Mama’s, Don’t Let Your Babies Grow Up to be Real Estate Agents
A satirical update on the world’s 2nd oldest profession.
Real Estate.
There’s no other profession that requires its practitioners to be as client-centered and focused. Those who work in the industry are acutely aware of the importance of communicating and responding to clients, since this directly determines how well they are compensated.
Well, okay. Maybe real estate isn’t the only profession in which mastering the art of the schmooze can be the difference between professional success and failure. Politics comes close. But a lot of people don’t consider politics to be a profession — at least not an honorable one.
I obtained my first real estate license in 1979. I realize that was before a lot of you were born. On the up side, it means I’ve seen a lot of both good and bad agents enter and leave the business in lock-step to economic cycling and interest rates.
The ebb and flow of agents isn’t rocket science.
When the economy turns positive and the real estate business goes up, new agents flood the industry. They spend a few weeks completing the required education, take a multiple choice test, get their license, and the state turns them loose on an unsuspecting public.
Conversely, when the economy takes a nose-dive, the majority of fair-weather agents go back to being a cashier at Walmart, selling tires at Costco, or deciding to become an online influencer — because it’s easy money. Just ask the guy they bought the course from.
And then there are the old-timers — agents with ten, twenty or even thirty years in the business of helping people buy homes. These are the folks I’m talking about.
They’ve developed the patience, communication skills, and a sixth-sense red flag detector that’s more accurate than any polygraph machine. They know when a buyer is lying about how much money they can spend. They know when a seller is trying to conceal a leaking basement or the sinkhole hiding “somewhere” in the backyard.
A good agent knows how to “read” people.
Myers–Briggs may have their personality type test, but a good Realtor can usually peg the values and intentions of a client within the first few minutes of meeting them.
Agents also know when they’re being used and often abused. And they’re acutely aware that most people would rather sell their first born child than pay a commission.
And yet, they continue to smile, nod, and respond with the magic word, “Yes,” as they mentally note the verbal cues, criteria words, and physical congruency of their clients.
Because later — during contract negotiations when it’s imperative to know their client’s financial limitations — they’ll be able to bargain in good faith, regardless of what their ego-driven client wants them to believe.
Agents have heard all the stories.
They’ve listened patiently for hours while buyers and sellers told them about the last time they held a backyard party and the next door neighbor called the cops.
And then there’s the buyer who knows everything there is to know about real estate, doesn’t need any advice, and only uses an agent because that’s the way the industry is set up — to keep prices high and undeservedly reward the pencil-pushers.
Conversely, I know there are plenty of unscrupulous, devious, self-involved, even arrogant agents out there.
You can see the tip of the iceberg by looking at the Realtors cast as “stars” on real estate reality shows. Pushy, ego-maniacal, and over-confident, they wheel and deal with demanding buyers and unrealistic sellers, hoping to negotiate a transaction that pays them an exorbitant commission. In their defense, their intense and often ruthless behavior may be a necessary and even expected component when hard-balling it with the big boys.
The premise and plot usually follows a similar story-line: A pretentious and condescending seller is interviewing agents to determine who will get the listing on his ostentatious, over-priced, outdated mini-mansion centrally located on a street with so much traffic he hasn’t been able to back out of his driveway for three years.
But is that a problem? Hardly.
Especially, when you consider the offsetting luxury provided by the imported goose-down wall-paper in the dining room and the hand-painted cherubs framed with red and silver filigree on the ceiling of the master bedroom.
Hell, he’s not selling a house, he’s giving up a priceless work of art.
After summarily dismissing the first few agents like brown M&M’s, who does the owner finally choose to list his home? The leggy, thirty-five year-old, ex-Playboy model with the killer body and angelic face, who always walks around barefoot to avoid scuffing the home’s wood floor — made from the hull-planking of Noah’s ark.
The message? The hot blonde always gets the listing.
Traditionally, Realtors have always had exclusive access to the sacred scrolls.
More commonly known as the multiple listing service (MLS), you can think of it as a master data bank for all property listed for public sale. Fifteen years ago, if you were in the market to buy a home, you needed access to that list — which was only available from a Realtor.
But with the proliferation of online companies offering both owners and agents a platform to advertising their listings nationally, the MLS data — or some derivation of it — is now available to anyone who wants it.
For example, with a few key strokes, Zillow will give you the price and pictures of any MLS-listed property, along with an invite to be contacted by any one of a number of Realtors — only one of which will be the listing agent.
Why the additional agents? Because that’s how Zillow makes its money — by selling agent advertising based on zip code and the percentage of inquiries an agent chooses to buy. And that’s what determines which agents are promoted, and how often.
The fact that agents still buy into this take-your-turn-based-on-how-much-you-want-to-spend is a fascinating study in human behavior.
Many agents believe they must have a presence on Zillow to prevent their conspicuous absence. But what do they get for the money? It’s hard to say.
There’s no guarantee on the quality of the lead.
This means when a call comes in from a Zillow ad, the agent has no idea if the caller is financially qualified or even seriously considering a home purchase. And based on my experience, Zillow has no idea either.
After buying a year of highly-targeted Zillow marketing, the majority of calls I received were folks wanting to know why their neighbor was moving, was I aware the seller’s teen-age son was running an auto repair shop in the backyard, and would the owner consider selling the patio furniture — not the house, just the patio furniture.
Yes, I received all those great leads, and it only costs me an average of a hundred dollars a call. (I’m not kidding!)
But agents need not worry about the cost of advertising.
Because selling real estate will make you rich!
Yep, after a month or two of putting a few ads on social media, you’ll be rolling in the dough. The commissions will be coming in so fast and furious you’ll have to buy an extra Cadillac to park in front of the new custom home you just purchased. On the beach. In Malibu.
Yes, real estate agents know how to spend money
Especially on newsletters, billboards, and postcards. And while none of these are guaranteed to produce a buyer, agents love the warm, fuzzy feeling that comes from stuffing mailboxes with brightly-colored brochures made from those pesky old-growth forests that needed to be cut down anyway to make room for a new housing development.
In every market, there are always a few superstars that rise to the top.
These are the agents who do the majority of business in a particular market. They work hard to convince sellers and buyers they’re the best choice — because they have the most experience, the best service, and most reasonable commissions. They might even promise to answer their phone personally after regular working hours — even if you want to chat at 10:00 pm.
But that’s not the public’s perception of an agent.
Instead of acknowledging an agent’s expertise in marketing and negotiating, I usually hear some derivation of the following:
“All agents are the same. There’s no difference, so go with the one who charges the cheapest commission.”
And then there’s the classic:
“My agent hounded me day and night until I gave him the listing, then I couldn’t get him on the phone if my life depended on it.”
It’s called cognitive bias.
And after the last real estate meltdown, it’s doubtful the industry is going to be able to change the public’s general negative perception. Because, as we all know, the nationwide crash was the fault of those damn agents who forced all those hard-working folks to buy overpriced, overvalued homes to make sure their commission stream continued to flow.
What’s the future look like?
Agent-less transactions.
Those whose crystal ball is a lot clearer than mine are predicting a huge reduction (pronounced wash-out) in the total number of agents. Instead of buyer-to-seller based transactions, these business prophets see a new model — one in which an owner sells their home to a company (for example, Zillow), and buyers then purchase the home from the company. This essentially reduces and even eliminates the need for independent agent representation.
Think of it this way: When you’re ready to sell, you request an offer from a wholesaler, who buys your property in similar fashion to selling a piece of jewelry to a pawn broker. After taking care of any deferred maintenance and cleaning, the company advertises and sells the property for a profit.
In all cases, it’s a customer-to-company transaction.
No one will care about the gorgeous roses you planted in the backyard or the wide perimeter of pool Kool-decking that cost you an extra five grand. And those build-in storage cabinets you installed in the garage? Might as well pull them out and sell them to a neighbor.
The value of your home will be based on a market analysis — an objective financial assessment of what your home will sell for in the next ninety days, less the cost of rehabbing, administration and processing fees, advertising, signage, holding costs, and the profit the company wants to net.
How will this new model affect the current sea of independent agents? As many as two thirds of them are slated to leave the industry.
Still ready to give up that pain-in-the-ass job at Google and look for the nearest real estate school?
Here’s what you do:
- Move to Los Angeles.
- Get a California real estate license.
- Answer a casting call for the next real estate reality show.
- Amaze the producers with your sassy attitude, quick wit, and reprints from your Playboy photo shoot. And by all means, dress to impress. Wear something that provides a hint of cleavage and shows off those sun-kissed thighs. (Sorry guys, but this is a good place to re-read that paragraph about selling tires at Costco.)
I’ll leave you with this . . .
I recently listened to a doctor tell me how he had looked forward to encouraging his son to follow him into the practice of medicine. But with patient care now determined by the insurance industry and the rising cost of malpractice premiums completely out of reason, he was now advising his son to pursue business or law.
Will parents who’ve traditionally made their living selling real estate also begin to dissuade their children from pursuing a career as an agent?
Even with the majority of traditional real estate agents expected to suffer the same consolidation as travel agents and retail stock brokers, I doubt it.
The lure of fast, easy money is too strong.
After all, who wouldn’t want to drive a Rolls Royce, wear a fifteen-thousand dollar Rolex, and pay for a cappuccino with a hundred dollar bill and tell the server to keep the change?
I know I did — even if it was just a fantasy.
© 2020 Roger A. Reid. All Rights Reserved.
Roger A. Reid is the author of Better Mondays: The New Rules for Creating Financial Success and Personal Freedom (While Working for the Man)
Roger A. Reid, Ph.D. is the host of Success Point 360 Podcast and author of Better Mondays and Speak Up. A certified NLP trainer with degrees in engineering and business, Roger offers tips and strategies for achieving higher levels of career success and personal fulfillment in the real world.