Did They Really Just Say That?

“A glut of mediocre Realtors is screwing over homebuyers,” says Entrepreneur.com. Is that just clickbait, or a serious remark?

And hey! If we didn’t have agents, what exactly would home buying look like?

What’s the Deal With a “Glut” of Agents?

During the housing boom after Covid first struck, the real estate agent population surged. Suddenly, everyone and their cousin seemed to be trying their hands at profiting from a hot market.

Now, there are more agents than there are homes for them to sell.

There’s no glut of excellence in the field, though. And when too many agents of all abilities compete for diminishing returns, agents keep commissions high just to survive.

Yes, home buyers could feel “screwed over” in the chaos of it all.

What About the “Mediocre” Part?

Hundreds of thousands of new agents arrived during the 2020-2021 boom. Some of these agents, though, are running away from the current housing slump.

All in all, turnover and low standards mean a lot of so-so people claim to be adding value to the field.

Perhaps the states could toughen up their licensing requirements? As things stand, states usually require only a few weeks’ worth of online study.

We might wonder why the real estate profession doesn’t improve from within. The National Association of REALTORS® (NAR) is real estate’s main trade group. Entrepreneur.com says the association doesn’t want to raise the bar to entry into the profession. NAR’s membership numbers are, after all, key to their influence.

Meanwhile, the heavy costs of buying already take up a huge share of people’s incomes. No wonder some go through the trouble to be their own agents.

How about you? Would you become a real estate broker to buy your own home?

What Would We Do Without Our Agents?

Most buyers get serious value from agents. Buyers’ agents can find good local inspectors and contractors, flag flood risks, and so forth.

A talented agent can spare a buyer the hassle of negotiating with a seller directly, getting a well-crafted result. So, competent agents save their clients from the work that would have become a huge job.

But a seller might well say: Hey! I can sell this home myself!

And a good number of sellers simply don’t hire agents. Cutting out one agent can save 3% of the purchase price. Some figure they’ll save thousands of dollars by just posting details and images of their home online, and opening a communications channel for potential buyers. Local lawyers can manage the contracts on behalf of these sellers.

It’s the buyer who needs the most help, including mortgage support as a new homeowner.

DIY Escrow: Is Today’s Tech Creating Tomorrow’s Solutions?

Could blockchain tech manage direct interactions between sellers and home seekers?

With blockchain — the technology underlying bitcoin — buyers could handle direct, secure exchanges. Imagine this. A seller accepts the buyer’s offer and requests payment through blockchain. Once identities and details are verified, the blockchain ledger gets updated with a permanent data block. Payments are safely released.

Blockchain-based smart contracts execute their own terms and conditions, automatically.

Blockchain is basically an electronic recording system. It’s a good fit, then, for managing and transferring real estate records. It gives everyone involved updated access to accurate information, reducing the risk of misunderstandings. Smart contracts based on AI, blockchain, and other advanced technology could even automate appraisals, based on the same inputs appraisers would normally use. There’s a lot of potential here.

So, Looking Ahead…

We don’t need more real estate agents. But we do need good real estate agents. To the extent that professional people fall short of consumer expectations, today’s digitally driven market will find alternatives.

This doesn’t mean blockchain and AI will take over the agent’s job overnight — if at all. But blockchain technology could streamline transactions, even where professionals stay in the picture.

We’ll keep watching, as innovations at the intersection of tech and real estate continue to develop.

Supporting References

James Rodriguez via Entrepreneur®: There Are Way Too Many Real-Estate Agents – A Glut of Mediocre Realtors Is Screwing Over Homebuyers (published by Entrepreneur Media, LLC on Aug. 2, 2023; republished from Business Insider).

Aspire Solutions via LinkedIn.com: Transforming Real Estate – How Blockchain Is Revolutionizing Property Ownership (Sep. 30, 2023); see also Aspire Solutions via Medium.com: Transforming Real Estate: How Blockchain Technology Is Revolutionizing Property Ownership (Oct. 4, 2023).

Seven Bits Technologies via LinkedIn.com: Exciting Times for Real Estate – How Blockchain is Transforming the Industry (Oct. 3, 2023).

And as linked.