Real estate is the career of choice for many. The idea of independence—being able to make your own schedule and run a business based on personal preference—can seem like the ultimate dream. However, with 2 million active real estate licensees in the U.S. already, and over 85,000 brokerages, according to The Association of Real Estate License Law Officials (ARELLO), becoming a successful agent can be much more difficult than it appears—and the open accessibility to this career path brings with it myriad benefits, but extensive challenges as well.
Dan Lee, broker/owner of Elite Team GA with Valor Realty Group, believes the ease of access to real estate licensing can initially lead to widespread advantages stemming from individuals’ diverse backgrounds.
“I think the greatest benefit of our industry is the fact that people from all walks of life can enter and enrich our field,” says Lee. “The wide range of agents with differing backgrounds ensures we always have fresh views.”
Agent Training: An Area for Improvement?
Testing and a few months of classroom experience aside, obtaining a real estate license is typically much easier than other career paths that require more stringent schooling and hours of logged training before being given the reins to the job.
“Probably the first and foremost [industry challenge] would be educational requirements for licensing. Our industry has become one where anybody feels that they can join, and although that has its own merits, currently, joining real estate is the career path with one of the lowest amounts of difficulty to enter,” says Lee.
So, how can the industry come together to raise the bar, level out the playing field and ensure every consumer receives the excellent experience they expect? According to Lee, it should start at the training level.
“Every brokerage leverages some sort of continuing education or training program to recruit hires,” says Lee.
However, he believes broker-provided training can be improved upon to increase retention rates. The first obstacle to resolve? Cost.
“In the training/coaching world of real estate, we see higher standards being taught,” says Lee, “but the price of these programs can be the deciding factor for newer agents’ participation.”
Commitment to Excellence
The National Association of REALTORS® has taken recent steps to address the experience and knowledge gaps of agents and increase participation. Its Commitment to Excellence (C2EX) program hopes to ensure that NAR members can best represent the real estate industry with a comprehensive understanding of the elements of professionalism, at no additional cost.
“There are 11 different competency areas that were identified by the Commitment for Excellence Committee, which runs the program,” says Kasey Stewart, director of Member Development at NAR, who adds that the online program determines the proficiency of participants in these areas. “They were approved by the NAR Board of Directors and range from advocacy, real estate law, technology, customer service, and more.”
Once members take the assessment, the C2EX platform produces a personalized learning path for self-improvement in their target areas. For brokers, a special competency area focuses on creating and maintaining a work environment that encourages professionalism and mentorship within the brokerage.
“The C2EX program allows agents and brokers to say ‘I have this endorsement from NAR which signifies that I hold myself at a higher professional standard,'” says Stewart.
According to Lee, the focus should be on staying competitive, offering agents better tools and systems to allow them to grow—a goal this member benefit hopes to achieve.
Putting the Onus on Brokerages
Right now, Lee says, training and systems are the sole responsibility of each agent. To raise the bar on agent success, he believes brokerages should shoulder more of the agent accountability.
“I do believe that instead of facing that challenge, our industry chooses to keep the bar for entering our field as low as possible to ensure that brokerages have as many hires to recruit as possible,” says Lee. “This inevitably leads to lower standards among real estate professionals.”
That’s why the C2EX program is looking to equip brokerages with the tools and resources to heighten these standards from within their organizations, according to Stewart.
“Brokers can use this program as an agent training tool,” she says. “The Committee is actively working on providing metrics for brokerages so that they can say they are a C2EX-endorsed brokerage. We will also be including materials such as press releases, advertisements and signage so they can tout their brokerage’s C2EX endorsement.”
Increasing Agent Standards Across the Board
Lee believes, however, that there are additional challenges to confront, and that includes the low barrier for entry right at the start of the career: recruitment.
“It would not be a far-fetched claim that agents interview brokers and not the other way around,” says Lee of the current process. “Sure, if you’re an experienced agent, that should be the case—yet for newer licensees, it has become our industry’s model to try and recruit as many as possible with little regard to the competency of those hires.”
Lee recommends that brokerages focus on retention efforts—investing in the improvement of new agents’ reputations and expertise to ensure their offices are not revolving doors of agents with low standards, as this negatively impacts the consumer experience.
“The consequence of all this is that the consumer can expect to have a negative experience working with the majority of real estate agents,” Lee says. “The claim that the top 20 percent does 80 percent of the work means that most consumers will unwittingly end up working with the other 80 percent. It is far too frequent that we work with a client that relays their nightmare experience with their previous agent.”
The solution is to first recognize the problem and tackle it head on, says Lee.
“Finding success as a REALTOR® is difficult, thus the rate of new licensees and the rate of newer licensees exiting the field is a point we shouldn’t ignore,” he says. “These higher rates that exist in our industry should be a clear indicator that entering and exiting our field poses too little resistance. Our educational requirements are too low, our standards for hire are too low and knowledge of our field to the general public is too low.”
Improvement Strategies in Progress
According to RISMedia’s 2019 Power Broker Report, today’s Power Brokers are addressing this need for improved agent education, reporting training as a top area of investment. And as the short-term C2EX results have shown, there is a growing interest in increasing agent standards to provide a high-level consumer experience every time.
“The program has really extended past our expectations in terms of growth and participation,” says Stewart. “C2EX has only been running for six months and we already have a total of 18,557 participants and a total of 600 endorsements.”
With more brokerages participating, and more agents taking on the task of self-improvement, the real estate industry could see a boost in agent productivity and an enhanced REALTOR® reputation all around.
“With better quality hires, the field becomes more competitive with current real estate agents. Although we are independent contractors, the quality of service that our industry provides, on average, is far too low,” says Lee. “With better agents, the accountability goes to each professional to keep up with the better-trained and more knowledgeable agent.”
Liz Dominguez is RISMedia’s associate content editor. Email her your real estate news ideas at firstname.lastname@example.org.