Is professionalism in real estate overra…

Is professionalism in real estate overrated?

The real estate zebra clearly things so… but I have to totally disagree.

But before I talk real estate, it’s worth talking about my experience as a licensed transportation engineer, where I never remember hearing anyone debate the value of “professionals.” Among the many different types of projects I worked on were signal design projects, where a dumb design mistake (bad signage, lack of sight distance, non-standard turning radiuses, etc.) can easily (and often do) lead to accidents, deaths and lawsuits. At my consulting firm, every project was overseen and actively reviewed by a principal of the company. The principal was not only licensed, but had years (almost all had at least a dozen years) of licensed experience. In other words, ever after an engineer became licensed (which involved a multi-day test!), they wouldn’t be able to approve final designs until they had years more experience. And far from being the exception, that was how every transportation engineering consulting firm (at least that I was aware of) operated… and it resulted in an industry that generally has a very good reputation with their clients (who are generally city and state governments)… Like any industry, consulting firms are often selected based on price, but the risk of sacrificing quality has been mitigated by the fact that there’s such a strong professional ethic within the engineering industry.

Compare that to the real estate industry where the barriers to entry are so much lower and the quality reviews so much more infrequent. The industry often portrays itself as “professionals” who are always looking out for the best interest of their clients (and most real estate agents are), but there are enough incompetent “bad apples” in any given market that there’s widespread distrust among consumers.

Daniel makes an extremely valid point that on any given transaction, industry-wide “professionalism” doesn’t matter much, as it’s the professionalism of the individual agent that determines if the client is satisfied. And when we sold our Seattle house, Ardell represented us, so I was able to feel more than confident that our agent was looking out for our best interests.

However, it totally misses the issue of widespread consumer distrust of the industry in general. (Want to see some distrust among consumers? Check out this post on RCG.) Unless/until the industry can do a better job removing the bad apples who are just around to make a quick transaction (ethical or otherwise), I would argue that the real danger is consumers, especially consumers who don’t already have a trusted advisor, will be more than happy to seek out and use alternative business models that differentiate themselves only on price.

[cc photo credit: One bad apple]

7 responses

  1. Thanks for the good debate, Dustin. I’ve been missing this, lately. 😉

    I’m not saying that we shouldn’t constantly be striving to improve the industry. I’m just saying that the industry seems to have a collective oversensitivity to an issue that is NEVER going to be resolved. No amount of increase in standards is going to eliminate the perception that some people have of real estate agents.

    Look at lawyers, for example. The practice of law has almost impossibly high standards. The number of people who actually get into law school, graduate from law school, and pass the bar exam is very, very small. Despite the very high standards that the legal industry has, ask 10 random folks on the street what their opinion is of lawyers, and I’ll guarantee you’ll get at least 4 negative answers. Hell, there are whole books filled with jokes about lawyers. Lawyers aren’t bad people, either. I know, I spent years working with them, and trying to become one. What they don’t do, however, is spend copious amounts of time worrying about their public reputation. They know who they are and who they are not. They deal with the bad apples, and they move on.

    Here’s the thing– I’m not going to dispute the fact that there is a public misperception about Realtors. That, however, is the fault of Realtors, not the fault of the standards for entry into the profession. If you want to get rid of the bad apples, do what you do better than them, and the public will choose you. If the public is choosing the bad apples over the good, the responsibility for change lies with the good.

    John Wooden famously said, “Be more concerned with your character than your reputation, because your character is what you really are, while your reputation is merely what others think you are.”

    The real estate industry might have a bad reputation with some, but it certainly has good character. Realtors need to do less worrying about their reputation, and more time showing their character. Everything else will take care of itself.

  2. a rising tide lifts all boats. Any industry is judged by it’s lowest common denominator not by select individuals who are the cream of the crop. The real estate industry has some work to do. However, they’re about 100 years ahead of the mortgage lending industry. That’s how old the Realtor Code of Ethics is.

  3. Daniel, I was a student at a continuing legal ed seminar all day today. All the attorney students: arrived on time, had their cell phones off the entire time, were dressed professionally, sat quietly for the entire 8 hours, didn’t constantly interrupt the speaker and weren’t on their blackberries constantly. Oh, and there wasn’t any students who needed constant attention from their mommy, I mean instructor. I’d say there is a huge difference in professionalism between agents and attorneys.Yes there are unethical attorneys but at least the Bar Assoc in each state handles complaints and dis-bars some members. They don’t make state regulators do it, their own industry is responsible for its professionalism. Every renewal cycle attorneys have to have a certain number of hours of Edu on the topic of ethics. Yes, I’d say real estate agents/Realtors still have a ways to go. Let’s definitely not stop now.

    1. Daniel: I must say that I’m with Jillayne here. Lawyers prove the importance of professionalism. They may not have a the best reputation as people, but get into any legal trouble and even people who hate lawyers want one by their side.

      All too often consumers have the opposite view of real estate agents and view using an agent as a necessary evil because the system is stacked against them… As Jillayne notes, the role of ethics has deep roots in the industry, but improving the standards and actively rooting out the bad apples could go a long way to improving consumer’s perception.

      By the way, I miss these debates as well! It’s the main reason I switched over to this new theme. I wanted to get away with the focus on blog formalities and encourage a stream of conversations (and debates!).

  4. The majority of people would do the right thing, if we could just agree on what that “right’ thing is.

    The legal profession is not confused about what their role is in Society. Agents for the Seller are also not confused about what their role is in Society. The Code of Ethics may be 100 years old, but it does not adequately address, nor do the trainings to date, the huge shift of responsibility in this Industry to include buyers as clients vs. customers. That event is not 100 years old…and in most areas is still in infancy stage as to Corporate Training and Ethics.

    Even the Best of Brokers from the Best of Brokerages still retorts to an agent who just helped a buyer client view a house “Did you SELL “it”?!” Ugh!! And that is the NORM, not the exception.

    That my friends is where the lack of “professionalism” stems from, and is supported at all levels of the industry as if Buyer Agency never happened. It is Buyers vs Sellers who hold agents in disregard more and most often, and with good reason. That is reality and not perception and it is not a MIS-perception.

    Ethics in it’s highest form is “Right vs. Right”, not Right vs. Wrong. Do we “Sell a House” for the Broker when we “represent” a Buyer Client? That, from the Broker and Brokerage’s perception is the RIGHT of “it”, and the reason the public views us as charlatans and wolves in sheep’s clothing and frankly they are absolutely correct.

    Most agents who do not SELL a house TO a buyer, but rather offer good advice even when that advice is “do not buy it”, do so to the great dismay of their Broker and Brokerage. In fact they most often have to hide their “good selves’ from their Broker, who will be saddened that they simply did not sell the buyer a house.

    Agents would all do the “right” thing…and be highly regarded by the public, if we could simply agree on what that right thing is when it comes to the home BUYING public. I don’t think I’ll live that long. The industry still operates as if we all represent sellers of homes, and deserves the results of that failure to rise to the challenge of buyer agency.

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