The Bloodhound Blog’s Greg Swann has been making his argument for elimination of agent licensing altogether. Call me busy (I have it on authority that the cat-who-hates-Steve just hurled her Fancy Salmon Feast again), call me distracted with other issues of import (paying my utility bill and my quarterly taxes weighs heavily on me right now), or accuse me of lacking the Big Thinker gene (”big” as in larger than Paris Hilton’s legal bill). I disagree with his proposition that occupational licensing is criminal, but I lack the mental agility and clarity of thought to tackle this weighty thesis this morning. That would require self-sequestration in a windowless room appointed only with black lights and the soothing background sounds of Ayn Rand’s talking book series.
What I am prepared to argue, however, is that we are already there. Sure, strictly speaking, we have real estate licensing requirements. Greg’s world, one with virtually no barrier to entry, is essentially upon us; the day when everyone is a de facto licensee is today, because the majority of the adult population it seems does in fact have their license!
My past week has been rich and full of bad-agent experiences. I have seen the devil, and he is wearing a cheap suit… or, at least, his cousin is.
Mega-Agent- I haven’t personally spoken to him, I will never meet him, but his ad campaigns tell me he is bigger than life. Trying to submit an offer on the behalf of my client on one of his listings has been an experience akin to swimming the English Channel. He is a busy, busy guy. He is so busy, that each call to his office, calls in which I identify my purpose and ask to speak with him, is met by a “Is there something I can help you with?” screening from the receptionist. Once, when I had finally, successfully navigated my way to the Marketing Manager, I felt so empowered that I was ready to take out my own ads. “Kris Berg is connected in the real estate community. Her vast Network includes Mega-Agent’s Marketing Manager!” I did finally receive, at one point (underscore “one”), a perfunctory call back to voicemail from The Man, The Man who does not publish or otherwise give out his direct phone number. “Ah-ha!”, I shrieked, scrolling through my call records. ”Now I have his number!” Blocked Caller.
Mega-Agent Wannabe – He is looking for a home for himself, but he is smarter than I am. I know this because he tells me it is so. Every conversation begins with my being reminded that he is the “#1 agent for (company)” in the county. Every conversation except the last, that is. The last one began with his statement, “I hate old people”. I am not kidding, and neither was he, as he proceeded to tell me why. Apparently, they are indecisive, they take up too much of his time, and they tell long stories. How dare they! I’m trying to negotiate an offer with this nice man, and they are wasting his time with stories! Oh, and after assuring me that, despite the fact that he had offers on several homes at the moment (my listing being one of them), he would honor our contract if the sellers signed, he reneged. No problem that my clients left work for two hours to sign a steaming mound of documents in good faith. I guess he is just smarter than I am. One word, Mister - Karma.
The Con Artist – I thought that the voice message said that her husband was an agent, but that he is in China. She assured Steve on the phone, however, that she was unrepresented and that he misunderstood. Later at the showing (at 8:45 PM to be exact), after more than two hours of discussion involving price and terms of an offer, the olive branch was generously extended. Steve would be allowed to represent her… for a 2% “rebate”. It seems that the husband isn’t an agent, that much is true, but the cousin is! Steve never confirmed his whereabouts, but it is presumably China at the moment. I guess they have fax machines.
The Con Victim – “I have a strange question. Did you get an offer from me on (property address)? We came to the open house and told our agent two days ago that we wanted to make an offer, but she isn’t returning our phone calls. I saw on your website this morning that it is in escrow. Was it us? Oh, wait, we probably would have had to sign something.” Tears followed. You can’t make this stuff up.
I have got at least a half-dozen more personal examples of an industry run amok from just this week alone, each more painful than the next. So, you see Greg, you win the argument but we are all losing the war. Licensing requirements, while they exist, are simply straw men. If you want anyone to be able to practice real estate, I am here to tell you that they already are.
ABOUT THE AUTHOR Kris Berg is Co-Owner and Designated Broker of San Diego Castles Realty. If not-so static web sites are your thing, go here at once where you will find loads of real estate information including homes for sale, market trends, floor plans and more. Kris's hobbies include fencing and spot welding. She likes kittens. 
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{ 26 comments… read them below or add one }
Kris – I feel your pain. However, I love the current setup because when these wannabes and so called mega producers (no, of course not including you, Russ) think they can swim in investment waters, my clients win — sometimes big.
Take solace in the fact this correction is weeding out the latest crop of wannabes, and that by the end of the year, many of your walking headaches will be back selling Mary Kay.
FWIW, you are beating up a Straw Man. I have not argued for an increase in practitioners. In the absence of real estate licensing laws, I would expect the number of practitioners to find a closer balance with demand — that is, fewer, not more. For reasons that I have elucidated in detail, it is the licensing laws themselves that have created the glut of incompetent practitioners.
As Kris so eloquently pointed out, the past few days have been a cross between Bizarro Land and the Twilight Zone. But a potentially important point to take away from her message (besides the arrogant and/or incompetent agents mess) is the fact that all of these homes were playing in the multiple offer arena. Maybe it’s just the time of year or maybe a concern about rising interest rates or both. I honestly don’t know. But it is getting interesting.
Are you talking to me? Are you talking to me?
Seriously, I am usually in your boat. But these things seem to run in waves. I am in escrow right now on 6 houses. 4 of the agents are outstanding. I really don’t think I’ve co-oped with any better. They are easy to reach. They know the contracts. They are not oppositional without cause. They don’t “give away the ship” when talking about their clients or properties.
At no time in my 5 years has this ever happened. Usually the balance goes the other way…trust me.
As for the other two, those are double sided deals. So I really have to keep on top of myself to not make fun of me and to do as I’m told by me.
Jeff – Thanks for the empathy.
Greg – As much as I want to, if not agree with you, then understand your point of view on this one, the logic is escaping me entirely. What we basically have now is an absence of licensing laws, and I think that is the biggest counterpoint to your argument. You have a licensing test that a three-year-old could pass using a Keno crayon before nap time. Anyone who has any desire to be licensed is licensed. I think I will go take this up with you on the Bloodhound where it belongs, since my psychic skills tell me that you are right this very minute rolling your eyes at my ignorance, at my missing the argument entirely and at my inability to grasp an obvious concept
Chris – It really does equalize at some point. This was a particularly difficult week, but others are an utter delight as you point out. By the way, have you had to send yourself a notice to perform on those “other two” transactions?
> What we basically have now is an absence of licensing laws
What we have now is irrationality caused by licensing laws. Eliminating the laws eliminates the irrationality: Clients would shop more intelligently, vendors would deliver the product more intelligently, third-party oversight entities like E&O underwriters would police more intelligently. Force is the opposite of reason (that’s pure Ayn Rand). If you want rational markets, you have to eliminate the coercion.
Greg – Okay, I like to challenge Kris at every corner that I can, but on this one I have to agree her. Clients have the opportunity to intelligently shop now and too many are doing a lousy job of it. The reality is that the standards are too low and the policing is almost non-existent. Lowering the bar to entry would only exacerbate the problem.
Kris, you are right. What Greg imagines as real estate utpopia already exits—the present low barrier is, in effect, NO barrier. It is the wild west and snake oil salesmen roam free—–why aren’t consumers smiling?
But did you catch this doublespeak? Can you reconcile these statements Greg?
Greg first said “The purpose of these laws is to artificially “limit entry” into the real estate business,…..
But now he says they have created a glut:.
>For reasons that I have elucidated in detail, it is the licensing laws themselves that have created the glut of incompetent practitioners.
Which is it: Do the RE licensing laws limit entry or do they cause a glut?
Kris, you are right. What Greg imagines as real estate utpopia already exits—the present low barrier is, in effect, NO barrier. It is the wild west and snake oil salesmen roam free—–why aren’t consumers smiling?
But did you catch this doublespeak? Can you reconcile these statements Greg?
Greg first said “The purpose of these laws is to artificially “limit entry” into the real estate business,…..
But now he says they have created a glut:.
>For reasons that I have elucidated in detail, it is the licensing laws themselves that have created the glut of incompetent practitioners.
Which is it: Do the RE licensing laws limit entry or do they cause a glut?
Snake oil salesman did very well, thank you, before regulation, as they do now, after regulation. It is the irrationality in the marketplace that gums up the cogs in Greg and anyone else’s anarchist machine.
Finally, and most importantly, the license does not define the business model I must use since the law does not mandate a certain model with the license. The barber who gets his license isn’t restricted to one set of scissors & only one way to cut hair. Either is the real estate agent. He, or she, is free to develop their own business model to give greater value to consumers than traditional brokers. That result is achieved using one’s brain, not one’s license.
Thank you Kris, I know this is a difficult battle to jump into for you.
Greg the main problem with your argument is that by definition, half the population have below average intelligence. Please spell out exactly how doing away with licensing laws will enable those of below average intelligence protect themselves.
And lets be clear here, you have been clear that you think ALL licensing laws are bad. Not everyone is capable of being an Elitist Greek like yourself. How will letting the sheep and wolves into the same paddock play out?
Or does it simply not matter to you what happens to the sheep?
-Athol
Greg, with all do respect,
This probably belongs on bloodhound, but I think what is missing is really really simple- the alternitive. Greg, you’ve not gone so far as to explain what happens after the laws are gone- that is what boggles the mind, chaos and criiminality would simply fill the void. The days of the carpetbagger salesman would return to Texas & California and Arizona and the ability to really look up and see who has been verified by the state and actually is ON record with the state would no longer be an option. I disagree with the assertion that all reasons for licensing are for the protection of the Broker/Agent. In Texas especially when you have such a large mass of land and population spread across such a large land mass, you must have a way or recording who is transacting real estate or you could seriously land us back in the day of the old west. I really do not know the subject in nearly the detail you do, but like I said, you aren’t describing the aftermath you forsee. Our minds see insanity. So, I don’t think I have a problem with what you’ve said, more of what you haven’t said.
BR
“That’s pure Ayn Rand”.
I suppose among certain people that’s the equivalent of “Look it up, it’s in the Bible.”
Those of you who are half the fans of Latin that Greg is will easily spot the argumentum ad vericundiam.
BR- I agree that the “holes have been poked” in the bubble, but no solution has been offered; I look forward to Greg’s next article suggesting the solution- BHB is a great blog venue and Greg has a captivated audience looking to him for leadership.
Kris- really great article! I have (and will) steer clear of licensing issues (for the time being) because (1) my cat just barfed too so I’m a little busy, (2) I’m not licensed, so my opinion would be consumer-based and the timing isn’t right yet (y’all are just heating up), and (3) I think the problem has now been aired well but the solution needs to be posed in the next week over the blogosphere. I don’t like getting in the middle of the crapfests, but you’ve done a great job at agreeing yet disagreeing.
John – Let me be the first to publically admit that I had to Google “argumentum ad vericundiam”, and I get it now (although the spelling is questionable). You currently have more “smart points” than I.
BR – Yeah, that!
ARW – It is so funny – I wasn’t even intending to go there in the post. I am seriously lacking the brain cells this week to engage in a philosophical argument with Greg, or my three hole punch for that matter. My knee-jerk reaction, without benefit of insightful deliberation or public polling, still stands however – I think the Let’s All Be Agents concept is a bit goofy. Conceptually, the Communist Manifesto made an inordinate amount of sense too, yet in practice it was a wee bit questionable. Call me unenlightened…
Joseph – I rescued you from Spam Land. Yea! This won’t be popular in some camps, but I can’t disagree with your comments. Maybe I’m still missing something.
(Greg, If you ask me, “Who is John Galt?”, I won’t be surprised.
)
Thanks for saying my spelling was questionable, Kris, where “wrong” was easily more accurate. Oh well, I guess I flunk Latin spelling. And poor Mr. Kowalski gave me an A+ in that class, too. If you meet him, don’t tell him, ‘k?
Kris, is there any way to pump up the font size a notch or two- I have 20/20 vision but I have to lean my eyeballs on the screen to see the text?
sincerely, blind guy
BR – Funny you should mention that. On my laptop, I have the same problem, but on my desktops (and Steve’s) the font is very large.
Any techies out there who can explain this to me?
BR – Any better?
well, whatever you’ve changed has worked- so keep your wallet in your purse!
And yes, I do use a laptop, it never occured to me there would be a difference.
On the Internet Explorer menu, see “View / Text Size” to adjust the font size on the client side. On the web site side of things, it’s a bit longer of a discussion. Kris and Steve, you know you get free programming and blogging support when you come to work for Elite Properties, right?
I’ve always wanted a San Diego office in case I need to go to a nice beach…
Thanks, John. I fixed the code in the style sheet, which seems to have helped Benn (if that’s what you meant by more complicated).
Thanks for the job offer, in any event!
Soooo Greg… *crickets chirp*
Kris, no, I just meant there’s about a zillion ways to fix it in the style sheet. As long as you found one, you’re good to go.
Job offers? No extra charge. Typing all night long on the Internet: priceless.
Geez ~ hot topic, to say the least!
I strongly disagree with Greg’s assertion that we should eliminate licensing.
I do agree, however, that the status quo has essentially done that.
And, Kris, in case you haven’t checked yet ~ your cat DOES already have a license
It gets even worse ~ In Idaho, law enforcement now asks for a real estate license when making traffic stops ~ seems that not everyone HAS a driver’s license
I think we need to STRENGTHEN our licensing laws and make it extremely difficult to become a real estate agent/broker, and thereby eliminate all the wannabe get-rich-quick snake oil salespeople.
How about some meaningful continuing education, instead of the wink and nod everyone passes stuff?