What do you expect from a real estate agent? An industry vilified for providing minimal consumer protection during the boom is now in the midst of becoming active again. This time, real estate consumers have much more information at their disposal with MLS, public records, valuation programs and demographic data all available. Given this, what role do agents play? A National Association of Realtors survey conducted in 2012 gives a few highlights.
Agents play a role but not necessarily the same role as in the past. The reasons vary; the primary one is the cloak of darkness surrounding MLS access being pierced; many buyers come to agents with homes they’ve already found. No longer are agents the single route to listings; finding homes is one of several roles they play, not the singular most critical.
- 41% of buyers first looked for properties on line
- 11% of buyers went on line to find out about the home buying process
- 89% of buyers bought their home with the use of a real estate agent. That number steadily increasing from 69% in 2001
Agents in the current environment remain important in finding homes but appear to be most important in deciphering the information and managing the transaction. Having piles of data, no matter how reliable, is worthless without the ability to organize and utilize it. Agents are relied upon to connect the dots for clients. Buyers expect agents to ascertain which properties are financially sound purchases, negotiate for the best possible results and manage the process to the closing table.
Home sellers also have a wealth of knowledge at their fingertips, like buyers they expect agents to explain that information and put it to use for their benefit. Home sellers expect agents to properly expose their home to potential buyers, assist in pricing the home and negotiate the terms of the contract for the best possible results. In short, they want the most money with the least amount of turmoil.
Buying and selling real estate has become rather complicated. Mortgage approval has been called one of the most combative and stressful things a person can go through; agents are expected to alleviate problems here, with the appraisal, inspections and the myriad of other possible hot spots. The current environment pressures both buyers and sellers and what used to be a somewhat exciting process can often devolve into a stressful event. Agents are expected to temper this and control the chaos.
With agents playing an admittedly critical role, how are buyers and sellers finding agents? About 50% of buyers found their agent through referral or prior use; 61% of home sellers found theirs the same way. Yet only 10% of buyers and sellers actually used the same agent again despite many saying they would. Also consider that 67% of buyers and sellers interviewed only one agent to work with; in a sense there was nothing to compare that agent with. For such an important event, the lack of effort put into selecting a real estate agent is puzzling.
The real estate industry has been much maligned over the last ten years; while improvements have been made, much remains to be done at the basic agent level. As the market heats up, agent ranks are beginning to swell again with “opportunity” or “DNA” agents; those that rely on friends and family for business. This is not, nor was it ever a part time business; what the public expects of real estate agents requires a level of intimate familiarity with the market and the process that cannot be obtained working part time. Change will come when the public demands it – yet if the collapse didn’t change the paradigm, what will?