The raise the bar narrative
At any given time, there are roughly half a million full-time real estate professionals (sales agents and brokers) in the United States. Yet, at the same time, there are over one million members of the National Association of Realtors®. Does anyone else take issue with the big gap here? Can it possibly be that almost 60% of the real estate professionals that I deal with day in and day out are actually dabblers in the field?
Industry changes are coming fast and furious – so quickly in fact that it is often hard for even the busiest of real estate professionals to keep up. While we tend to think that it’s the technology that’s always changing, it’s not just tech. It’s contract law, state and local policies and procedures, and risk management among other things. The truth is that with that production volume comes experience – lots and lots of it. Dabblers, hobbyists, or part-time real estate professionals have a tough time staying in the game.
I realize that I am not going to make any friends here when I say that part-time agents (those closing only one or two transactions per year) often lack the experience and know-how to get the job done. A part-time agent may not know about the latest contract forms release or the latest technological advance. In addition, a part-time agent may be dividing time between two jobs and thus compromise the quality of customer service that he or she can provide to a client. I’ve had buyers call our brokerage and request a showing of one of our office listings; they’d say that they are represented by another agent that is “too busy” to show the property or “at work.” And this hasn’t only happened once. It has happened over and over and over again.
What kind of message do phone calls like these send about what’s going on in the profession?
Three areas where we can forge change
When considering ways to address the challenges faced by working in an industry where 58% of the real estate professionals may not have the demonstrated expertise associated with full-time work, it’s curious to consider where change should begin – at the top or at the bottom. Here are some places to start to raise the bar:
- At the state level. What would happen if licensing and renewal requirements were strengthened in each state? That is, if it were tougher or more expensive to get a license or if the renewal requirements were a little more challenging than passing a few $69 correspondence courses; this might actually enhance the quality of licensed professionals. Making it more expensive to obtain a license or to renew would also demonstrate that those who do renew are serious about practicing real estate. It’s pay to play, and those that pay (if it costs more) would be serious about the play.
- At the local level. At the local level, real estate associations could increase their dues, offer more educational opportunities, and have stricter requirements for membership. Again this would force the hand a little bit. Kelley Skar, a Canadian Realtor® states “if the associations start increasing the cost, they might start to see a slight dip in their membership numbers which could be detrimental to their bottom line. I see this as being temporary as the associations and boards would make adjustments within their current business model to allow for decrease in membership.” If associations do see a dip in membership, they’d have to do something about it to keep the doors open, Namely, they’d have to demonstrate their relevance or increase the value that they provide to the current members.
- At the brokerage level. In a perfect world, raising the bar in the real estate industry would begin at the brokerage level. If brokers were to have minimum guidelines for they type of contractors they would accept and offer trainings and guidance to keep their agents at the forefront of the industry, this could make things better. The reality is that this will never happen. Skar points out that there will always be discount brokerages and brokerages whose model depends not only on producers but non-producers that pay a monthly desk fee. As long as there will be brokerages where non-producers can hang their licenses, the industry is not going to change.
Theory of natural selection
The good news is that Charles Darwin’s theory of natural selection seems to apply pretty well to the field of real estate. If you are reading this article and actively working within the industry, you are likely one of the half million that is raising the bar in the industry by working full time, staying ahead of real estate trends, and developing personally and professionally.
Whether the change begins at the brokerage level or at the state level, it shouldn’t matter to you. You’ve paved your way to success among your industry peers. You’ll have no problem stepping over the bar even if it raised a little bit, because you are fairly flexible already.