Is it true that 90% of people fail in Real Estate within the first 2 years?

Question

Throughout the years I have seen so many people come and go in the industry regardless of their purpose. I’ve been in the industry for a little over 4 years now, and even though I still consider myself new I wanted to start this discussion to share my opinion of why this happens and would love for people to share their perspective on it too.

For those who know me personally know that I’m big into fitness. I grew up playing competitive sports and it took me until I started working out to realize that to see results you have to consistently show up for long periods of time. And it took me another couple of years to realize that that same concept didn’t only apply to fitness but to all aspects of life.

Discipline will get you where you want to be in life, just by consistently showing up you will get better each day. The saying “If it was that easy, everyone would do it” goes a long way. I see many people starting out in the industry with very unrealistic expectations that drive them to take action, which is completely normal and that’s how most humans function. Discipline comes into play when those unrealistic expectations become a reality and the vision becomes blurry.

I want to finish my post with this quote from Jeff Cunningham “It’s better to be consistently good than occasionally great”

Would love to hear everyone’s opinion on this topic!

Chris Seveney · Answer

@David Ramirez

It’s still the same percentage but the reasons are

1. Lack of experience

2. Lack of knowledge on what they are dealing

3. Lack of financial acumen

I wonder what percentage get into real estate with little to no money and spent most of it on a guru course - it’s no different then people who want to be a day trader or crypto miner or Amazon business. Many people try it and get bad education (which is often over priced)

Think of it like any profession, it takes a lot of work and effort and you need a good mentor / teacher - it also doesn’t happen overnight.

Joshua Christensen · Answer

I have to agree with @Nathan Gesner and @David M.as the post is a bit vague as to what type of real estate we're talking about.

That being the case I'll hit tow things.

1. REAL ESTATE BROKERS - In my experience, brokers get their license because they like houses and want to help people.  Unfortunately, they don't realize the challenges of building a consistent pipeline of clients and new business.  They find a client, get under contract, stop looking for new clients for 60 days to close the one they're working on, then start over.  Without consistent steady flow of clients, income is sporatic at best.  It is the hardest part time job you'll ever have.  Too many brokers treat it as such.

2. REAL ESTATE INVESTING - People read a few books or attend a seminar and are suddenly dubbed "Real Estate Investor".  They quickly jump into transactions without any idea how to build a sustainable cash flow machine. Without regular cash flow, businesses die.  The expectations are wrong and the work that goes into the portfolio is wrong.

Just like working out, it may take months or years of steady and consistent work to see lasting results.  Our fast food, microwave, AI world demands instant results, yet, that's not what REI is about.

The Failure Rate is from people's head space more than anything else.  They are not conditioned to work and do the things it takes for success which is often boring tedious work repeated frequently.

Nathan Gesner · Answer

It's not an opinion question. Studies have shown that approximately 90% of all agents quit within the first two years.

Why? Because real estate is easy to get into, but difficult to build a living. Some people get lucky and enter the game when everything is easy to sell, but the market eventually dries up. They haven't budgeted their money accordingly. They don't have systems in place. They don't know how to hustle or differentiate themselves from the competition.

It's like any entrepreneurial endeavor: it takes time and discipline to find success.

David Ramirez · Answer

Hey @David M. and @Joshua Christensen, Sorry for the confusion. The purpose of the title was to prompt discussion and reflection on why many struggle to succeed in real estate and to invite perspectives on this topic. It was mostly targeted at people building active businesses in the industry (agents, brokers, lenders, contractors, flippers, wholesalers, among others) and not so much for those investing passively.Should have been more clear!

David M. · Answer

@David Ramirez

I guess your question is the subject header of the thread?  And, I'm not sure where it connects with what you wrote, honestly...

The National Association of Realtors statistics is 75% of new real estate agents drop out in the 1st year, and 90% by the 3rd year.  Lets face it, its a tough sales business with 100% commission.  Not everybody is cutout for sales, and its a very low barrier for entry.  Just like real estate investing, its "sold" on how great it is...  But, that's just the marketing.

Meanwhile, i'm not sure what aspect of "real estate" you are asking or looking to discuss.  Sorry.

Is it true that 90% of people fail in Real Estate within the first 2 years?

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