Technology

Did NAR’s ‘DANGER Report’ help or hurt Realtors?

Findings that paint an unflattering portrait of the industry have sparked debate among agents

“After buying and selling a few houses I would rate real estate agents just barely above the drug cartels when it comes to morality and honesty.”

That’s one of a number of negative comments about Realtors that appeared beneath an article recently published by The Washington Post.

The subject of the article was the “DANGER report,” a sometimes-scathing study recently released by the National Association of Realtors that details potential threats to the real estate industry.

The report concluded that the No. 1 liability for the industry is its masses of “untrained, unethical and/or incompetent agents.”

That, along with other findings that paint an unflattering portrait of the industry, has sparked a debate among real estate agents about whether NAR should have released the study.

While plenty of agents agree with many of the report’s conclusions, some worry that it largely validates many consumers’ negative perceptions of real estate agents. Others applaud the study as an overdue wake-up call that could spur much-needed reform.

6 ways empowered agents embrace disruption to drive success
Using technology to generate leads and win listings READ MORE

The report was authored by Swanepoel T3 Group on behalf of NAR. NAR spokeswoman Sara Wiskerchen said the report “does not in any way represent the opinions, positions or conclusions of NAR or its leadership.”

NAR commissioned the report “in the belief that it is healthy and helpful to hear what others are saying, especially those ideas that might be uncomfortable or disagreeable,” she said.

Wiskerchen added that NAR did not widely distribute the report, but did “distribute it to all who participated with the understanding that the information would be shared and discussed.” NAR announced the report on its public Facebook page in late May.

The report lays out 50 threats to five groups: agents, brokers, NAR itself, local and state associations, and multiple listing services.

“Masses of marginal agents destroy reputation”; “commissions spiral downward”; “the agent-centric era ends”; and “the agent is removed from the transaction” are among the top 10 threats to agents cited in the report.

Finding from NAR's DANGER report.

Finding from NAR’s DANGER report.

Those and other findings resonated with many in the industry, particularly the conclusion that subpar professionals are damaging the appeal of Realtors overall.

“The bandwagon effect is in full throttle,” said one person, commenting on the report in the Facebook group Raise the Bar in Real Estate. “Why not — there is no real barriers to entry — pass a test and your a Realtor! Yeah! Not!”

Another called the report a “huge punch in the face, a huge black eye for the industry,” but seemed to appreciate it, asking: “My question is, do marginal agents know they’re marginal?”

Other agents who agreed with the report’s findings overall still found its tone and format somewhat abrasive, and questioned the value of releasing it to the public.

“I’m a huge fan of transparency, vulnerability and speaking the truth, but this report screams of negativity, guilty conscience and pessimism,” said one commenter.

Another griped that the study sometimes lacked “significant context.” While the report notes that homes sell at a lower commission rate in Europe, the commenter said, it didn’t add that agents there “are also salaried with generous leave and benefits to boot.”

Some critics said that they would have supported distribution of the report if it proposed solutions.

“Airing our dirty laundry in public just gives the public justification for their already poor opinion of real estate agents unless there is a ‘so here’s what we plan on doing to improve things,'” said one commenter.

But supporters argue that making the report public could nudge the industry in the right direction. “Awareness precedes change,” one commenter said.

Stefan Swanepoel, CEO of Swanepoel T3 Group, which authored the report, said that publicly releasing the study, which is available for download at dangerreport.com, advances the interests of agents because “to change an entire industry, an entire industry should participate, and therefore an entire industry should know the information.”

He added that, so far, “consumer commentary” on the report “is, in my opinion, largely from those that thrive on disagreement and controversy — and that’s OK, as that is the modern-day world of social media and public opinion we live in.

“Self-analysis was the first step; the second is meaningful dialogue; the third is finding practical solutions that have a high probability of effecting the desired change followed by wide implementation and adoption,” he said. “The biggest work, by the entire industry, is ahead.”

NAR’s Wiskerchen said the Realtor group’s leadership and strategic thinking committee will discuss all the report’s findings over the next year “for the purpose of creating future strategic direction based on what in the report they find useful, forward-thinking, progressive and actionable.”

NAR could “explain, refute, deny or otherwise create a counterpoint for every item discussed” in the report, Wiskerchen noted, “but that was not the spirit in which it was created.”

“We are neither celebrating nor disappointed in the author’s perspectives,” she said.

Email Teke Wiggin.