[NOTE: This article was orginally published December 1, 2022]
"I THINK I SHOULD SEE OTHER LISTING AGENTS"
It’s time to have “the talk” with your listing agent.
It’s not that the vibe isn’t right -- it certainly is. Even with the housing market cooling from the heights of the pandemic, economists still believe the residential market is relatively hot (and they claim the boom has remained far more sustainable due to larger cash down payments, less reliance on high-risk lending, as well as notable regional population shifts). If you’ve been dipping your foot into the market recently, looking either to buy or sell, you can certainly confirm it is indeed still a warm seller’s market.
It is the process of selling a home, however, that leaves much to be desired. At best, it feels clunky and uncomfortable. Even a relatively smooth transaction does not prevent some questioning if the experience could have been more efficient, or delivered a slightly better financial outcome. At worst, the process can be borderline toxic and costly. Horror stories about market value misalignment, hidden fees, listing stagnation, and downright fraud are abundant. (There is a reason this decade-old article on “How Shady Real Estate Agents Cheat” still receives updated comments from frustrated homeowners). So what exactly makes our relationship with real estate agents so unfulfilling?
NAVIGATING THE REAL ESTATE PROCESS
Overwhelmingly, the deciding factor in our experience can indeed be the real estate agent representing our interests. This makes sense, given our heavy reliance on an experienced professional to navigate [what always turns out to be] an arduous journey -- 89% of sellers list with an agent! The pressure is only amplified by the high stakes, as a home is not only a massive factor in our quality of life, but also the most significant asset for the majority of owners. (See “How Housing Became the World’s Biggest Asset Class”). Homeownership is a momentous occasion, as a huge investment that is both sentimental and financial. We want everything to go swimmingly and we put our faith in a real estate agent to make that happen.
So if our listing agents are critical to maximizing success throughout this experience, then choosing the RIGHT listing agent carries equal importance. But this is where things go awry.
Finding real estate agents has become a perverse casino game. If you begin your search blindly, you’ll find yourself Googling a few key terms and poking around online. Your top results will yield links to the larger brokers sites, which are as vanilla and unhelpful as you’d expect. Next you might find some ranked lists and Yelp reviews, which you suspect are favorably skewed by SEO-savvy operators. Then as you narrow your search, you might peruse the Instagram pages of a handful of agents -- which are most definitely skewed in their favor! From there, you will arrange some in-person (or Zoom equivalent) meetings, but you’re essentially working from an information set that has been highly curated and massaged by the agents themselves... Especially everything that comes out of their mouth from that point onward. Not an ideal start to the selling process.
The alternative is finding an agent the traditional way, through word of mouth. This inevitably introduces a different set of issues. As soon as you reach out, the peer pressure begins. Any referral by a friend carries an implicit expectation to use their recommendation, both as a courtesy to them and as a confirmation of their own judgment. Contacting an agent you know personally brings even MORE pressure, lest you jeopardize your relationship by spurning their services. While there may be a time and a place for acquiescence, that is a terrible reason to choose a realtor. Do you really want to leave the task of selling your home above market value to Chad, your old high school buddy who used to copy your algebra homework during the few classes he’d actually attend? Choosing a listing agent through your immediate network is essentially just opting for “the devil you know.”
50 FIRST DATES BEFORE A LISTING AGREEMENT
It comes as no surprise that one of the most commonly used analogies for the agent search is… old fashioned dating.
Perhaps your friends try to set you up with folks they know, or maybe you prefer to approach attractive strangers you encounter by happenstance. You put yourself out there on a bunch of first dates and try to pick the one that seems the best of the lot -- sounds pretty similar to the aforementioned process for sourcing a real estate agent. Both searches are nerve wracking and uncomfortable, and you only learn if this person truly has your best interests at heart when they are in a position to take advantage of your vulnerability. But by then it is too late.
Therein lies the conundrum. While the dating game has evolved, we continue to source listing agents like it’s 1991.
Nowadays we have a multitude of unique dating applications, online reviews, and social media platforms that are tailored to that search. While once taboo, dating apps in the US now top an astounding 15 millions daily active users. These tools have become integral to the modern dating process, because they bring transparency and reach to the process. You no longer need to play the guessing game about a potential partner’s intentions, career, personality, habits, interests, values, political leanings, and more -- everything is publicized up front. Furthermore, you are no longer limited to first or second degree connections -- immediately the option pool swells exponentially.
Other industries are being forced down a similar path. In the auto industry we’ve seen companies like Tesla (and others) offering a better digital buying experience. Transparent platforms eliminate the need to trust strangers at their word; the data speaks for itself. Don’t like what you see? You have a whole array of different options at your fingertips, beyond the small sample at your local dealership.
So why are we still settling for the outdated way when it comes to the agent for the single biggest transaction we make?
MOVING ON FROM THE HEARTACHE
A better process is on the horizon.
It’s time to say, “It’s not me, it’s you” to all the lackluster listing agents. It’s the broken promises, the constantly moving goal posts, the ghosting -- yes, even in a professional capacity -- when we need you, the lack of transparency, the malaise… it’s become all too much emotionally, while all too little monetarily.
It’s time for agents to put their money where their mouth is. Instead of taking them at their bold claims for what they might do, we deserve a performance guarantee on what they will deliver.
It’s time for a platform that gives power back to the homeowners. One that makes the agents work for us, not the other way around. A great, experienced agent relishes the chance to showcase what they can do! A selling agent represents the seller – what a novel idea.
A system for sourcing agents that is totally transparent and provides a far greater pool of brokers simply benefits everyone. More homes sold for top dollar.
First timers should not feel paralyzed with fear of making costly rookie naivetes. Homeowners re-entering the market after many years (the median duration of homeownership in the U.S. is 13.3 years) should feel confident they’re receiving the most current information and utmost diligence. Even frequent flippers, who have active familiarity with the process, would benefit from a platform that helps them maximize their margins and scale their portfolio beyond their current reach – any tool that brings prospective buyers and a higher asking price would be most welcome.
The premier agents, the brokerages that overdeliver, would see their efforts validated by a visible success rate. Their performances would speak for themselves, while the less reputable agents and their fish tales would be immediately exposed – or better yet, excluded from the system entirely. Ultimately, establishing an incentive structure that anchors the agent’s commission to delivering on a seller’s desired sale aspects makes for a very motivated realtor, and a very happy seller.
It’s time. Time to reimagine the market for real estate professionals, time to bring parity to all their promises, time for homesellers to get their groove back.
Like this article? Know other people frustrated with the process of finding a listing or selling agent? Please share this with your friends so together we can reinvent the real estate transaction model, and receive much better than what most real estate agents offer.
