Here’s the bottom line:
New agents come into the field convinced that it’s an easy way to earn money and that deals will simply fall into their laps.
Many new agents are not mentored or trained on how to sell real estate or complete the necessary contractual forms. If you pass the DRE test, you can work as an agent.
Agents are encourage to promote themselves as having experience in real estate.
Even CAR and NAR don’t release information about the number of transactions an average Realtor® does each year. Based on the number of deals out there and the number of agents, the average for California would be approximately 6 sides (representing seller or buyer) per agent for 2005 and 2006. This year it will be dramatically less.
Experienced agents and brand new agents are offered the same commission percentage when representing a buyer. Many will negotiate the same commission for a sale as well.
The system is set up to benefit those in control by increasing the number of agents. Not by long term experienced agents. Newer agents in large numbers support the large brokerage firms, CAR, NAR and the Local Realtor® Associations.
Clients are a secondary consideration for the agent. Agents need to make a living, completed transactions are the way to do that.
The people commenting on the state of the market are those who have a vested interest in making the market look good.
The outcome:
There are good agents out there. Good agents are conscientious, hard working and put the interest of their client over and above everything else. Good agents take the time a client needs to find the right home and be emotionally and financially ready to buy or sell.
Good agents are very hard to distinguish from bad agents. For a buyer or seller, it is very hard to determine the amount of experience of the agent. Buyers and sellers can and should check the Department of Real Estate website for information about the agent they are thinking about choosing. Although the information at that site only has to do with licensing date and the state of the license, it is better than nothing.
Many people will recommend an agent they used if they believed the transaction went well. The problem is that the client may not know whether or not the transaction was handled well. Agents are sales people, they are very good at putting the right spin on things.
The only person who may have the experience and expertise to know whether or not the agent did a good job may be the escrow officer or the other agent. Of course, if the agent picked the escrow officer and does a lot of work with her, then your chance of getting an honest answer may be questionable.
What I’m trying to say is that everyone in this business works on commission and has a vested interest. Escrow officers are dependent on agents for their business. Agents get referrals from escrow officers. Who does an escrow officer refer to, the best agent or the one that gives her the most business? And the escrow officer may not know if the agent has done her job well. A lot of things happen behind the scene that neither the escrow officer or the client see.
Next: Things The Client Doesn’t See in a Real Estate Transaction
© 2007 by Judy Kane
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