Residential Brokers & Property Managers
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 94,000 residential real estate and property management firms in the US work with owners to find buyers for property for sale, lessees for property for rent, and to maintain and manage rental property. Over 60% of industry revenues come from the sale of residential property, and the remainder comes from property management services.
Fewer Qualified Buyers
Mortgage lenders adopted stricter lending practices in the wake of the 2008 financial crisis, making it more difficult, especially for first time home buyers, to qualify for new loans.
Greater Internet Marketing
Residential real estate brokers and property managers are increasing their use of both the internet and multiple listing services (MLS) to advertise available properties to prospective buyers and renters.
Industry size & Structure
The typical residential broker and property manager employs 3-12 workers and generates about $1 million in annual revenue.
- There are about 94,000 firms in the US with $128 billion in annual revenue and about 1.1 million employees.
- The industry is highly fragmented with the 50 largest firms totaling 21-29% of industry revenue.
- The largest firms include Century 21, Re/Max Realtors, and Coldwell Banker.
- The majority of industry employees are property managers and real estate agents. The remainder are office/administrative support and management.
Industry Forecast
Residential Brokers & Property Managers Industry Growth
Recent Developments
Jul 18, 2024 - Multifamily Developments Trend Smaller
- Low- to medium-density multifamily building construction has grown to account for a larger share of the overall multifamily market in recent years, according to National Association of Home Builders analysis of US Census Bureau data. In 2024, there were 450,000 multifamily housing unit completions, marking the highest level in 37 years. Of those, 216,000 were buildings with fewer than 50 units, which was the largest share for low- to medium-density buildings since 2006.
- A recent survey by property management software firm Zego suggests that what property managers believe their tenants value most and what residents want don’t always match, according to Multifamily Dive. The survey questioned 600 multifamily property managers and more than 1,000 residents. For example, property managers believe turnover is typically due to renters seeking a lifestyle change when renters say their primary reason for moving is rent being too expensive. Property managers indicated that a tech-enabled lifestyle was a top renter priority, but tenants said their key concerns were security, maintenance, cleanliness, and community appearance. Technology is important to renters, but they want some aspects of the renting experience to be tech-enabled and others to have the human touch. Renters like digital platforms for taking surveys, paying rent, and community updates but prefer face-to-face interactions for lease renewals, move-ins, and receiving packages.
- A trend in smaller lot sizes for single-family detached homes has accelerated in recent years, according to the latest Survey of Construction by the US Census Bureau. Even as more families decamped to suburban areas seeking more space during the pandemic, lot sizes have continued to shrink. In 2023, lot sizes of less than 0.16 acres (less than 7,000 square feet) accounted for 40% of new single-family home sales compared to 30% in 2011. The share of lots under 0.16 acres has risen two percentage points since the pandemic began. Shrinking lot sizes suggest that firms that build homes speculatively have reduced lot and home sizes to cope with lot shortages and to offer more affordable homes as housing costs have risen.
- Home builder confidence in the single-family market dropped in July to the lowest level since December 2023 amid high mortgage rates and elevated builder financing costs, according to the National Association of Home Builders (NAHB). Home builder sentiment, as measured by the NAHB/Wells Fargo Housing Market Index (HMI), fell one point to 42 in July 2024. Any HMI reading over 50 indicates that more builders see conditions as good than poor. The HMI survey also showed that 31% of builders have reduced home prices to lure potential buyers off the sidelines, although the average price reduction of 6% remained unchanged for the thirteenth consecutive month.
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