NAR: Real Estate Firms Cite Housing Affordability and Rising Costs as Biggest Challenges

WASHINGTON—Real estate firms are bracing for continued challenges related to housing affordability and rising industry costs, according to the 2025 Profile of Real Estate Firms published by the National Association of Realtors today.

Top Challenges for Real Estate Firms:

• Housing affordability (56%)
• Industry costs (36%, up from 34% in 2023)
• Local economic conditions (35%, up from 34% in 2023)

Despite these challenges, 38% of firms expect their profitability to increase in 2025, up from 30% in 2023—the last time this survey was conducted.

“Real estate firms are on the frontlines of the industry and are seeing firsthand how housing affordability and local economic conditions are impacting their clients,” said Jessica Lautz, NAR deputy chief economist. “Firms are also experiencing the rising cost of running their businesses. While the current real estate market is challenging, the majority of firms expect profitability to at least remain stable.”

The report measures characteristics of real estate firms nationwide to determine how they operate and assess what lies ahead. NAR surveyed its broker members to better understand firms’ demographics, composition and characteristics from the executive and manager perspective.

Additional Key Findings from the Report:

• 46% of sales volume is generated from repeat business and 44% from past client referrals.
• 35% of firms are actively recruiting—down 5% from 2023.
• 81% of real estate firms have a single office (identical to 2023), with two full-time real estate licensees on average (down from three in 2023).
• 19 years: The amount of time the average residential firm has been operating (up from 16 years in 2023).
• 25 years: The amount of time the average commercial firm has been operating (identical to 2023).
• 71% of firms encourage agents to pursue certifications and designations.
• 61% of firms encourage agents to take additional training classes.