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Why Does Realtor Experience Matter So Much?

Updated: Apr 3


Why is experience so important when choosing an agent, and how can a consumer be sure they are selecting an agent with adequate experience to assist them?


Both my parents told me you want to find a doctor who isn’t so old; they aren’t familiar with the new technologies -- but not so young that they haven’t had enough experience! What’s especially funny about this is that my parents have been divorced for 45 years and have probably had two conversations at chance meetings in Greek restaurants in Chicago in the last 20 years. 


I’m entertained by ideas like this and other nuggets about life that I didn’t realize when I was younger. I like to think about this concept almost like the life cycle of a career.


In my 20s and 30s, I was going deep into the world of finance, trading, financial software, and risk management for securities portfolios. In my late 30s, I applied a love of operations and financial expertise to process and capacity planning in the corporate world, and then in my 40s, I applied all of this to a client-centric, white-glove real estate experience.



This life cycle of a career helps us build our skills in our younger years and apply them without thinking much about the mechanics as we hit that sweet spot of experience that my parents mentioned to me. 


How does experience impact real estate and the consumer getting the best experience possible?

When you’re working with someone who has a great deal of experience in any field, they can tell you what to expect. What is a normal outcome, and what is an unexpected outcome? 


An experienced CPA can alert you to the behaviors that have triggered the IRS to audit past clients and what the likely outcomes may be. They have seen so many events, and they have learned easy wins from other clients' experiences. They have a process for their clients to have a great experience and a list of best practices that have been learned over the years.

 

An experienced attorney can tell you what your exposure is on a certain event based on their years of experience in their field and seeing 50+ other clients in your situation. An experienced doctor can identify and diagnose based on their past cases with patients presenting symptoms in the same manner. 


With real estate, unfortunately, the consumer hasn’t been taught to search for the most experienced agents. Agents with 20+ transactions per year know what the market is doing weekly. They can feel a shift in the market before the data reflects this shift. 

A newer agent hasn’t seen market shifts; they may only have six transactions per year and thus only “feel” the market through their transactions every two months versus the agent that is more immersed in the market due to their larger volume. Agents that don’t have current properties for sale in the market also can’t have a great grasp of where the market is at any given time. 


An experienced agent can better guide a buyer or seller on the outs in a contract, the frequency those outs are exercised, and the frequency with which they expect to see other events in the transaction process. 

A less experienced agent isn’t likely to have enough data points to be able to guide their clients on a probable or improbable outcome.  With only ten transactions over the course of a career, it’s difficult to set a client’s expectations on what a likely outcome is in any given situation.


There is discussion in the news about the value realtors bring. Comparing them to travel agents and stock brokers in an academic paper and several news outlets. 

Other than betraying a lack of understanding of some basic concepts about fungibility and stocks, this minimizes the value of having an experienced consultant by your side as you purchase or sell one of the largest assets you will likely ever own.

Academic paper: Et Tu Agent?


Critical skills agents learn over time

With more data points, agents learn what they can expect within a transaction. How often do buyers terminate in general, 80% 90%? What outs can they use when they do terminate, and which ones are they less likely to use? How can we mitigate against some of the lesser-known outs by playing a great game of defense as a seller?


What is expected behavior when my seller is first on the market, and how can I guide my seller to act in a way that is expected and normal to the buyers who are interested in their property?  Behaving in predictable ways helps our clients have predictable outcomes. Having a larger data set of experience allows agents to articulate better what predictable behavior is.


How do you deliver messages to your colleague in a transaction to keep the feelings of the other party calm and collaborative? How do you delicately let the other party know you have a backup offer? How can you deliver a repair request in a manner where it is received as a collaborative request and has the greatest chance of a positive outcome?


How can agents improve their experience level when they are just starting?

New agents can work as assistants in order to see more data points and get comfortable with likely outcomes. Since real estate doesn’t have a required apprenticeship like real estate appraisers do in Texas, new agents should look for opportunities to learn while getting paid in the industry.


My background prior to working in real estate was risk management in finance, software product development, and operations. The low barrier for entry into real estate didn’t make sense to me when I would be handling the largest asset most clients owned, so I worked for an experienced agent for 2+ years to get exposure to 60+ transactions.


Rather than being overly confident about my skills, I realized it was hubris to think my financial skills would apply to another field that easily. 

This gave me the apprenticeship I needed to make sure my clients were well taken care of and mitigate risk. Learning from others gave me the confidence to move forward and help my clients responsibly.


After two years as an assistant, I had exposure to 60+ transactions, and I felt comfortable that I had completed an apprenticeship that would allow me to guide my clients safely.


What questions should consumers ask to be sure that they work with someone who has adequate experience?

It isn’t rude to ask an agent how long they have been in business and how many transactions they have managed. Consumers should do their due diligence and ask agents how many transactions they do each year. 


This is far more important than how many transactions an agent does in your neighborhood. Yes, it’s good for an agent to broadly understand homes built in the 1940s in Austin, Texas, and what the condition of those homes typically is. But it is far more important that they have broad experience in your city and as many data points to learn from as possible.


You won’t trust a newly minted attorney to defend you, you won't trust a newly minted CPA to do a complicated tax return, and you won’t trust somebody in med school to do open-heart surgery on you. 

Why would you trust somebody without adequate experience to dispose of the largest asset you and your family own?


We want to raise the bar in the industry and demand excellence in our colleagues and our professional community. When we have the opportunity to work with experienced agents who understand what the normal process is for a real estate transaction, both our client and the other party have a better experience. 


Consumer education is the only way to get the message out on agent experience, why it matters, how to determine experience level and what the tangible differences are to the client.


Cheers,

Jen & the team




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