When Swanepoel Talks…
I had an exchange with Stefan Swanepoel on January 8, 2010 on Twitter. You are probably keenly aware of who Stefan is: the leading author, commentator, observer, speaker, trainer, etc. in real estate. When I think “real estate,” he’s the first guy I think of. Read more about him here.
In any event, I sent out a Tweet that said, “On a Scale of 1 to 10, what is your personal opinion of the level of professionalism in RE (real estate)?“
And Stefan replied to that Tweet.
Here’s a screen grab of the conclusion of that thread:
It’s a little hard to read this, I know, but here’s the key statement from Stefan (in his Tweet on the left):
“@ProfessionalOne – On a scale of 1 to 10, what is ur personal opinion of the level of professionalism in RE?<– May I also answer?? 4.59
.”
So, this person, who, because of what he does for a living – traveling around the country, meeting with brokers and agents from every company, giving speeches, interviewing people, writing blogs and multiple books about the industry – probably has the SINGLE BEST BASIS for having a TRULY INFORMED OPINION on this EXACT QUESTION, thinks the current level of professionalism in real estate is “4.59 on a scale of 1 to 10.”
4.59.
Let me repeat that: 4.59.
I think that is TERRIBLE.
If this were an academic grade, it would be a full level – or maybe even TWO levels – below “failing.”
And I think his opinion is absolutely, positively, unequivocally right…on…point.
Rather than repeat a number of other opinions, perspectives and predictions that have already been written in this Blog, I would ask you to consider the following:
- Does Stefan’s opinion bother you?
- What can be done to improve the level of professionalism in real estate?
- What kind of opportunities exist for the agents, brokers, companies and franchises that can demonstrate a legitimate “above the norm” level of professionalism?
- Do you think clients would be more likely to work with an agent, broker or company with a demonstrated level of professionalism “above the norm” for the industry?
- How would an agent, broker, company or franchise quantifiably demonstrate a level of professionalism “above the norm” for the industry?
The points of this post are as follows:
- To share Stefan’s opinion with you, because I trust and respect his opinion as much if not more than anyone else’s in real estate;
- To (hopefully) make you think about what can be done to improve professionalism in real estate, and
- To (hopefully) make you think a little bit about what you can do to enhance your own level of professionalism and how you might then leverage that increased level of professionalism to increase your business and your income.
When Swanepoel talks…we should listen!
I’d love to hear your thoughts and opinions on this…
Comments feed
Stefan’s opinion is maybe a little high (in my opinion). Of course I’ve had to deal with an inordinate number of real estate snakes during my exile to the northern regions of my state.
We should focus on quality vs quantity. The highest, or number 1 agent in any given area is not necessarily the best.
.-= The Mayor´s last blog ..Clueless in Washington =-.
I have publicly supported and encouraged a continual uplifting of the educational process and the professionalism of the real estate brokerage industry in most of my last 16 books and reports.
The time has come for a big change. I think a significant “Game Changer” type shift is now required. Otherwise we may, as an industry, slip further and further downhill until one day “others” outside the industry will find a new solution that may not include real estate agents as we know them today.
Stefan Swanepoel
Author: Swanepoel TRENDS Report
http://www.RETrends.com
@The Mayor
Not sure I follow you. My scoring of the current level of professionalism and knowledge of real estate agents in general is only a 4.5 out of 10. That’s not good IMO. Are you saying that you think that’s too high? What do you think it should be?
I agree 100% we should focus on quality and not quantity and yes the #1 agent in an area definitely does not imply that they are the best, most knowledgeable or most professional at all.
4.59 may measure the industry average, yet the measurement that matters would be one that reflects the 10% who do the business. Yes, 10%. The public has already discovered the true professionals in the real estate industry, and they hire their REALTOR from the best…90% of the time.
Great post Michael. This subject always needs to be expanded upon by all. Some of the attributes of those professionals who are contributing to our industry were list in a post I did back in December http://www.mikebowler.net/?p=761.
NAR and all Brokers need to figure out a way to survive by quality vs. numbers.
I don’t agree or disagree with Stefan’s statement, because I think the question is ill-defined. The first thing you have to ask is, what is your definition of professionalism? Is it dress? Is it personal habits or the way that you carry yourself? Is it communication, education, expertise, effectiveness? Or is it some mixture of all of these things, and others? Different people are going to have different answers to that question, so it’s hard to put ANY rating in its proper context.
That having been said, while I agree that the industry as a whole needs to improve its image with the public, and that an increase in professionalism is key to that improvement, we have to tread carefully as an industry to make sure that we do not do anything that could be legally percieved by the government to be anti-competitive. When the lawsuit against NAR by the DOJ was worked out, one of the compelling arguments that helped us as a defendant is the fact that we have very low barriers of entry into the industry. While I hold several designations myself and am continually learning and implementing new and innovative systems and procedures to maximize not only my own profitability, but also to maximize results for my clientele, education and/or licensing is only one small way to improve professionalism, in my opinion. The core difficulty in ‘imposing’ professionalism in our industry is that you are dealing with 1 million + independent contractors who can do what they want, when they want, and how they want. We have a Code of Ethics, but it seems that NAR advertising has mentioned that only in passing while communicating to “use a Realtor”.
So in conclusion, I would propose that if we are truly serious about improving the professionalism of the industry, that we first define the ideal, then figure out a way to incentivize (if that is a word) the general Realtor population to strive for it. I don’t mean incentives in the form of ‘stimulus’, but rather possibly selecting individuals (as a group, irrespective of locale or franchise) who embody the ideal and then point out the disparities between themselves and the stereotyped masses – it could be higher earnings, more time off, or other definitions of success. The public will be the last to notice, but true change has to occur first for any image improvement to be lasting.
Rob,
You’ve written too many good things here for me to comment on given my current time limitations.
Let me just say this: the issue, in my humble opinion, is NOT getting the wrong people to do the right things AFTER they are in the industry (and yes, “incentivize IS a word!”). We should never have let them in in the first place. This is all about having a LEGIT barrier to entry and LEGIT rules and regulations. Right now, real estate has NEITHER. See my other blog posts (“GAAP Gap” and “Raise the Bar“) for my thoughts on these issues).
And you are correct: sadly, the public will be the last to notice. Our reputation is too well established at this point.
Thanks for your comment – I appreciate it very much!
Best,
Michael
I could not agree more. If we as “professionals” in our field do not continue to search for new and better ways to represent the sale of real estate and really study what buyers and sellers demand some other organization, business model will. It may already be too late. My crystal ball may be foggy but I truly believe that when we look back 5 years from now we all will be selling real estate in much different way. Just wish I new the model because whoever does is going to be $$$$$$
Chris,
There is no doubt that we as an industry are SUPER vulnerable. I am writing several different blog posts right now that talk about how a Google could *easily* swoop in and put 95% of us out of business OVERNIGHT. I really believe that. Leadership is either asleep at the wheel or just that clueless to see that RADICAL changes are needed to avoid something like this from happening. I use the “supertanker” analogy a lot for real estate, in that we’ve been headed in this same direction for so long with so much “wrong” momentum that we’re not going to be able to turn before we collide with the giant iceberg that’s floating in the water just in front of us.
*BOOM*
*RUPTURE*
*SINK*
I am of course oversimplifying all of this. And there are MANY more factors at work – an outdated business model used by *most* franchises predicated on HUGE agent counts being chiefly among them – but I absolutely see a lack of leadership being a big part of all of this.
Thanks for your comment – much appreciated.
Best,
Michael
Everybody has valid points on this issue. Personally, I’m glad the market is difficult now because the agents who did nothing and knew nothing except work at discounts are now out of the business. These are the very people who helped give us a bad reputation.
There are others who are not reputable and some who make our jobs more difficult. Then there is the Internet, which tends to lead the public to believe they can buy and sell real estate without the help of professionals. Our own rules & regulations make it difficult for us to do some things.
I agree wholeheartedly that the standards for getting into this business need to be tightened up considerably. It’s too easy to get in and because it’s a relationship business not enough agents report other agents for violations so the problems continue and grow.
Bottom line is that WE, the professional REALTORS, need to continuously educate the public as to what we can and cannot do and why. One family at a time….it’s a slow process and only for those who will listen.
I’ve been in the business for 19 years and take great pride in offering quality service on a referral basis.
Janet,
I hear you and agree with just about everything you’ve said here. I DO agree that we as an industry have done a TERRIBLE job of educating the public on what we do. I’ve been in the business exactly as long as you have, and I can tell you that overcoming the negative stereotypes that people have about us can crush your soul over the long haul. Thanks for being a real professional! And thanks for taking the time to post a comment here. Keep fighting the good fight!
Best,
Michael
John
I agree that a significant percentage of the “professionals” (lets take your 10% for sake of this discussion) does the 90% of the transactions.
That however means that the remaining 10% of the transactions (say 10% on 5m sales) or about 1 million transaction sides, are being handled by “unprofessionals” that tarnish the others and provide “poor quality services” in the most expensive and complicated transaction of the average persons life.
That’s just not right that 1 million, buyers or sellers, should get the short end of the stick every year. What do you think?
John & Stefan,
I don’t agree with the implicit premise that the 10% that are doing 90% of the deals are QUALITY, PROFESSIONAL agents. I can tell you for FACT that, in my market, that is NOT the case. I’ll stop myself before I say too much here.
But let me just say this: the Code of Ethics is 1% of 1% of 1% of what it needs to be. The weak rules that do exist are never enforced because everyone knows they are weak and it simply isn’t worth the effort to even try. I can say this from an informed perspective, as I am a member of Professional Standards, and I don’t think there is any validity to that process. We don’t need to improve the “system” we have. We need to throw it out and start over from scratch, and build something like currently exists in law or medicine or public accounting.
Everything else, quite frankly, will be little more than rearranging deck chairs on the Titanic.
Best,
Michael
Rob, your answer starts off very pc so I will be a little more direct:
I agree 100% with your statement “…true change has to occur…”
You provide many great thoughts and suggestions. Thanks
Perhaps 3.0 is closer. Our profession has so much work to do. It is so easy to secure a real estate license anywhere in our country…and finding an office for an agent is simple. If only their was an easy answer to cure our faults.
Wow Michael,
*BOOM*
*RUPTURE*
*SINK*
What a visual….
Stefan,
Is that Leo & Kate at the front of the boat?
Best,
Michael
Great comments, Michael, to John and Stefan.
Not sure Michael,
I am dumbfounded watching the thousands re-arranging the chairs.
Stefan
Stefan: Here’s the 80-20 Rule progression, as I’d apply it. 90% of the business is done by 10%. Of the remainder, the 90-10 applies, once again. Then, of the next remainder, the 90-10 applies again, and so on. Somewhere it levels off, and the “ills” rear their collective heads. I’m not qualified to say where that point is, nor how to measure it. If I were pressed to ballpark, I’d go 50/50. Close enough to your 4.59 number. What I do know, and have experienced, is that we can learn something new with every real estate transactions. Thus, having a solid set of principles and best practices in place is a prerequisite to professionalism.
Michael: Good point. Let’s apply the 90-10 Rule to the 10
Thus, of the 10, nine are professionals and one is there by default.
I was following this conversation via UberTwitter today as I was doing (it was a good day)what I do. Showing properties, selling properties and getting listings.
I took a step back and organized my thoughts on all this.
- We all have choices. From an individual and company level we should conduct ourselves with the highest level of professionalism and associate ourselves with the same.
- Change is necessary in several respects.
- Because we are licensed(I believe all at the state level) we need to make the message clear to our associations, local, at the state and national levels because of the system. This is where change can be facilitated in our state license laws. That is in the hands of our lobbyists. As a Government Affairs chair, I prefer the term advocate, Advocacy is one of the few strengths NAR has.
- As someone who was an executive director of a professional association in another lifetime and another profession I am aware of that in other licensed professions associations require additional education above and beyond what the states require. I have always thought our “designation” system was a pay to play for some initials. Speaking for my market, I don’t see any top producers with the extra letters. The only required test is the quadrennial ethics “training” which I think is a joke. No education involved and our professional standards system is irrelevant anyways.
- Separate from the issue of professionalism, the Association dug themselves in a deep hole that maybe RPR is the first step in getting out of. They have been operating on the premise they need to keep control of information – all information. That boat sailed without them forcing agents and brokers to navigate this new world without them. An example is Realtor.com. They have tied themselves into a long term commitment with a dinosaur and we all know what happened to the dinosaurs.
-This tweet opens a whole other conversation.
PeepsandProps: Just seeing the conversation what bothers me is the forced membersip in order to get mls access much perfer the system in seattle
If the value that is offered in membership was clear to its members, the above would not be an issue.
As someone who serves on their local board as well as a past state and national board member I can say this. I wanted to get involved so I can be a part of the solution. What I continue to see is that once they capture volunteer leadership they get them drinking the KoolAid. They become cheerleaders for what was and backward vision instead of advocates for what could and should be. All of the above is also tied into bottom line issues for the Association: right wrong or indifferent.
In closing, I have to say Stefan is clearly the one to follow. Although I have come to know him as a result of my involvement in the Realtor Association, he is not drinking the Kool Aid like so many “industry leaders” do. Everytime I hear him speak or read what he publishes I believe his content is truly relevant to the industry and my business.
Stefan,
That’s EXACTLY how I feel: watching people rearrange deck chairs on the Titanic.
All the problems trace back to the same things I keep saying over and over: the barrier to entry is too low, the rules too undefined and vague, and the top-level economic drivers (agent count, agent count, AGENT COUNT!) too wrong-headed.
NAR needs agent count, and most of the big, historically successful (but now nose-diving) brokerage models (*robot voice* BIG BOX…MUST HAVE HUNDREDS AND HUNDREDS OF AGENTS…STAND OUTSIDE OF TEST SITE AND RECRUIT LITERALLY ANY PERSON WHO WALKS BY) need agent count, and that FORCES the wrong people into the business.
And I am still beyond flummoxed when I talk with Realtors who STILL THINK THE INTERNET IS A PASSING FAD! 95% of agents WITH websites don’t know a thing about SEO. They have a website because “they have to have one…I guess *sigh*” They don’t know how to generate web leads, and, even when they do, very few handle them properly (see MIT study).
And Social Media? That hasn’t even ENTERED THE CONVERSATION for 90% of the people in the industry. How many people can YOU name that are leveraging SM effectively today? 100? 200? MAYBE 300? From in industry that has over 1 million constituents?
The future belongs to (1) the professional agent, and (2) the agent that can CRUSH IT on the tech side. I am VERY confident of this.
Keep fighting the good fight, my friend!
Best,
Michael
John,
I’m going to have to respectfully disagree. In my base market, out of the top 10 agents, knowing what I know from working with them, if I were a consumer and needed to select an agent… I MIGHT choose 1 or 2 of them to represent me.
The RULE – not the EXCEPTION, but the RULE – among this “elite” group is that they are driven almost ENTIRELY by numbers and money, not, not, NOT by providing phenomenal service. I talk about identifying this kind of agent is another blog post I wrote at http://cli.gs/7JsMm.
My experience is that the best agents – in terms of professionalism and providing great service to their clients – rarely make it above the 90th percentile. Why? Because there is a physical limit to how many clients you can handle properly, and that limits the agent’s volume.
These are my opinions, obviously. And I greatly thank you for sharing yours here. I look forward to continuing this dialogue with you in the future…
Best,
Michael
The real estate industry needs (1) Higher bar for licensing; (2) Continuing Ed with more teeth. Few real estate associations get behind any meaningful change in either of these areas. It is counterintuitive to growing member ranks.
I do not believe organized real estate has the chops to effect meaningful change. I’ve concluded that change WILL come, but it will be forced upon the industry after significant lawsuits.
I am going to stick my neck out and make a prediction: 2010 and 2011 will see legal challenges in the real estate industry that will make the recent DOJ matter look like children’s play! I think those legal challenges will occur in the foreclosure arena and social media space. It is not going to be pretty, but healthy change will follow.
Frances,
Thanks so much for these prescient comments. I don’t disagree with anything you’ve written.
I am very curious to learn more about what you are thinking re legal challenges involving the social media space. If you would be kind enough to elaborate on that comment, I would be indebted to you.
Best,
Michael
Does Stefan’s opinion bother you?
Yes because he is correct and as an industry we need to do a better job with each other and for the public.
What can be done to improve the level of professionalism in real estate?
Require more, high quality education. With a focus on law, ethics, and best practices the State can set the expectation for consumer experience. Raise the bar for entry into the industry in Massachusetts Barbers are required to complete 1000 hours of training, Real Estate salespeople 30 hours. We expect Lawyers to attend an accredited Law School and pass the Bar, why not require a degree in Real Estate?
What kind of opportunities exist for the agents, brokers, companies and franchises that can demonstrate a legitimate “above the norm” level of professionalism?
Brokers, Agents and Franchises do lack opportunities, they lack enough reason and or will to change and improve. The driver will be new models and Franchises that want to grow and are willing to bring a new way of thinking to the industry. As long as there is success in business as usual don’t expect the big companies, brokers, or agents to change.
Do you think clients would be more likely to work with an agent, broker or company with a demonstrated level of professionalism “above the norm” for the industry?
Absolutely, provided they know and value the difference between an outstanding sales perfomance and an outstanding sales experience.
How would an agent, broker, company or franchise quantifiably demonstrate a level of professionalism “above the norm” for the industry?
By doing the right thing in every situation, thinking long term, and working together for the benefit of Everyone involved in the transaction Franchises, Brokers and Agents can save the industry from itself.
I have known Stefan personally for a number of years, and one thing I know is that he does not make uninformed statements. In my classes I have ranked “us” (I say Us as I am a licensed Ohio Broker as well as a speaker/trainer) a 3-4 with gusts to 5. In the Preamble to the Code of Ethics it states that we “….become and remain informed on issues affecting real estate….” That statement, supported by most states license laws, requires from a so-called “Professional” a lot more effort than currently given by most practicioners… and that includes many of the so called “top producers” … quantity of production does not qualify as a gaurantee of Professionalism, in this profession, or in any other… (think Drs., Lawyers, etc.etc.) Professionalis take their business obligations seriously, become students of their business, work constantly and consistently to sharpen their saw to better serve the people who rely on them for advice, counsel and results.
The decades old (or argueably century old) current real estate model needs to be completely dismantled and re-designed .. in every way, with the consumer at the center of every decision. And that includes our outdated agency laws which allow practices like “dual-agency” which fly in the face of the practices expected of professionals.. and I will also include “transaction and facilitation” which also don’t give the consumer the necessary protections of full fiduciary duties.
Kindest regards to you all. It is apparent the folks on this thread “care” about our Industry/Profession… what might it look like with, say, 500,000 practitioners who care to make this a true profession.
Alec Hagerty
Michael,
The prospect of litigation attached to social media has prompted me to change my primary blog focus to social media risk management.
http://realestatesocialmediapolicies.com/blog/
Common daily infractions:
* Antitrust
* Fair Housing
* Agents urging consumers to break contract with brokerages
* Agents urging consumers to break contract as principals
* Agents giving real estate advice across state lines where laws are different.
The foreclosure front is also highly important to measure core competency and it’s just a matter of months before brokerages get clobbered by state attorney general offices, unhappy consumers, and banks. I collected thoughts in a blog post:
http://realestatesocialmediapolicies.com/2009/10/05/consumers-and-banks-to-realtors-how-can-i-sue-thee-let-me-count-the-ways/
.-= Frances Flynn Thorsen´s last blog ..Realtor Association Execs: Social Media Risk Management Webinar Replay =-.
fsagghgmant
Reading this for the first time, thanks to your BridgeUrl tweet this morning. Our industry as a whole is unprofessional, which creates a huge opportunity for the agents and companies who do it right.
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