Teresa Boardman is a long-time columnist with 400-plus Inman columns under her belt. She writes about her real estate observations and experiences as an officeless indie broker in Minnesota.
Times are changing. If consumers are convinced that real estate agents are too expensive and are no longer needed because anyone can find a home for sale on the internet, we will all be out of work.
How the home search used to be
Back when my husband and I bought our first home, we did not use a real estate agent. Back then, real estate agents were “gatekeepers.” During the pre-internet era, we had to rely on newspapers, for-sale signs and neighborhood gossip if we wanted information about homes on the market and what the asking price was.
For some reason, we did not even know that a person could make an offer for less than the asking price. When we went house hunting, we only looked at homes that were in our price range. We calculated our own price range and the high end was about 60 percent of what our lender said we could afford.
A friend of ours told us about a home for sale in an area we were interested in. Even though we didn’t have any data and there was no Zillow, we knew the house was priced about average or slightly below average for the neighborhood. We had a feel for prices because we had been watching the papers for months and going to open houses.
When we went to an open house, we avoided the real estate agent. They seemed to pounce on us. We just didn’t want to make a commitment and neither one of us liked salespeople. At the time, they seemed a little shady and looked expensive. We could barely afford the house and didn’t even want to guess what the real estate agent would charge — and we never bothered to ask.
We went to the house that the friend told us about and looked in the windows. It was vacant at the time, and we liked what we saw through the windows. We called the number on the sign and the listing agent took us through the house the next day.
How the home purchase used to be
It was love at first sight. We just wanted to buy the house and we made that clear and we were not sure how to proceed. We were told we had to offer the asking price and that we did not need an inspection because there was a “code compliance statement.” The house had been recently rehabbed.
The seller’s agent wrote the offer for us and we closed a couple months later. At the time, we had no idea that a buyer’s agent could help us or that they would act in our best interests or that we could have chosen the closing date instead of letting the seller choose it.
What we paid for was a newly renovated house. What we got was a poorly rehabbed house. It was still a good value, but the contractor wasn’t very good and the work wasn’t inspected. Over the years, we paid for a lot of re-work.
It would have at least been nice to know that part of the house had no insulation and that the pipes would freeze every winter and that the wiring in the upstairs bedrooms was knob and tube and that the wires were cloth-covered.
Even so, we don’t have any regrets and believe we bought the right house. We loved the location, and for the most part, enjoyed making the repairs and upgrades.
Why consumers think they don’t need us
My first client did not know that three months before we met, I was working as an IT consultant or that I had just gotten my license or that I had never represented a buyer before. We just don’t volunteer that information, and buyers don’t always ask.
Sites like Zillow and realtor.com make it very easy for anyone to find a home for sale. If they believe that all an agent does is find homes for sale, then I understand why there are some who believe we are obsolete.
Homebuyers can go on Facebook and ask for buying advice — and they will get a ton of it in a few minutes. Some of it will be from people who have never purchased a home, and some of it will be from people who purchased one home once. For some people, advice from Facebook friends is the only research needed when buying or selling real estate.
Consumers can even read five-star reviews left by first-time homebuyers who do not even know that their agent did not do a very good job but gave them five stars because he was “nice.” The agent who wrote the offer for us was also “nice.”
Most of the people I meet who want to buy real estate don’t know what they don’t know, and they don’t always ask the right questions. Buying or selling a home isn’t as easy as we all make it look.
We will be obsolete if we don’t change things
Even though one of the first things I do with new clients is explain agency, they don’t seem to really get it or even care about agency.
We don’t even advertise the fact that, most often, two agents are involved in the sale of a home. The name of the second agent does not appear on the sign, and the neighbors say “XYZ Realty sold the Jones house,” even though an agent from ABC Realty found the buyer. If we were more transparent about working with co-operating brokers maybe buyers and sellers would understand the value of buyer’s agents.
Homebuyers still don’t know what questions to ask and seem to believe that because there is so much information on the internet, they will know everything they need to know. They don’t know how much of the information is inaccurate and how much is nonsense.
It doesn’t surprise me at all when someone wants to sue us or try to pass a law that disallows our business practices. After decades of being gatekeepers, many consumers don’t trust real estate agents and will continue to look for workarounds.
Real estate agents look expensive and people don’t understand how they — we — can help them. If we don’t learn how to communicate our value, we will become obsolete. We might already be obsolete in the eyes of some consumers.