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Tuesday, September 29, 2009

Keeping Listing Agents Honest - A Modest Proposal

Recently I was competing for a listing with another agent. We were both asked how much real estate we had sold in the last 30 days. For myself I guessed (correctly) about $1 million, but the other agent said $1.7 million. When I got home I looked him up on the MLS. He had sold one small property in January and another in February -- nothing since! Agents can indeed lie to prospective sellers and the seller has to take their word, because there is no way to verify past sales, only current listings!

Back in April 2008, I competed with an agent for a $685,000 listing (which I got).  The seller showed me the listing presentation which the other agent had left behind.  That agent claimed to be the city's top selling agent for over 10 years straight selling over 100 listings per year.  Since I'd never heard of him, I looked him up on the MLS and found that he had averaged under 20 sold listings per year in the last three years and had not sold any of his own listings or any other agent's listings in the previous 2 years!  (He claimed he had a database of buyers waiting to buy a "home like yours.")  It was outrageous, and I wrote about it without naming him in my newspaper column. (www.ecentral.com/members/jimsmith/Columns/Apr24YH.pdf)  A couple colleagues guessed who I was talking about, which surprised me!  My only regret is that I didn't file an ethics complaint against this agent, because he is a Realtor and bound by the Code of Ethics which says you should not lie about your statistics.

I'm thinking of creating a website on which sellers could get accurate performance statistics on any agent usng the MLS. It would involve the seller giving the agent's name and someone with MLS access would look the agent up on the MLS and send a report. Do you think this is a good idea?

PS: I don't want to do the analysis myself -- and don't have the time, either. But it requires access to the MLS to do the analysis. One solution would be for the local Realtor association to farm out the assignments to volunteer members whose reports would be anonymous. This should not be a way for one agent to win clients away other agents, just to keep agents honest and give sellers some way to verify perfomance claims.  I think we owe this integrity check to consumers.  Don't you?

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