Is It Any Wonder...why REALTORS, don't get any respect or trust. 

Jim Towner - March 31, 2008

An article written by Matin Crutsinger, Associated Press, appeared in the Business section of Virginia's Roanoke Times with the title "New home sales hit 13-year low".  Not exactly a breaking story or a shocker for anyone who has not been a castaway for the last twelve months or so. Blood and Sex sells papers so the ..13-year low.. part must have really been a winner, readership wise.

The local Roanoke, VA resale housing market was also tagged with a round house punch when the article noted that the Roanoke Valley market was glutted with over-abundance (not just abundance but an Over-Abundance) or a 12.9 months supply compared to 9.8 month supply nationally.  The article also noted that the 9.8 month supply was the highest national number in 26 years.  I guess that is where the "over-abundance" comes in?

Sounds ominous...let's take a look from another perspective. The article talks about the Roanoke, VA market and states that the 259 homes put under contract in February 08 represented a decrease of more than 20% for the same period last year. So that would mean that last year 323 homes were put under contract in 07.  Was 07 good or bad, no one said?  Now let's divide the total sales for 07 & 08 by the number of licensed real estate agents in the Roanoke Valley Association of REALTORS.  The Association website states that it represents over 1,000 sales professionals reaching as far as Smith Mountain Lake.  So another look would determine that in 07 the average productivity per licensed sales associate was .324 sales per associate compared to the more current 08 productivity measure of .259 sales per associate. Now if you double every pending sales contract to represent the seller and buyer sides the sales associate productivity changes to .648 sales per agent in 07 vs. .568 sales per agent in 08.  If national statistics are brought to bear on these numbers, of the 518 sides completed in 08, 80% were probably done by fewer than 200 of the 1,000 plus agents. I wonder what the other 800 agents were doing?  So when the market was ok we sold .648 homes per month per agent but when it is bad we sold .568 per month per agent?   So in good times or bad it looks like it takes the average real estate person two months to get one sale?  If the average sale was over $1,000,000 I guess these numbers would not be so bad, but the average price was just over $200,000 per sale.

So why don't REALTORS get any respect or trust?  Inman news recently posted an article by Marc Davison of 1000wattconsulting.com  "Real Estate: the least trusted profession" Davison sited a 2006 Harris Poll titled "Doctors, Dentists and Nurses Most Trusted Professionals to Give Advice. 

The poll was trying to determine the Trust in Various Professionals to Give Good Advice:  The poll asked the question; "If you were getting professional help or advice from each of the following, how much would you trust them to give you advice which was best for you?"  The respondents were given four choices: Completely, Somewhat, Not At All, Not Sure.

The Davison article picked out the 7% "completely trust" response for Real Estate Agents and compared it the 50% "completely trust" number given to doctors.  Sounds ominous. What is not clearly revealed, without using the link provided in the article, is the balance of the info gathered by this survey.  Please check it out to get the whole picture.

When you combine the "Completely and Somewhat" responses Doctors score 83% compared to real estate agents with a combined score of 72%.  An 11% difference vs. a 43% difference.  This however does not vindicate the Real Estate Agent or the Industry.   When it came to the "Not At All" response Doctors scored a 4% while Real Estate Agents Scored 20%.  Think about this, 20 out of 100 people you might talk to about real estate do not believe one word you are saying!  That should hurt.  Why are we not trusted? The Harris Poll did not elaborate on that, Marc did offer his opinion and if you just consider the per agent productivity numbers I discussed earlier in this post I would hope you begin to get the idea.

There are many factors that make up consumers attitudes and perceptions.  Good old nosey Harris conducts lots of polls.   Consider the August, 2007 poll conducted to determine the Prestige of 23 Professions and Occupations. You can see this poll on the same Harris Poll link.  Respondents were given the following choices: Very Great Prestige, Considerable Prestige, Some Prestige, Hardly any Prestige At All, and Not Sure/Refused. Want to take a stab at how Real Estate Agents fared?  The winner of the "Very Great Prestige" was Firefighter with 61%, followed by Scientist, & Teacher tied at 54%, Doctor & Military Office tied at 52%,  Real Estate Agent, dead last with 5%. 

Wonder why?  I hope so.  Let's return to the beginning of this article where I reference the .."13-year low" article.  Generalities abound.  There is not effort made to delineate or examine if there is any hope for any price range or location.  Certainly the price demographic of a major resort area such as Smith Mountain Lake has an impact on the Roanoke Valley statistics, both in price and total sales units.  Are all price ranges, communities, subdivisions equally affected?  This type of information is readily available.  There was nice graph included in the article which just illustrated that  "Yup" there are a lot more homes listed for sale. A veritable "Over-Abundance" of all houses but with no distinction of where or what price range or any differentiation of D.O.M just all houses lumped into the same rather distasteful stew.  I hope that is not how we do CMAs or provide advice, perhaps this plays into the trust factor?

In the same Roanoke Times, I noticed a number of real estate ads. One Ad for what appears to be a nice New Home Community displayed  pictures of houses, some narrative, phone numbers next to agents photos....but not one email or website address....I seem to have read somewhere that the internet was playing a somewhat important role in the real estate business these days.  Something like upwards of 80% of today's buyers begin their search on line.  I guess we don't want the consumer to get better informed before they talk with us?    

If we want trust we must be trusting, if we want prestige we must perform professionally and demand the same of our peers.  The Harris surveys tell us we have a ways to go and our own actions prove it. 

There is hope here.  There is still opportunity for anyone who wants to be a professional.  Like politics, real estate is local.   Start your own poll.  Have you ever turned to your client at the settlement table, pointed to your commission on the RESPA statement and asked them flat out, "was I worth it"?  Have you ever had a client point to the commission amount on the RESPA statement and ask you   "was this enough"? Make that a goal.

I know hundreds of real estate agents.  I am fortunate to know many real estate agents and brokers that score much higher than any of the Harris polls and have earned the respect and loyalty of consumers. I know other agents who have not done so well.  But I know Real Estate Brokers and agents can earn trust.  What will you do about it?