Thank you to Allbusiness.com for posting the video on the homepage, “One Big Happy Family”, interviews with Ebby Halliday, Petey Parker, and Leonore Bergert of Ebby Halliday Real Estate, a real estate agency based in Dallas, Texas. It’s provided me inspiration for today’s theme. Ethics! Can there be anything more important, not just in how you run your business and treat clients, but live your life as well? Personally, I don’t think so.
In my last posting, “Pricing Real Estate in A Fluctuating Market”, I make mention of a strategy some agents employ when listing properties. In an effort to secure the business, they’ll agree to the seller’s listing price no matter how unrealistic or off-base it might be. The advantage to the listing agent is that it’s his or her sign standing in the front yard, not a competitor’s. Not only does this provide neighborhood presence, but the listing is likely to be featured on the agent’s web-site, in the local paper’s ads, etc., all leading to more business potentially. Of course, a sign with a flyer box full of flyers means the neighbors and drive-bys are learning about the agent, too. The listing agent’s presumption might also be that, over time, the seller will come to realize their home is overpriced and the sale will be made ultimately. The short term upside for the agent seems pretty apparent; exposure and pipeline activity. However, dig a little deeper and I contend the downside is far greater. Reputations are important in our business. Establish one for consistently overpricing listings and your fellow agents might view your expertise or lack thereof in a different light. Other potential sellers in the same neighborhood are watching that sign in the front yard, too. If it’s still standing there months later while other houses are selling, they’re certain to wonder about the agent’s marketing abilities. Sellers whose homes don’t sell quickly or for the price they imagined are not typically very happy either. How likely will they be to refer that agent to their friend, the next seller? This isn’t to say well meaning agents and clients don’t overprice homes. It happens all the time. It’s the deliberate effort to deceive or appease in order to secure business regardless of whether or not it is deemed in the client’s best interest I find unethical.
When I am working with a client, I ask myself this question first and foremost: Am I the best person to serve their needs? If the answer is “no”, then I either decline or refer the business to another agent better suited to them. A typical scenario might be taking on a listing well out of my normal geographical business sphere. If it’s too far away or I am thoroughly unfamiliar with the neighborhood, I’ll counsel the client to work with a local agent accordingly. Sometimes, I’ll accept the business if the client insists that they prefer to work with me regardless the home’s location. In any event, I make certain they are informed fully of their options, my fiduciary responsibility to them and any risks they may take on by working with me in a neighborhood less familiar to me.
My thinking on the matter is pretty simple. If I pay my clients the courtesy of being honest and direct with them, they will proceed knowing they’re being treated with respect and integrity. This makes it possible to work through transactional issues and hurdles as they occur in a more productive, less emotional manner. It also increases the likelihood my clients will continue to refer me and my services to their circle. If, as a result of my counsel, we determine it is better they hire someone else, then I am creating room in my business for that better opportunity which is right around the corner.
If real estate is the career path you’ve chosen and you’re in it for the long run, then to be anything less than ethical is to asssure trouble sometime in the future. I believe most professionals in our field operate their businesses from a position of absolute integrity and it is my hope through blogs such as this that agents who pursue their business unethically, either revise their thinking or learn to do so the hard way. Treat your clients as you would your friends and family. How you do the latter will probably inform your approach to the former.