Are you having a tough week..... can't find the right house, you have the customer from Hell, house had a poor inspection, lender needs additional documents. There has to be an easier profession.

Right!

If you are feeling this way, I would like you to take a ten minute break and read a story that always touches my heart. It is about a REALTOR® in Baltimore who spends her entire day helping poverty stricken people become homeowners. Her name is Irene Mabry and she is truly an inspiration.

I guarantee you will go back to work feeling better about your situation.

When I used to sell houses there were certain phrases I hated coming from the cooperating Realtor - "I will not let my buyer pay this" or "I will not let my seller take this for their house" I knew right then I was dealing with a difficult agent and not a "deal maker".

Agency laws have a way of taking away the "deal maker agent" and insisting they become a "representing agent". It is assumed that a "deal maker agent" is an agent that is only out for themselves (it also assumes their client is stupid) and the "representing agent" is totally looking out for their client's interest (funny, this one also assumes their client is stupid). Why not have every agent become a "representing agent"? This is the way attorneys work.

"This will be good for the consumer".

Big Problem - Attorneys get paid hourly wages to totally represent the rights of their clients. Even when their client is wrong. However, when the money runs out watch how quickly that attorney becomes a "deal maker". If all attorneys worked on a percentage of the successful lawsuits or successful business deals they worked on, you can bet they would become "deal makers". Let's take a divorce lawyer. They will always ask for a larger portion than they should receive for their client. So each side asks for unreasonable terms..we have an impasse.....attorney's fees mount up...the estate starts dwindling...clients become impatient and tired...more attorney's fees....clients want to settle. Bam! The attorneys become "deal makers" and get the divorce settled.

This was good for the client?

The problem is that there is a fine line when the agent is a "deal maker agent" and when the agent is a "representing agent". How can an agent totally ever protect their customer? There is always a better deal or there is always someone willing to pay more for the client's house. Of course, it may take months to find them. In the meantime, the client has not found a home or has not sold their home. The market conditions change and the customer could be in worse shape than before.

This was good for the customer?

Many states are now trying to legislate agency laws concerning real estate agents and how they represent their clients. Unfortunately there is a very fine line between "protecting the consumer" and "making the deal", and all the legislation in the world cannot define that line.

In 1995 Bill Chee gave a speech called "The Lion Over The Hill" in which he predicted that one or several large companies would be the demise of Realtors and their commissions. These companies could take advantage of the new technologies and reproduce the Realtors functions and therefore reduce the total commissions paid to Realtors. This multi-billion dollar industry was too tempting.

At first, the two companies that were most feared were AT&T and IBM. Well, those two do not even get mentioned these days. Next, came Microsoft - Gates is coming after the Realtors. Not that I would put it past him to try, as a matter of fact he is being "tried" right now. However, HomeAdvisor is not a threat, and so far Microsoft has gone out of its way to be Realtor sensitive.

Lately, many are pointing to HomeStore (RealSelect) as the new threat. Look again. Realtor.com is too dependent on Realtors' information and minority owner NAR is committed to keeping the Realtor in the middle of the transaction .

I see the "The Lion Over The Hill" and it is not any major company, but it is the Realtors themselves. They have resorted to beating themselves up. Buyers agents are pointing to dual agents and crying "foul". The exposure given to agency issues is bringing pressure on the old six percent model. Some agents have resorted to giving reduced services for, of course, reduced commissions. Now, some are even bidding for the consumers business. This is a bid where the lowest commission wins.

It seems many Realtors are trying to find an angle to get a bigger piece of the pie, however their angle is pointed to reducing commissions. With over 700,000 independent agents, maybe this is inevitable. However, in the past it was Realtor against Realtor and may the best Realtor win. But leave the commission alone!

Realtors, if you're looking for that lion who is going to mess with your wallet ..... Look in the mirror.

• Week of June 7, 1999
• Week of May 31, 1999

has been in the real estate industry in Texas for over 15 years in both commercial and residential brokerage and is a past member of National Association of Realtors. Jody is the publisher and majority owner of Realty Times, which first launched as Agent News on October 15, 1997. Jody’s wife, Nora Lane, is a very successful Realtor in Dallas, Texas.

Published: May 25, 2012

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