Real Estate Industry Not Overprotective

By Bill Powers
Realty Executives - COO

Allegations that organized real estate is trying to "squash" low-fee Internet competition couldn't be more misleading. The industry is one of the most competitive (and cooperative) in the United States. And the National Association of Realtors (NAR), the industry's trade association, was established on the premise of increasing ethical behavior.

My company and others like it insist that U.S. franchisees be NAR members. For consumers, the benefit lies in knowing that their agents are NAR members (while a number of low-fee and limited-service providers are not) and are, therefore, held to higher ethical standards. In no way does NAR affect the fees charged to consumers. Each broker is responsible for establishing a fee structure.

Companies within the industry have long had what is known as "menu pricing," or different fees for different levels of service, though Realty Executives does not. These are determined not by NAR but by a combination of the brokerage, consumers and market conditions.

The charge that the real estate industry fights new business models is also false. Innovative ideas have always been a part of the evolution of real estate sales. Low-fee and limited-service providers have been around for decades. The only distinguishing difference with today's new providers is the introduction of the Internet and the increased amount of capital flowing into this effort.

Low-fee providers typically surface in strong seller's markets. But, because these providers do not rely on customer service, they tend to disappear in weaker markets that require more work to sell properties.

The proposal that real estate brokerages should share hard-earned, qualified leads is no more preposterous than suggesting USA TODAY share all current and future article leads and sources with its competitors.

Most Internet low-fee providers do not employ licensed agents to actually sell the properties they market, making it necessary for consumers to find licensed agents to act as buyer representatives. For this reason, a significant number of agents across the country are currently working with these Internet service providers — instead of trying to eliminate them to protect their own fees.

The goal of the industry is to create a level playing field. Through the innovative and changing spirit of the industry, both the brokerages and consumers stand to benefit.

Bill Powers is chief operating officer of Realty Executives International, a real estate franchising firm based in Arizona.

I have to add that I am proud to be associated with Realty Executives of Paradise Valley. I have been a full associate there for since 1994, and have never even considered going elsewhere!

Matt Pellerin - Proud Realty Executives Associate.
The Paradise Valley Realty Executives Office is located at:
11211 N. Tatum Blvd. Suite #130 Paradise Valley, Arizona 85028