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NAR Needs Major Education Reform to Preserve Our Industry

kidgradRealtorThis is a follow-up article to my recent post about the 10 things I Wish They Taught in Real Estate School. The response I got to the article has gotten me to thinking about our industry at large and some of the disparity between the industry image that NAR projects and the reality of how Realtors are really perceived.

Take a look at NAR’s Mission and Vision Statement:

Mission
The core purpose of the NATIONAL ASSOCIATION OF REALTORS® is to help its members become more profitable and successful.

Vision
The NATIONAL ASSOCIATION OF REALTORS® strives to be the collective force influencing and shaping the real estate industry. It seeks to be the leading advocate of the right to own, use, and transfer real property; the acknowledged leader in developing standards for efficient, effective, and ethical real estate business practices; and valued by highly skilled real estate professionals and viewed by them as crucial to their success.

Working on behalf of America’s property owners, the NATIONAL ASSOCIATION OF REALTORS® provides a facility for professional development, research and exchange of information among its members and to the public and government for the purpose of preserving the free enterprise system, and the right to own, use, and transfer real property.

It’s a great theory. Part of their vision is to be “valued by highly skilled real estate professionals and viewed by them as crucial to their success”.  I believe in the concept of NAR, but not the reality.  NAR is crucial to my success because I need their forms, MLS access, and my office demands it.  I do not believe that NAR is really moving their membership forward, however, because in my mind I see NAR as an organization with very low standards.

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For all of their talk/want/desire to be creating minimum standards of practice, do they really practice what they preach?  Do you know what the minimum standard is to join NAR?  40 hours of training, a completion certificate, and $115 in your pocket.  certainly sounds like a great way to develop effective business practices to me!  Practically anyone with a pulse and some spare time can become a Realtor!  How can it take years of training and apprenticeship for a guy to fix my plumbing, HVAC, etc; 1400 hours of training for my barber to be able to cut my hair, but I can sell real estate because I spent a week in some class??  Standards don’t get much lower than that, folks.!

The problem is that if you let anyone with a pulse join, the lowest common denominator is going to drag the average down.  “All it take is one bad apple”, right?  It’s awfully easy to find a bad apple when income potential for Realtors is seen as $100k+, and becoming a Realtor is so darn easy!

FIX THIS PROBLEM!

NAR needs to raise the minimum number of hours in training required to become a Realtor.  Why not 100 hours of minimum education?  Maybe 400 hours?  Raise the cost of the course and membership if need be, there’s nothing wrong with that, but require more education!  Until NAR requires stricter regulation and training of agents, this entire industry will continue to suffer.  It should be criminal that such lax requirements allow people to handle such large financial transactions!

NAR may not be able to control local state to state licensing, but they CAN lobby for change, or modify their own entry standards.  Think about how much the image of our industry would improve if we showed the public that we’re working to create a higher standard!  NAR also bills itself as a consumer advocacy group for home owners.  What better way to protect consumer interests than to require higher standards for their own members?

If NAR really wants to support it’s members, then it NEEDS to help prepare it’s members for success, not let them sink or swim on their own accord. When agents are set up for failure like they are now, every single failed agent reinforces the public’s negative view of our industry.  How much longer are we as agents willing to watch this revolving door make a punchline out of us, our industry, and our trade organization??

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Written By

I'm a Realtor in Southern Maryland. I grew up surrounded by the RE business, spent time as an actor, worked as a theatrical designer and technician, and took the road less traveled before settling down in real estate. I run my own local market website at https://www.somdexpert.com and when I'm not at the office or meeting clients, I can usually be found doing volunteer work, playing with my 3 rescued shelter dogs (Help your local Humane Society!), or in the garage restoring antique cars.

33 Comments

33 Comments

  1. Fred Romano

    February 16, 2010 at 3:09 pm

    Good luck raising the bar! In CT we just went from 30 hours to 60 hours a couple of years ago. But you also have the big brokers that are “running” the classes wanting it stay low. Why? they make money off the courses and need headcount. Its an evil cycle that may never get broken becuase of the way this F’d up industry is run.

    What may happen someday… Buyers and sellers will not use us at all. They will find every home for sale on Google Realty (listed direct by owner) and get a lawyer to assist with the transaction. Done.

  2. Fred Glick

    February 16, 2010 at 3:19 pm

    Forget the hours.

    How about tests on state levels that actually deal with the things agents do everyday.

    How about a test to get into NAR? (Yea, right…they can’t afford to lose the dues!)

  3. Duke Long

    February 16, 2010 at 4:39 pm

    Jump on Twitter and follow the hashtag #RTB .Plenty of conversation and points of view.

  4. Ken Brand

    February 16, 2010 at 5:04 pm

    I don’t want to Raise The Bar #RTB .

    I want to take the steel bar and beat the crap out of the leaders (Broker’s/Sales Managers/Team Leaders/etc. who hire, support, allow, retain and reward people who violate natural laws of human interaction, common sense and professional conduct (as defined by our association).

    And sometimes, I think it’s up to the consumer, if they choose crap, they can eat crap sandwiches, if they don’t like how it tastes, they can spit it out and order a steak sandwich. YUM! Also, there is an advantage to competing with people less savvy, committed, dedicated, imaginative and motivated.

    Raising the educational requirements sounds like an easy fix. Problem is, I know lots of educated lazy opportunists and I know some under educated, passionate, over achievers. Education is not the core problem. Lazy Low Bar Leadership and uneducated citizens is the core problem, IMHO.

    Actually, the challenge is as difficult as solving the Federal Budget, Unemployment and the Housing Crisis. Like Gandhi said, “If it’s to be, it’s up to me.”

    Rock on and thanks for sharing.

    • Jonathan Benya

      February 16, 2010 at 6:22 pm

      Kris, you are right on! I don’t blame NAR simply because agents are often under-trained and under-supervised when they start in the biz. I do however see a problem that NAR has the opportunity to rectify, but has not done so.

      We need to not accept current training/education minimums as “OK”. They aren’t. We need to make it harder to become a Realtor, not for the sake of doing so, but for the sake of preparing people for a career rather than a part time job.

  5. Kristal Kraft

    February 16, 2010 at 5:41 pm

    The problem with our industry is we have no standards. None. Nada.

    Real Estate School education is a joke. It exists to teach people how to pass the real estate exam. (When in doubt choose “c”.) Sadly, people who pay their bucks to get a real estate license don’t realize all they are paying for is exam prep. There’s very little real life “how to’s” there.

    Then they get out of school and go work for some mega-broker (fill in your favorite name here) and immediately get 1) ignored 2) charged for training (it’s a mega broker revenue stream doncha know?) 3) cycled through the system until they sell to their circle of friends.

    Then worn out, broke, angry and annoyed they go back to their old job, leaving us old timers to clean up the mess of their wake.

    The low entry level fails so many of us. The old timers, the noobs and the wannabes.

    If we had higher standards, everyone would know what to expect. Real estate would be a destination career, not something you do until you get a real job.

    I believe this would even be good for the consumer, don’t you agree?

    Guess you can blame N.A.R. but then that means we are blaming ourselves, because you see we are N.A.R.

    We have meet the enemy and it is us.

    Ken is right. If it’s to be it’s up to me. Maybe we can petition Dale and tell him we want some standards.

    Putting your money where your mouth is, is hard, when the problem is bigger than a bread box.

    Personally I don’t believe more education hours in a classroom is going to raise a bar. Practical, supervised experience will.

    For lack of a better term think apprenticeship with achievable benchmarks for completing transactions that have positive customer feedback. Perhaps a grading system that is measurable using systems outlining expectations for both the consumer and the agent.

    A system like this would train a new licensee providing them with the skill set and habits that would carry them through a life-long career. More importantly, the consumer would know what to expect. Heck they might even gain a deeper respect for us, knowing that we have standards that we must meet.

    Other industries do this. Why can’t we?

    kk

    • Fred Romano

      February 16, 2010 at 10:39 pm

      This will never happen! Why? because there is money involved. What top agent would take on an “apprentice” so they they can learn from them and eventually take their business? C’mmon now. NO ONE will…

      This industry will eventually die off anyway, gone the way of the travel agents. I have no doubt that eventually buyers and sellers will smarten up and realize they are throwing their money out the window.

      Google will buyout Zillow, merge into Google Real Estate, create an awsome database of homes, and offer sellers the ability to post online, buyers will simply click click, and find a home, get an attorney to do the paperwork and close. No need for Realtors…

      Not so far fetched I bet you.

  6. Bob Stahl

    February 16, 2010 at 10:39 pm

    The real estate industry has changed so much, really in the last 5 years. Now that buyers and sellers can find so much information online, they really need their real estate agent to be an expert advisor — kind of like a lawyer. It’s a much more sophisticated role than simple transaction manager.

    Plus, all of the new technology tools are really must-know for Realtors these days, yet so many simply can’t/won’t get up-to-speed.

    • Fred Romano

      February 16, 2010 at 11:16 pm

      How can you seriously compare “agent expert advisor” to “kind of like a lawyer”? Are you for real??? It takes practically NO training to become an agent, whereas … lawyers… wow, this is absurd.

  7. Ira Serkes

    February 17, 2010 at 12:15 am

    Real Estate is a great business, but it’s definitely not a profession.

    I’m with Kristal – I think an apprenticeship for real world experience is essential.

    And just as essential – someone willing to say “You’re Fired”

    Standards to get, and keep, a real estate license in California are disgraceful. I’d guess there are some agents in other states who would have to use words which weren’t SFW.

    My suggestion. I knew most of the GRI by the time I had to get it for the CRS … but

    TWO GRI courses before you can sit for the real estate exam.
    Completion of GRI designation within 18 months of getting the real estate “learner’s permit” – at which point you get a provisional license

    Completion of 4 CRS courses within 36 months of getting provisional license

    CRS designation within 48 months of getting provisional license.

    Feel free to adjust the numbers – it’s the concept I’m after

  8. Kevin Forrester

    February 17, 2010 at 1:43 am

    I recently saw this interesting post on NAR’s Info Central Blog on the subject of lawyers and real estate agents (posted on Lincoln’s birthday):

    infocentral.blogs.realtor.org/2010/02/12/lincolns-wisdom/

  9. Russell Shaw

    February 17, 2010 at 3:18 am

    If tons more education was such a great solution how is it that there are so many lawyers (who each have lots and lots and lots of education) whose primary purpose seems to only be to line their own pockets at the expense of the public?

    Regardless of how much we have to know – like Ira said – we are sales people. Our job is to list and sell houses.

    In response to one of Fred Romano’s (usually endlessly degrading) questions:
    “What top agent would take on an “apprentice” so they they can learn from them and eventually take their business? C’mmon now. NO ONE will” – I can answer, I do. And so do many other top agents that I personally know. Most effective top agents (at least the ones who *stay* on top) find it necessary to do actual real world training so they aren’t personally needing to do it all themselves.

    In closing, please read Ken Brand’s (it is 2nd from the top) comment again. I couldn’t agree more.

  10. Kevin Cottrell

    February 17, 2010 at 4:16 am

    I agree with Russell and Ken. As an agent and leader in my office, we take on agents as apprentices and teach them the core skills to succeed. My team assisted over 240 families last year – and like Russell we are very busy, yet, I will gladly take the time to assist any agent who wants to learn the skills at a high level. This is a sales professional with no magic pill or formula. It takes hard work, leadership and training.

    On our office, agents are expected to attend mandatory real-world training and skill building centered around key core skills. This training amounts to close to 400-500 hours a year including homework. These classes are not focused on topics that are not relevant and something that’s taught by someone who hasn’t sold enough real estate to impart anything of value. There are plenty of so called gurus and experts that are such as they couldn’t survive in the (not so competitive) real estate profession.

    And we do have a minimum standard of production for our office and our CEO/Team Leader will be raising it each year to ensure our clients in our market are served by the best of the best.

    So, in the end as Ken, Kristal and Russell mention above, with some focus on core training/mentoring, high standards (even at the brokerage level) and leadership, we can in our own backyard, ensure success for the agents in our immediate scope of responsibility.

  11. Yvonne Bondanza-Whittaker

    February 17, 2010 at 9:44 am

    I totally agree. There are brand new agents out there practicing real estate way beyond any level of expertise. Did you know it takes 600 hours of training to become a “nail technician” in the State of Arizona, but it only takes 90 hours to get a real estate license??!!

  12. Nick Molnar

    February 17, 2010 at 10:26 am

    If someone is going to be remarkable, they’re going to do it regardless of how hard or easy it is to get a license or join a trade group.

    Changing license requirements will be as effective as attempts to legislate morality have been.

    The most effective way to “raise the bar” for the industry is simply to be remarkable and let competition drive up the standards for everyone.

    • Jonathan Benya

      February 17, 2010 at 11:46 am

      I don’t agree. #RTB cannot happen if we are complacent about our standards as an industry. Lot’s of people choose their agent because they have a friend or family or coworker with a license. that has absolutely zero bearing on their ability as an agent, and does nothing to encourage better knowledge or service.

      Changing license requirements is key, IMHO. I don’t want a surgeon operating on me that hasn’t been through years of med school, I don’t want a barber that hasn’t had 1000+ hours of training, and I don’t think it’s right that the person helping someone make the biggest financial decision of their life has had the equivalent of one weeks training.

      You are right though:

      “If someone is going to be remarkable, they’re going to do it regardless of how hard or easy it is to get a license or join a trade group.”

      I don’t see that as rationale for leaving standards as low as they currently are though.

      • Nick Molnar

        February 17, 2010 at 12:13 pm

        I wouldn’t argue that license requirements make any sense now. I merely doubt licensing regulations are the most effective means to shape the industry.

        Perhaps working on the perception that licensed real estate agents are interchangeable and your newly licensed cousin will represent you as well as any other agent with a license would help. Note to any non Realtors who find this – they aren’t. You should interview more than two agents and grill them on why they are your best choice.

        Of course it may be easier to change the laws than the public opinion of Realtors.

      • Nick Molnar

        February 17, 2010 at 12:14 pm

        I wouldn’t argue that license requirements make any sense now. I merely doubt licensing regulations are the most effective means to shape the industry.

        Perhaps working on the perception that licensed real estate agents are interchangeable and your newly licensed cousin will represent you as well as any other agent with a license would help. Note to any non Realtors who find this – they aren’t. You should interview more than two agents and grill them on why they are your best choice.

        Of course it may be easier to change the laws than the public’s opinion of Realtors.

  13. Jonathan Dalton

    February 17, 2010 at 10:32 am

    It’s not NAR’s issue, it’s the state’s choice … different states, different requirements. And good luck passing in the Wild West AZ Legislature what may pass elsewhere.

    Everyone talks about beauticians and such … want to know the requirements to get your Series 7 and become a stockbroker? Work at a brokerage for 90 days. Pass the test. That’s it. And I’ll tell you, studying for and passing the Series 7 was 1,000 times more difficult than getting past a real estate exam – national and state versions – that amount to an intelligence test.

    NAR could lobby for more stringent requirements but why do that when lower requirements lead to more dues paying members?

    And at the end of the day, I don’t really care what the general public’s perception is … it’s only the perception of my clients, prospective and otherwise, that matters. If they choose to think all other agents are idiots, so be it.

    • Jonathan Benya

      February 17, 2010 at 11:52 am

      I’d love to see a minimum of 90 days training in a brokerage first. 40 hours (our current minimum to take the test) is the equivalent of 5 days, so why not?

      NAR would see less dues, and I think that is at the heart of this problem. What a shame if the only reason we don’t have higher standards is because NAR would pocket less cash.

  14. Joe Spake

    February 18, 2010 at 8:45 am

    In the immortal words of Deep Throat: “Follow the Money”. NAR and the local and state organizations thrive on the dues. As long as that money keeps flowing, there is no incentive to raise standards.

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