It’s an exciting time to be working in the real estate industry.  Due to a recent class action lawsuit against the National Association of Realtors, many things are changing in the industry.  Times of transition are times of opportunity.

Some old timers are scoffing saying, “It worked better the old way.  Why do we have to do it differently now?”  They are blaming the consumers.  Consumers should have dealt with the old way rather than filed a lawsuit.  Consumers aren’t going to like the new way.  Many of them who are toward the end of their career will probably throw in the towel rather than figure out how to get paid under the new rules of business.  That’s great for newcomers.

I also think people might try creative business models.  Some things I would like to see…

  • Real estate agents who charge an hourly rate for work they do regardless of whether or not the house sells. This would be similar to what some attorneys do.
  • Real estate agents who charge a flat fee. For example, for a flat fee of $___, I will show you five houses.  If you decide to buy one of those house, the fee goes toward the full commission you would owe.
  • Real estate agents who offer several packages. For example, for this price, I will put the house on the MLS, advertise it in fancy magazine, and help with the contract.  For a higher price, I will do all of the above plus use a professional staging company and drone photography.  For an even higher price, I will do even more.
  • Some agents will stick to the traditional model of pay a commission only if you buy or sell.

There are a few agents who have different offerings, but I would like it to be the norm.  In the legal field, there are attorneys who charge by the hour, some who charge a flat fee, and some who charge a commission on the settlement.  All of those are normal ways of doing business.  I would like to see that happen in real estate.  Why?

Real estate is the only industry I know of where good agents get paid the same as bad agents.  Most agents charge the same percentage or very similar.  This makes it difficult for newcomers to get into the field.  Why should I as a consumer hire a new agent when I can hire an experienced agent for the same amount?

I even know brokers who forbid new agents from working for less than their predetermined rate.  They would rather you not get the listing than get it for lower rate.

In most industries, new people work for less than experienced people.  A brand new web designer is going to charge less than someone with ten years of experience.  This is good for the web designer because he can enter the market.  It is also good for the consumer because there are various price points depending on what you are looking for.  To be clear, I’m not saying that new agents should always charge a lower rate.  I’m saying that it is one way to get your business going.  Plenty of agents got their business going using other methods as well.

Going forward, I hope that agents are more creative in how they get compensated.  I believe that the changes resulting from this lawsuit will be good for consumers, but also good for new agents.  The people who are grumbling the most are the old-timer agents who don’t want to figure out a new way to do things.

If you want to get into real estate in Orlando, Florida, there has never been a better time to get your Florida real estate license than right now.  Check out Demetree School of Real Estate to get your Florida real estate license.  We offer in-person classes or online classes.

Please note that neither Karen Climer nor Ron Climer teach at Climer School of Real Estate or Gold Coast Schools.  Climer School of Real Estate was sold by Ron Climer in 2014.  It has since been sold a few times and is now owned by Colibri.  We are both teaching for Demetree School of Real Estate in Orlando, Florida.