Ranks of NYC brokers swelled in 2012

The real estate market bounced back last year but the wider jobs market continued to sputter, prompting an increasing number of people to obtain real estate licenses in New York City. In late 2012, the city was home to about 27,000 licensed salespersons and brokers, or 5.5 percent more than the 25,600 who were licensed at the same time in 2011, according to New York State Department of State data provided to The Real Deal.

Breaking the numbers down further, there were 14,666 licensed salespersons in New York City — an 8.4 percent year-over-year increase and the highest number since 2007, before the housing bust. There were 12,337 licensed brokers, a modest 2.2 percent increase over the same period in 2011.

(More commonly known as agents, salespersons represent the first rung on the licensing ladder, while brokers must have at least two years of industry experience and pass an additional licensing test. All agents must renew their licenses annually.)

While it’s difficult to pinpoint the exact cause of the growth, insiders pointed to two parallel trends bringing people into real estate: healthier sales and a rental market with more opportunities for deals, and a lackluster jobs market that has convinced some to try a different career.

A year ago, the real estate market looked “dark and scary” to those on the sidelines, but this winter a trickle of new developments, a hot rental market and a stabilizing sales market — particularly in Manhattan — are all causes for optimism, said Gary Malin, president of Citi Habitats. “Once people start to hear positive news about a sector that was maybe getting battered earlier, they want to get in on that in the earlier states of a recovery, rather than in the middle of the recovery,” Malin said.

Larry Friedman, co-founder of the brokerage AC Lawrence, which was recently acquired by Bellmarc Realty, said that he has not necessarily seen more agents coming into the industry, but he has seen “better quality” agents, who enter real estate as a second or third career, already equipped with contacts. (For example, one recent AC Lawrence hire, Arnie Leventhal, is a retired urologist, he said.)

Rather than real estate being the proverbial “last resort,” the career is “something they’ve always wanted to do,” and see now as the right time to try, Friedman said.

As The Real Deal has reported, the industry lost a number of less-experienced agents in the years immediately following the housing crisis.

Indeed, the number of licensed salespersons plummeted nearly 30 percent, from 16,928 in 2007 to 11,947 in 2009, while the number of licensed brokers (who, by definition, have more experience) fell only 3.2 percent between 2007 and 2009, from 12,715 to 12,309. The figures suggest that newer agents pursued other lines of work, while veterans managed to ride out the downturn. Salespersons began to return to the field in 2010 and 2011, and that trend continued last year.

Between January and November of 2012 (the most recent figures available), the state granted 3,366 new salesperson licenses — an 18.9 percent increase over the same period of the previous year, and more new licenses than in all of 2011. Meanwhile, the state granted 1,050 new broker licenses during the same 11-month period, or 8.6 percent more than a year ago.

And it appears that existing agents are also sticking around the industry: 4,773 salespersons renewed their licenses between January and November of 2012, or 16.6 percent more than in the same period the year before, while 4,943 brokers renewed, representing a 10.2 percent jump over the previous year.