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Realtors fall on hard times
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BY DAVID FALCHEK
STAFF WRITER
Everyone told Frank Baresse he got a lucky break when he sold more than $4 million of property in his first year as a real estate agent in 2004.
Things have changed a lot in the last four years. Mr. Baresse now works part time in the lumber department at a home improvement store. Like many real estate agents, he’s holding on to his license, hoping the economic storm engulfing the housing market passes.
In late 2003, Mr. Baresse left an anonymous job at a print shop, lured by the flexible schedule and princely commissions of real estate. By May he was working full-time at ERA One Source Realty and was living large. Full-page ads in the newspaper real estate section featured his smiling face. He worked long hours to attract listings and find buyers, and made close friends of the clients he helped get into homes.
“The most satisfying thing was getting a family into their first home,” he said. “I still keep in contact with some of them.”
The prosperity train chugged through 2005 and 2006. In 2007, Mr. Baresse saw the first rumbles of trouble. The market never warmed up after winter. The multiple listing service was flush with homes. A series of closings he had lined up crumbled because of inspection issues, poor credit or appraisal shortfalls.
Three months passed without a commission. The mortgage industry collapsed that summer, credit tightened and the pool of buyers dried up further. Mr. Baresse did something he couldn’t imagine doing two years earlier: He got an hourly job.
At the home improvement store, he’s still helping people with their homes, he figures.
He works alongside two other real estate agents, and sometimes in the aisles they talk about the good times and what they will do when things get better.
Holding on
Many Realtors are like Mr. Baresse — holding on until the market improves.
The dramatic decline in the housing industry hasn’t resulted in a commensurate decline in the number of real estate agents. Among the five Realtor associations serving Northeastern Pennsylvania, none saw large charges. The total number of agents increased, up eight in April compared to the prior year.
The Poconos, which has always had a mercurial market, doubled the number of practicing Realtors from 2003 to 2006, peaking at 1,272. Since then, ranks have declined about 7 percent, to 1,183.
Associations in Wilkes-Barre, Hazleton and Pike/Wayne peaked in 2007 and have lost some members, but not the decline some had expected.
Many Realtor associations expected a thinning of the ranks in 2005 and 2006. Janet Gallagher, executive director of the Pike/Wayne Association of Realtors, said things are steady.
“If we lose a few, we pick a few up,” she said. Her association shed only 10 net members in the last year.
So far in 2008, about 17,000 homes were sold in Pennsylvania, according to the Pennsylvania Association of Realtors. Even if those sales were spread among the ranks of the state’s 33,000 Realtors and include separate buyer and seller agents, that would mean Pennsylvania agents averaged half a transaction for the past five months.
Active- and semi-active real estate agents may not be rolling in commission, but they are still busy. All those listings require an agent’s time and effort, even through the agents won’t get paid until a sale. In addition to coming up with savvy marketing to get listings noticed, agents have to respond to calls, keep an eye on vacant homes they have listed, and look for other listings or buyers.
“There are a lot of listings out there, and listings need to be serviced,” Mrs. Gallagher said.
Realtors such as Mr. Baresse who keep a foot in the real estate industry pay a price. Whether agents are pulling down commissions or not, they have to pay local, state and national dues and join the multiple listing services that gives them access to information about homes. They pay the same dues whether they are taking in commissions or not.
Michael Paccione, a full-time agent with Classic Properties in South Abington Township since 2004, was surprised more people haven’t backed out of the business or put their license in escrow, a way to take time off.
With nine listings, it may look as though Mr. Paccione isn’t doing too bad. A year ago, he had fewer listings. But today’s listings aren’t selling. With buyers in such short supply, he’s not picking up commissions as a buyer’s agent either.
“This is a struggle, and if things continue the way they are, I will have to pick up a side job,” he said. “It will be another 12 to 18 months to get the ball rolling again. Until then, the majority of Realtors will have to confront this and decide what they will do.”
Mr. Paccione has a sale pending, and the commission could keep him going for a few more weeks.
He’s crossing his fingers.
Contact the writer: dfalchek@timesshamrock.com
Things have changed a lot in the last four years. Mr. Baresse now works part time in the lumber department at a home improvement store. Like many real estate agents, he’s holding on to his license, hoping the economic storm engulfing the housing market passes.
In late 2003, Mr. Baresse left an anonymous job at a print shop, lured by the flexible schedule and princely commissions of real estate. By May he was working full-time at ERA One Source Realty and was living large. Full-page ads in the newspaper real estate section featured his smiling face. He worked long hours to attract listings and find buyers, and made close friends of the clients he helped get into homes.
“The most satisfying thing was getting a family into their first home,” he said. “I still keep in contact with some of them.”
The prosperity train chugged through 2005 and 2006. In 2007, Mr. Baresse saw the first rumbles of trouble. The market never warmed up after winter. The multiple listing service was flush with homes. A series of closings he had lined up crumbled because of inspection issues, poor credit or appraisal shortfalls.
Three months passed without a commission. The mortgage industry collapsed that summer, credit tightened and the pool of buyers dried up further. Mr. Baresse did something he couldn’t imagine doing two years earlier: He got an hourly job.
At the home improvement store, he’s still helping people with their homes, he figures.
He works alongside two other real estate agents, and sometimes in the aisles they talk about the good times and what they will do when things get better.
Holding on
Many Realtors are like Mr. Baresse — holding on until the market improves.
The dramatic decline in the housing industry hasn’t resulted in a commensurate decline in the number of real estate agents. Among the five Realtor associations serving Northeastern Pennsylvania, none saw large charges. The total number of agents increased, up eight in April compared to the prior year.
The Poconos, which has always had a mercurial market, doubled the number of practicing Realtors from 2003 to 2006, peaking at 1,272. Since then, ranks have declined about 7 percent, to 1,183.
Associations in Wilkes-Barre, Hazleton and Pike/Wayne peaked in 2007 and have lost some members, but not the decline some had expected.
Many Realtor associations expected a thinning of the ranks in 2005 and 2006. Janet Gallagher, executive director of the Pike/Wayne Association of Realtors, said things are steady.
“If we lose a few, we pick a few up,” she said. Her association shed only 10 net members in the last year.
So far in 2008, about 17,000 homes were sold in Pennsylvania, according to the Pennsylvania Association of Realtors. Even if those sales were spread among the ranks of the state’s 33,000 Realtors and include separate buyer and seller agents, that would mean Pennsylvania agents averaged half a transaction for the past five months.
Active- and semi-active real estate agents may not be rolling in commission, but they are still busy. All those listings require an agent’s time and effort, even through the agents won’t get paid until a sale. In addition to coming up with savvy marketing to get listings noticed, agents have to respond to calls, keep an eye on vacant homes they have listed, and look for other listings or buyers.
“There are a lot of listings out there, and listings need to be serviced,” Mrs. Gallagher said.
Realtors such as Mr. Baresse who keep a foot in the real estate industry pay a price. Whether agents are pulling down commissions or not, they have to pay local, state and national dues and join the multiple listing services that gives them access to information about homes. They pay the same dues whether they are taking in commissions or not.
Michael Paccione, a full-time agent with Classic Properties in South Abington Township since 2004, was surprised more people haven’t backed out of the business or put their license in escrow, a way to take time off.
With nine listings, it may look as though Mr. Paccione isn’t doing too bad. A year ago, he had fewer listings. But today’s listings aren’t selling. With buyers in such short supply, he’s not picking up commissions as a buyer’s agent either.
“This is a struggle, and if things continue the way they are, I will have to pick up a side job,” he said. “It will be another 12 to 18 months to get the ball rolling again. Until then, the majority of Realtors will have to confront this and decide what they will do.”
Mr. Paccione has a sale pending, and the commission could keep him going for a few more weeks.
He’s crossing his fingers.
Contact the writer: dfalchek@timesshamrock.com
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