Ethics. You don’t hear too many people talking about this subject in today’s competitive real estate—or any business—environment. Doing the right thing, being honest and upfront with clients, avoiding conflicts of interests…these character traits should never be considered weaknesses or flaws.
Maintaining an ethical business reputation will help you gain customers and, better yet, increase your number of repeat customers and referrals.
Ways that focusing on ethics can help your real estate business
Despite what you may have read in the newspaper, ethics have never really gone out of fashion. After all, everyone enjoys being treated with honesty and respect. We feel this can be turned into a competitive advantage while allowing you to live your values, even in the sometimes-aggressive real estate industry. There are many ways you can get into ethical gray areas or even cross ethical lines in real estate.
As an agent, you might be so eager to close a sale that you fail to disclose a prior fire, flood or other major incident at a property. You might overstate the number of offers a property has received in the hopes of spurring a potential buyer into making an offer. Or, you might decide it’s not necessary to disclose that the property failed a previous home inspection now that the sellers have fixed the problem.
Members of the National Association of REALTORS® (NAR) are required to take an ethics class every four years to continue their membership; however, ethical behavior is often open to debate, even in the real estate industry, and requires day-to-day attention. The good news is that the time you spend debating the ethical way to handle transactions can pay big dividends in growing your business. Here are five things to consider:
You can use your NAR membership in your marketing. Your NAR membership doesn’t just tell people that you’ve met the standards set by this organization; it means that you are continuously trained and reminded of the ethical standards set forth by NAR for members of the real estate community. Potential homebuyers and sellers aren’t necessarily aware of this part of NAR membership.
Hone your communication skills. The best real estate agents are those with excellent communication skills, according to Hollish Hill, an ethics instructor for the Greater Capital Area Association of REALTORS® (GCAAR). These agents have the tools and skills necessary to share information and aren’t afraid to engage people and make those difficult phone calls. There’s always room to grow in this area.
Ask for referrals based on your behavior. It’s not out of line to ask your clients to refer their friends and colleagues to you if they feel that you’ve treated them in an ethical and honest manner. Trust is the hallmark of a good agent/client relationship and it’s fine to ask your past clients to use ethics as a basis for referrals.
If your state has a real estate ethics requirement, make sure you tell your clients. In addition to the NAR requirement, some states—such as Ohio—require real estate agents to attend an ethics seminar periodically in order to renew their state license. This is another fact your clients are likely unaware of. Use this in your marketing to your advantage.
Increase your social media presence. Social media posts on sites like Facebook, Twitter and LinkedIn are an open book. They allow potential buyers and sellers to see your responses to questions before they even pick up the phone to request a viewing or an appointment to discuss listing their property with you. If you converse on these sites in an ethical manner, following the real estate ethics guidelines, as well as the golden rule, your behavior and your professionalism will shine through. Just ensure that your posts and comments are viewable to the public—not just a select group—and coordinate your posts with marketing in other media, such as the newspaper and MLS listings.
Living with integrity and maintaining an ethical business in the real estate industry should never be considered a disadvantage. In fact, it can set you apart from your competitors and help to increase your referral and repeat business!
John Graff is the CEO of Ashby & Graff Real Estate in Los Angeles, Calif., where he brings over 16 years of combined real estate and public policy experience. He is a director at the National Association of REALTORS® and serves as Policy Advisor to the National Association of Gay & Lesbian Real Estate Professionals.