Texas Real Estate Brokerage Sales Apprentice Education (SAE) Practice Exam

What does market share represent in real estate?

1. The total number of properties owned

2. The percentage of unit and dollar sales within a market

3. The total profit made by a company

4. The number of tenants in a building

The correct answer is: The percentage of unit and dollar sales within a market

Market share in real estate signifies the percentage of unit and dollar sales that a specific brokerage or company captures within a particular market. It is a critical metric as it indicates the company's competitive position compared to others in the industry. By evaluating the market share, real estate professionals can assess their sales performance in relation to competitors, identify trends in the market, and implement strategies for growth and improvement. This aspect of market dynamics reflects both the volume of transactions handled and the total sales revenue generated, thereby providing a comprehensive picture of a firm's performance in the marketplace. Other options do not reflect the actual meaning of market share. The total number of properties owned refers to inventory and does not account for sales dynamics. The total profit made by a company pertains to financial results rather than sales performance in a competitive landscape. The number of tenants in a building is related to occupancy rates and property management, which again diverges from the concept of market share as it applies to sales within the real estate market.