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Property Management Drives Growth in the Activities Related to Real Estate Industry

Property Management Drives Growth in the Activities Related to Real Estate Industry

by Brian Rooney

January 19, 2018

Oregon’s activities related to real estate industry has experienced strong employment growth during the economic recovery from the Great Recession, adding 324 jobs between 2011 and 2016 for a growth rate of 20.0 percent over five years. The growth is almost entirely due to the property managers subsector. A second, smaller subsector, offices of real estate appraisers, has not grown after job losses during the recession.

Oregon Employment Trends

Firms in the property managers industry are expert at taking care of the responsibilities of owning both residential and commercial rental properties including collecting rents, maintenance, security, and trash collection. Employment growth in the industry has been strong in Oregon, growing from an annual average of 6,578 in 2001 to 9,145 in 2016. This is roughly 2.6 percent annual growth, well above the overall Oregon employment growth rate of around 1.0 percent per year over the same period. Notably, employment in the property managers industry did not decline during the recession. The growth in the industry during the recovery is due to a growing economy and more people moving into the type of buildings that property management companies operate, such as apartment buildings and senior housing.

The property managers industry has a well-defined seasonality, rising through the spring, peaking in late summer and then dropping off in the fall to bottom out in winter. Demand for property management services is stronger in the summer months when people are more likely to relocate, including college students who rent and move into housing in the late summer. In addition, vacation rentals are busier during the summer season.

The property managers industry is further broken into residential property managers and nonresidential property managers. Residential property managers make up the lion’s share of employment with 8,365 workers in 2016 compared with 971 workers in nonresidential property management.

Firms in the offices of the real estate appraisers industry estimate the fair market value of real estate, largely for mortgages, taxation, and litigation. It is the second largest subsector in the activities related to the real estate industry, employing 556 in 2016. The industry peaked at 807 in 2007, dropped jobs during the Great Recession, but has not grown during the recovery. The lack of job growth coming out of the recession has been attributed to a number of factors including less demand after the housing bubble that caused the recession; federal legislation that gave rise to appraiser management companies; and stagnation of the fees that appraisers collect.

Other activities related to real estate is a third, small subsector that includes escrow agencies, listing services, and fiduciary offices. It has rebounded with the economy after the recession and had 354 workers in 2016.

Occupations Have Mid-level Wages and Lower Education Requirements

The table shows that occupations in activities related to real estate are a mixture of record keeping, maintenance and repair, and management related to the property managers industry. Most of these occupations do not require postsecondary education and pay mid-level wages. The largest occupations in the industry tend to be low paying jobs but property management can provide a career ladder and good paying jobs for those without a college degree.

Appraisers and assessors of real estate, whose median hourly wage was $28.62 in 2017, are not listed in the table. This is a highly paid occupation that requires at least post-secondary training for entry and a college degree to reach the highest certification.

Two occupations in the activities related to the real estate industry require a license. Real estate property manager’s licenses are obtained by taking an examination through the Oregon Real Estate Agency. Real estate appraisers take an exam administered by the Oregon Appraiser Certification Board. For appraisers there are training and education requirements, which include an associate’s degree or any combination of work and education equivalent to two years of experience or completion of an approved appraisal training program. There are three categories of appraisers in Oregon; state licensed appraiser, state certified residential appraiser, and state certified general appraiser.

Outlook

Occupations within the activities related to the real estate industry are expected to grow. According to the Oregon Employment Department’s occupational projections, property, real estate, and community association managers is expected to grow by 10.2 percent between 2014 and 2024, adding 489 new jobs and 838 replacement openings for 1,327 total openings over the 10-year period. The appraisers and assessors of real estate occupation is expected to grow by 2.5 percent with 22 new openings and 144 replacement openings for 166 total openings over the 10-year period.