Breaking into residential real estate as a new agent has always been tough. According to a figure widely attributed to the National Association of Realtors, 75 percent of real estate agents fail within the first year, and 87 percent fail within five years.
It’s one of those statistics that gets repeated constantly across the industry. Every coach, trainer and brokerage recruiter seems to cite it or at least know about it.
It’s worth noting that its origins are murky. Many blogs cite the figures, but there is no verified data to back them up, and no one is quite sure where the data comes from. It has become more of an industry legend than a verifiable data point.
What is verifiable is that the post-pandemic correction has made the underlying reality behind the stat worse. According to data from real estate analytics firm Relitix, about 49 percent of agents who had their first closing in 2022 failed to close a single deal in 2023.
It was a significant increase from the 37 percent failure rate among agents who had their first closing in 2021, and a stark contrast to the average first-year failure rate of 28 percent recorded between 2017 and 2020.
So while the 87 percent figure is the one everyone “knows,” the actual data suggest the odds of survival have gotten meaningfully worse since the boom ended.
The thinning of the herd
NAR membership peaked at 1.6 million in October 2022 and has been declining since. As of November 2025, it stood at about 1.49 million, a loss of roughly 110,000 agents from the high. The 2023 decline was the first annual drop since 2012.
The attrition is real, but the more telling story may be who’s leaving. The share of NAR members with two years or less of experience fell to 15 percent from 18 percent the prior year, while the median age climbed to 57, up from 55, and agents with 16 or more years of experience now make up 46 percent of the membership.
The industry is getting older and more experienced, not because veterans are flooding in, but because newer agents are washing out. NAR projects membership will fall further to around 1.2 million in 2026.
So, how are new agents surviving during this down market?
The new agents who quit and the ones who make it may not be separated by work ethic as much as the industry likes to think. They’re separated by specific skills, financial preparedness and an honest understanding of what this business has become, especially after the market correction that followed the pandemic boom.
That’s the through line in Inman’s conversations with a half-dozen real estate professionals across the country, from a 21-year-old newbie agent in San Gabriel, California, to a veteran broker coach who has trained hundreds of agents over the past two decades.
Can you afford to wait for that first deal?
Justin Chau, a Realtor with eXp Realty of Greater Los Angeles, got licensed in March 2024 and moved right into a slow market with rates near their highs. He earned his license right after graduating high school while living with his parents (he still does, he said), and closed his first deal with a family member just six weeks in. The financial cushion that came with living at home gave him something most new agents don’t have: time.
Justin Chau | eXp Realty of Greater LA
During stretches of six to eight months without sales, Chau stayed afloat because he had built a system with his first paycheck. Twenty percent went immediately to a tax account, and a third of his net proceeds went back into the business. And he always kept a six-month safety net in reserve.
“What has helped me stay in the business,” Chau told Inman, “is my ability to budget my finances.”
That kind of discipline is rarer than it should be, according to Ben Mizes, a real estate agent and president of Clever Real Estate. “It is common with new entrants in the industry to drastically underestimate their monthly expenses and burn,” Mizes said.
MLS fees, brokerage fees, leads, marketing, and basic living costs can run between $2,000 and $4,000 a month, and that’s before a single dollar of commission comes in.
Most new agents take six to nine months to close their first deal. Some never close one at all. “Without having a financial cushion, in the way of savings or a second income, new entrants in the market drop out of the industry,” Mizes said.
Ben Mizes | Clever Real Estate
Ran Biderman, a strategic coaching advisor at Real Estate Bees who has been in the industry since 1998 and trained hundreds of agents across the country, puts the monthly burn figure even higher. By his estimate, agents spend $3,000 to $5,000 a month before their first closing.
“The agents who make it through Year One almost always had enough set aside so they didn’t panic,” he said, “or they had someone supporting them financially for the first few years.”
The 4 skills that separate the new agents who last
The financial picture is only half of it. The other half is skill, and the 2020 to 2022 market masked how much of it agents actually lacked. When inventory was thin and buyers were frantic, new agents could close deals without being particularly good at their job. That era is over.
Ran Biderman | Real Estate Bees
“Agents were closing deals without developing real skill because the market was doing most of the work,” Biderman told Inman. “Now the market requires ability, and many agents simply don’t have it.”
Biderman breaks down what separates the agents who last into four skill categories. The first is phone skills. Not just comfort on the phone, but knowing how to open a conversation, handle objections in the first 30 seconds, and move toward an appointment.
“Most new agents avoid this,” he said. “They spend time on Instagram, their website, their CRM, anything that feels productive but keeps them away from rejection. The agents who make it understand early that the phone is still the fastest path to income, and they lean into it.”
The second is listing appointment skills. Buyers will tolerate a newer agent, but many sellers won’t. If you can’t walk into a listing appointment, defend your price, handle the “I want to list higher” conversation, and leave with a signed agreement, you’re going to struggle, Biderman said.
“The agents who last take this seriously,” he said. “They practice, they role-play, they review their appointments and sharpen over time.”
The third is lead-generation discipline. Not a push when things get slow, but a daily standard regardless of mood or market conditions. “The agents who survive have clear numbers they hit every day,” he said. “Conversations, follow-ups, outreach.”
The fourth is objection handling. Sellers want to overprice, buyers hesitate and prospects say they have a friend in the business. “Agents who don’t learn how to work through that don’t last,” Biderman said. “They accept the first ‘no’ and move on until they run out of people to talk to.”
Treating it like a system
Alex Wright, who was licensed in Bozeman, Montana, in 2019 and rode the pandemic market to some of its highest peaks, watched that pattern play out in real time. Wright is now a licensed real estate agent for 307 Real Estate in Cody, Wyoming.
Alex Wright | 307 Real Estate
It took Wright about nine months to close his first deal. “During that stretch, I definitely thought about quitting, but I also knew that timeline wasn’t unusual starting out,” he told Inman.
Once that first deal closed, things picked up fast for him. He said that being in Bozeman during that time made a huge difference. The market was extremely active, and he ended up being one of the top monthly performers at his brokerage at different points.
“A lot of newer agents came in during that period expecting it to be easier than it is,” he told Inman. “When things are moving fast, you can get away with a lot. As the market cooled even a little, you could see people start to fall off.”
What kept Wright going when the market cooled off wasn’t cold calling or door knocking — neither worked particularly well for him — but a few consistent, repeatable sources of business.
He took the Monday morning office shift every week, which meant he was the one handling weekend leads when no one else was in. That four-hour weekly commitment turned into five to seven deals a year.
“Most people didn’t want that shift, but it was one of the best things I did,” Wright said.
He also picked up a few deals through people he knew at the gym, got referrals from a semi-retired agent, and worked with a top producer who would pass along clients they didn’t have time for. If he could close them, it worked for both of them.
Wright said his monthly costs were pretty low, consisting mainly of brokerage and licensing fees. “I was living in a duplex I owned, and the other side covered the mortgage, which made it easier to stay in it during slower stretches,” he said.
The biggest difference Wright noticed was that many new agents didn’t “treat it as a system.” “They weren’t tracking what they were doing or what was actually working,” he said. “They’d try something for a short time, not see results, and move on.”
The ones who stuck with it, he said, usually had a few consistent sources of deals and kept working them long enough for it to compound.
The runway is shorter than it used to be
In New York City, the economics have been compressed from a different direction. Corey Cohen, principal of The Roebling Team at Compass in Manhattan, said the portal-lead model, which used to serve as a training ground for newer agents, has effectively collapsed.
Corey Cohen | The Roebling Team at Compass
“I ask every newer agent the same question: If StreetEasy shuts off tomorrow, do you still have a business?” Cohen told Inman.
Six years ago, he said that the question didn’t matter. Portal leads were the on-ramp. Cohen said agents could work for StreetEasy or Zillow, take on first-time buyers, learn the craft and make a living while building experience. That path is gone now.
In New York, Cohen said StreetEasy now charges a referral fee that runs as high as 35 percent. “Stack that on a brokerage split and a team split, and a junior agent closing a $1 million deal walks away with enough money to buy a sandwich,” Cohen said.
Now, Cohen said, agents need first-party lead generation, including their own relationships, content and network that come to them directly.
“My job as a team lead is to give newer agents real experience on my deals while I help them cultivate those first-party opportunities,” Cohen said. “But it takes a year or more to mature, and the economics don’t give people as long a runway as they used to have.”
Mizes, who has watched waves of agents enter and exit the market since the pandemic, sees the industry itself changing in response. “Real estate brokerages and teams are becoming more discerning and structured,” he said. “The era of recruiting as many agents as possible is over. The focus is on training, a culture of accountability, and realistic expectations as standards.”
The ones who survive Year One, he said, tend to have found a niche, committed to a lead-generation system beyond referrals, and attached themselves to a mentor or team rather than trying to go it alone too soon.