The NAR Verdict is Good for the Real Estate Industry
I’m in the real estate industry full time pushing 35 years. I see things from two sides; appraisal and sales, and the entry requirements for each could not be more different. Appraisers sit classes, work as apprentices, log hours and work their way up through three tiers of experience (trainee/licensed/certified). It’s not an easy task and the commitment is significant, and that pot at the end of the trail doesn’t have gold in it. Not so for the sales side. Change has long been need on that side and it might just be happening…
The Agent Problem
The industry could easily lose 75% of the agent population and no one would know. The requirements to get a license are inexplicably low; compared to other professions they’re insulting low. There are no apprenticeship requirements, no field training requirements and no experience license tiers. The National Association of Realtors sets no legitimate bar to entry or retention. Is it any wonder that the agent population is so insanely bloated? The industry (led by NAR) cares only about the agent’s ability to pay. Pay national, state and local board fees, pay MLS fees, pay license and class fees, pay broker and desk fees, pay pay pay. This job is pitched as the perfect part time job; “who do you know” that you can coerce into using you to buy or sell a home? Everyone is “Number 1” and a “top” agent.
The Agent Problem II
It takes an insane amount of work and skill to make a real estate transaction look boring. Buyers and sellers are involved in a transaction once every few years, a professional agent once or more every few weeks. Daily, pros are writing offers, walking homes and working with the associates like mortgage reps, appraisers, inspectors, etc. Where are the hobby agents? Are they trailing the experienced agents or are they doing something else? Managing brokers might offer training classes but are these agents going? We know that answer. The hobby agent, the part-time agent, the hack agent…bad for buyers, sellers and the industry.
The Public Solves the Agent Problem
Those lawsuits — and more are coming — are the first step. It’s clear that change will come from outside, Zillow ripped down the iron curtain around date (before spectacularly imploding). Now individual buyers and sellers need to step up. Google. Google is the five minute answer. Hobby agents will coerce, pressure and guilt any one they know into using them to buy or sell a home. Every agent is a top producer, every one selling multimillions in volume every year. Except they’re not. Take five minute and Google the agent. Have the agent explain the brokerage agreements, the contract, ask pointed questions about writing stipulations. Make them put all of the nonsense packets away, get them off script. What happens if the appraisal comes in low? If the buyer or seller doesn’t close? What’s the difference between an inspection and appraisal?
Interesting times ahead for both the housing market and real estate industry, if you’re jumping in you better go in eyes wide….and use GOOGLE!
