What Good are Realtors?

​Its fun to hate on Realtors. They often appear to be the unwelcome mutation of a Bar Exam failure and a used car salesperson. And they can activate something deep in our reptilian brains that make us flee at the first muttering of the R word. I never thought I would be one. But maybe you never thought you'd be the Senior VP of North America's 3rd leading smegma stain removal company. Despite our national fallacy of Be-What-You-Wantism, many Americans find themselves careers away from those smegma stained dreams of their collegiate egos.

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Twenty years in Chicago real estate has taught me the needed adage of our times: two things can be true. A lot of Realtors are clueless sycophants concerned more about networking than genuine client representation. They couldn't differentiate a boiler from a hot water heater, coherently explain the benefits of different window types, or provide sound reasoning for valuation. To these enlightened masses, real estate is merely another multi-level marketing charade that they are trying to conquer. It is the reason that the daily realtor inbox consists of networking strategies, networking coaches, and branding consultants but nothing offering the skills needed to understand homes and clients.

But I met the other realtors too, the ones who wipe down dusty window sills before a showing, who can explain the correct way to open up a load bearing wall, who treat all parties honestly, and who know how to ethically push themselves to get the best possible terms for their client.

Selling a home seemed pretty basic in the online era. How hard could it be to take some photos, write some fluffy language (pre-ChatGPT), and hit <submit> Representing buyers seemed to be the real challenge. It provided the ability to embark on a true creative process, starting with just a vague idea, guiding through the jungles of floral wallpaper funhouses, carpeted travesties, & bathroom nightmares before ending with the most meaningful material product of one's life, a place that would eventually harbor some of their greatest memories.

I would become a dedicated buyer's agent with the oddest of pricing structures – none. I learned it the hard way. Before getting licensed, I bought a property without a realtor, because, who would trust one of those? I told the listing agent I wanted to negotiate directly with the seller. She said it didn't work that way. But she invited me to the seller's dining room table to present my offer. And present I did. That hard working Humboldt Park native was not about to give away his Devil's Ivy strewn two flat to this scruffy looking gringo. I got kicked out of his house. But the soon to retire agent kept the deal together even as I insisted the price be lowered since I was representing myself. It would be a few more years till I learned the truth about buyer's agent commissions.

A break-up and a lawsuit are like Malort and Old Style. You think Chicago. You're at the bar. Why not. Well, you soon learn why not. It didn't go well. Forget about getting a share of the home, or maintaining any of those friendships. It was all gone. But the discovery process revealed something – realtors from the Redlining age take really detailed notes. And apparently don't mind sharing such under subpoena. There were quotes from my dining room haggle brawl neatly scripted on the yellow legal pad (“he's pushing too hard”), and sitting in a lonely corner of the page was each counter offer with the final price stating a $1,000 reduction in her 6% commission. So instead of paying a buyer's agent roughly $10,000, she pocketed $9,000 all while providing zero representation. Proof that a buyer's agent was a necessity. The buyer would never see a difference in the price because real estate prices aren't fixed. A $500,000 home is only worth what a buyer will pay and a seller will accept, and depending on the market, and whether Mercury is in retrograde, that value can hover between $470,000 and $525,000 (of course, drastically less or more depending on the condition/location/pricing matrix). So an unrepresented buyer will never notice their 'No commission savings.'

I soon learned why so many agents eschewed buyers or simply stuck somebody lower down their in-house MLM pyramid to accompany. It is a lot of work. Buying a new hairbrush on Amazon might take 30 minutes of reading reviews to reluctantly choose (incorrectly, of course – those two star reviews were right after all). Buying a home brought out every imaginable anxiety and why wouldn't it – the biggest financial investment of your life that might also create an identity crisis, and, potentially, just potentially, bankrupt you. Holy shit. This was a job for a seasoned psychologist who moonlighted as a hostage negotiator.

Buyers know what they want. No they don't. They think they know. It is the agent's role to guide them to the best possible fit and that means some trial and muthaf**k'n error need to happen. Open kitchen. Wait, no maybe we want to keep that separate. MUST have central air. Oh, really? You didn't know you can add central air to a really awesome house for less than the markup of that inferior home? Does that mean you can also add a dishwasher? Oh, of course, yes. But laundry, where can I put it? And here is where an agent needs to understand space and structure because by removing walls, and putting up new ones, and knowing where plumbing can and can not go, an apartment or home without the 'W/D', can now have one, or have it moved from the basement to the 2nd floor. A room without closets now has two. Well, with that logic, a primary (nee 'master') bathroom can be added too. Unless it can't. That's right – the wise agent needs to show a buyer if, and where they can make room for another upstairs bathroom because mommy and daddy don't want the little ones running poop down the big ones' toilet. Among other unmentionables.

What many buyers want is just a place that looks like a 4.9 star AirBnB listing. Virginal. Cheap Middle Century furnishings drowning in Grey enveloped with white shaker cabinets and a dollop of reclaimed anything with no signs of human habitation. They don't care the house was flipped in a measly 5 weeks, or that you can walk to, well, nothing. Location. Quality. Many buyers quickly tunnel vision it out like the origin stories of so many couples - “Oh man, she was so hot when I met her, how could I have known.” “He was so kind, and thoughtful, just downright gallant, I just never would have suspected...” Well, unlike dating a person, dating a home allows you an agent to slap you silly with email rants: “Did you take a walk around the neighborhood? At night?” “Did you notice the cover up paint all along the basement floor?” “How about the old plumbing visible under the sinks?”

Now the lazy agent, or the greedy agent, they aren't going to bother when the easy justification is the “buyer likes it so I'm done.” See: Best friend who only tells you upon divorce notification that she never liked him and wasn't surprised. The good agent – they are the parent you wish you had (once you make it through therapy), the one who sets boundaries but does it with care. They guide you away from the traps; the free credit cards, the timeshares, the text message brides. The wise agent must resist the passionate yet unknowing buyer's pleading, and show them another path.

Eventually, a home is found, sometimes after months, even years and every once in awhile, immediately. Now, the buyer's agent can step back. Right? If they don't want to negotiate, sure. But identifying the home is only one challenge. In a competitive market, an agent needs to understand how to prepare a winning offer, but also ensure you aren't grossly overpaying, whereas a soft market, or an 'ugly duckling' house, requires that agent to understand value and demand. The better agent can tweak an offer to win out in a multiple offer scenario, or engage in a careful negotiation that could save the buyer additional thousands, often more than their commission.

Maybe this is the point where the buyer's agent can just hand it over to the attorney or whoever. Inspectors? Best to recommend somebody that won't 'kill the deal'. Alarmists, they say. The better Agent thinks contrarian to the masses. The inspector nobody likes should get the nod. Better to know too much than not enough. But somebody needs to help the buyer understand what is typical in the inspection, and what is concerning. And therefore, what is worth negotiating and what should the buyer just accept. The good agent knows. But don't be too greedy because the seller can cancel the deal too. You didn't know that? Well, guess who does? Ahem....

More issues can arise: Lawyers fighting over tax prorations. A low appraisal. An underwriter classifying the property incorrectly. Maybe a pre-approval that shouldn't have been given. Title company won't insure the home. Irregular zoning. It seems reasonable to let those people take care of it. Unless you are that agent. The good one. The person who feels in control of the deal, and won't let anybody derail it. This agent gets on the phone, and stays on the phone, with as many people and hours as necessary until a resolution is found. A reputable agent believes in the Realtor's primary ethical function: promote and protect their client's interest. Nobody else cares about the buyer the way their agent should.

It is tempting to think about bringing a DIY mentality to the home purchasing process. After all, anybody who has bought more than a few homes knows the general idea. They often know the property they want to buy, exactly how much they will pay, and don't need anybody to guide them. And those buyers aren't wrong but they are a true minority.

How about them sellers? Don't they need an agent to protect their interests? And who would be an ideal seller agent? A buyer's agent. Somebody experienced with buyers knows exactly what a seller needs to do to sell their home. What repairs & upgrades are worth it, and what aren't. How should things be arranged? Does it really matter what kinds of sheets you keep on the bed? What is going to photograph best? And of course, what would somebody pay for this place?

How hard can it be? Just put one of those generic 'For Sale' signs on the lawn and a Craigslist Ad, and voila, SOLD! Any realtor can tell you that the worst deals they've ever done were with 'By Owner' sellers. And it's not what you think. A good realtor can get their commission covered by an unrepresented seller, or even their own buyer. The issue is the personality type that sells DIY-style. They often have no understanding of price, assuming their poorly decorated, and severely outdated home is of similar value to their neighbor's gut renovation because, well, Jim was a total dipshit. The 'ByOwner' seller really goes off on Jim before revealing his own Q-Anon coffee mug. These miserly sellers often did most of the work themselves and refuse to admit any of it is inferior. They get so emotional over the sales process that attempting to negotiate is a lesson in vile spewing restraint.

In an online world, every realtor, regardless of company size, has access to the same fundamental advertising tool; The MLS. This is the database that feeds every single website you've ever seen advertising a property. Heck, for a small fee, every 'By Owner Sellers' can put their property on there. So what does a good realtor need to do that the average homeowner can't? Understand staging. Organizing. Pricing. And pricing. Pricingpricingpricing. Because there are so many variables that truly determine a market price and there is no appraiser, AI system, or online site that understands this better than a realtor with truly local knowledge.

Oh, you know the price because your neighbor just sold an identical property. How do you get multiple offers? How do you select the best one when the prices are similar? How do you deal with a buyer who wants to back out? How do you handle murky financing? What do you do with an attorney or a spouse who wants to derail the deal? How do you adjust a listing to a changing market? What should inspection negotiations look like? What if the buyer gets cold feet, or worse, the seller? How do you maintain calm while dealing with the intensity of emotions surrounding the largest transaction of someone's life? It's the reason the profession exists.

Becoming one of the good Realtors turned out to be pretty natural. Probably no different than your everyday asshole who assumes they are doing nothing wrong. Its just who they are. For some people, when you do something wrong, thoughts start percolating in your head - “Are you sure?” “You probably shouldn't do that.” And many people might brush them away until they resurface with greater tenacity. It is here the separation begins. The reputable agent recognizes earning a commission isn't worth running into their client months later only to hear their house is a total disappointment, or how they should have made more money, like Jim. That thing they call a 'conscience' won't let the good agent rest. So they take the more difficult route, the one involving more time and potentially loss of income.

The not-so-good agent learned long ago to drown out those DoGooder thoughts, and successfully replaced them with “I did my job” and resume listening to their life coach networking podcast hosted by B. Killinit, America's #1 Realtor of the 21st Century – start your free trial subscription today!