Bad agents are here to stay
Realtor Notebook
By Teresa Boardman, Thursday, January 21, 2010.I have never heard anyone say that the bar is set too high and that it is too hard to become a Realtor. Take a few classes, pass a test, get a license, pay your dues to the National Association of Realtors and you are a Realtor. It all takes two to six weeks, depending upon which state issues the real estate license.
Getting a real estate license and becoming a Realtor are easy. A person who just got a real estate license probably is not qualified to write a purchase agreement, and many would not even know how (I know I didn't).
Then there is the whole NAR thing. Yes, we are held to a higher standard. I don't think I even read up on what that was all about until I had been in the business for a couple of years. There is no initiation into the NAR, and anyone who has a license and can pay the dues is a member. I am not even sure I understood what I was a member of, or even that I was a member.
Now that the housing market has become so challenging, I have heard industry veterans claim that the "bad agents" will be weeded out because there isn't enough business, and now that things have gotten so much tougher those "bad agents" will crash and burn.
Sadly, I don't think the economy or the housing market will weed out any more bad agents than it does good agents. The bar to entry into the business remains very low, and success or failure is based on sales ability, the ability to find clients, and money management skills -- not on ethics or professionalism.
It is a self-eliminating profession. People who don't make enough money at it quit -- few ever get thrown out unless they do something illegal.
I like to think that the agents who don't do a very good job won't get any repeat business, but doing a good or a bad job is in the eye of the beholder. I have met some agents who have made my life a living hell, but in the eyes of their clients they are still the best.
We all have buyers or sellers who don't like us, but life goes on and so does our business. It isn't like other businesses, where it costs less to keep clients than it does to find new ones. In fact, it is actually cheaper to find new clients than it is to keep old ones.
The bar is being lowered in our industry every day, as agents scramble to make a buck. There are more agents than ever who refuse to return a phone call. ...CONTINUED
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Submitted by William Metzker on January 21, 2010 - 3:02pm.
Things are looking up In Oregon. in 2010, the state will require that a licensee be a high school graduate or have a G.E.D. Oooh.
Submitted by John Fischer on January 21, 2010 - 3:21pm.
I agree with your article Teresa. Sadly though ...NAR is never going to make the membership requirements tougher...nor are they going to push the state boards of REALTORS to push the individual states to increase requirements. Frankly - it isn't in their best interest. Lets take a look why:
Less members = less revenue.
Less revenue = less need for state boards and local boards.
Less state and local boards = less cushy jobs for the employees.
Lets rally our boards to create a secondary membership of some sort. For example, you have to be part of at least 5 transactions in a 12 month period or your license has to be in a differen't catagory ...or a differe't leve of membership in NAR, local boards, etc. At least this way NAR & crew could still get the dues revenue.
Submitted by Jeffrey Bastress on January 21, 2010 - 3:44pm.
I feel your frustration.
Trying to schedule 7 showings where selling agents accompany is near impossible as 4 out of 7 normally will not even return the call. When you follow up they can't be there themselves at the time requested so they didn't bother to call back.
Forget agency and compensation issues, as these are simply over many agents head. Start with lockbox 101. I swear if the showing instructions were that a key is under the mat...I would still get calls from agents at the door with Buyer over their shoulder calling me to ask..."which mat?"
I thought also that the downturn would help eliminate bad agents, but I am afraid the opposite has occurred to often. Many bad agents are the spouse of a bread winner and in it for the hobby or that they simply love just looking inside other peoples homes and income is not the driving force...and they keep on keeping on. Where as many great agents cannot continue to maintain their lifestyles and have bailed due to lack of income to support their families.
So bad agents have compounded the problem, as there is not enough business to go around as it is, and the precious deals they screw up or miraculously close are making a bad name for the industry and taking deals off the plate of professionals that would earn their due.
So as I know this will not change, we have come to know this now so well.
States need the license income and NAR and state boards need the membership income. The easier in the better for them.
Oh well...keep on keeping on in Massachusetts still.
Jeffrey Bastress
Startpoint Realty
jeffrey@startpoint.com
www.HomesByJeffrey.com
blog: www.RealtyRag.blogspot.com
Submitted by John Rakoci on January 21, 2010 - 4:07pm.
WoW! You are 100% correct. Now that sales are down many have found another job. When calling for a lockbox or gate code they cannot answer their phone as it iss not permitted at their real job. BICs need to get past the numbers game. It is not the number of bodies but who is producing in an ethical and legal manner. As NAR and state associations along with MLS services want the revenue numbers bring do not look for change unless BICs would incur costs to hold agents. There does not need to be a extremely difficult entry but BICs need to act like managers and business peple.
Submitted by Ray Wood on January 21, 2010 - 4:45pm.
Sounds like you've had a couple of bad days in a row Teresa. But you are right, bad agents will be around forever.
That's the real world and that's the way it is.
Before Real Estate I worked in marketing with a large international corporation with a reputation for excellence. They could fire anyone that they wanted for any reason. They still had the same problems that you talk about in your article, albeit on a smaller scale.
The reason the bad apples don't get weeded out in real estate is because we don't file complaints with our local boards and commissions. The reason we don't is because it's too much trouble and we may be writing an offer on one of their listings tomorrow and our clients would suffer. Not to mention the time and effort that may produce the result you want but is sure to make someone mad at you.
The BICs don't want to take action unless the offender is a marginal performer or they finally hit a pain threshhold they can't stand.
The only practical solution is to have a good memory and use the knowledge you gain to protect yourself and your fiduciaries when you have to deal with the bad apples. These guys are usually real predictable and that makes it easier to use their weaknesses against them.
Ray Wood
Assoc. Broker, ePro
Prudential Jack White-Vista Real Estate
Wasilla, AK
Submitted by Kristy Banks on January 21, 2010 - 8:37pm.
I am a new agent and am disapointed at how negative and even uppity this article and the following comments come off. It seems to me that this topic can be written about every industry, and is a waste of time. I wish I had learned something other than it seems that my counterparts are discounting the hard work, time and money I have put into becoming an agent. I appreciate that NAR has a relatively easy membership process, as I believe it will help me become a "good agent". As stated above, there are "bad agents" in every industry, and it is partially the consumers responsibilty to find the agent they feel will represent them the best, if they get swindled there is already legislation in place to protect them. Maybe if you remember that your fellow agents (especially the ones that just finished their "2 week discount education") are human and bound to have a bad day or a "duh" moment, it won't be so depressing for the "good agents" knowing that the "bad agents" are here to stay.
Submitted by Teresa Boardman on January 22, 2010 - 3:53am.
Kristy - this was not aimed at new agents. Since all agents enter the industry the same way and there is good and bad in every industry. There seems to be an opinion out there that hard times weed out "bad" agents and I don't think that is true.
Submitted by Valasie August on January 22, 2010 - 7:35am.
Teresa...you are obviously right on the money about the condition of the average Realtor profile. John is right about the revenue issue being at the root of not raising the bar. However, the very agents that complain about these unprofessional agents are often unwilling for the fees and standards to be raised not realizing that the end result will be fewer MORE professional Realtors. The Associations want the money but if they can raise the same revenue with fewer agents I believe they would be all over that but they are concerned about the member backlash and so they don't even go there.
But ultimately Ray has the answer. It is my office mantra this year to put front and center the public. We are obligated to protect the public NOT the Realtor and when we are aware of violations we have a resposibility to move forward with reporting them regardless of the work involved to do so. The weeding out of unprofessional agents many of whom don't just aggravate us by not returning phone but also commit acts of misrepresentation, fraud, agency violations and Article 1 and 9 violations is a Realtor's responsibility.
Raising fees and standards will help but reporting Code of Ethics Violations will be the tipping point for our industry to clean it up.
Valasie (Val) August
Managing Broker
Long and Foster Real Estate, Inc
Submitted by Josette Skilling on January 24, 2010 - 6:30am.
Kristy, with time you'll see that Theresa's comments are right on the money and will be echoed by many who have learned to practice their craft well in spite of the very low barriers to entry that create many of the problems we see with "bad agents".
I remember asking on the last day of my 10 day pre licensing class what would protect the public from all of us since we basically knew nothing. The code of ethics we so proudly quote makes no sense until you've done some transactions and understand it in context.
Val's right that it's time to clean up our own act. But I think we need a bigger broom.
Josette Skilling
Long & Foster Real Estate, Inc.
Submitted by Ken Lampton on January 24, 2010 - 9:24am.
I'm intrigued by your statement that "It is actually cheaper to find new clients than it is to keep old ones." I'd like to hear more on this topic in a future posting.
------------------------------
Ken Lampton, CRS
RE/MAX About Dallas
www.m-streets.com
"The M Street Agent In Dallas"
Submitted by Lynn Wilber on January 24, 2010 - 9:40am.
Lynn H. Wilber, GRI, e-PRO
Broker-Assoicate - Downing Frye Realty, Inc. - Naples, FL
www.NaplesWave.com
After 32 years in this business, I would love to tell you that I have seen it all where bad agents are concerned. Unfortunately I never cease to be amazed at the lack of education in our industry. While the National and State levels do not set a high bar for becoming a Realtor, it has been my experience that many Brokers do not want to spend money educating their agents. Heck, agents do not even want to spend money on their own education!
I do respect new agents who do not know what they are doing and ask questions. I have NO respect for new agents who "wing it." As far as I am concerned, every time a bad agent leaves the business, a champagne cork pops somewhere in the country.
Submitted by Peter C. Fyler on January 24, 2010 - 9:46am.
Wow! What a rant … you go girl. Teresa, you are 100% spot on and my blood pressure is absolutely percolating right now. I could hear myself silently shouting Amen at the end of every sentence and paragraph.
I have been in this business for more than 20 years. I have to laugh when I think back to my transition from a career in the garment center on 7th Ave & B’way in NYC to what I thought was going to be a gentler way of life, Ha! What a joke that was.
I remember a leather necked old timer saying to me at my first local MLS meeting when I was introduced to the broker community, “This market is like Dodge City”. I learned soon after that it is an anything goes pragmatic business with no enforced personal behavior Code according to Hoyle. In this business the Golden Rule ends up being synonymous with “Show me the Money!”
We have a Code of Ethics, but who reads it and is it enforced? I think very few read the Code or realize that it is constantly being amended and updated. Local memberships lean toward wrist slapping admonishment instead of hard time. In my most cynical moments I have felt that our national association and local boards are essentially white collar welfare sucking off of the perception that real-it-ters are rolling in dough. I remember Tom Hopkins saying when we calculate how much money we make verses the hours we spend working in real estate, it calculates to 50 cents an hour. No wonder I often feel like Rodney Dangerfield; “I get no respect”.
However, I do believe as it has been in previous down markets, these are times that test men’s souls and the cream will rise to the top. Markets like this will bring out the best in people as well as the worst in people. It is human nature. You and I know that we can only control our own behavior and maybe through our actions and the power of example others will learn to behave better.
Those bad agents or those who don’t take this profession seriously are chameleons who are now wearing aprons, tool belts and blue vests with smiley faces on them, but to paraphrase the Terminator, they’ll be back. After all, as sad as it may be to say this, it is all about the money and there are no friends where money is concerned. I wish you all that I wish for myself and thanks for getting mad.
Peter C. Fyler, CRS, REALTOR®
SplitRock Real Estate, LLC
Exclusively Representing Buyers
Martha's Vineyard, Massachusetts
BuyersOnly@SplitRockRE.com
http://www.SplitRockRE.com
Submitted by Michael Studebaker on January 24, 2010 - 10:17am.
Teresa:
Your points are well made. The spectrum of bad agents, uncooperative and/or just not knowledgeable or professional, is significant but not I don't believe it's increasing. They're just more exposed. I see it in the new licensee who isn't trained properly. Or the somewhat experienced agent who is quietly on the sidelines waiting out rather than jumping in to help distressed sellers or credit challenged buyers. It's also veteran agents who just aren't adapting to new technologies and new ways to collaborate and cooperate with their peers.
Whichever profile you choose, the finger points back at the broker or manager who fields the complaint from a client or the comment from a concerned agent about one of these "bad agents". If we as broker managers don't act quickly to set the standards, no one will. I surely don't expect higher licensing standards to have any measure of success.
There aren't necessarily more of these agents about today. The pool of agents just got smaller and the lot of bad apples just seems disproportionately larger. For every "bad agent", there is a weak ass broker or manager who is willing to accept mediocrity or worse and perpetuate this mess.
________________
michaels@glrealtor.com
Michael Studebaker
Broker/Owner, CRB, CRS, GRI, e-PRO
Gallagher & Lindsey, Inc REALTORS
share, flourish, repeat
Submitted by Jon DePoe on January 24, 2010 - 10:20am.
Terrific article. To the point, concise and most of all right on the mark. After 20 years in the business I couldn't have said it any better. I served on our local Realtor® Board of Directors for 11 consecutive years before retiring in July of '09 and can attest to the fact that agents in general have no clue to what NAR and its component parts are, nor do most give a rat. They belong because around here (SWPA)they have to because their broker belongs. Ninety five percent (and yes, that's an accurate number) of the local board membership don't attend the quarterly meetings of the board, nor do they get involved with any other board activities.
There are hardly ever any grievences filed through the local board against other agents even when there are glaringly justifiable reasons to do so. Agents around these parts and I suspect many other places are just scambling to get business, any business, in any way they can just to exist in these rough waters. Most as you have said have no idea what the Realtor® Code of Ethics is all about and have no interest in really finding out. I will say that the recent ruling mandating quadrenniel review of the Code has helped somewhat but again that obligation falls to the local board most of which are unprepared and unable to manage and conduct the needed ethics classes for their membership. And at present there is no real way of accurately enforcing member compliance because local boards are loathe to suspend any member for fear it will negatively impact their bottom line, especially now at a time where dues revenues are sinking.
The consumer is participating in a crap shoot when they start looking for an agent to represent them. They could luck out with a good agent or not. The odds are against getting a good one and as long as that scenario exists there will be ongoing consumer mistrust of all real estate agents which will keep the real estate agent near the bottom of the consumer confidence list that's put out every year or so.
When I retired I went with our local referral company where I can and do assist consumers in selecting a good, experienced, trustworthy and reliable agent. There are some out there to be sure.
Jon DePoe
KW Referral Co
Pittsburgh, PA
www.depoe.com
Submitted by Barrett Powell on January 24, 2010 - 11:46am.
Time in the business has no bearing on the quality of the agent. I have seen new agents come out of very good programs with more knowledge than many who have been practicing for more than 20 years. In fact I find some of the worse offenders are the ones who have been doing it so long they lapsed into bad habits that were never corrected.
Last month I took a first time home buyer to a new housing development from a National builder. I had set the appointment up though our local MLS. First, the lockbox combo was incorrect. It conveniently took the onsite agent to come down and let us in the house. Once in, this "veteran" agent proceeded to start asking my client questions. I politely reminded her I was their buyer's agent and I appreciated her letting us in and that we would like to view the house ourselves. She proceeded to follow us around and tell my clients that in order to qualify for her company's closing cost my buyers would have to use her bank (BOA) and her attorney. By this time I was getting agitated and reminded her that "steering" was unethical and possibly against the law. To which she responded that she had been in the business much longer than I had and had more experience than I had and knew the law better.
Her bank was not able to close the deal. The house did not appraise for the asking price. Our original mortgage broker who had already pre-qualified my buyers ended up finally closing the deal.
A couple of weeks later I saw in the newspaper where the builder and their real-estate firm had been charged with illegally "steering" clients.
Yes, the economy may weed out bad agents. But it is just as likely to weed out some good agents. I have written before about the "bad" agent with the employed spouse or partner who can weather the storm while the "good" single agent or agent with the unemployed spouse or partner cannot.
There are no easy answers to this problem. Though I think a more graduated "internship" process like other professions have may be a good start. North Carolina has something similar in our "provisional broker" program. Unfortunately it did not help with all the grandfathered agents already in the system.
Barrett Powell, Owner/Broker/Consultant
Southern Advantage Companies
RSA Software & Consulting
288 East Street, PO Box 1427
Pittsboro, North Carolina 27312
http://www.REMAXChatham.com
http://www.RealEstateWebExpert.com
barrett.powell - Skype
wbarrettpowell@gmail.com
Submitted by Armani Arbizi on January 24, 2010 - 4:12pm.
This refreshing article and its writer deserve full respect from those who agree and even others who may not. The article is a candid and responsible assessment of people engaged in real estate. I am one of those in full agreement with the information.
But here's another idea that may sound too idealistic and yet, I believe it will be a strong factor in having better quality agents in terms of honest and professional conduct. The goal is to drive that level of mindset into agents. For this, it must start from the top. Allow me to parallel this with parenting where they have to instill values to the family or children as they grow. But those parents first need to have those values in mind so they can pass it on. Easily said than done, I know because it could go against the business culture (which is precisely part of the problem).
But perhaps the established authorities, whether public or private, can offer or create some dynamic type of incentives to real estate corporations and managements. Such incentives will be somehow tied up to a criteria of developing realistic programs to create skillful and ethical agents.
Many broker corporations or managements are purportedly responsible technically over their brokers and agents. But they are actually very distant on this score regarding their agents. As other views had expressed, only revenue is foremost and so headcount is the goal. And so, many agents are free to use their own practices.
I am sure there are other measures that should go along or be incorporated too. But I firmly believe that helping develop or shift management concept towards TRUE QUALITY has strong chances to make a change.
Armand Arbis, citizen
Submitted by Shannon Adams, CA Broker on January 24, 2010 - 4:52pm.
I absolutely agree 100%. I manage over 100 agents, and I can tell you many agents aren't even willing to spend the $1,000 a year it takes to be a Board member and have a lockbox key. What business can you start up for a $1,000 and on your first sale earn an average of $12,000 commission!!! If they won't even invest in the tools of the trade, are they even investing in training and education to be the best advisors they can be? Many are winging it. YOu should see the contracts I review on a daily basis. When the contract calls for the description, meaning the address, they are writing 1600sq.ft. 3 bedrooms & 2 baths. This is a sad state of affairs. There should be more mandatory training. This is a very legalistic profession, and especially now with so many agents trying to think outside of the box with shortsales and loan mods. And as you say, they will only drop out when they are not making money, and for no other reason. Amen to you Teresa!
Shannon Adams
Realty Network Broker
Submitted by Chris Somers on January 24, 2010 - 5:22pm.
Teresa,
Well written article ! I have been one of those agents saying that the bad agents will be weeded out. But the more I think about it after now being an owner of a RE/MAX office and seeing other offices hire pretty much anyone, I agree with what you are saying. Not only are the barriers to entry very low, but so many offices are in the body business per se. Is a shame because it lowers the standards of our business. On the flip side, the bad agents do help the good agents shine !
Submitted by Alex Valadez on January 25, 2010 - 7:12am.
I agree, there is a need for self-improvement in our industry. Many brokers claim the lack of time, energy or inability to secure a trainer in their bag of resources. Just like many businesses, the brokers and owners are mostly responsible for poor performance and knowledge level of their licensees. This is mostly true in any industry from accountants, to attorneys, to doctors, to insurance brokers. As you call them "bad agents" it occured to me that you might as say "bad brokers" who need additional training and re-tooling. Let's all say that we can start on improving our industry by writing our names correctly as: REALTOR®. I saw the incorrect spelling 6 times in this article. Broker involvement and setting higher expectations is the more logical choice of weeding out a bad agent and keeping a well-trained REALTOR®.
Alex X. Valadez
Broker/Owner
Lakewood, REALTORS®
Dallas, TX
Submitted by David Dorman on January 25, 2010 - 8:31am.
I'm sad to say that I share the thoughts in this article. Being an 11 year vetran of the business, I have noticed a decline in service and knowledge for many agents. The issue in my opinion is how agents are brought into the business. I truly believe that there should be an apprentice type of situation prior to getting your REALTOR enrollment. The time it takes to get your license is minimal and they do not teach you HOW to sell real estate. Unless you are lucky enough to join a training office, you are likely to upset many people and probably drop out within the first two years.
The big issue here, since people stil need to buy and sell homes, is how do you tell the difference betwen a good or bad agent? The branding of your major real estate firms gives all agents an equal playing field and a false sense of ability to the clients. Unless they are properly certified and background checked, agents can truly damage a clients transaction. So how do you tell the difference?
PRC was designed to help people find a REALTOR they can trust. PRC stand for the Profesional Realty Council and what they do is simple, but effective. They use Regional Directors to help sift through the agents in an area to find the best ones. Agents have to meet a minimum 3 years experience and also a specified level of consistant income. After that, they must pass a goverment level background check as well as interviews by several of the staff. Only upon approval can they then be called a PRC agent.
I find it amazing that out of all the agents that join the Board of REALTORS this year, that 93% of them will be gone within two years! That's an NAR stat. No wonder so many people are frustrated with REALTORS. I am a REALTOR and I am feeling the same pain. The difference is I am doing something about it. If you need a good agent in FLorida, contact me and I'll get you a PRC agent!
Submitted by Dean Uhing on January 25, 2010 - 1:29pm.
This article simply stated the obvious about human behavior. Prior to my becoming a real estate agent, I was a Catholic priest for 17 years. In deciding on a new career, I came across the preamble to the Code of Ethics and was inspired to become a Realtor. After a few months in the business, I noticed that many people were not living up to the Code. I talked to my manager and told her I was deciding on leaving the business because I did not want the business to do to me what it was doing to others. She said,wisely, " Just remember, you are in charge of your business. The business is not in charge of you." From then on I decided to do things according to my moral beliefs and convictions. I have no control over others so I really don't worry about them, or the industry or any associations. I can only control myself and that's enough of a responsibility.
Second, I don't expect anyone to live up to any values or ideals. Those things are beyond anyone's capacity to obey or fulfull. The only I expectation, I have of anyone is, " First, do no harm." If you do then I will fight to defend myself and the ones I care about; including my customers and clients.
Submitted by Brian Friemel on January 26, 2010 - 10:09pm.
Everyone,
I am Brian Friemel, President & CEO of Pulse Realty Software. I was in Start-up Alley at Connect in NYC and, interestingly enough, met two of you who've commented on this article at my booth.
The topic of this article led to the creation of my company three years ago. One of my founding partners owned an agency and realized that his brand was only as good as the customer service provided by his weakest agent. Recognizing that customer experience defined his brand, he was determined to create an end-to-end system to set service standards, to establish processing procedures, and to capture agent performance data. That system was highlighted at Connect and is called Pulse.
Pulse redefines the "Transaction Management" space as "Brokerage Management". Pulse organizes all processes by replacing paper checklists, internal forms, spreadsheets and certain systems with one shared process management system. Along the way it captures data regarding the transaction (showings, marketing, on-line presence, key dates, key metrics) and centralizes that data for reporting to all appropriate parties including Ownership, Management, Staff, Agents and even End-Clients.
Pulse allows THE CUSTOMER to hold the agent accountable for the service promised by creating transparency never before available.
I invite you to visit our site and view the 2 1/2 minute video overview of Pulse. Pulse is not for the faint-hearted. It requires conviction at the leadership level to change the traditonal methods used to run a brokerage. However, you've all alluded to the notion that someone has "to protect the public" to use Val August's words. If not NAR, then who? If you are ready to take action and to hold agents accountable, please contact me at your earliest convenience.
Please forgive my use of this forum to introduce our product. If it weren't so relevant, I would have never mentioned it.
Brian Friemel
President & CEO
Pulse Realty Software
314.779.3737