"Make money while you sleep!" promised the nice spammy-man in my inbox this morning. Not only can I make money in my sleep, it seems, but I can also be socking it away in the old retirement account while I’m on vacation or even out shopping. Except, he’s wrong. That was 2003.
Ah, 2003 — and 2004, and 2005. Those were the wonderful "tweens." Back in the glory days, taking a listing triggered a very predictable chain of events. Order the yard sign, enter the particulars in the MLS, and schedule the automatic bill pay for 45 days out. Simply making eye contact with a would-be buyer meant a trip to the Lexus dealer was imminent. A home in escrow was a futures contract with virtually no risk. They all closed.
During the peak, we ran into a fellow agent at an open house. "It’s almost too easy," he confessed. "I feel guilty." He wasn’t bragging, and he wasn’t joking. He was making a statement of fact, and I remember thinking then that he had just delivered a very poignant and ominous State of the Industry address. At that moment I knew things had to change.
At about the same time, the groundswell of customer discontent was gaining momentum. We started to hear it more often and with more feeling. Real estate agents are overpaid; agents provide limited value. Agents are the root of all evil. We continued to take our orders, and many saw their tax returns mistaken for that of a spinal surgeon — or an NFL wide receiver — yet, no special skills were really required. We just had to show up.
This is not to say we didn’t have value. It’s just that during the tween years, we didn’t have to demonstrate it; the times didn’t call for it. The agents who had come before, who had lived through slower markets and even the days of 17 percent interest rates, knew the difference. But the new millennium brought with it a thundering herd of new licensees who had only this one reality. I grew up with Dewey and his decimal system, while my daughter thinks a library is the file where all of her downloaded music is stored. If someone took away her laptop, could she finish her research paper on the Jacksonian era? Probably, but it would involve a learning curve. And there would be more than a little whining along the way.
During the tween years, preparing a price opinion involved taking the last sale price and adding a big, random number. How big really didn’t matter, since the home would ultimately sell over full price with multiple offers. Getting our buyer clients a "good deal" involved simply getting them the home — writing the offer with the biggest number at the top. Now, in our new reality, agents talk among themselves about managing their clients’ expectations. Maybe it’s time we stepped back, put the whining on mute, and considered managing our own.
2008 was a tough year for agents for sure. It was so tough, in fact, that it is all we seem to talk about. But what if 2008 is the way it is supposed to be, not some cruel, cosmic anomaly? What if having a successful real estate career was never intended to be accomplished in our sleep or while we are shopping or on vacation? According to the Association of Real Estate License Law Officials, there are currently almost 3.2 million real estate licensees in the United States compared with about 2.2 million in 2001. That means there are a million licensees out there who have been making spaghetti sauce from a can, and now someone has taken away their can opener. There are a million licensees who arguably aren’t aware that a bunch of ingredients are required to make the sauce.
I think we will forever look back on the tween years as a historical time of convergence for the industry. What it will represent is much more than a housing boom but a pivotal time of social and cultural change. If the Internet had busted out sooner or if the boom had come later, I suspect the glory days wouldn’t have been so glorious for many agents at all. What has really happened is that the world has picked our pockets of our precious MLS, of the mysteries of our contracts and of the monopoly we had on listing marketing and exposure. What we are left with is the basic ingredients, new to many and forgotten by many more. How many agents today have never really had to negotiate a contract, watch a listing expire, or celebrate several Labor Days with the same buyer client in their backseat? Today’s agent needs to analyze trends, understand lending fundamentals, know the neighborhoods, master technology, and play paralegal. Today’s agent needs to have honorary degrees in communications, marketing, finance and economics, and all the while they have to remain "undeclared," ready for the next in a series of changing dynamics coming at an increasingly rapid-fire pace.
Of course, it’s hard. Of course, it’s more fun to make money while you sleep. But, it’s not 2003 anymore, and we likely won’t see another 2003 ever again. In short, maybe we need to wake up and get to work.
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