The Impact of Individual Characteristics and Branch Characteristics on Housing Agent Performance: Heckit model and Hierarchical Linear Modeling

Abstract

This study investigates the impacts of individual characteristics and branch characteristics on housing agent performance. Data were analyzed using hierarchical linear modeling (HLM) to provide estimations. The empirical results suggest that individual performance varies significantly from branch to branch and is better in branches with higher levels of compensation for individual performance. Individual characteristics including college level education, having children over the age of six, work experience, the square of work experience, and work experience outside the real estate industry have significant effects on individual performance. Individual performance is also better in branches with requirements for hours worked. The individual performance of salespeople working under team compensation schemes is not significantly better than that of salespeople working in branches without team compensation schemes. When the average housing prices for the areas in which branches operate are higher, individual performance will be higher. As the average housing price for an area increases, however, the corresponding increase in individual performance will be less and less strong. According to the empirical results, there was a degree of self-selection in the samples. The results of two-stage estimation were not significantly different from the estimation results of the original model. Hence, the results demonstrate the robustness of the estimation model used.