Choosing Your Realtor Wisely: The NAR Lawsuit Wake-Up Call | Real Estate Revolution Episode 21

Let's talk about why the consumer is much at fault as the real estate agent. A shitty transaction. We all have heard about this lawsuit coming from NAR and you know it's a big deal, A lot of people are up in arms about it. A funny thing about it is they're not wrong in some ways of this class action lawsuit. And they're talking about commission fixing, price fixing and a bunch of other stuff in there, right? So big class action lawsuit that the consumers won. What does this, what does this mean for you? Well, it doesn't mean a lot. There's definitely going to be some changes in the real estate industry and we don't know what those are yet. But let me just give you why my opinion is that some consumers are really responsible for shitty real estate transactions. And I'm going to set the stage with this. If you are in a hurry to get to the airport and it's a 30 minute drive, it's rush hour traffic, you need to get there. You need to know that the person that is driving knows how to drive, right? You wouldn't go and grab your 16 year old and tell them to drive 80 miles an hour down the i17 to get you to sky harbor in a quickness feeling like this is really safe for me to do now if you put me behind the wheel, I can get you there no problem. Right? But I've also been behind the wheel for 25 years. So let's take that to real estate. Why is it that the consumer goes and does a favor for a buddy, pays them to learn at their expense on their largest purchase or sale of anything that can financially ruin them. I have long not understood this and questioned this where recently I talked to a client, he called, he's like, hey. He's like, you know, we need to get out of this house and we listed it with a friend. And I'm like, okay, so what's the deal? It's like, well we really need kind of that cash offer thing so that we can get out of this. I'm like, okay. I said why? If I sold you the house and I bought one of your houses in the past, why did you hire this person to sell your house? He's like, well, you know, he's a buddy of mine and you know, he closed down his car dealership and he used to be in real estate. Now he's just getting back into real estate, so I thought I would give him a shot. Why the freak would you pay somebody to give them a shot at selling your home? With inexperience. I just, I don't understand the industry as whole where we hire inexperienced people and then we get mad at the inexperience when things go wrong because they can't fix them. And this is nothing against inexperienced agents because I think there's a lot of agents out there that are going down the road of teaming up with a team or a mentor and they're learning and they have that backing behind them. But I think in most cases, it's so interesting to watch when somebody gets a real estate license. And if you don't know this, like a real estate license is really 90 hours of schooling. They don't teach you shit about real estate or the transaction. They teach you the high level stuff and then you go and take a school test, a state test, and boom, you've got a real estate license and the ability to go make as much money as a doctor or go screw up somebody's life, you know, in a heartbeat. And I just, I don't understand the industry itself when it comes down to this. But more importantly, I don't understand the consumer in the lack of questioning or interviewing a real estate agent when it comes down to a market like the one that we're in, which is very different. It has a lot of curves and a lot of twists. And it's going to take somebody that has some experience to understand the market, where to go and how to advise. So I started putting together my actual real estate resume and I'm working in this process right now so that if a consumer wants to talk, I want them to see my resume. And it's going to come with a blank resume that they can actually application to put to the test with a couple other real estate agents. Rather than looking and interviewing a real estate agent and saying, oh, well, you've done so many transactions, you've been in the business for so many years. Do you know what's hard about, hey, I've been a real estate agent for 10 years. Okay, that's great. Go one step further. Have you been full time for 10 years? Have you been working another job? Have you been doing it full time? Have you been doing it part time? How many problems have you solved for people? How many buyers have you represented? What was the biggest problem you solved for a client recently? What was the hardest challenge you've overcome? We're not getting deep into these things. You know, I give another example is like, look, if you're going to get plastic surgery and you're researching doctors, you're not going to the plastic surgeon that just came out of school, you're just not going to, you're going to do research, you're going to get referrals, you're going to get references and go, this is the person I want to use. So why, as the consumer, do we choose a real estate agent based on a list price that they give that probably they can't get? A market that is so different and wonky that most agents haven't experienced it. But there's a few of us that have experienced 25 years of markets doing this and this. And so we've seen some correlations of 2008, some correlations of 2012, 2015. You're like, well, here's all the things I've experienced, so I'm going to help you navigate through those. And the interesting point is that the consumer will go through, they will pay one real estate agent who has no experience about 1% less than an agent that does have experience. And we've all heard, you know, different real estate agents going, well, yeah, you can hire that person, but I guarantee you that's the service you're going to get. I'm not so worried about the service as I am the experience. So I would challenge anybody that is looking to sell or you're interviewing with clients that you start doing a little bit better job in interviewing the person that is actually going to handle this financial transaction. And so when it comes down for me, in my experience, number one, we're a real estate investor. So I have bought and sold almost a thousand homes. Personally, we've been in the market since 1999. I'm a third generation real estate agent. So, you know, my grandmother, my parents, my sister, we have all been it. My wife's in it. So I have lived and breathe the Phoenix real estate market for a very, very long time. And I understand it forwards and backwards. It doesn't matter the areas. Sure, there's some areas I'm not an expert in, there's other areas that I am an expert in. So those are important for you to know. And when it comes down to it, because representing a buyer in certain things or representing the seller in certain things, it's important to understand how that works and processes. And I just think the consumer should ask better questions and interview in a better process in order to find the person that is going to guide them through this and that investment that you're making. You see some of the people out there, the consumer will ask, well, what do you charge? Well, I will tell you, in my opinion I'm not charging you anything. My question is, what are you willing to invest? For my experience of nearly 25 years and more than 10,000 transactions, what does that investment look like for you, the consumer? So those are some things that I'm just kind of noodling on right now in the real estate market that are just questions that, that I kind of have, you know, with this lawsuit going on, is that, you know, I believe the consumer needs to do a better job at interviewing their agents and talking to them and figuring out, is this the best person for this time of my life that is going to lead and guide me through the problems that I have. And that's where we're at at this point. I hope you'll do a better job, ask some better questions, and I'll see you next time.