End of 6%?

Damon Darlin’s article in the New York Times “The Last Stand of the 6-Percenters?” (with a quote by moi,, towards the end), is a rehash of complaints we’ve all heard before and purposefully provocative. The author was already a little hostile to real estate brokers in some past writings, and he just continues that thread with this little article. (Even Rain City Guide notes that the New York Times real estate blog “The Walk Through” is “surprisingly anti-agent”. Which is odd, as the entire real estate section of the paper would disappear if there weren’t agents to buy the ads. But I digress….)

Anyway, the main thrust of his article is the rising number of discount brokerages threatening the traditional real estate model.

He’s got some good juicy quotes in there about how these discount firms have trouble getting other agents to show their clients houses. Zip Realty, our local area’s largest discount brokerage, doesn’t seem to have any problems, but Redfin does. One of their agents, a Ms. Howard, recounts how she can’t get listing agents to show “her clients” their listings. However, Redfin will show their clients homes for 4 hours for $250.00, but for those too cheap to pay, I guess Redfin expects the listing agents to show the homes for free…..

I, as a general rule, do not show my listings to anyone I don’t know. I will occasionally hold an Open House, but only if the house is on a well-trafficked street with neighbors close by. I will not meet anyone in a vacant house, or even an occupied home, if I haven’t met with them before. They must first meet me in my office, for safety reasons. Between 1992 and 2001, 86 real estate professionals across the country fell victim to violent acts, including 63 that were killed. Between 2001 and 2004, the latest figures available, 25 real estate salespeople and brokers died as a result of “assaults and violent acts,” according to the Bureau of Labor Statistics. I have written in the past about this business model and the dangers of meeting strangers at vacant homes.

However, if I refuse to meet a stranger at one of my listings, I run the risk of being listed in the Redfin “Hall of Shame” or having a Redfin agent call my seller to complain. If they cannot reach my Seller by telephone, then Redfin will send them a registered letter complaining about me.

“When that happens, Redfin agents contact the sellers and let them know that their agent will not show the house. When they cannot find a phone number, they send a registered letter. When sellers have moved, they track them down through the relocation service that moved them.”

This is just one of the ways they threaten, intimidate and harass agents who won’t do their work for them.

And they wonder why some agents are less than cooperative? LOL!!!

We all remember the murder of Windermere agent Mike Emert, in Bellevue a few years ago. An agent was murdered showing a house in Dallas just a few months ago, and agents are easy targets for criminals of all sorts all around the country.

I urge all agents to not be intimidated into showing a home if they are uncomfortable and not to be afraid of losing a customer or being intimidated by another real estate company or pushy Buyer. I am under no obligation to put myself in harms way to show a house, and I’m sure no Seller would want me to. Our safety is more important than a commission.

Our office, as do many other real estate firms, suggest that ALL Buyers be met at the office first. It is suggested that we photocopy their I.D., get their drivers license and ask for a letter of pre-approval before showing homes. I think this would be a good policy for all real estate offices to have, to put safety of their agents and their sellers first, before the promise of a sale. If someone wants to complain about that and send a certified letter, so be it.

Violent Crimes on the Job

Keeping Real Estate Associates Protected

Real Estate Murders from Mortgage News Daily

Law enforcement officials, real estate boards, real estate trainers, and others routinely advise agents to observe some common sense safety precautions.

Realtor Safety Tips:

Always meet a client for the first time in the office. Introduce him or her to coworkers and make it clear that they know you are taking him out of the office. Try to take separate cars but if that is not possible you will have slightly more control if you drive. Do not meet a client at the property, particularly if he is calling on a yard sign. He will already have had a chance to note if the property is vacant.

Get a license plate number and leave it at the front desk. Just explain that it is office policy; a customer who means no harm won’t mind. You might also leave an itinerary for your house tour.

Don’t identify a property as vacant to a caller on an ad or sign.

When showing property to a stranger, follow rather than lead him through the house. Don’t let him get between you and the door. At an open house, take up a position as close to the door as practical.

Always carry a cell phone where it is easily accessible (not in the purse you left in the car or stowed in a kitchen cabinet.) Make sure emergency numbers are programmed into the speed dial.

Ask the office manager to control keys to the office and to place deadbolts on the doors. If you are alone in the office at night draw the shades and do not admit anyone you do not know well and trust.

Go with your gut. If something doesn’t feel right, if anything raises the hair on the back of your neck escape the situation immediately. You might feel like an idiot but don’t worry about it.

More comments on the New York Times story by Damon Darlin:

If Bill Clinton ran Redfin
on Bloodhound Blog

Housing Panic’s message to Realtors: Drop dead you crack whore!

Work the Numbers: Redfin’s not much of a business by Greg Swann

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23 comments

  1. Alan

    “Between 1992 and 2001, 86 real estate professionals across the country fell victim to violent acts, including 63 that were killed…”

    Come on, that 86 in 8 years? Nationwide? That’s basically zero. You’re in far more danger driving yourself home this evening. If you really think numbers like that are likely to be affecting you, you shouldn’t be selling houses, you should be buying lottery tickets!

  2. Terry Sanford

    Lets see… over 9 years “86 real estate agents were subjected to violent acts” so of 1 million + members less than 10 a year were assaulted which is a rate of one per hundred thousand or 0.00001. Maybe we should consult with the guys over at freakonomics.com and see how that compares to the rate of violence in other professions or the rate of violence that occurs in general. Seems to me like if Marlow were to use his own logic he would have to stay in bed for the rest of his life least he risk the real world.

    One other point…
    “This is just one of the ways they threaten, intimidate and harass agents who won’t do their work for them.” To clarify, I think this is how Redfin threatens, intimidates and harasses agents who won’t do the work that they contracted to do for their sellers.

  3. Richard Johnston

    Even if one violent act occured, thats one too many. I agree agents should meet their buyers in the office and get some more info than just a name and number. Possibly running their credit will deter criminals.

  4. Marlow Harris

    Dear Alan and Terry,

    You are right. The chances of me being killed or raped showing a vacant house to a strange person are close to zero. But there are a lot of chances I’m not willing to take.

    The chance of putting my eye out while running with scissors are slight, as are the chances of contracting the hantavirus from mouse feces, but I neither run with scissors nor seek out mouse feces for fear of the consequences.

    There are approximately 300 million people in the U.S.. And according to the CDC, the estimated number of diagnoses of AIDS through 2004 in the United States is only 944,305.

    Since the chance of AIDS contraction is so small, one might surmise it’s ok for everyone to have unprotected sex, as the chance of contracting AIDS is so very small. The Robert James Frascino AIDS Foundation says “Although it’s hard to give very specific numbers, the odds of contracting HIV from having unprotected vaginal or anal intercourse with a partner who is HIV-positive is in the range of 1 in 300-400.”

    So it appears that the odds are greatly in my favor for not being infected with HIV by casual sex and the odds are greatly in my favor for not being raped or killed for showing total strangers houses. But, you know what? I’m not going to have unprotected sex with strangers and I’m not going to show them a vacant house either. When I take a listing, I do not agree to expose myself to unnecessary dangers. I do not agree to show the house to just anyone who calls me. I do not agree to show the house to unqualified Buyers. I do not agree to run around and show strangers vacant homes and waste my time and incur increased liability and put my Sellers or their homes or their belongings or myself in danger. Am I being overly cautious? Perhaps. But it’s my choice to make, and I will not let anyone pressure me into taking these kind of risks. There are many things that are NOT under my control, but there are some things that are. You may ridicule my caution, but this kind of risk is easy to mitigate by just saying “No thanks”. No scissor-running, no mouse feces, no unprotected sex, no meeting strangers alone at vacant homes. Ok?

  5. Andrew Hodge

    Redfin would be in a lot of trouble if they tried contacting another agents clients up here in Ontario (maybe one of the reasons that they don’t exist up hear). Here if you contact another agents client it is considered interfering with their contract, which is not allowed under REBBA 2002, and can get your licence revoked (The Real Estate Business Brokers Act, REBBA 2002, has penalties up to $50,000/$250,000 for an individual agent/Brokerage (respectively) plus 2 years in jail).

    We can no longer even contact expired listings as the information on the MLS system is still considered private and therefore cannot be used to market to your service to the seller without breaking the privacy laws. Even if you live across the street and just happen to notice the sign when down, you can not approach them to list unless they contact you first.

    Sending letters to someones client saying that their agent is not working would equal libel, in my opinion, and potential further legal actions on top of the usual industry punishments.

  6. Galen

    To the “buck up and meet them” crowd, I’m sure the risk is significantly higher if you are an agent who meets strangers at houses frequently. If you still think this is bologne, I suggest you meet one stranger a week in a non-public area – I’m sure you can find them on craigslist.

    On a different topic, Redfin has been publicly begging for “crazy interactions you’ve had with traditional agents about Redfin”. Any chance they’re feeding these “crazy interactions” to the NYT writer in order to drum up controversy where there isn’t controversy?

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  8. david losh

    You see this is why I do not read your blog. It just upsets me.

    My job is to get my sellers house sold. To sell that house takes a ready willing and able buyer. To be a buyer they have been to the lender to be preapproved.
    A buyer is very specific about what they are looking for. They have made the decision to buy so if they are looking at my sellershome it is meeting the criteria.

    So am I supposed to close the buyer at the house? Am I supposed to write it up for 4%? If they get excited about the house do I send them away? What would I be doing there? How am I supposed to represent the property? Do I say nothing for fear that what I say can be used against my seller during negotiations? How can I puff the good points to some one I just meet at the property? I do not know them.

    Why do all of these sycophants to the Real Estate business think the buyer will just sign papers. I have stayed up nights after buying a screaming good deal on a house and thought
    \”What have I done?\”

    It makes no sense to think the educated buying public will just magically change human nature to accomodate an internet, on line brokerage business model.

    On a very real point about the dangers of the Real Estate business. I am sure none of these new guys to the internet Real Estate business remember it was unwise for a woman to put her picture on a business card. Today any nut job could cyber stalk and have Redfin insist the object of the predators desire meet them at a vacant house.

    Only some guy would think that was OK.

    Really, most rapes or thefts of Real Estate agents go unreported. We are inviting people into our cars and empty houses. We have business relationships with people that is hard for the police to figure out. I have lost my wallet, I do not wear jewelry, and my camera is a joke about when it will turn up missing.

    Those are just the things of my business. For a woman it is twice as hard. I know a woman agent who was raped, the rapist caught, and the case dismissed. The rapist claimed she and he had a preexsisting relationship of a sexual nature. She is a housewife and he has a criminal record. I know more women agents who have been raped and do not report. Sometimes the agent themselves get confused into think maybe they did something wrong.

    That is very real, it is not talked about, but if you think about it you may appreciate why I do not meet some voice on a telephone in a secluded spot.

  9. Gaug

    You expect potential buyers to have their ID photocopied just to see houses? I thought you are running a blog so you’re with the modern time? Good luck with your business.

  10. Shawn Goetzinger

    A compelling explanation of the remarkable service that is offered to clients for 3% of the sales value of their homes.
    However, the bottom line is the bottom line and it is inevitable that brokers will get pinched as buyers and sellers try to reduce costs.
    Having sold several properties through brokers before I recall the experience as follows: Realtor comes into house explains the simple to read contracts then proceeds to explain that a neighbors 3bdr/2.5bth house, in average/good condition, sold a month ago for $350,000 and another neighbor sold his recently renovated 3bdr/2.5bth property last week for $400,000 and since my average/good condition 3bdr/2.5bth house was renovated 8 years ago, it was decided that we should list it for $375,000 and for that wisdom I paid $11,250.
    I can find all this information easily on the web using such tools as the county assessor’s website, etc. Shoot, a seller could hire a real estate attorney to handle the transaction cheaper than hire an agent.

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  13. Nana Bonsu

    I wouldn’t worry much about the gloomy forecast in the NYTs article. It does seem to me that Redfin is passing the buck by not taking THEIR clients to see properties of interest to them. Don’t most listing agents use lockboxes that Redfin agents can access to get their clients into properties? Of course if you require the 10 listing agents to be at each of the 10 different properties your client looks at over time, you probably can afford to give back a substantial portion of your commission. However, for every client like the couple in the NYTs article that has the time to use the internet to find the one property they like and is able to be the highest bidder, I bet there are thousands of buyers that want to look at several properties and “kick the tires.” Even after that, I bet some change their mind and decide not to buy. Of course as long as listing agents bear the costs associated with such buyers, again, Redfin CAN afford to give away money they didn’t earn. And guess what? The couple “toured the house with a friend who is an agent.” Another bloke that did Refin’s work and didn’t get paid. Myself, I think the NYTs article misses the point. Comparing buying a home to “ordering a book at Amazon.com or a computer at Dell.com” (things I have done a few times) is not quite right. Try sending back a house after you have lived in it for 30 days because you are not satisfied. Airline tickets, books, DVDs, computers and the like, are things you can pretty much pin down. There are a finite number of airline seats choices you can find on flights from Seattle to New York on any given day. The same is true for a particular book, DVD, or computer you want to buy online. I don’t think most homes, especially resale homes, are quite like that. Two houses with identical descriptions supplied by sellers may not necessarily have the same underlying value. A traditional agent with knowledge of the locale can probably do a better job determining the intagibles that feed into that value. How many people buy new automobiles online? It is a much smaller investment, and you pretty much know what you are going to get. Yet most of us still get them from dealers who charge commissions. Yes, perhaps there is a case to be made for traditional real estate agents offering variable commissions based on the service that is offered. And rather than being rigid about it, the traditional agents and their associations such as NAR should take a serious look at improving their current system to take advantage of the innovations out there. For folks like the couple in the NYTs article that do most of their own searching for that one property they like, it does not make much sense to charge them a full 3% commission. However, most people probably do not have the time to look online for that one property that fits their budget, and they are certainly not looking to be the highest bidder. Those folks will probably need the personal touch a traditional agent can offer. On the other hand, rather than fight with traditional real estate agents, I think these new online outfits should work with them to offer the broad range of specialized services that consumers desire for commensurate prices that are fair to consumers. Based on the description of what they do, I think it is only fair that Redfin give back two-thirds of its sales commission to its customers.

  14. Marlow Harris

    I have no problem with rebates to customers. But I don’t think this companies business model of using other agents and their labor, making them bear the liability and risk, and then passing those savings on to their cients, is good business. They can show their clients homes — they even provide that service for an extra $250.00, so to try to get other agents in trouble for not freely providing a service that they charge for is disingenuous.

  15. Len

    Interesting article. Again NYT slamming agents. I notice no mention of REALTORS®.
    The REALTOR® Code of Ethics & our state law prohibit an agent calling or interfering with a listing or buying contract. Sounds like Redfin is having listing agents do all the work and take on all liability for no compensation. If Redfin or Zip Realty agent wants to show my listing – fine. They had better cross the threshold if they want to get paid.
    There is more than signing a contract to purchase. Who recommends which inspections to get? Who goes to the home inspection? Who explains and recommends actions from home inspection issues? Who helps the buyer negotiate the purchase and sales? Who explains what certificates are required and whether it is a buyer or sellers responsibility? NOT the listing agent. The listing agent works for the seller and offers compensation only for agents who do the job. Procuring cause is more than showing a listing on the computer and writing an offer.

  16. Ellen

    “Even if one violent act occured, thats one too many…”

    No, if one violent act occurred, that’s actually fine. Because one = zero for all pracical purposes, especially on the scales this original post claims.

    “Even one is too many” is a stupid-ass absolutist attitude that turns normal people into raging fools. It’s childish and nannying, not to mention unrealistic, to think that society or any profession has the obligation or willingness to seriously consider the one-in-a-billion chance that you will be attacked by a client.

    The “one is too many” argument is not used to show real conviction or belief in justice. It’s used to destroy opposing views and to push the argument into unreasonable exremes, as if the opposing opinion thought it was ok if a million agents were attacked.

    And what about the real jobs that have real risk associated with them? Are you outraged about police, firefighters, bus and taxi drivers, criminal defense lawyers, construction workers, truck drivers, factory workers, miners, or any other profession where people are attacked or accidentaly killed every damn day?

  17. Albert

    “The REALTOR® Code of Ethics & our state law prohibit an agent calling or interfering with a listing or buying contract.”

    But see a “code of ethics” is not a set of laws or actual binding rules. It’s a suggested set of guidelines that carry no penalty for breaking. Oh boo hoo, someone interfered with a buying contract and took your customer away by offering them a better deal. Whattaya gonna do about it, write a letter to the Realtor’s newsletter complaining of “ethics violations”?

  18. Marlow Harris

    Well, actually, there ARE some penalties for breaking the Realtor Code of Ethics. By joining the NAR, members agree to submit disputes into arbitration and can and have been ordered to make payments to the injured party.

    The problem with Redfin, however, is they are NOT Realtors and hence, not bound by the NAR Code of Ethics.

    It’s hard to play fair with someone who doesn’t play by the rules.

  19. david losh

    Hello Ellen,

    I\’m a construction worker who charges different rates for different degrees of risk. One rate for being on the ground, another for being ten feet up, twenty, or thirty. I charge more for digging a ditch by hand than with a machine. Some people don\’t like that, but thats how I bid the job. They can hire me or not.

    I can be a coal miner like my grand father, but you\’re right it does not pay enough. Police and fire persons are compensated for risk.

    Compensated is the key word.

    As a Real Estate agent we put on that brave face. The fact is we deal with strangers every day. We are not in an office or many times public areas with strangers. Many times we are alone in a car, or empty house with a stranger. Not too many people have tried anything with me. I\’m a construction worker. I have had a gentleman ask for my wallet which I gave him. Another guy asked for my watch, but I think he was just kidding.

    I\’m one guy. I get scared. You never know what\’s going to happen, but we still invite these strangers into our cars, and allow them to lure us into empty houses.

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