Brokerage

Where Old West gold mining and real estate intersect

Look back at history to truly understand plight of today's agents

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Rarely does the public at large truly understand the scope and depth of the plight and the job that a real estate agent undertakes to conduct business. Above all, the key attributes he or she must have are self-sufficiency and focused determination to reach the final goal of closing escrow on the sale of a property. The role and job description of the real estate agent is as long and varied as the job descriptions of most proprietors and entrepreneurs. The modern real estate agent is everything from CEO to janitor — and everything in between.

I was trying to think of whom the real estate agent could compare to best, and the answer was more elusive than I thought. I think I might have come upon a close match with a comparison to a figure of the early history of the United States during the late 1840s.

It was a most exciting time in America. It was the end of the Mexican-American War. The nation had expanded its borders all the way south to the Rio Grande River and westward to the Pacific Ocean as Mexico ceded the territories of Arizona, New Mexico, Utah, Nevada and California to the U.S. government.

A new presidential election was just launching, and in its first stages, local banks were flourishing after the closure of the Bank of the United States by President Jackson and gold was discovered in California. A great westward movement followed as pioneers, homesteaders, farmers and fortune seekers all looked for economic opportunity.

All were a sturdy bunch, as self-reliance and self-sufficiency were tantamount to survival. These were the true pathfinders of this county; the forbearers who with their hard work and determinedness extracted from the earth crops, livestock or minerals to sustain for themselves a better life and future.

Among this hardy group were the gold miners. Those tens of thousands of independents and entrepreneurs, who sought their fortunes by mining the earth. Those who had haphazardly chosen one of the most difficult, dangerous and confounding ways to eek out a living by sifting the soil and mud dug from freezing cold streams and underground mines to obtain small particles of gold. They left behind their families, wives, children and loved ones to travel to work the gold fields. By and large, it was already too late for them to realize that the genuine gold was found in the business of “mining the miners.”

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During this time, three savvy businessmen came to the conclusion that the real riches were in the pockets of the miners themselves. Through the selling of picks, shovels, sundries and equipment to the gold miners, they amassed large fortunes. They were among the only men to strike it rich during the great gold rush, and they never mined for gold even for a single day. An altogether pretty amazing story, isn’t it?

I liken real estate agents to the early gold miners in that they did not choose the easier, softer way to make a living. To the contrary, an agent can work many hours, conduct as many open houses, provide transportation to as many potential buyers doing home tours and making numerous phone calls sifting through Internet leads like sifting sand through your fingers — all without making a single dime.

As most might know, real estate agents don’t make anything until they reach a contract and get it to close because most of them are working on 100 percent commission. Even after closing a deal, the agent is frequently the last one to get paid even though he or she was the one who initiated the whole process in the first place.

It also brings to mind the onslaught of the various ways that real estate agents today, much like the gold miners, are nearly overrun with opportunities to part with their money. For new agents, first come the real estate school tuition fees. Then come the local, regional and national membership fees. Next are the multiple listing fees and the lockbox/keycard fees. Don’t forget about the errors and omissions insurance payments and the state license fee. All that’s before you have to purchase signs and business cards.

Every article I’ve ever read says that all agents must have an online Web presence including a blog, and they must develop their social media, too. When you join a brokerage you frequently have to pay an office fee and then a fee to use the copier, the fax and sometimes even the phone. Then comes all the real-world expenses that an agent needs to get down to business like gasoline and oil for his car.

We haven’t even begun to crack the numerous and various ways that individuals, companies and salespeople ardently strive to “mine the agent.” How about the personalized pen companies, the magnet people, the contact management systems, the virtual tour photographers, the postcard people, the selling-system seminars and the personal coach? Did we mention the printer, the e-flier people, the single-page-website guy and the search engine optimization folks? Do you need continuing education to maintain your real estate license?

Then add them to the list, as well. I nearly forgot the worst of the offenders: the big data real estate aggregators who beg for your listings to advertize and then sell the leads they obtain from you to your competitors in the area.

It’s usually an expensive game of trial and error that an agent comes to choose his tools of the trade from the myriad of options presented him or her. I would love to hear what some of your favorite ones are.

Could it be that the modern equivalent of the three savvy businessmen of the old gold mining days are the three top realty data aggregators — Zillow, Trulia and realtor.com? Are they the ones to extract vast wealth and riches from the real estate industry without ever selling a single house or stepping a single foot in the community?

Please believe me when I tell you that few real estate agents are getting wealthy from selling properties. Most agents are not in it solely for the fat paychecks. Agents who stay in it develop a passion for helping people and make a personal commitment to the community they serve. Those who mine us will never make such a commitment, and yet make far more money than we will ever begin to realize.

Real estate agents as the backbone of the industry experience a steady and continuous barrage of fees, expenses, shakedowns, schemes and foolproof marketing systems in order to get into his pocket. I’m not asking for sympathy for the agent in choosing this line of work.

It is by far one of the most rewarding experiences one can have in an avocation by assisting a buyer or seller reach his goals and helping them to be able to move on with his or her life. All I ask from the reader is respect for the occupation and the effort it takes to survive in the business as one might acknowledge the dogged commitment of the gold miner in his endeavors to find for himself or herself — a speck of gold.

What tools do you use to better mine the gold in real estate? Please continue the conversation in the comments section below. 

Andy Freeman is a native of Nashville, Tennessee, and an area affiliate real estate broker since 2005 at Parks in Green Hills. He currently assists his clients make wise decisions about real estate.

Email Andy Freeman.