Since MRED pulled Zillow’s IDX feed because Compass and its wholly owned companies’ private exclusive listings violated Zillow’s internal policies, there has been a strong reaction from the real estate industry. Everyone has a position, an opinion, or a prognostication about the future of both teams and their chances to win the World Series. Compass and its companies (the ones they own, not the companies operating under the franchises they bought when Anywhere became Compass International Holdings) are posting all over social media, claiming that Zillow doesn’t have the majority of listings in the Chicagoland Area.

EXP and Nexthome started touting the direct feed they’ve established with Zillow and recommending that midsize and smaller companies do the same (there are some restrictions on advertising elsewhere if you do that, but hey, it’s an individual owner’s choice, right?).

A bunch of people were newsjacking the event (talking about a viral story to elevate their online presence) to amplify their opinions. One in particular found it amazing that Robert Refkin had made deals with four MLSs in a very short time, seeming to indicate a conspiracy or a long-term conspiracy coming to fruition. Another accused Refkin of weaponizing the Compass-affiliated directors of MLSs (my own experience in working with individuals like this has been that they are careful and thoughtful about their roles as directors and have the same good intentions and integrity as any other directors) .

People who don’t like the idea of Zillow or portals in general thought MRED was heroic. People who didn’t like Private Exclusives thought that Refkin had seduced the MLSs with whom he had agreements, and Zillow was the good guy for standing up to them. Everyone seemed to be guilty of confirmation bias in their estimates of why you people were doing what they were doing.

Here’s the Box Score

Robert Refkin and Compass have aligned four MLSs, seeking financial gain or larger membership by aiming for a National MLS—an idea as impractical as perpetual motion or unicorns. This creates a proxy conflict, much like nations using proxy states, with MRED as the proxy. The outcome is uncertain, but MRED is making a bold move toward that high goal.

Zillow’s response to these MLS deals was a pivot back to direct deeds from brokers- harking back to where the portals began. If the MLS isn’t going to play nice, they’ll go directly to the broker to populate their portal in a pinch. It’s time-consuming and challenging, but they’ve executed difficult maneuvers before and seem willing to take it on.

Everyone was ready for the fight, and the real estate industry grabbed a bucket of popcorn and sat in the stands to watch the game. A pitch was made, the batter stood ready …

And then the game was called.

As part of the litigation, Zillow sought an injunction requiring MRED to restore its IDX feed, and it was granted. After a few short days (and lots of videos and social media posts), the first inning had been played, and the courts had called a mandatory timeout. While the opponents return to the locker room to strategize for the next inning, the other industry participants and the consumers they serve stand by with bated breath. The moves to come and the outcome of the next inning are anyone’s guess. But what’s really intriguing is that both parties went to their social channels and claimed victory!

As I understand the court’s decision, Zillow gets its feed back, but it is forbidden from filtering out the private exclusives that caused this entire kerfuffle (or any other zipcodes covered by MRED for the next year). In other words, the Judge said that, as a member, Zillow is entitled to the feed, but it must conform to the rules of the broker cooperative from which it seeks to derive a benefit.

So it was a week full of words and opinions, and it ended with both antagonists claiming victory. I don’t know who will win, and I am sure that we have not seen the last of this conflict. Mr. Refkin is really good at spinning his side of the story, and he has been doing yeoman’s work running from place to place, meeting to meeting, broker to broker to use his considerable charm and passion to espouse his cause. Zillow and the brokerages and agents aligned with it and its business model are likewise working to sway public opinion (and by public, I mean the real estate industry and everyone watching it).

So, what happens next?

We’re witnessing a struggle between the largest forces of our industry seeking control of the marketplace itself by manipulating the most important tool created to facilitate the efficient transfer of real property from sellers to buyers. And while I hate to be melodramatic, perhaps, we’re going to see institutions and individuals suffer if we aren’t smart enough to protect the MLS as a non-partisan joint effort to foster competition and help real people try to achieve the American dream of homeownership, build familial and generational wealth, and provide security for their families.

I am solely on the side of the broker cooperative – the MLS, and by that I don’t mean MRED alone, I mean the broker cooperative in its 500 variations all across the US and Canada. It is by far the most important tool ever created in our industry. I have my disagreements with both sides here. I told you what I thought of the idea of a national MLS earlier in this post, and I have told anyone who would listen what little regard I have for the concept of private exclusive listings. This is a position I have held for well over a decade and am unlikely to change (I am always conscious that the word “exclusive” has its roots in the Latin “exclusivus,” which is derived from “excludere,” meaning “to shut out”). I am and always have been a proponent of complete cooperation between brokers and agents to benefit buyers, sellers, landlords, and tenants.

The purpose of the Broker Cooperative is not to serve as an advertising platform, though its data may be used for advertising by the members’ agreement. Its purpose is not to benefit any one member more than any other member. The strength of every MLS, and of the system itself, has always been the balance each organization strikes between the business interests of its participants and the obligation its Directors and staff have to the industry and the public at large. Those directors, officers, and staff have the obligation to put the interests of the MLS before their own business or personal interests, and most of the people in those positions take that obligation very seriously – and now more than ever, need to reaffirm their dedication to those principles. As long as they do that, the future of the MLS can be ensured. If they falter, it may not be.

The MLS promotes competition by addressing the inherent fractionalized nature of the residential real estate market that would exist in its absence. It is to facilitate the exchange of information among members so that buyers and sellers, and landlords and tenants, can navigate a more efficient real estate marketplace. And that requires all teams in the league to comply with their team’s and the league’s rules, whether it inconveniences them or not.

We’ve reached the peak of the silly season

The “silly season is defined by Wikipedia as “a period—most commonly during the summer months—when the mainstream media focuses heavily on trivial, frivolous, or offbeat stories because major political figures and lawmakers are on recess, leaving a lack of hard news“. It’s the time when we read “Man Bites Dog” articles, or tales of outrageous human behavior.

I’ve been observing discussions about the MLS industry’s role, governance, current issues, and future prospects. Opinions vary from poorly informed to well-informed, making me feel like I’m witnessing an ongoing “silly season.” As I’ve observed before, you don’t have to have a clue to have an opinion on something. I know we’re in a time of change, but I am optimistic that the MLS community has the brains and the will to meet any challenge.

The challenge we face today could be existential. If the MLS rules are an inconvenience for a member, who gets to choose how (or if) the inconvenience is resolved? Deciding that may decide the future of the MLS.

We all have reasons. We’re doing it for “the client”!

If you’re reading this, I assume you know the facts of the matter as reported everywhere by everyone. You may filter out prejudice in the authors’ positions as you wish, but I’m not going to. Everyone is entitled to take a side. I don’t want to parse the motivations of Refkin, MRED, Illinois REALTORS, Bright, Zillow, or anyone else, but they all share certain public positions that revolve around advancing their cause because they believe it benefits “consumers” or “clients”.Cynic that I am, I dismiss some of those reasons as self-serving. There are obvious business reasons for the positions of Compass, Zillow, MRED, and the Associations affiliated with it, as well as the shareholders of Bright MLS.

Compass and Zillow are huge companies with smart, aggressive leaders and substantial obligations to their shareholders, and each is committed to advancing its cause by leveraging whatever assets it can bring to bear on the problem. That led Robert Refkin to offer to subsidize a potential 100,000 new members for MRED and its affiliated Associations, as well as any other MLS that aligned with their business model, which is no small financial gain for them or commitment for Refkin. It was a terrific propaganda win for Refkin and a financial windfall for the MLS. That put pressure on Zillow to reaffirm its position using the tools at its disposal. The manner in which Zillow deployed that leverage led MRED to interpret it as a violation of its rules. And that led to Lawfare!

Lawfare isn’t good for anyone but the lawyers.

Again, I’m going to turn to Wikipedia for a definition (full disclosure, I am an annual financial contributor of $20 per annum to Wikipedia) – it tells us “Lawfare is the strategic use—or misuse—of legal systems, proceedings, and institutions to intimidate an opponent, damage their reputation, or hinder their objectives. It turns legal action into a weapon where the process itself, rather than a definitive victory, is used to drain time, energy, and resources.“

Without going into the details of Zillow’s quarrel with Compass’s business policies and the details of MRED’s rules, suffice it to say that when Zillow was unhappy with MRED’s actions, it decided to use the legal system to challenge the MLS ruleset. Maybe I am being too harsh in calling it lawfare, but that is where I think the company’s actions threaten the structure of the MLS.

Zillow, like Compass and every other member of MRED, agreed to follow the rules of the broker cooperative upon joining. There is not one set of rules for the small and another for the big. The rules apply to everyone, regardless of size, business model, or business goals. When Zillow chose to ignore the rules of an MLS to which it belonged, it faced consequences. They began litigation to prevent the consequences (that’s the lawfare part), but, to their credit, MRED didn’t blink; Zillow faced real consequences when MRED stopped its listing feed to their site. And everyone in the country seems to have at least one opinion about it, no matter whose side they’re on.

Rules? We don’t need no stinking rules!

The Multiple Listing Service is, at its core, a broker cooperative. It is an agreement between competitors who understand the fractured nature of the real estate market, where there are millions of sellers, each seller with one unique product, trying to reach millions of buyers, each looking for a single property. It is a difficult, if not impossible, task without an agreement to share inventory access equally among other members of the cooperative.

Rules are important. In the case of the broker cooperative, the rules are the difference between the portals that serve the rest of the world, which are more properly advertising websites, where data standards are sketchy at best, and there is no governance of the aggregated data. Our MLS rules ensure that the interests of the market and the needs of consumers are served, even when it is inconvenient for individual members’ business interests. And that’s why MRED had little choice but to enforce its rules when Zillow chose to violate them. And in saying that, I’m not siding with MRED against Zillow. I don’t have a dog in that fight. I am siding with the rules everyone agreed to when they joined the MLS. In fact, when any company bullies or litigates to create undue influence on the ruleset and operations of the broker cooperative, I am firmly on the side of the MLS. If you don’t want to follow the rules, don’t join. If you don’t want to do business without the MLS, you join and follow the rules. The choice is yours, but it is a choice, not a fait accompli.

This is why we can’t have nice things (unless we’re thoughtful)

I’m sure you’ve heard or used this phrase to describe irresponsible behavior that led to the destruction of something valuable. You might have even been the culprit once or twice as a child, but now we’re facing a serious problem that goes beyond the business needs of Compass, Zillow, or even the MLS involved.

Over the last 100 years, the broker cooperative has grown and matured, becoming the most efficient engine in the world for helping agents connect buyers and sellers, and making the “American System” of real estate the envy of the world. The broker cooperative became ubiquitous, and like so many things, we took it for granted. No real estate agent or broker in the United States has ever lived in a world without a functioning MLS, and as a result, we take its benefits for granted. Like the air we breathe, we don’t think about it until it’s gone, but when it’s gone, we die if we don’t restore it.

Rules were never intended to promote or restrict any single business model – they were made to facilitate the most efficient marketplace for buyers, sellers, housing providers, and tenants. Rules aren’t always comfortable. They may not always be simple. They may create friction for vendors or third parties. But all of those problems are outweighed by the incredible tool that benefits real estate professionals and their customers and clients.

I don’t like it when rules get in my way, but I recognize that the rules are there for all of us, and no party or business model is entitled to rewrite them for themselves, regardless of their size or influence. Though it may be an unpopular sentiment in a world of large MLS structures and Mega Companies, what has made the MLS the amazing engine of competition it has been is the collective rule-making of its volunteer members, with the assistance of its professional staff. Rules make us do the right thing even when we don’t want to because they shape what we do, how we are constrained, and how we are held accountable. Without the rules set, an MLS is just a Portal, and that’s only an advertising vehicle, not a broker cooperative.

Former Speaker of the House Paul Ryan said, “Every successful individual knows that his or her achievement depends on a community of persons working together.” I hope that MRED, Zillow, Compass, and every other member of every MLS understand that their success relies on the community working together and on the need to preserve their rules while still finding a way to compete and be successful in that competition. They’re all smart and resourceful enough, and I’m rooting for them to do so.

In the meantime, I’ll be over here eating popcorn and watching.

A Note about Industry Consolidations

Earlier this week, on my way to HousingWire’s The Gathering, I read the news about the possible acquisition of the iconic RE/MAX franchise by a tech-enabled real estate firm with a different business model, REAL. My immediate reaction was a flashback to the morning I received an email telling me that my franchosors parent company, Anywhere, was being purchased by Robert Refkin’s firm, Compass Real Estate.

The proposed purchase of Remax by REAL had many similarities. The purchaser was a competitor for agent affiliation in the real estate business. The purchaser had a different business model and philosophy for conducting the real estate business. The buyer’s real estate business was operated internally and had no franchising experience. And the purchase was a big surprise to the industry.

Humans, when startled, react before they think things through. My first reaction was shock at this unexpected event, my second was to question how that would impact my business, and the third was to calm down as soon as I realized that it wouldn’t impact my business in any way that might be harmful to me because I had a franchise agreement that clearly delineates the responsibilities and obligations of the franchisor and the franchisee. All three things happened in seconds, but weren’t unlike the reactions of a tenant concerned about the sale of the property they rent until the owner or agent reminds them that their lease controls their situation, not the purchaser or the seller. I realized that the sale impacted the buyers and sellers more than it impacted me. The operations of my business and our value proposition to consumers and agents remained the same at their core. ReMAx franchisees are in that same position.

The thing about franchised business operations is that they are not monolithic. There are big ones, mid-size ones, and small ones. The people running the franchises make their own decisions, and some make better decisions than others. Some of the franchises are run by amazing operators, some are middling, and some are not so great. And none of them become fundamentally different because the company that owns their franchise changes.

Everyone Sees Something different

Of course, after these types of things become public, people in the industry react, and their opinions are often formed by their position relative to the event. As C.S. Lewis said, “What you see and what you hear depends a great deal on where you are standing. It also depends on what sort of person you are”.

Competitors see this as a chaos event that might indicate a recruiting opportunity. When the Compass/Anywhere news broker, my agents were immediately solicited by a local competitor who commiserated with them in an email about the uncertainty of change. It had no effect, because I had already sent an email to our entire organization with the subject line “We’re Still Us!”. Of course, their action prompted me to email their agent population the next day, offering them the opportunity to learn about the benefits of affiliating with the world’s largest real estate organization. In other words, business continued as usual with brokers looking for ways to recruit and retain agents, and the net effect of the emails was zero-sum.

Agents with REAL perceive this as a win against a competitor, often assuming that ReMax franchisees will immediately abandon their current business models and adopt the REAL business model and methods. Again, I hasten to point out that a franchisee isn’t about to change their successful business model just because their franchise owner has changed.

Unaffiliated agents or independent brokers see the event as an almost existential threat to boutique practitioners. For a brief, startling moment in reading the news, they might, like me, be startled and then think they need to take action, until they realize that their business is done becuase of their relationship building skills and the effort they put into their businesses, They will probably be least impacted because the people that want to do business with them, want to do business with the individual not the business name or style.

Pundits in the industry (and everyone seems to be a pundit these days) see this as an indication that technology is taking over the industry, and the entire shape of the business will be a desolate (or triumphal) landscape of an AI-fueled, directed, or dominated business. In fact, REAL and Compass are, at their core, real estate businesses, facilitated by technology. They are not technology companies, but they use technology to further their core business of helping consumers buy, sell, lease, and rent real estate. They are companies that actively recruit agents and brokers, without whom they could not accomplish their business goals.

That word you’re using doesn’t mean what you think it means

Across the internet, people kept referring to the acquisition of ReMax as a merger. This is not that. While it might seem like Compass or REAL acquired companies, they did not. Unlike Compass’s rapid growth, these transactions aren’t new offices and agents for the company’s bottom line. They acquired franchise operations that provide tools, systems, and branding to independently owned and operated companies. These offices and agents aren’t assets to be acquired; they are clients to be served. The deal between the buyer and seller doesn’t mean the Broker owners and their agents will buy into the business philosophy of the franchise company’s owner. Robert Refkin knows that and is using his considerable charisma and energy to woo his new clients. I don’t know how REAL accomplishes the same thing for Broker Owners of a brand built on their independent business decision-making. Everything and everyone is transportable, and nothing is predetermined except for the terms and conditions of the existing franchise agreements. Even they can be contested by those with the will and the checkbook to do so.

There are business benefits for companies entering the franchise space, including additional cash flow, the potential to roll in retiring owners’ businesses, and, in the case of Compass, the acquisition of company-owned stores that they may choose to convert to Compass offices at some point in the future. But it is not directly growing the parent company in either case

Our business is done on the Micro Level, not the Macro

Though I believe in the concept of consumer brand preference, we have an incredibly fractured marketplace, where the brand is not a reflection of the quality of the manufacturer or the product, but the quality of the service offered by the real estate company. That quality is affected by the agent’s performance; we all know that the best brands have some low-level agents, the least recognized brands sometimes have terrific agents, and each potential client judges performance based on the agent they meet. Consumers don’t care about REAL or ReMax or Compass or any brand as much as they care about Claire or Sally, or John or Arnold, who is sitting across from them demonstrating their product and neighborhood knowledge, their negotiating skills, and their ability to accomplish the consumer’s mission, whatever it may be. People like to have choices between various brands, but they make choices based on their relationships.

In the end, the whole situation is of more interest to Wall Street than to Main Street, and except for creating a topic for speculation and conversation, of most interest to the people paying the money, receiving the money, and their shareholders. The next pieces of news will revolve around the individuals at both companies who became, as the British say, “redundant”, but they will find new homes in other enterprises or start new ones of their own. The rest of us can just talk amongst ourselves or go about our business, as usual, because the only person who cares less about this than we do is the consumer.

A shell game, according to Merriam Webster, is “a swindling trick in which a small ball or pea is quickly shifted from under one to another of three walnut shells or cups to fool the spectator guessing its location, is a version of one of the oldest and most widespread forms of sleight of hand.”
Robert Refkin has elevated that game by crusading to have the real estate industry modify the rules of Multiple Listing Systems, ostensibly to “allow consumers to make choices about how they market their properties. ” But that’s where the sleight of hand comes in. The change in rules is not about the consumer’s innate desire for a specific type of marketing but the agenda of Mr. Refkin’s firm.

Unlike many other articles about this issue, I don’t wish to debate whether consumers should be allowed to decide how their property is marketed because that isn’t the crux of this particular shell game. In most states, a real estate agent’s job includes following their clients’ lawful instructions, but this is not about consumer choices being restricted, its about the real estate agents presentation of choices the consumer hadn’t even thought of.

For decades, I have trained agents to believe that sales should be defined as “helping someone do something in their best interest, that they would not have done if the salesperson were not present”—counseling and assisting rather than coercing or exploiting. The Compass Three Step Program is more accurately described as “helping someone do something in Compass’s best interest, that the consumer would not have done if the salesperson were not present.” It is more accurately the manipulation of the consumer by the salesperson to create a financial benefit for their firm and themselves.

When is a Choice Not a Choice?

The term “Hobson’s Choice” indicates something that provides the illusion of choice but is not a real choice. And that would most accurately describe the “consumer’s choice” the real estate industry spends so much time discussing. Various theoretical reasons are presented for the choice that Refkin suggests consumers want. Those reasons for choosing a private exclusive listing have been easily addressed by the real estate industry for over 100 years with the existing rules set. In this new model, consumers are introduced to the program through manipulation disguised as concern and counseling, which contradicts the obligations of agency under which most real estate practitioners receive their licenses.

I had a chance to experience this first hand. I was approached by a Compass agent who wanted to list some properties I own at the New Jersey shore. The agent was pleasant and persistent. She had sold a similar property for me when another broker listed it. I invited her to send me a listing proposal explaining what they would do to market the property. On page 6 of the proposal, I was introduced to the Compass Pre-Phase, which is described as follows: “Pre-marketing is a proven strategy to build anticipation, drive demand, and help sellers get to the best offer faster. Compass Real Estate offers a unique platform that gives your property valuable exposure to both agents and consumers before it hits the market and begins accruing critical “Days On Market”

The marketing plan begins with Stage 1 – Private Exclusive Listing (Non-Public), in which I was informed (not asked or consulted) that they will:

• Launch listing on Compass.com as “non-consumer searchable coming soon”
• Email to individual clients and add to their Private Collections.
• Post on Compass Workplace (exposure to 500 local agents and 15,000 national agents)
• Notify other Compass Agents through an email newsletter
• Discuss listing at Compass Real Estate sales meeting

When you analyze the promises and compare them to the tasks, you see that the promises are empty. For example the 15,000 Compass agents are overwhelmingly in other markets and could not sell one of these properties because they are not licensed in New Jersey. The tasks accomplish nothing except allowing Compass and its agents to prohibit the property’s exposure to any consumer not working with Compass.

After I read the presentation, I called the agent and thanked her for sending me her proposal. We discussed their marketing suggestions, and I asked, “Why, for even a minute, would I not want my property exposed to every potential qualified buyer in the world?” She answered this question (or avoided answering it) by inviting me to a client appreciation event at her office so I could meet other sellers with whom they had worked. I thanked her, but explained I just wanted to get my properties sold and I wasn’t looking for an evening out. When people deflect the answer to a question, it’s because there is no easy or logical answer for them to give. The lack of a straightforward response to my question emphasizes to me the lack of consumer benefit to the program, even by its proponents.

It’s All Fun and Games Until Someone Loses $100,000

In the controversy surrounding private exclusive listings, the supporters of that type of limited marketing speak at great length about consumer choice and privacy, but these conversations are all about generalities and unnamed clients. Now that the discussion has reached mainstream media, we are learning that consumers don’t volunteer for or request the “choice”, no matter what Mr. Refkin and his firm would have you believe. And that’s good. Perhaps you think I am too critical of the suggestion made by the agent who wanted to list my properties. Maybe I had too much experience to be swayed by her suggestion (which does not avoid the shell game of this choice being the agent’s suggestion and not the consumer’s desire), or maybe I prejudged its benefit because of my opinion. None of that matters because we have specific facts that show issues with the deployment of the program and its significant harm for the client.

Recently, Caitlin O. Bigelow wrote a post entitled “Compass Exclusive Almost Became a $100K Mistake,” in which she relates her experience with the program. “At our Realtor’s suggestion, we listed our home on Compass’ Private Exclusive, an off-market option that quietly shares your home with Compass-connected buyers before it hits Zillow or the MLS.”, she explains, Not ” I wanted to market my property this way”, or “I desired exceptional privacy during the sales process”, or the troubling “I wanted to restrict who saw my home”, but based on “our Realtor’s suggestion” she made a choice.

She goes on to explain that they sold the home at the asking price (which again, “At our Realtor’s suggestion” was lower than she and her husband had hoped, only to have that buyer fail, and the property go on the open and unrestricted market, where she received multiple offers, and six days later accepted one that was $100,000 higher than her asking price (In her words” long live the free market”)

Sellers Feel They’re Being Poorly Served

Ms. Bigelow is not alone. In a recent StreetEasy survey , sellers who had used a Private Exclusive Marketing program ad similar things to report. Three out of four of them said their agent had suggested the program. Over 40% of the sellers said that the agent’s reasoning for recommending a private listing strategy was simply that it was standard practice at their brokerage.

The survey goes on to note that roughly one in three of these sellers experienced seller’s remorse, more than twice the norm., and 16% of the sellers “fired their agent” more than three times the norm, while 92% of the sellers surveyed felt that if their home would sell more quickly if publicly listed and 94% felt they would get the price they want if listed that way. Certainly, those sellers didn’t seek this choice, and the idea that this marketing practice is a response to consumer requests is just nonsense.

Agents Need to do Better

I don’t believe it’s an accident that the companies in favor of this type of marketing specialize in expensive properties where the additional commissions earned might lead to substantial extra income for the agent and the firm. While Refkin and Compass have led the charge, companies like The Agency and Douglas Elliman have supported the concept. Coincidentally , all three firms have a focus on higher-end properties where the impact of even a small percentage of additional commissions is significant .

The idea that this is about choice for the consumer is disingenuous and an absolute red herring. Its about the compressed real estate market, the financial benefits to the companies involved, and the additional benefits that might accrue to the listing firm’s website . But as real estate licensees, that’s not what we’re supposed to be concerned about when list a property for someone.

Real Estate Agents in the Unite States are considered fiduciaries. As a result, they are required to put the best interests of their clients before their own. This shell game is not that. Respecting consumer choice should begin with the consumer originating the request, not with a strategy designed to steer them toward a choice introduced by their agent primarily benefiting the real estate agent or firm.

If seller’s believe that public listing will sell their home faster and get them the price they want, then let them. An agent or firm steers the consumer in any other direction at their own risk. While the vast majority of real estate agents still seem to support consumer choice, I have a sneaking suspicion that some attorney, somewhere, is just waiting for the opportunity to generate an expensive piece or pieces of litigation.

While many of these conversations start with the cost of agent compensation, starting there presumes that all real estate agents provide identical services, and that’s just not true. My fellow Philadelphian, Ben Franklin, once wrote,” The bitterness of poor quality remains long after the sweetness of low price is forgotten.” – let’s see what info can help you choose the best person to represent your interests.

1. Not all real estate professionals are REALTORS® (members of the National Association of REALTORS®). Every member must adhere to the REALTOR® Code of Ethics, which is based on professionalism, serving clients’ interests, and protecting the public. Should a consumer feel they have not been served according to that code, a complaint may be filed with the local REALTOR® association.
2. Not all real estate professionals have the same level of training.  Every licensee needs to take introductory courses (usually titled RE Practice and RE Fundamentals)  to pass their real estate test. Still, they and their future clients may not be well served if their education stops there. Their brokerage may or may not provide additional training, but you need to know what that might be. Getting a real estate license should be the start of your real estate education, not the end of it.
3. Not all real estate professionals have the same level of expertise.  More experienced agents may have taken specific courses resulting in certifications or designations educating them on working with Buyers, seniors, investors, international purchasers, relocating clients, military clients, etc. They may have taken courses in negotiation, contracts, financing, or other fields that can benefit you as a consumer. Many of these courses are the products of or offered by local REALTOR® Associations or national franchises. 
4. Not all real estate professionals have the same level of experience. Based on their experience, training, and previous transactions, Agents may have additional information about the property, neighborhood, or community that can inform your choice of property. Construction expertise, exposure to previous inspections, and knowledge of local municipal codes can all improve your transaction.
5. Not all real estate professionals provide the same resources. Though most residential agents belong to a Multiple Listing Service, that isn’t the only resource available to help consumers find homes and analyze the differences between them. Some agents work for companies that provide substantial technology tools for the agent and the consumer, and some business models have agents working for them that have to provide their only tools and resources, and in that type of company, some of the agents will spend more or less to provide consumer-facing tools. The question of management support and transaction processing support is also something to consider. Will your agent have someone to turn to if there’s a problem that they haven’t encountered in their practice? Will you have someone in the company to turn to if you are dissatisfied with the agent you’re working with?
6. Not all real estate professionals provide the same services. Buyers can work with agents exclusively or non-exclusively, but there may be a substantial difference in the services offered. An agent can provide services for a client who is committed to working with them exclusively that they may not offer if they are merely a face in the crowd of people that the buyer is working with. Different tools and technology may be made available for you to provide information on schools, markets, financing, or generally enhance your buying process.

Whatever you choose, don’t make the mistake of thinking that every agent is the same or that every real estate firm is the same. The choice is yours and your choice can certainly influence your home buying experience.

One of the new business models attempting to gain ground is the show-for-free or show-for-fee model; Each one is driven by their desire to make money, regardless of their hyperbole about why they started the business. I have no problem with wanting to make money because that’s why the vast majority of people go to work or open businesses, and everyone has a variety of motivators that decide why they choose the job or business that they desire. For example, I love that I get to help people build familial and generational wealth when they achieve a part of the American Dream, but I operate a business because that fulfills the primary need that I had to support myself and my family, so I’m as guilty as they are when I reveal that, but still, I do want the priority to be straight.

Information is Not Knowledge, Knowledge is Not Wisdom

I say this a lot because people habitually confuse these three words. Buyers, for example, have access to more information than ever in history, but that doesn’t make them more intelligent or better equipped to make decisions than their predecessors because the information is not knowledge about anything complicated in life. Knowledge, I believe, is information placed into context. Context is understanding what the information means in relation to the other factors in the process you’re considering. Information, understood in the light of the process, is knowledge. But knowledge is not wisdom. If knowledge is understood in light of its relationship to other pieces of information, wisdom is understood in light of aggregated experience in similar situations. Thus, wisdom is Knowledge tempered by experience.

Here’s an example of how this works. Most people in my market can access information about asking prices, sales, prices, rental prices, tax implications of property ownership, the costs of mortgage payments, etc., but that doesn’t necessarily make them savvy real estate investors. When someone learns more about the four types of real estate returns, the benefits and difficulties of operating a rental property, they understand what they will need to do on a regular basis, and they turn the information into actionable data with this knowledge. I on the other hand have been investing in real estate for decades, and in minutes can identify and good deal from a poor one in seconds. That’s because having bought and sold hundreds of homes, I know the unseen benefits and pitfalls that I learned one deal at a time, and that’s wisdom (in this example),

Buyers are exploited by needing to pay per tour instead of working with the traditional success-based fee. With a success-based fee, the buyer spends nothing until they have purchased and closed on a property at a price and terms that they are happy with. As you may recognize from an earlier blog post of mine, that means an average of 10 showings for the successful deal, but there are many more showings for people who have not achieved a successful transaction that cost those consumers nothing.

It’s Bad for Buyers

Showing a property is far more involved than just opening the door. Showing a property starts outside when an experienced agent can help the buyer understand the architectural features of the property and its condition in comparison not only to other properties for sale but also to properties that have sold in the past or did not sell when put on the market. Also, the agent can point out how the location of the property, including the street it’s on, compares to other properties in the area and what is negative or positive about them.

The showing agent should conduct the tour of the property in a logical order to make sure that the buyer sees the flow of the property, that all of its features have been demonstrated, and that the benefits or obstacles caused by those features are discussed with the buyer in the spotlight of the buyer’s needs, wants, and wishes.

The agent should be able to comment on the home’s condition, the types of amenities and improvements made to the home, what those amenities mean to the property’s value, and what the quality of those things might be. The agent, having knowledge of the history of the properties and homes in the neighborhood, should be capable of talking about things like functional or locational obsolescence if they exist, how they impact the value of the property, and whether the buyer benefits from them or not. They should also be capable of commenting on whether other homes in the area would suffer from that design or location flaw.

Agents typically are aware of the foibles of different builders and styles of homes and types of heating and can provide additional information because they see so many homes. Again, the context can be brought to their inspection by the agent’s experience in listing, showing, and selling other properties in the area because that experience lets them understand why one property sells while another lies completely fallow.

All of these things and more are completely aside from the other things that buyer agents should be doing and are solely related to the showing, but the business model has demoted the licensee from a trusted advisor to the guy who just opens the door for a fee. Most state regulators would consider that they have actually performed as an agent, creating liability for them and their brokers.

Having skipped a buyer counseling session to establish the buyer’s needs, wants, and wishes, the agent can’t properly demonstrate the benefits (or lack thereof) of the house’s features because they can’t be clear on what they are to the specific buyer.

We all use professionals because they know more about their topic than we do. These buyers don’t get that help in their home-buying journey. But they do get to spend money every time they look at a property—something that other home buyers don’t need to do. And that can add up. In a recent post, I pointed out that real estate agents typically are paid on a success based fee, and that they statistically show about 10 properties to buyers who make offers, and that they statistically write four offers to get one accepted. That means that with a $49 per showing fee, four buyers would pay $1960 for showings, but only one of them would have gotten a property, And that doesn’t;t count the buyers who end up coming into and then leaving the market, costing them hundreds or thousands of dollars they don’t need to spend using traditional models.

It’s Bad for Brokers

When these business models were first announced, this jumped out as me because as a broker, I often feel I have a target on my back, and I am careful to minimize the number of people that might be shooting at it. There are few, if any, brokers who don’t think about liability and risk management frequently because if you don’t, you end up out of business. When an agent shows a house, the liability starts outside the house. If the buyer or the agent trips, slips, or falls and hurts themselves, there’s liable to be a claim. If a key goes missing from the lockbox, there may be a claim or at least the cost to replace the existing locks. When an agent accompanies a buyer through the house the liability grows. The agent is responsible for the actions of the buyer and their invitees. If they break something in the house, let the cat or dog out, use the bathroom and clog up the plumbing, try the water pressure and can’t turn the faucet off, forget to lock the house, or slip and fall inside the house, there’s liable to be a claim. Did I mention falling down stairs, tripping over an uneven threshold, or forgetting to lock a door? All of these things and more are events that cost the brokerage thousands of dollars to defend, putting aside any bad results from the litigation or claim.

Finally, most states forbid real estate agents from accepting money from anyone other than their broker for real estate activities. I’m unsure how seriously these new entrepreneurs take the state regulators or their opinion of whether they will inspect agents accepting money from these companies. I know many of these people around the country, and thankfully, for the consumer, they take that job very seriously. There is of course, a concern that an agent will ” go rogue”, and accept these “assignments” without notifying their broker, and the business may pay them directly. Now the agent is in violation of the state regulations, their broker may be liable because they “failed to supervise” the agent sufficiently, and hopefully, the regulators will fine the business for practicing real estate without a license and violating the state real estate regulations, but none of those things benefits anyone.

It’s Bad for Agents

I understand the average agent’s optimism and willingness to hope that showing the property will create a bond with the buyer, but any good buyer’s agent knows that isn’t the right way to approach the problem. I also know that in the current market, many agents are struggling, and a little income is better than no income, so they may decide to try this without giving it the thought it deserves.

To begin, the buyer is most likely to believe that they have paid for the agent’s time and are under no obligation to them. The agent has decided not to be a professional but to be a door opener. Of course, we’ve already talked about what a good agent will do, and how long they will take, but in the eyes of the buyer, you and the guy at Dominoes who delivers the pizza are in the same line of work. Not consulting, not advocating, not negotiating, not assisting, just delivering the experience to them they asked for.

The agent loses a lot. Like everyone, they only have so much time in their work day. Instead of spending time reaching out to potential clients, looking for properties, and soliciting opportunities for their existing clients, the agent burns time and wastes gas running from low-intention consumers to low-intention consumers.

So Why Is This A Thing?

Whenever there is disruption or chaos, there are those who seek to benefit from it. In the rush to exploit the new policies surrounding the real estate industry, many people are treating it like a new gold rush.

It seems they suffer from unwarranted confidence generated by a lack of understanding, which made Dunning and Kruger household words. One of the companies states that it’s not a broker or licensee but is providing services that, in most states, are regulated by their real estate licensing laws. It reminds me of a friend of mine in high school who got a job working for a clothing store when he was 16. When I asked him what he knew about selling clothes, he said, “I wear them, don’t I? That’s good enough!” When helping consumers navigate one of the most significant purchases or sales of their lives, just buying or selling a property or two isn’t enough. That’s why states make real estate agents take course and test in order to get licensed,

Secondly, these business ventures, like so many others before them, have a low opinion of what agents and brokers do. And how they approach them through these businesses are indicative of that. Ironically one of the named plaintiffs in the Missouri law suit has opened one of these businesses. I don’t think he suffers from a surplus of respect for the people he wants to facilitate his new business.

Speculation about Change is a Risky Business

I get that change brings disruption, and businesses are always looking for ways to exploit that, but experience has taught us that the newest idea is only sometimes the better idea. Sometimes, the business is a solution in search of a problem. Here, the problem these business models have identified is the reluctance a consumer may have in signing an agreement with a real estate licensee as required by the policy change resulting from the NAR settlement. The solution to that is an educated consumer, not pandering to their reluctance. Buying real estate is a complicated process requiring the cross-disciplinary skills of a real estate professional. Having a trusted advisor who has a legal obligation to your best interests is far smarter than finding someone to open a door and deprive you of that guidance and protection.

In a recent Inman article, Robert Refkin made several claims about how the Clear Cooperation Rule violates the National Association of REALTORS Code of Ethics and state laws. He almost hit a home run by misstating the Code of Ethics requirements and using logical fallacies to support his arguments.

I get that Mr. Refkin is inconvenienced by the Clear Cooperation rule and is using the industry’s confusion, given the recent litigation, to make his arguments. Still, the rule encourages competition in the real estate marketplace and is incredibly pro-consumer.

When is the Public Not the Public?

‘When representing a buyer, seller, landlord, tenant, or other client as an agent, Realtors pledge themselves to protect and promote the interests of their client.”

Mr. Refkin – quoting the first Article of the Code of ethics tries to make the argument that it is somehow not in the best interests of the client to market their home to the broadest market possible. He argues that there is a conflict without actually stating one. Instead he posits that a client might somehow want to “market their homes publicly for more than one day without placing them on the MLS”. I frankly don’t understand what he means. Is he suggesting that marketing a property without exposing it to the public is somehow public marketing? Or is he implying that marketing the property publicly to a smaller segment of the public, excluding competitors and some members of the public, is beneficial? I argue that such an action is more likely a violation of this article than Mr. Refkin’s suggestion.

When Less is More (Is it really?)

He then doubles down on his lack of logic by stating ‘Many clients don’t believe that more exposure equals a higher price.“. There are many people who believe that the earth is flat (10% of a group surveyed according to the University of New Hampshire). That belief doesn’t make them right, nor does it relieve a real estate agent from protecting and promoting their interests by explaining the demonstrated fact that exposure through the MLS brings a significantly higher price to the seller.

Mr. Refkin then uses a logical fallacy called a false equivalency when he asks “If more exposure equals a higher price, why do home builders sell hundreds of thousands of homes off-MLS each year? f more exposure equals a higher price, why do hundreds of thousands of companies not sell their products on Amazon, where there is the most exposure?” ( A false equivalency is a logical fallacy in which one assumes or asserts that two things are the same or equal when, while alike in some ways, they are not sufficiently similar)

In both of these examples, the seller has a fixed product and fixed marketing outlets, unlike the residential resale market, where each property differs from the next. In the case of builders, there are as many (or more, depending on the market) builders who list their properties on the MLS as do not. The argument about retailers fails because Amazon is a platform different from the MLS, which has nothing in common other than a search feature and being a digital platform. These vendors determine their need to use Amazon based on their individual marketing metrics, such as the cost of customer acquisition, the cost of goods and services, and the cost of sale, factors that home sellers don’t need to consider.

The Non-Sequiturs

“Realtors shall cooperate with other brokers except when cooperation is not in the client’s best interest.”

Again, Mr. Refkin makes a statement and backs it up with supposed but unfounded and unsupported belief. In high school, my teacher would have called that a non sequitur (a conclusion or reply that doesn’t follow logically from the previous statement). However, he suggests a conflict (there is not) and lists things that have no connection with cooperation between real estate agents.

Let’s take them one at a time;

Point One– The sale involves sensitive family legal arrangements, This is so vague its almost non-existent. If their legal arrangement is unrelated to the property, that arrangement doesn’t need to be discussed at any point in the transaction. If it impacts the title, usage, or the purchaser’s ability to finance the property, it needs to be disclosed, and the sellers need to overcome their sensitivity. In any event, this has nothing to do with whether the agent showing the property is employed by the listing company and thus has nothing to do with cooperation.
Point Two– An estate sale involves parties not ready to acknowledge the sale publicly. Once again his objection is vague and has nothing to do with cooperation. If the property is an estate sale, the seller’s death and their estate’s existence are publicly acknowledged in most places. There are obituaries, probate offices, etc. Again, this has nothing to do with whether the agent showing the property is employed by the listing company and thus has nothing to do with cooperation.
Point Three–High-profile clients and law enforcement officials need discretion due to privacy concerns related to security or public image. This is my favorite Red Herring -(something intended to divert attention from the matter at hand). The owners of real property are listed in public records. Anyone wishing to conceal their identity can easily use a straw party or an LLC to conceal their true names, and celebrity homes for sale are news articles, not confidential matters. But most importantly, this has nothing to do with whether the agent showing the property is employed by the listing company and thus has nothing to do with cooperation.

Do you want to know a Secret?

“Realtors shall not knowingly… use confidential information of clients to the disadvantage of clients; or use confidential information of clients for the REALTOR®’s advantage or the advantage of third parties unless clients consent after full disclosure”

This one was a real head-scratcher. Mr. Refkin leaves the realm failed agency relationships or loose lips sinking ships of family secrets and goes full conspiracy theory, giving the following rationale: “It can be easily argued by homeowners under state laws that information they deem confidential is being used to advantage the MLS, a third party that sells their data, and that the Clear Cooperation Policy limits the homeowners’ ability to provide explicit and informed consent to use such information.”

Actually, no, it can’t! First, the Code of Ethics is a voluntary obligation of the National Association of REALTORS members, not businesses like the various MLS organizations in the US. Secondly, not all MLSs sell data. Thirdly, Mr. Refkin is not privy to all of the listing contracts in the country and has no idea what permissions, explicit or implicit, sellers give their agents. What information is he concerned about, and who is he worried about deeming that data confidential? The seller? The examples he uses include exterior photos of the property and the addresses of the property – the first you can find on Google Maps, and the second is public information found on tax maps municipal records, and is anything but confidential information

Clear Cooperation and Competition

Mr. Refkin and his arguments are victims of confirmation bias in his reading of the Code. His preconception that, somehow, there is logic in the concept that a seller can have a better experience and a more successful outcome (as he defines it) by limiting the ability of some consumers to buy their home. It just isn’t, so. It is not by accident that exclusive and excludes find their roots in the same Latin verb, “excludere,” which means “to shut out” or “to close off.” And with the exception of ill-reasoned arguments like the ones he makes in his Inman Article, no one has ever articulated a benefit to the seller as clearly as one can articulate the benefit to the agent or company that wants to shut out or close off a share of the market from their competitors. I can’t imagine a more anti-competitive structure than a private listing network, whether it is internal to a company or a club designed to exclude competitors (unlike the MLS, which welcomes competitors and provides an arena for each competitor to test their business against each other to the eventual benefit of the consumer.

Clear Competition is a pro-consumer and pro-competition rule that increases the ability of the buyer to locate properties to purchase and the seller to find the largest pool of buyers for their property. It assures that the most significant amount of inventory is made available to the greatest number of business models and generates reliable data to be used by new startups and existing businesses in not only the resale business but also every related business or business model/ Competition is enabled and encouraged to test a variety of competitive business models.

With the Buyer agency coming to the forefront of discussions about real estate purchases, there’s been a lot of criticism about the amount of Commission earned by a real estate professional on a transaction. The claim is that agents are overpaid because the commissions on most properties are so generous. (There is an extra claim that this somehow impacts house prices but let’s not waste time on that myth because it’s just not true. I have been licensed to appraise property for over 40 years. Factually, the presence or amount of commission paid to real estate agents in no way impacts the value of real property.) Most of these criticisms about the size of agent compensation are made by people accustomed to going to work and being paid for every hour they work. Real estate professionals aren’t paid that way, and the critics need help seeing the entire agent compensation structure.

Success Based fees

Unlike their critics, real estate agents most commonly earn their income through a success-based fee. By that, I mean that the real estate brokerage and the agents that work for them are not paid anything unless they provide a successful result for their clients.  That means that typically, the agent is working far more, and earning far less than might appear at first glance.

Real estate professionals often work for buyers doing research, providing neighborhood information, showing property, etc., without getting paid because a transaction is not consummated or, sometimes, even entered into.

Consumers benefit from the thousands of hours of professional service for which they do not have to write a check. That work never becomes part of the compensation discussion. Before we dismiss these services provided by the agent tainted by the rationale that they don’t deserve to be paid because they didn’t achieve a successful (or acceptable) outcome for the consumer, I suggest that no other service suffers in that manner. An accountant who does a lousy job or makes a mistake is still paid. The attorney who loses the litigation is paid. The Doctor who fails to diagnose or cure an issue is paid. I could go on and on, all the way to the meal you paid for but it was not what you wanted it to be, or the teacher who failed you when you were in school, but you get the point. In considering whether a real estate agent is overpaid, you must review and consider all their work before making that judgment.

Even Success Isn’t Always Enough

Even when someone gets paid for a successful outcome, there are many who do not. Recently, one of our newer sales agents got their first listing. The market has been very competitive, and she got 13 offers on that property. All 13 agents performed the same job. They showed their clients some properties, including the one she listed. They met with their buyer clients and had a consultation about their needs, wants, and desires. They discussed their financial situation and alternative financing solutions, directed them toward appropriate financing, shopping for rates, terms, and a good loan originator.

They showed the subject property one or more times, reviewing the features and benefits of the property, discussing the neighborhood, possibly discussing the schools, the homeowner’s association, the construction, layout, and the condition of the property. They discussed the benefits and drawbacks of the property. They reviewed the pricing and what competitive properties sold for or were asking. Reviewed other properties on the market. The agent drew up a contract for the buyers to purchase, explained the contract to them, and discussed contingencies like home inspections, termite inspections, and other concerns that the buyers might have. They reviewed the taxes and special assessments and discussed homeowners’ insurance. The agent discussed the appropriate deposit amount, how the price would be paid, the terms required by both parties, and the dates the purchaser and seller wanted, and delivered that agreement to the listing agent once the buyer had executed it.

There were probably some additional tasks that varied from customer to customer, but all 13 agents did the same job essentially. Only one of them got paid. The other 12 agents moved on to the next property to do all of that work over again, hoping that this time they would be successful and actually get paid for all of that work.

In an inventory short market, it is not uncommon for real estate professionals to submit agreements of sale on more than one property before the buyer has a successful result. Considering it briefly, it becomes evident that even the successful agent who earned a fee did the same job four times. That means the amount paid needs to be divided by four to calculate the cost. This amount is reduced even further when we calculate the time the agent probably spent working with consumers who did not have a successful result.  And remember, that’s the agent’s gross income – taxes still need to be paid, and they have incurred costs or fees of their own that must be deducted.

Alternatives Might Cost Consumers More

The alternatives, like some fee-based compensation, a retainer basis or an hourly basis, or even on a task-based fee basis, are problematic. They might cost an individual consumer less per transaction, but given the example above, the consumer would have had to pay four times to achieve one positive result, and consumers who didn’t achieve a positive result would still have to pay fees they don’t pay today to sustain the professional services consumers are accustomed to. A quick bit of math on a new company that only schedules showings and prepares contracts for the consumer could cost that average consumer $2,756, but provides no other guidance or protection for the homebuyer. The business discloses that they are not a brokerage and denies the consumer the protection that regulators have built into state laws to protect people buying the most expensive and important purchases of their lives.

Frankly, I believe that they may run afoul of licensing laws in many states, and I for one, would be uncomfortable with a contract performed for fee by an individual who is not licensed as a real estate professional using standard forms for my state, or was an attorney licensed in my state. There are reasons real estate is a regulated activity, with consumer protections, standards of care, and legislation governing the process.

This high-risk, low-return model does nothing to save money for the consumer. In fact, it exposes them to extra costs and denies them crucial expert advice, the protection of a fiduciary, the experience of a local professional, the benefits of working with a REALTOR (a member of their local, state, and national Association of REALTORS) and many other safeguards. Simply put, it might cost an individual consumer less per transaction, but it would most likely cost all consumers far more in fees and risks than it costs now for the same services. The risks far outweigh any possible savings for a single consumer.

The NAR settlement of the Sitzer-Burnett case has created some furor, and the media is exploding with speculation about the industry’s changes. This speculation is fueled mainly by people who aren’t in the industry, who rely upon or regurgitate articles someone else not in the industry wrote or just speculation shaped by that individual’s narrow view of the overall questions. There are no benefits to the changes brought by the litigation for sellers or buyers, but that doesn’t matter to the attorneys who earned an 8-figure payday by bringing this litigation. (I know that sounds snarky, but I couldn’t resist)

So, let’s dive into today’s realities.

First, cooperative compensation has not gone away; only the ability to publish an offer of compensation in the MLS is prohibited. That means that prudent sellers will still be able to cover the cost of the buyer’s agent with the transaction instead of limiting the pool of buyers who might be able to afford their house.

Anyone who has ever worked with or been a first-time home buyer knows they are usually extremely short of cash and are apprehensive about the home-buying process. They need, and, more importantly, want professional assistance and guidance through home-buying, from finding and choosing a home to negotiation, contract preparation, transaction management, and closing advice. At the same time, everything they can save is used for closing expenses and down payment.  According to an independent study completed in 2022 by AB Schnare Associates, adding the cost of professional representation as a cash expense could increase the cash needed to buy the home by 12 to 42% or more!  It makes it impractical for most buyers to consider a home where the transaction does not cover their agent’s fee. How will they get what they need without finding a house where the cost of their representation is covered in the transaction?

Second, commissions haven’t magically become negotiable. They’ve always been negotiable, and the real estate industry has numerous business models that offer alternative services to consumers. In over 50 years of practicing as a real estate professional, I would say that the commission topic seems to come up almost every time a consumer hires an agent to buy or sell a property. Each time that happens, there is an explanation of services, expectations, and an agreement by both parties before the contract is executed.

Third, real estate values aren’t impacted by who pays an agent’s fee or whether it is published in the MLS. Values fluctuate with the market’s supply and demand. In 2008, there was an oversupply of property and a limited number of buyers to buy it, so prices went down. In today’s market, where there is a limited property supply and many people want to be buyers, prices continue to increase. In neither instance was the agent’s commission a factor impacting value.

Fourth, don’t panic. Realtors are professionals. We are committed to our clients’ needs, helping people achieve the American Dream of homeownership and building familial and generational wealth through real estate ownership. We are your neighbors and friends and will continue to make the home buying and selling process as smooth and understandable as possible for consumers. You are our community, and we are yours. We value you and will continue to be here to serve you professionally, ethically, competently, and with concern and compassion. 

Over the years, I have been chastised for suggesting that agents who seek education from Facebook groups are lazy.  – and since I’m a real believer in that statement, allow me to reiterate it. Facebook, a public arena is not the place to seek professional guidance and education – but it is an easy forum, where your supposed peers can feel free to provide you with any advice that pops into their head – well-intentioned or not. I have seen well-intentioned people offer professional advice that would make any knowledgeable professional shudder with terror. 

With inventory short markets around the country, interest rates at historic lows, and incredibly high demand, agents are feeling frustrated and put upon to degrees they may never have experienced. Add to that the policy changes facing the real estate practitioner, there are a huge number of people seeking answers to questions that should most properly be addressed to their brokers. But people being who they are, many of them end up looking for validation and information anywhere they can find it. Sadly, Facebook is too easy to run to.

Even when you make a statement or ask a question in a closed or private group, that has a fancy title and was created by someone active in the real estate industry or industry adjacent publications or an industry vendor, or even a well-publicized real estate professional as a place to enlighten or educate, bring a grain of salt to the group, and apply it liberally when you get advice.

I’m not saying that anyone there is necessarily malignant, or are providing information to hurt anyone, I’m suggesting that asking for education from the other kids in the playground instead of asking the teacher for help is not the best way to go to make your career better – especially when the playground is virtual and the market, the regulations and the practices in your market may be far different from the place they work. So what’s an agent to do? Let’s take a look at a couple of possible options.

If the issue is one that impacts your actions as a real estate agent, the first step still has to be to go to your manager or broker. They are responsible for your actions, they are generally (depending on the business model) involved in your success, and should be committed to helping you do the right thing and make a good living. If they are not, I have said before and will continue to say, you may need to go somewhere that they will.

If for some reason they are unavailable, or they are part of the problem you need to solve, then go to a senior management person or a senior agent with a good reputation at your company. They are your teammates and hopefully will be able to provide you with some information that is helpful accurate and consistent with the company’s policies.

Should your broker-owner, or manager, or senior team members not be available, try the legal hotline at your association with your question. Or go to www.realtor.org and use the copious information there, or go to the company intranet site, or the intranet site from your franchise to use the education resources there as a temporary measure until you can get the right team member to help you.

I know that everyone feels safe and distanced from such conversations, and people on Facebook speak with such conviction that it seems highly unlikely that they could be wrong, but you don’t know anything about their level of expertise, or the level of accurate information they possess other than what they tell you, and horribly, that may not all be accurate.