Why People Hate Real Estate Agents

Like any industry, there are a lot of misconceptions about real estate among people who aren’t in the business. 

In particular, I believe many people have a negative opinion of “realtors.” Some think they’re just sleazy salesmen, out to get your money at any cost, others think they’re an unnecessary expense who provide little value to the process of buying or selling a home.

There’s also the misconception that agents have the easiest job in the world, and that they collect huge payouts for a just few hours of work. 

These misconceptions give realtors and agents a bad reputation and can seriously impact a client’s ability to pick the ideal agent for their needs. 

So, where have these misconceptions come from?

Bad Apples

There are a lot of amazing real estate agents out there, but there are also a lot of really, really bad ones, too. 

These few “bad apples” spoil the bunch and leave the word “realtor” and "agent" with a bad connotation.

This makes sizing up an agent difficult for many people because so many agents fluff and puff about themselves. It's hard to tell what is true and what is misrepresentation or an outright lie.

There isn’t just one thing that separates a good agent from a bad, but one thing I’ve found is that many bad agents just don't get it.

Technology’s Role

Let’s talk about Zillow, for a moment. 

Zillow has done some amazing things for the real estate industry especially in regard to data, both on the agent side of things, and the client facing side. But, like anything, on the other side of the coin, it’s also caused some problems.

For example, when you’re looking at a home on Zillow, there will be a list of agents featured on the property page for that home. However, only one of them is the listing agent for that property. All of the others have their image plastered next to that house because they’ve paid Zillow to be a “Premier Agent” (the cost of which starts at ~$4k/month in my neighborhood). This is a way for agents to collect buyer leads. I feel that if you live by the sword, you die by the sword, and if agents are relying too much on Zillow for the bulk of their business they will face tough times ahead especially when/if Zillow becomes a brokerage.

Because technology is forever changing. This will always be the case, but if we look at how tech has changed the real estate industry over the last 15 years, the transaction really hasn't changed much at its core.

That means if you're a tech savvy, hyperlocal broker who specializes in one neighborhood, your business is going to be less susceptible to changing tides. No matter what technologies come down the road, if you are armed with data you still have neighborhood expertise, and that can’t be replicated or substituted easily.

Drive and Skill Are Key

Before going any further, I’d like to clarify that there’s a distinction between realtors and real estate agents. Many people use the terms interchangeably, kind of like how people mistakenly call their tax refund their “return,” when the return is what you file, in order to get back a refund. 

While all realtors are agents, not all real estate agents are realtors. 

Realtors are actually a member of a trade group called the NAR (not to be confused with the NRA!).

Considering the minimal amount of work that some agents put into their listings and clients, it’s easy to understand why some people might think the job is easy. Let's face it. The barriers to entry to becoming an agent are minimal. All you need to do is take a one-week course, pass an exam and affiliate with a broker. 

This was much easier than the four-part CPA exam I passed earlier in my career and the graduate school requirement I filled.

You see, many agents just don’t have the bandwidth to be great at their jobs because they are constantly chasing after the next deal.

There is a huge turnover in the real estate industry. Industry statistics show the number of active real estate agents falls and rises with the economy. When times are good, everyone wants to be a real estate agent, and the number of active real estate agents rises. So, even though a large number might not renew their licenses, a fresh batch of newly licensed agents fills that void. The most recent crash sent many agents running, and the next crash will too. 

These agents are the bad apples, the ones who are in it for the quick score, and who don’t bother to learn how to genuinely be creative and add value to their clients.

Some people think that all you have to do to sell a home is post photographs online and toss it on the MLS. 

Those two actions might bring a buyer but they don't necessarily sell a home. A lot can happen between signing the contract and closing. 

A smart agent also knows how to negotiate and how to handle problems that can pop up like an appraisal coming in low which we'll see more of, home inspection repairs, buying and selling concurrently, contingency releases and more.

Lastly, unless buyer agents are giving you 'off market' buying opportunities instead of relying solely on MLS or your selling agent has built an extensive marketing reach in your neighborhood then their value play diminishes. Too many times I find agents covering too much ground because it's hard for them to generate enough business in a single neighborhood or location. A master of everything is a master of nothing and the value play diminishes the more they move away from their core neighborhood(s).

If they want to earn their commission, they have to do more than add their clients to the MLS, send them automatic updates, and go to a showing. Or if they're selling a property, they need to be marketing experts in order to create a competitive edge, and not just toss input data into the MLS database.

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Have any questions? Here are the latest trends shaping the housing market in Southie. Here are 4 takeaways from South Boston's real estate market in 2017.

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Chris Fitzpatrick is a licensed real estate broker in South Boston. Chris prides himself on his knowledge of South Boston nuances, off-market listings and new development projects that are rapidly shaping the neighborhood. He focuses on adding value in the form of creating proprietary real estate market data, predictive analytics, and technology helping sellers, buyers, and developers. Chris can talk your ear off about the benefits of yoga, loves to travel, is passionate about entrepreneurship, and loves rooting for the underdog.