Across the country, real estate markets are much healthier than they were a few short years ago, when a housing bubble precipitated a much larger economic crisis. But some places have recovered better than others have, and continue to grow beyond even pre-recession levels. These local markets are creating a good climate for real estate agents. SmartAsset wanted to find out which cities are the best for real estate agents right now.
This is the 2014 version of SmartAsset’s study. See the 2015 version here.
Methodology
To measure this, we considered 4 factors. We looked at the home turnover rate (the percent of all homes in a city sold in one year), the market heat as measured by percent change in median sales price from 2013 to 2014, competition as represented by number of homes sold per agent, and median real estate agent salaries in each city.
Find out now: How much house can I afford?
We found an average figure for each of these categories and, for each city, determined how many standard deviations that city’s score in each category was above or below the norm. We used the sum of these to create a normalized rank for each of the 120 cities being considered.
The Best Cities to Be a Real Estate Agent
The west seems to be a good place to be a real estate agent, with eight out of the top ten cities in the far West or Midwest.
Las Vegas, Nevada
Sin City’s real estate agents enjoy the best environment among major cities in the country, chiefly due to a hot housing market with a large turnover rate. Vegas house prices shot up 24 percent from 2013 to 2014, and its 10 percent housing turnover rate is the highest among cities surveyed.
Reno, Nevada
The number two city in our ranking is also a Nevada gambling mecca. Reno’s real estate agents aren’t seeing a business boom quite like that of Las Vegas – there was “only” a 7.2 percent turnover rate and 17 percent price increase last year – but the median salary for real estate agents is higher there.
Rockford, Illinois
A regional center for the growing aerospace and health industries, Rockford only saw a 4.4 percent housing turnover rate, close to the national average, in the past year, and its home prices actually decreased. But it has very little competition – there are more homes sold per real estate agent than anywhere else – and those same real estate agents are making more than $10,000 a year greater than the national average despite the decrease in home prices.
Eugene, Oregon
University of Oregon home Eugene had a slightly lower turnover rate of homes than even Rockford – but nevertheless its home prices increased 10 percent in the last year. It also has higher than average real estate agent salaries and low competition.
Naples, Florida
One of the wealthiest cities in the country, Naples’s 8.6 percent turnover rate is close to twice the national average, and its 27 percent one-year home price increase is tied for first among cities surveyed. This was enough to give it a high ranking despite high competition.
Sacramento, California
The California capital’s housing turnover rate is only slightly better than average, and it has about as much competition as average, but it saw a 22-percent one year price increase in homes and its real estate agents make significantly more money than the national average.
San Jose, California
The unofficial center of Silicon Valley, San Jose’s home prices rose 15 percent in a year, and its real estate agents face relatively low competition with a significantly higher salary than the national average.
Denver, Colorado
The Mile High City saw a very healthy housing turnover rate of 7 percent in addition to 10 percent price increases in one year. Real estate agents here have a median yearly salary of $66,760.
Chicago, Illinois
Chi-Town real estate agents rode the wave of an 11 percent housing price increase this past year, and are now ranked some of the highest-earning in the country at more than $82,000.
New York, New York
Everyone knows Big Apple real estate is expensive – and it’s only getting more expensive thanks to New York’s 6 percent price increases in the past year. This no doubt contributes to why New York real estate agents are some of the best-paid in the nation, even with an average amount of competition.
The Worst Cities to Be a Real Estate Agent
The cities where the climate isn’t good for real estate agents are much more diverse with just about every region of the country represented. However, a lot of them are concentrated in the South.
Dayton, Ohio
Despite Dayton’s about-average turnover rate of 4.7 percent, its prices have remained completely stagnant – it saw no significant price increase in housing from 2013 to 2014. Its real estate agents also make more than $10,000 a year below the national average.
Spartanburg, South Carolina
Like Dayton’s, Spartanburg’s home prices haven’t grown in the past year. Its real estate agents also face some of the stiffest competition in the country, with about half the average homes sold per agent per year.
Springfield, Missouri
Despite its real estate agents making close to the national average salary, the Queen City of the Ozarks saw the most precipitous one-year price drop among all the cities surveyed, with a 15 percent home price decrease from 2013 to 2014.
Tallahassee, Florida
The Florida capital’s home prices went down 4 percent from 2013 to 2014, and its real estate agents also must deal with a higher amount of competition than the national average.
New Orleans, Louisiana
The Big Easy only benefited from a 1 percent home price increase in the past year, and its market speed is dismal – its 2.3 percent turnover rate is the lowest among cities surveyed.
Binghamton, New York
Upstate New York college town Binghamton’s home prices took a 4 percent drop from 2013 to 2014, and its real estate agents have to deal with nearly as much competition as Spartanburg’s do.
Pensacola, Florida
The Panhandle city of Pensacola has a fairly average housing turnover rate, but also had to deal with a 5 percent home price decrease last year, and its real estate agents each only sold a third as many homes as the national average.
Charleston, South Carolina
South Carolina’s oldest city, Charleston suffered through a 9 percent price drop in housing over the past year, as well as high real estate agent competition.
Columbia, South Carolina
“Famously Hot” Columbia’s housing market has gone cold, with only a 2.8 percent turnover rate from 2013 to 2014. Its real estate agents are also some of the lowest-paid among cities surveyed.
Fayetteville, North Carolina
It’s not just one factor that put Fayetteville on the bottom of the list; lower-than-average turnover rate, a 5 percent decrease in home prices in one year, somewhat high competition, and low-paid real estate agents makes it the worst place in the country to be a real estate agent.
More on Methodology
We got the percent of homes sold by city from Zillow, the change in median sales price from Q1 2013 to Q1 2014 from the National Association of Realtors, the number of homes sold per agent and median real estate agent salaries by city using data from the Bureau of Labor Statistics and the Census Bureau.
Photo Credit: flickr