Report turns a spotlight on the real estate industry’s innermost worries, generating impassioned reviews from those whose reputation it calls into question.
When the country’s largest real estate trade group publicly bares some of it’s biggest concerns, should owners, sellers, and buyers of homes pay attention?
That is the question columnist Kenneth Harney posed in a recent Washington Post article – his response to the recently published D.A.N.G.E.R Report. The National Association of Realtors (NAR) commissioned a report detailing the “most significant threats, risks, and black swans” facing the embattled real estate industry.
Some of my boisterous colleagues are calling the report, “a punch in the face, a huge black eye for the industry and an unnecessary public airing of dirty laundry.” Others find the 160-page report to be, “a breath of fresh air, a much-needed wake-up call and a catalyst for change.”
If you ask me, an analysis of this magnitude and standard is long overdue. As an agent of truth and transparency, count me in the camp of folks who largely disagree with prevailing sentiment that the report signals Armageddon for the industry. Rather, I see this as a huge opportunity. Until there is a voice (some actual teeth) behind the problem, there will never be enough demand for a meaningful dialogue about the solution(s).
But see, this is where the D.A.N.G.E.R Report falls short for me, in a big way. The research cataloged more than fifty threats facing the real estate business. It analyzed the multitude of risks leveled at individual agents, brokers, and the MLS’s, as well as the national, state and local Realtor associations. Trouble is, the report looked at all perspectives and potential problems for the housing market except (wait for it) . . . .
What about the actual consumer? Where is the consumer’s voice? Let’s face it; most consumers don’t care much about the housing market from a business perspective. The consumer cares about real estate from a retail and investment perspective. The report did very little to address the threats and dangers to the consumer – you, the people who actually hire the agents.
Preeminent Danger – Masses of “Marginal Agents”
The real estate industry is saddled with a large number of part-time, untrained, unethical and/or incompetent agents. Stated differently, working with the wrong agent, similar to choosing the wrong plastic surgeon, can have negative and lasting consequences. That was the preeminent conclusion from the D.A.N.G.E.R report – the biggest overall threat – their words, not mine.
Though, if you’ve been reading my newsletter articles of late, you know that we were well ahead of the curve on this one. Heck, much of what is discussed and exposed in the D.A.N.G.E.R Report, I talk about in Chapter 1 of my book – The Value-Driven Approach to Sell Real Estate.
The stated purpose of the D.A.N.G.E.R report was to stimulate “healthy and helpful dialogue” but (quoting the text of the report), “it was decided from the beginning of the project that identifying solutions is the responsibility of each respective leader and organization.”
In other words, the most impactful and imminent danger affecting the real estate industry (and ultimately its users, the consumers) is “Masses of Marginal Agents,” who threaten the credibility of the industry. Okay, fair enough, no argument here. What is the solution? Well, nothing, that’s not the point – here. No Solutions? It makes no sense!
The report is a well written piece of crap. It contains no data or actual facts or ideas about how we can improve. – Realtor Commentary
Unlike the D.A.N.G.E.R Report, in our book, I also discuss solutions. I frankly couldn’t care less how big brokers, NAR, the state & local associations, and the MLS’s are negatively impacted by self-inflicted wounds. The consumer, my clients, and my readers are my focus. If the real estate industry is truly “dog eat dog,” then I choose to be in the bunker with you. Fighting for you, with you. I’ll leave the others to slug it out amongst themselves. But you watch, very little change will actually come out of this charade. The industry can’t get out of its own way.
Further, one of the more interesting points of debate for me, inside of the report, was the question of whether or not real estate is perceived as an actual “profession.” I’ve always considered myself a professional and therefore I’d given it little thought. It makes sense though.
The report states, “For decades the industry has held the opinion that it is a profession, however, the reality is that those outside of the industry don’t hold the same opinion.” The article cited the fact that most professions [doctors, lawyers, accountants, engineers] require thousands of hours of study. It went on to compare hours of mandatory instruction for professions like earth drilling (704 hrs) and cosmetology (372 hrs) to the real estate profession (just 70 hrs on average).
Sure, the state of Texas does have more stringent real estate education requirements and licensing standards than some parts of the United States. However, having sat for the salesperson exam and then the broker’s exam, six years later, I can attest to the fact that what you have to memorize and internalize to pass the written exam has very little practical application. It’s a joke, really.
The fact of the matter is that the National Association of Realtors – the nation’s largest lobbying group, in essence a government – is more concerned about lining its pockets with money from its 1 million-plus-members than it is with stepping up to the plate and mandating meaningful change for the industry’s licensing requirements.
Untrained, unethical and/or incompetent agents is an understatement. It used to be just an occasional encounter with a dipsh*t agent, now it’s the norm. Daily. The report was too kind, frankly. – Realtor Commentary
The report concluded, “the delta between great real estate service and poor real estate service has become too large, due to unacceptably low entry requirements to become a real estate agent . . . And while this lack of agent knowledge is a significant danger to itself, when combined with a lack of basic
competency it could be destructive and harmful to both the industry and the consumer.” I don’t know how you can sum it up any more succinctly than that.
The cat is officially out of the bag. Though, we probably did not need to waste hundreds of thousands of dollars on a commissioned report, interviewing almost 8,000 Realtors and 74 top Realty CEO’s to come to the same common sense conclusions that I discuss in my book. I explain, friends don’t let friends get taken advantage of by unethical or incompetent agents. It’s as simple at that, folks. It’s clearly a problem and all I/we can do is continue to trumpet the dangerous consequences consumers face when choosing to work with “the marginal masses.”
The consumer has absolutely NO idea how to choose a ‘good’ Realtor as compared to a ‘bad’ one.” – Realtor, Implicating – YOU
Despite publishing articles like this, speaking the truth and fighting against the status quo to protect clients, the problem remains. Consumers must still do their due diligence.
If you’d like a complete copy of the 160-page DANGER Report, you can download one here. I’ll provide you one, along with a complimentary copy of my book, as a blueprint to greater return on your investment.
For a more in-depth discussion on these topics, you can request a free copy of my book “The Value-Driven Approach to Sell Real Estate: How to protect yourself from Real Estate Greed and bank extra profit by thinking like the great Warren Buffett.” Expect Delivery via USPS media mail in 2-3 Business Days.