Is This The End of The Line For Real Estate Agents?

By
Managing Real Estate Broker with ERA American Real Estate
https://activerain.com/droplet/4CJT

I ran across this in an email I figured this would be a good topic to have some debate. 

 

 

The long term viability of the agent, as a group or individual, is going to turn on their ability to deliver value to the real estate consumer. While there is great momentum in our society in favor of using a real estate professional when buying or selling a home, that momentum will slowly erode if the professional fails to deliver value to the transaction.

Consumers, in the absence of any agent value, will initially refuse to pay as much as in the past for the agent's services and eventually move away from the agent all together. Although this is beginning to happen now, we are still a long way from the disappearance of the real estate professional. Nevertheless, agents should not let any more time pass before identifying and creating value they can deliver time and time again to real estate buyers and sellers.

The challenge facing the industry, as in many industries, is that the "value" delivered in the past is no longer considered "value" today, thus forcing the real estate professional to create new value. Before the Internet, the primary reason to work with an agent was to gain access to the MLS. As a buyer, you needed to see what homes were for sale and then access those homes to view the interior. As a seller, you had to list your home on the MLS in order to market it effectively.

Real estate professionals were the gate keepers. Consumers now however, with the help of technology, are storming those gates and are just about inside the castle. Active listing data is widely available on the web. Consumers can list and market their homes on the MLS with the help of discount brokers or on non-MLS associated real estate portals, such as Zillow Trulia® or Google.

In another few years, consumers and agents will stand on equal footing with respect to access to and marketing of homes for sale. In addition, the real estate process is no longer a mystery. Much of the documentation is available online or from low cost providers. If a consumer is willing, there are few barriers to complete a transaction without a real estate agent.

In this environment, the viability of the real estate agent turns on their ability to find new and unique areas of value. So where is the value going to come from?

Answer: Developing an expertise.

 

Find a niche in which you can develop an expertise and translate that knowledge into consumer value in the real estate transaction. On my blog (http://www.realblogging.com/bill-miles-blog), I have identified a number of interesting areas agents are focusing on today to add value to the transaction. Scanning other articles and blogs, there are literally thousands of niches to focus on and dominate. Here are a few: beach properties, neighborhoods, seniors, technology savvy consumers, non-technical consumers, relocation, foreclosure, clients who speak English as a second language, commercial specialist, condos and so on.

Comparing the real estate industry to others that have been impacted by the proliferation of industry data on the Internet, can help us see the future. Ten years ago, when consumers gained access to booking their own flights, cars and hotels, many predicted travel agents were doomed. While many travel agents did change careers, still many others developed specialties and niches of expertise. This came through education and the development of an enhanced service. For example, when you look for travel agents today, you might find specialists offering company sales trips, "all inclusive" family trips or African safaris. However, you find very few that will make a business flight for an executive to Chicago . That market is gone. Those that have developed an expertise are being paid well and will have long careers. They deliver value beyond the traditional areas of service: scheduling the trip and making reservations.

A second example is the stock broker. Over the past 10 years, the Internet has enabled consumers to buy and sell almost any financial product offered in the market. Yet stock brokers have not disappeared. They have focused on financial planning or developed an expertise in certain financial products or industries. In addition, similar to real estate, buying and selling financial products is a complex activity. Consumers will always need experienced, educated advice in this area. As such, stock brokers still exist, but with new value to offer.

I believe the real estate industry will follow a similar path. This puts a premium on education and converting that education to consumer value. Real estate professionals who rely on traditional areas of value, such as MLS access and knowledge of the process and documentation, will disappear. Agents who have intimate knowledge of a neighborhood or senior housing options for example, will become invaluable, and will be viewed more like consultants. More and more real estate professionals will market themselves as Certified Neighborhood Specialists, or as catering to Spanish speaking first-time homebuyers. Many successful agents are doing this now, while others are holding onto the traditional areas of value, not sure what to do next.

In ten years, will consumers be doing their own transactions without a real estate agent involved? I doubt it. Will the requirements of a successful real estate agent change? Certainly, they already have.

Florida Real Estate with Brandon Jordan, your Northwest Florida Realtor and ActiveRain featured Realtor for Okaloosa County since 2007. We provide this information and much more on our site for you at no charge, so please remember us when you're looking to buy or sell real estate.

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Brandon Jordan, Realtor,E-PRO,ERA American Real Estate

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ERA American Real Estate
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at no charge, so please remember us when you're looking to buy
or sell real estate"

 

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Rainer
39,334
Deb Short
TENNNESSEE REALTY & AUCTION LLC - Sparta, TN

i think the MLS has a big role. Before I came to my company , I was a realestate agent. Not realtor

we didnt have MLS

I had to work ten times harder than any realtor, it cost me more money for my ads and advertising.

Since I LEFT the company has gone to the mls.

they have tripled there business

 

internet is such a key word with blogging,search engines..

you have a great article

Sep 24, 2007 11:20 AM #1
Rainer
434,914
Scott Daniels Florida Real Estate 2.0. Agents Earn 100% Commission.
Florida List For Less Realty, Inc. Broker/Owner. - Cooper City, FL

BJ<

if today is any indication of this, I`m positive there will always be a need for realtors.

I can`t tell you how many FSBO etc, get into trouble and need our assistance.

I guess the media pundits have to write about something!

Sep 24, 2007 11:20 AM #2
Rainer
39,334
Deb Short
TENNNESSEE REALTY & AUCTION LLC - Sparta, TN
by the way.. no i dont see anytime soon that realtors are out of the business. i do see realestate changing
Sep 24, 2007 11:21 AM #3
Rainmaker
223,010
John MacArthur
Century 21 Redwood - Washington, DC
Licensed Maryland/DC Realtor, Metro DC Homes

Brandon - It is more difficult for a camel to pass through the eye of a needle than it is for one man or woman to succeed without the support of their industry. You can become the greatest expert in your field but Don Quiote will have more success chasing windmills than you will find if you battle alone.

You have a national association. You would be best suited to demand that they protect your greatest assets.....your listings. I just wrote a blog about it but I have no clue as to how to put the link here. No matter, it is your parade.

Sep 24, 2007 11:23 AM #4
Rainmaker
238,216
Donna Paul
Keller Williams Realty Gold Coast - Dix Hills, NY
Long Island Home Specialist,All About Real Estate
Great article..... I know that we as realtor have to consider a niche within the market.. I've been trying to work with seniors, but I just don't know how to get into that market. I've contacted Senior center and also lawyers. I'm opened to any other ideas that you may have..... Thanks
Sep 24, 2007 11:27 AM #5
Rainer
407,371
Sean Allen
International Financing Solutions - Fort Myers, FL
International Financing Solutions

I believe there will always be a need for realtors. Yes people can find homes via the internet, people can list their homes on the internet and numerous other avenues,but realtors are need to bring the two together in an organized manor to make sure everying is done legally and compliant. Also, people will sell their homes much fast with the services of a realtor than on their own.

Years ago when fax machines first became available, many sales oriented businesses thought they could save money by sending faxes instead of sales people to sell their produces and quickly found out that there is nothing like having a warm body to peddle their products.

Sean Allen

Sep 24, 2007 11:51 AM #6
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