5 Reasons Why 90% of Agents Fail in Their Real Estate Career

Updated: Oct 23, 2019



I’ve spent a good portion of my career training and coaching new real estate licensees. Although I have a good track record personally, statistically across the US, just over 10% of new licensees make it to their 2nd anniversary. What! The biz looks so fun and easy! Who doesn't like to look at houses and I'll have an excuse to drive a fancy car! In this post I’ll discuss the realities of real estate and why so many seemingly qualified people fail so quickly.


1) It’s a low barrier to entry but gets really hard once you’re there: Although the number increases next year, prospective Nevada licensees are currently required to attend 90 “grueling” hours of pre-licensing education. Many candidates complete this online in their bathrobe and slippers. Only after the test is passed and the new license is hung with a broker does the truth begin to reveal itself. Like most sales-oriented business models, 80% of the real estate business in Reno and Sparks is conducted by 20% of the licensees. Let’s take a moment to flesh-out the numbers. There are currently 2,700 Realtors in our local association. Over the past 12 months we’ve had a total of 7,327 residential sales which equates to 14,654 residential transaction sides, this doesn’t sound so bad right? But wait! I still need to apply the 80/20 formula. Once that is done, you’ll find that there are only 2,930 transactions sides available for the remaining 2,160 licensees or 1.4 deals per agent annually. Ouch!

2) Lack of training and poor support: In a perfect world the brokers are always there with strong training and coaching but alas, they’re often not. Brokers are incentivized to recruit new agents because it’s almost a given that they’ll bring in 2-3 “friends & family” deals over the first year or two. This can be quite profitable for brokers because those early commissions are typically split 50/50. Brokers are then dis-incentivized to provide long term support because guess what? Most of y’all won’t be around in a year or two. New agents need mentors and role models dedicated to their long-term success. Sadly, this remains a weak spot in our industry.

3) They simply got in for the wrong reasons: “I just LOVE to look at houses and I watch all the home makeover shows” or “I want a job with flexible hours." I can’t tell you how many times I’ve heard statements like this this during interviews, but it’s a lot. Depending on our clients’ situation, agents are often expected to work nights, weekends, holidays and sometimes during the kids’ soccer game. As for the home-oriented reality shows? I’m sorry to break this to you but that is not reality. Most folks come into the industry with interest and enthusiasm, what they really need is an absolute commitment.

4) Failure to plan for skill development: People/social skills, time management, lead generation, marketing, contracts, technology, legal and math skills are all required. To make it into the top 20% a licensee must be proficient in all facets and unless the candidate is naturally gifted, that will require time and money. Imagine working 40 – 50 hours per week, for 6 - 12 months, with very little or no income and a bunch of unforeseen expenses. Yep, that pretty much sums up the first year in real estate for most of us. Come to think of it, this sums it up for just about everyone that aspires to own and manage their own business.

5) Fear of failure and rejection: Some people have a tough time getting over rejection and the real estate business offers that in spades. I once worked with a broker that early in his career walked door-to-door to solicit real estate business. It sounds far-fetched but this was a viable practice back in the 70’s and 80’s. In any event he found that he had to knock on an average of ten doors before he found one person that would say “hello” and take his business card. Rather than focus on the negative he would say “thank you” to himself after a door was slammed in his face, “Only nine more to go.” You guessed it, he did pretty well for himself in the real estate business.


I began this post by bragging about my knack for recruiting, training and coaching new licensees. I’m proud of those achievements. However, I should admit that there’s nothing magical about my abilities. Perhaps I’m just good at telling it like it is. Feel free to send me a note if you'd like to make a private comment: dan@nvhomeconnections.com

Dan Rider  NV Lic #29139

(775) 742-3376 Dan@NVHomeConnections.com