to complete your education, and right now you can save 25% on them with promo code SHOPTALK.
JON: Joining me now is Krista Reuther, Content Editor at The CE Shop.
JON: Well Krista, thank you for joining me.
KRISTA: Thank you for having me, Jon. Appreciate it.
JON: Happy to have you here. So talking about women in real estate March is women's history month. And a majority of REALTORS actually are women. So according to NAR, 64% of REALTORS are women. Why do you think women make up such a majority?
KRISTA: Yeah, that's a great question. I think it's given the low barrier to entry. Women can join this field and they have been since restrictions were lifted by NAR all those years ago. And we've really seen women be able to excel in real estate in ways that aren't always allowed for in other careers or industries.
JON: Yeah. And has it always been this way?
KRISTA: Oh, absolutely not. Not at all. You know, women have actually worked in real estate since its inception. There are some firms that go back to 1794, but unfortunately women have had to fight significantly harder for the same opportunities as their male counterparts. So you brought up NAR the National Association of REALTORS. They were actually created in 1908. And they admitted zero female real estate agents for two years. Great. Two whole years, right until Corinne Simpson came in, she was a Washington agent. She was actually the first female realtor and she was admitted in 1910. A little bit of progress is better than none. But as you'll see it, it was slow going. So over the years, more women were slowly admitted, but NAR restricted membership to four sales agents basically. So if you held a sales agent title, you're likely not going to be allowed to be admitted.
KRISTA: And wouldn't you guess it, the majority of women in real estate at the time were sales agents. So they were not allowed to join NAR up until 1973, when that restriction was lifted, as soon as it was lifted, though, within five years, women became the majority in NAR. So you can see that there was a real fire in drive from women to be a part of these kinds of professional organizations. And they were just getting blocked by the organizations themselves, which is wholly disappointing. But luckily now in 2020, 64% of all residential real estate agents are women. So we can see how they're starting to take off and really claim their slice of the pie in that sector.
JON: Wow, 1973. That is very recent for NAR to change that rule.
KRISTA: Yeah. You know, it's always good when we see progress and see things moving forward. But as a woman, myself, it's one of the situations where I look at it and say, why did it take so long? Why 1973?
JON: Yeah. Well, and the fact that it took five years for women to become the majority, once that rule was changed, that speaks a lot to the fact that women were probably always the majority. It was just more difficult to see that because, you know, NAR couldn't show it in their membership.
KRISTA: Exactly. Exactly. And when you don't see yourself reflected in professional organizations like that, the common woman will not think that they have a place in the industry, which is why I'm so happy that these things are changing and we're opening it up, seeing more successful, win in all sectors of real estate to really light the path for people coming back.
JON: Absolutely. Yeah. So what makes real estate a good industry for women in particular?
KRISTA: That's a great question. I think it boils down to a few factors. One, it's a field where men and women can largely be paid equally. You don't have the same kind of gender stigma attached to your paycheck. As you might find in other industries, women can generate their own sales, negotiate their cut with their brokerage. They also have an unprecedented amount of freedom and flexibility as independent contractors than you would in a typical office job, they can rearrange their schedule based on what's important to them and really capture the any number of sales that they're going after. As long as they put in the time and effort, they're not going to be restricted by their gender as much in this field.
JON: Yeah. That makes sense. So you made a distinction a minute ago where you said 64% of all residential real estate agents were women. What about commercial real estate agents?
KRISTA: Yeah, so commercial real estate, we definitely have room to grow and diversify. Only 36.7% of commercial real estate agents are women. And that figure has stayed stagnant for 15 years, 15 years. That is a long time to be just over a third of, of an audience when really it should be 50 50. Right. And if we break that down, even further, women only comprise about 9% of C-suite positions in the commercial real estate industry. That's crazy. That is wild. I guess you could argue that residential real estate is easier to join at first, typically their licenses, you know, don't require as much experience. It's a great entry into the industry versus commercial real estate. You're likely going to have a broker license or something higher. And it's, it's more familiar to sell a house than it is to sell a $5 million retail center. So there is an element of ease of entry in residential real estate that gets progressively more challenging as you enter commercial real estate. However, I do think women should push and, and at least entertain the idea of joining commercial real estate, if only for the money alone. The average commercial agent makes about $85,000 annually versus $39,300 for residential real estate agents. So there's a lot of money left on the table for these female agents who may not have pursued commercial real estate in the past.
JON: Yeah, absolutely.
KRISTA: It's going to be difficult though, because you know, we already mentioned that there are significantly fewer women in commercial real estate. And additionally there, they're still going to make less than their male counterparts on average. So there's about 10.2% less salary for women in commercial real estate. There’s a commission and bonus gap of 55.9% between female agents and male agents in commercial real estate. That's huge. That's significant, especially when your sales are, you know, five, six, seven figures. You're going to be seeing some disparity between your paychecks at first, but if you continue to work at it, we see a lot of women gain success in commercial real estate, and it's always very encouraging. So for example, there are two women in Alabama right now, Rachel Nichols and Lyndsy Yim.
KRISTA: And they are frankly kicking butt in commercial real estate. They work with the commercial real estate women, Birmingham chapter crew, Birmingham, and they are working to not only gain their own success and put their own foot in the door, but to really open it up for women following them. Lyndsy Yim is particularly impressive to me. She noticed that there were non English speaking clients who were being underserved and as someone with a Korean background, she found that she was able to fill that niche and really hit home and serve clients who are typically kind of swept away because there was a language barrier and that's something that has enabled her to find massive success in this market really distinguished herself. Yeah. Right. It's all women doing cool things.
JON: Yeah, absolutely. So you know, not to take the spotlight away from women in particular, but how about racial diversity? How does the industry fare as far as racial diversity?
KRISTA: Yeah, I think we're making progress. But again, it hits back to my question of why is this progress so slow? According to a study from 2017, more than 75% of senior executive jobs in commercial real estate are actually held by white men while only 1.3% were held by black men. If we start boiling that down for women, white women held 14.1% of these roles while nine nonwhite women held fewer than 1% of senior executive level jobs. Staggering, that's very, very horrible frankly, unacceptable. Especially because there are so many benefits, you diversify your workforce, but coming back to the data for a second only seven only 0.7% of the 889 real estate investment management firms included in this dataset were owned by women and just 2% were minority owned. So we're really seeing that commercial real estate is very white and very male.
KRISTA: And I think that is what makes the success of women like Rachel Nichols and Lyndsy Yim all the more important and impressive. One of the most commonly cited factors that leads to a lack of diversity in this field is really the manner in which people enter commercial real estate. Companies are often recruiting candidates through outreach to universities or different organizations and those organizations and universities that they're reaching out to already have a very homogenous base. It's already not a lot of racial diversity because of that. They're pulling in non diverse candidates and perpetuating this cycle of a very one note industry in terms of people finding success. It's unfortunate because when we diversify everybody succeeds, there's actually a cognitive intelligence study performed by MIT engineers that showed that companies with racial and ethnic diversity are 35% more likely to perform at a higher level and have increased ROI.
KRISTA: Companies employing an equal number of women and men managed to produce up to 41% higher revenue than companies without that equal mix. So we can see that we all benefit if we diversify. And if we enable people to join the industry who may not look like us or think like us, or have the same backgrounds. So what I recommend people do is try to actively seek opportunities to reach out to non-white perspective agents ensure that they're creating an accepting environment and promote social networking opportunities so that everybody can build each other up and we can all benefit.
JON: Awesome. Yeah. Those numbers are crazy. Especially the stats showing that, you know, diversity is not just a nice idea. I mean, there is actually business sense behind it, too, that it increases your revenue.
KRISTA: Yeah, absolutely. Absolutely. It increases your revenue and it also increases your adaptability because if you bring together people with different backgrounds, we've all faced different challenges in our lives. And the more that you can bring to the table and say, okay, I might not have experienced this, but I've experienced X. Instead you bring that to your company. They can then draw on your experience and find a path forward. That's more inclusive for everybody. So it's just something we should be prioritizing frankly, every day.
JON: Absolutely. Yeah. Okay. Well, getting back to women specifically in real estate, a stay at home. Moms are a frequent topic for women first getting into real estate. How can real estate help moms reenter the workforce?
KRISTA: Great question. I think what it comes down to in my opinion is really the flexibility offered by this industry. You know, stay at home. Moms are having to juggle so much already they're multitaskers in the best way. So if you give them a way back to the workforce that is flexible, that they can structure themselves and maintain their priorities, whatever those may be, then they're more likely to continue engaging with the industry and either be able to take it from a part-time to a full-time position remained part-time really customized their professional journey based on what their family prioritizes, which I think could be incredible. Additionally, real estate is fairly predictable. You know, they know when the selling cycles are spring and fall are going to be better for buyers. So you can make a plan long-term for both yourself and your family, that other industries just really don't allow for.
KRISTA: And lastly, you know, you can network with people who are already in your sphere of influence more or less, right? If you're a stay at home, mom, you probably know your kid's teachers. At some point, one of them might need to buy a house or sell a house. And you're right there because you already have a personal connection. And as a mom, you foster a lot of those personal connections, whether it's just the moms of other children that your kids play with people at the soccer game that your kid plays on. Anything, you have a greater opportunity to capitalize on what already exists in your life, through a career in real estate versus an office job where you might not have that same ability to tie in the personal aspect.
JON: Yeah. Yeah. Good points. The flexibility really is huge.
KRISTA: Yeah, we do see a lot of part-time real estate agents. You can always join the industry, set your own hours, whether that's, you know, 20 hours a week, whatever fits in your schedule and then either maintain that level or move into a full-time position depending on how you're feeling about it. And the other nice thing here is that you really have an unlimited earning potential. The amount of time you put into your practice is about how much money you're going to bring out of it. So if you're comfortable at 15 hours a week, and that scratches the itch that gets you, what you need. Awesome, do that. But if you're looking for something more like 40 hours a week, you have the ability to set your schedule and really focus on what matters most to you. Additionally, once you have a real estate license, you don't have to just be a real estate agent. There are other paths that you can pursue, like being a property manager, a real estate developer, a real estate marketing specialist. I mean, the list really goes on and on. So once you have your first foot in the door, you unlock a bunch of career paths that would have been closed off to you before.
JON: Yeah. And for anybody just starting in the industry, one thing that a lot of past guests always mentioned that really took their careers to the next level was finding a good how can an agent find a good mentor for their career?
KRISTA: Yeah. You know, and that's especially important for women. That's something that we see in the studies is women with a mentor succeed, way more than women who are trying to take on the industry themselves. So I would say to find a mentor first, you might have one provided by your brokerage, right? Once you hang your hat at a brokerage, they may have a mentoring system in place for you to really gain some industry knowledge from somebody at that brokerage. But if that's the case, that's okay, don't be afraid to pursue it on your own. I would recommend looking up professional women's organizations in your area, start networking, meet some people and try and find someone who is experienced in the industry willing to teach you someone who understands digital marketing subs. That's obviously the future and also has their own network that you could hopefully engage with. And once you find all of these factors in a person, also bear in mind that the mentor mentee relationship is not strictly to benefit the mentee. You want to find someone with whom you can have a back and forth something comfortable where you're both benefiting. And if you keep all of those aspects in mind, you should be able to find someone in your local market with the industry knowledge that you need to succeed in your career, who can hopefully reach back and help you pull along.
JON: Yeah. Awesome. And you mentioned professional women's organizations. What kinds of organizations are there for women working in real estate?
KRISTA: Yeah, there are a bevy of selections. It's no longer just, you know, NAR or nothing. There are specific women's organizations. Basically just really depends. There are so many, I will hit on two that have chapters in most States. And then give you some advice on how to find something in your specific area. So, the first big one is the Women's Council of REALTORS. This one was actually established in 1938 as a reaction to gender restrictions. Other associations placed on women. I love a good spiteful organization, not to say it's spiteful now, but if you don't have a seat at the table, feel free to build your own table. Currently Women's Council of REALTORS has 10,000 members and their average income from real estate specifically is $134,470. Wow. Nothing to sneeze at, I would say.
JON: That's pretty impressive. Wow.
KRISTA: So that's more, you know, all REALTORS, all real estate professionals are welcome with this group. We also have groups that are specifically dedicated to other sub industries. For example, commercial real estate has its own group as well. Commercial Real Estate Women Network or CREW. They were established in 1989 to bring together women involved in many aspects of commercial real estate to exchange information, develop business contacts and help each other succeed professionally. They have 12,000 members worldwide and there are four main tenants. They offer business networking, leadership development, industry research, and career outreach. Very fantastic group. Most of the data pulled in this podcast is actually from their reports because they are dedicated to diversifying and ensuring a quality within their organization and the commercial real estate industry as a whole. Awesome. Right. And you know, if you are looking for a local organization and neither of these two quite fits what you're looking for, or if you just want to explore all the options you have, I recommend just Googling professional women's real estate group in your market. So for example, Denver or alternatively check out Women's Council or CREW and determine if there's a chapter near you, never hurts to get connected with powerful women. That's what I'll say.
JON: Very cool. It is awesome to see that these groups exist and, and that they're so robust. And in conclusion here, is now a good time for women to enter the industry?
KRISTA: Absolutely 3000% join. Now, if you haven't yet, there are a variety of reasons why it's a great time for women to join the real estate industry. But if we just look at who's buying the most houses right now, that's a great place to start. Single female buyers accounted for the second largest segment of home buyers at 17%. That is incredible. And when you have a home buyer who is a single female, it's more reassuring to be led through the process of the biggest personal transaction of their life, by someone who understands your life experiences and who can validate that the decisions you're making will serve you for years to come. So now is a great time for women to get in, to serve other women, as they're trying to come up and build a financial future for themselves in their family. Additionally, if we look at commercial real estate, that wage gap that I mentioned is shrinking.
KRISTA: It's been shrinking in recent years. Now there's still a gap. Don't get me wrong, but we're making progress. So in 2015, the median total annual compensation in commercial real estate, including bonuses and profit sharing was $150,000 for men. And $115,000 for women, obviously still a gap, but that's a lot better than what we've seen in years past. Additionally, you wouldn't be alone in starting. The benchmark study from CREW actually saw a 5.4% increase in female respondents, 39 years old and younger, which means that there's a growing base of younger agents entering the industry than ever before. And I think it comes down to seeing people like Lyndsy Yim succeed so boldly and being inspired and knowing that they can do the same. So join now take your slice of the pie and don't let anybody tell you can't do something because you're a girl.
JON: That's amazing. Well, thank you Krista. Thanks for coming on. Oh yeah.
KRISTA: Jon, anytime. Thanks so much.
JON: That’s it for this episode, thanks for listening! You can find links to the studies mentioned in our show notes. If you enjoyed the episode, you can review us and subscribe to Shop Talk on your podcast player of choice. Shop Talk is a production of The CE Shop.