The Ethics of Realtors

I’ve talked in the past about all the ways real estate agents can help you, but I thought it is time to revisit this, and to share the reason I’d choose a realtor over a real estate agent who chooses not to be a realtor.

On the selling side, a real estate agent will assess your property to determine its market value and bring to light any issues that make it stand out (positive or negative). They advertise your property locally, online, and via the Multiple Listing Service (MLS), reaching thousands of potential buyers. Real estate agents are also connected to other real estate professionals and can share information about your home via those relationships.

On the buying side, realtors can act as a buffer between you and a homeowner, so you don’t tip your hand. In negotiations, it pays to have a representative on your side. When realtors communicate, they act as independent parties, providing you with information without giving away your position. (This is true whether you’re a buyer or seller.)

If you’re a buyer, realtors can save you a ton of time. As long as you are clear and specific about your needs, a realtor can filter through all the properties for sale so you only see ones of interest to you. And realtors are likely to hear of properties coming on the market before the general public, putting you in a position to know sooner.

Remember, it is in a real estate agent’sbest interest to help you meet your goal. They only get paid if you get what you want – a completed transaction. Licensed real estate agents have a fiduciary responsibility to deal honestly and in the best interest of the principal (you).  This is not just an ethical responsibility, but a legal one. Real estate agents must follow your instructions unless your instructions are illegal or “patently frivolous.” But as long as you are reasonable, your agent must represent you according to your wishes.

A realtor is a real estate agent who is a member of their local realtor association (affiliating them with their state and national associations). So in addition to a wealth of industry expertise, realtors adhere to a strict code of ethics and standards of practice, higher than those mandated by law.

Specifically, in addition to being ethically bound to adhere to real estate law, realtors are ethically bound to act in ways that put your needs before their own. Let’s say you receive two offers when trying to sell your house, and one is $10,000 higher than the other but comes with conditions that may risk or lengthen the transaction. A realtor is ethically bound to share the whole truth with you and make a recommendation that benefits you. A higher selling price would mean a better commission for the realtor, but the lower price may work better for you, and the realtor must share the pros and cons clearly and honestly. realtors don’t make decisions for you, but rather help you by sharing information and expertise.

It is my strong belief that everyone, regardless of their industry, gets paid based on the problems they solve. In real estate, it is the blend of attentive and ethical service with industry knowledge and experience that allow commission-based realtors to thrive. If you’re not sure whether your agent is a realtor, simply ask (or look at his or her business card). And to find a realtor you’ll be happy with, ask friends and neighbors for their recommendations. Cream rises to the top, and good realtors do, too.

If you have questions about real estate or property management, please contact me at rselzer@selzerrealty.com or visit www.realtyworldselzer.com. If I use your suggestion in a column, I’ll send you’re a $5.00 gift card to Schat’s Bakery. If you’d like to read previous articles, visit my blog at www.richardselzer.com. Dick Selzer is a real estate broker who has been in the business for more than 35 years.