[photopress:money_kid.jpg,thumb,alignright]I think this comes under the category of “Out of the mouths of babes”.
I happened upon this description of a real estate agent apparently written by the young man pictured here as a school project for “career day”. Recently I have been evaluating a large number of agents who are currently with the Company, as well as several asking to join us. I’ve always been told that my standards are too high. That my bar is not realistic.
As I read the young man’s description of what a real estate agent is, or should be, I was stunned by some of the key realities this young man depicted.
“Real estate agents help people buy and sell houses. They must be able to say approximately how much money a house is worth…Real estate agents work for real estate brokers. Real estate brokers manage real estate offices…They help the seller set the price for the house. To do this, they must know what the house is like. They must also figure out what people would be willing to pay for the house so that it will sell quickly…Good real estate agents also spend time away from the office finding out more about the houses in their town that might one day be up for sale…They should deal honestly with people and have good manners.”
This is just a small excerpt. I’m thinking of making this young man’s depiction of who we are and what we do required reading for all agents. More and more I find my standard to be “worthy of the public trust”. Someone you might hire to help your elderly mother buy a home. Someone you might seek out if you don’t speak English very well, and need someone who you can trust to have your back.
More and more I see people using “assistance to savvy buyers” as the benchmark for all that an agent needs to be. I just don’t see it that way. A savvy buyer can’t be the benchmark, though options should clearly exist for the savvy buyer. Lower cost options. But I think the standard of hiring and retaining agents has to be someone who is worthy of the public trust, because you really can’t forget the people who need an agent most, when setting your standards.
Ardell,
Thanks for the post. I really like this post and think it is great that you used this resource from the view of our future peers. I will have to keep it in mind for those younger people that I may encounter with questions.
I also think that it is great to have high standards. Over the years of working with people in training or management, the one rule I have always operated with, was to do what ever was possible in making them the best possible at what they were doing. Investing in people is expensive and time consuming and may not pan out but it is the only way to go in my eyes.
I also agree with you in how the public needs to see how the trust is held. In most state license language the act that requires a license is those who function in the trust of the public.
OK, you’ve triggered my favorite rant. I suppose it’s reasonable to assume that the state issues licenses to assure that not just any hack/incompetent/charlatan performs in the public trust. 60 clock/hours, and attainment of 18 years of age is all it takes to be allowed foul up some unsuspecting schmuck’s transaction, the biggest financial move most of us make. The real work of real estate happens at the level of agent and client; the “industry (brokers, MLS and the REALTORS) isn’t really in the business of real estate, their business model is predicated on how many agents get cycled through paying fees and commission splits. It is in their interest to keep the bar low assuring a steady supply of too many agents paying fees. We won’t see the “industry” raising the standard and since the state Real Estate Commission is filled with brokers you can rest assured that any rumors you may have heard predicting that we’d all have to have a broker’s license are merely lip service that won’t be acted on with any more than the the slightest increase in standards. It would behoove us as agents to organize with consumers an initiative that assures that a license means a higher level of competency. Perhaps even limiting the number of licenses would help. The precedent exists with liquor licenses and taxi permits.
From the link Ardell provided, the young man goes on to say the followng:
“The number of jobs for real estate agents is expected to grow about as fast as the average for all occupations through the year 2014. Real estate agents might even grow faster, but more information about real estate is available on the Internet. This allows agents to conduct more business in less time, so fewer agents are needed.
It should be rather easy to find a job as a real estate agent. This is because many agents find that they cannot sell enough houses to be successful, so they quit their jobs. Only people who enjoy selling, and are good at it, should try to become real estate agents.
Are there other jobs like this?
[Yes:]
Insurance sales agents
Retail salespersons (car salespersons, etc.)
Sales representatives, wholesale and manufacturing
Securities, commodities, and financial services sales agents
Travel agents
Good post, Ardell. I also like JD’s idea of a consumer/Realtor initiative to demand higher standards for agents. Perhaps we should all start the ball rolling!
Debra,
All it would take is for Brokers to have a high standard and stop being landlords.
The many myths on Real estate agents. Keeping high standard set you apart from the peers.
Ardell: I think another piece of required reading would be the article you wrote about the Realtor Rudy.
I am not sure where it was, but if you asked me to name 2 articles you have written, that would be the first one I would think of in trying to name 2 of about a million articles I have read from you.
But Ardell, brokers aren’t about high standards, they really are landlords. It would be counterintuitive for them to raise their standards. How many want to get the initiative ball rolling and where do you live? Maybe I can find a central meeting space.
http://www.raincityguide.com/2006/11/17/rudy-the-realtor/
Here’s the Rudy the Realtor piece I wrote almost a year ago.
Jillayne would have a hay-day with their definition of a Loan Officer: http://www.bls.gov/k12/money03.htm
The “Rudy” story is charming and happens just barely often enough to prevent it from being completely beyond the realm of possibilities. Those Rudys still came in under qualified and somehow managed to afford to spend nearly all of their time doing the things that may get him a listing or a buyer and virtually none learning the essential nuts and bolts of taking care of a client. How long did it take those Rudys to get good at it with only 60 clock hours? 10? 20? How many of those Rudy clients wound up losing money when an experienced agent on the other side danced them through the transaction *his* way? And Rudy is one of the 20% who make it past his first renewal. What about the other 80%? They may have enough relatives to get them a few transactions but they invariably deliver a less than dazzling performance. This mediocrity drags us all down and creates a glutted industry where the Pareto Curve is turned the wrong way; instead of spending 80% of our time and resources getting the client in the first place we should be spending it doing the deals. The Rudys of the world will thrive regardless of how high the bar is set. The rest won’t try.
JD,
Not sure why people with “liquor licenses and tax drivers” should represent some kind of “bar raising” due to limiting the amount of licensees. I have no desire to make agents as good as taxi drivers 🙂
Every time I see “reduce the amount of licensees”, I see someone wanting the pie to be cut into smaller pieces. It never sounds like better…it sounds like someone wanting more, by cutting out some of the competition.
I’m in Kirkland, but I’m more into hands on change, than sitting around chatting about Pareto Curves. It’s only been 30 days since I’ve accepted a challenge to influence change, but so far I’m hopeful. Seems that at least 50% of that 80% are hungering for real knowledge and skill. Real change is a slow process, but I hope to see some measurable results within 12 months.
I’d rather build a model for others to follow, than sit around talking about what’s wrong with “other brokers”. Someone has to prove, with real results, that it can be done, and that the public will support this change for the better.
Just as buyers and sellers should have more options as to cost, agents should have more options as to management style and Company focus.
At the moment I’m too ticked off about the foot on the necks of agents regarding MLS download agreements. I could spit blood about how the brokers control the MLS in a way that does not support the growth of agents as individual businesses within the broker model. Clearly voting should represent both Brokers and Member Agents, and not just Brokers trying to steer everyone to Company vs. Agent.
Keeping members weak, within a system of landlord policy making, as if the landlords are the ones footing the bill, is my puke point this week.
Spend some time in England (NYC for that matter) and you might come away with the impression that if real estate agents were anywhere near as qualified and competent as the taxi drivers that the industry AND the public trust would be in a much better place. The number of taxi licenses is limited presumably to maintain a high standard and, according to a Baltimore cabbie I know, to assure that a balance is met between transportation needs and and to protect the drivers (self employed contractors) from having to resort to unsafe or illegal practices to make a living. Raising the standards would pretty much weed out the part-timers, hobby agents and the not-so-bright and that’s a good thing. Just understand that limiting the number of licensees in a given profession in the public interest does indeed have precedent.
I don’t quite get the “cut the pie smaller” comment. I want a bigger piece and I think the people eating it should demonstrate a much higher level of education and training than the piddling 60 hours currently required. It would be better for consumers and better for our collective image as well.
Beyond that, I don’t think we’re too far apart. Perhaps my way of getting there is a bit more aggressive and not terribly friendly to the industry status quo as some have the stomach for.
Raising the standard will certainly have the effe
Like I said, those who want to raise the entry standard want a bigger piece, and are using “raising the standard” as a means to their end. More greed based talk. Wasn’t that the standard that got YOU in? It was OK for you but not others? How do you justify THAT logic beyond more money for you? Pretty crappy argument.
There is NO entry standard that will replace experienced agents sharing their knowledge with newer agents. You’re just looking for a way to thin the numbers it seems.
Thinning the number is just a side benefit. The core of my position comes from deeply believing that what we do is a service industry that, done well, puts people in *homes* (notice I didn’t say I “sell” houses) at the best possible price without the transactional drama that so often comes with poorly qualified agents. I also believe that the tacitly sacrosanct 6% commission could go the way of the dodo bird if ALL of us were spending more time doing more transactions and less time getting them in the first place. As for the standard I got in on, I brought a whole lot more to the table with it, including an MBA, negotiating skills honed at union contract tables and an engineer’s talent for identifying and solving problems. I don’t expect ANYONE to match that but I do expect the agents on the other side of my transactions to perform far better far better than 60 hours will get them. I understand Canadian agents are required to have a 4 year degree and that some states require an associates. Did you know that Bellevue Community college has an AA program in real estate? *That* should be the standard we get in on and if you’re so worried that I’m trying to close the gate after I got in I’d gladly meet the bar all over again. Not that I wouldn’t be gracious enough to grandfather in you and the rest of existing agents. As for greed, I’ve said before that by doing more transactions I could easily justify giving excellent full service for 4%. I still make a good living, the “limited service” dorks evaporate, the public gets a better deal and we all look like heroes. What do you gain by keeping the bar low? Someone to look down on? Maybe it’s the engineer in me but I like being surrounded by intelligence and competence in my colleagues and peers We all perform better in that environment. The 60 hour standard was written when a P&SA was rarely more than 3 pages and any idiot could handle them. The stakes are much higher now and the contracts more complex. The public deserves better and the experience new agents gain shouldn’t be coming so much at the hands of unsuspecting buyers and sellers who have every right to expect that a license confers some degree of competence.
BTW, Ardell; while you’ve never made it any secret that you’re a Broker with 60 agents in your office, it might be appropriate to mention in this context that lower standards mean more agents making YOU more money. Success in the typical broker model is predicated on how many agents you get paying you splits. More marginally qualified agents barely making threshold is better for you than fewer, higher qualified agents far exceeding it, leaving you with less. The real business of real estate happens at the level of agent/client. The rest of the “industry” (brokers, NAR and the MLS) are motivated by other things not necessarily in the best interests of agents and consumers. If you want to talk about greed, your end of the industry might be a good place to start.
I was a broker for a large, franchised company with 3 offices. I got time of wall hangers (barely active licensees), politics and whining. So I opened a new company with a different perspective and much more rigorous recruiting qualifications. We specialize in serving first time buyers and I’m truly happy again. There is nothing better than the feeling on closing day, knowing you have truly helped someone with one of the most important purchases of their life.
And that’s as it should be, Michelle. There’s a big difference between the conventional broker business model of playing the numbers and the satisfaction of doing it right.