New book explains real estate agent pitfalls

Author focuses on commission-rate competition, control of home listings

The provocative new book “The Real Estate Agent’s Field Guide” by Bridget McCrea seems to be aimed primarily at new real estate licensees. But it is also a “must read” for every realty sales agent who is serious about the business and who takes a long-term view toward thriving and avoiding costly realty sales pitfalls.

The book places heavy attention to the results of residential sales commission “compression” and how it affects the industry. Compression means reduction in the traditional 6 percent or 7 percent commission rate.

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McCrea explains the trend is toward discount brokerages and flat-fee firms such as Assist2Sell and zipRealty. She says this places pressure on traditional brokerages to adjust their commission rates downward due to competition.

The primary value of this well-researched book is for agents to learn the new developments in home sales brokerage and how local firms are adjusting.

For example, the innovative ideas of Dave Liniger’s RE/MAX offices, such as paying agents 100 percent of their commissions and charging them monthly desk fees, are explained throughout the book. As a result, RE/MAX agents are usually top producers as compared to realty agents at traditional fee-split brokerage offices.

To make the book extremely relevant to current realty brokerage situations, McCrea uses dozens of interview examples from successful agents through the nation. She interviewed sales agents and owners with large and small firms to gain their insights on the issues discussed.

But at times the book is a bit depressing. Perhaps realistic is a better term. To illustrate, in the chapter about risk management, the author interviewed Fort Lauderdale real estate attorney Matthew Zifrony regarding realty agent legal risks.

He said, “There’s a larger number of agents out there, fighting harder for deals and competing against one another.” The chapter then discusses potential agent problems such as toxic mold, agency disclosures, home defects, and “other sticky issues.”

A consistent focus throughout the book is the radical change from realty agents controlling home sale listing details through the local MLS (multiple listing service) to making that information easily available on the Internet. McCrea explains how home buyers use Internet research on home sale listings, but they still need local agents to negotiate sales and handle the closing details.

This new book provides an excellent overview of the current status of the real estate sales industry. The author is positive and upbeat, but also very realistic about the pitfalls realty agents encounter and how to best avoid them. This is a very important book for serious realty agents and brokerage owners who expect to survive and thrive.

Chapter topics include “Facing the Forces of Change”; “Changing Consumer Demands”; “Jumping on the Technology Train”; “The Commission Compression Factor”; “Dealing with Discounters”; “Selling Real Estate Piecemeal”; “Risk Management for Agents”; “Spotting Real Estate Trends”; and “Ensuring Your Future Survival.”

Although the book has a few minor errors, such as stating Freddie Mac is the nation’s largest mortgage lender (Fannie Mae is number one), the author should be commended for her thorough research and balanced viewpoints. She does an excellent job of reporting facts before expressing her opinions. On my scale of one to 10, this outstanding new book rates a solid 10.

“The Real Estate Agent’s Field Guide,” by Bridget McCrea (AMACOM-American Management Association, New York), 2004, $19.95, 263 Pages; Available in stock or by special order at local bookstores, public libraries and www.amazon.com.

(For more information on Bob Bruss publications, visit his
Real Estate Center
).

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