Here’s One Simple Thing New Agents Can Do To Avoid Trouble
Know where the line is between excellent customer service and getting into areas that are beyond the scope of a real estate agent. Here’s why agents should stay in their own lanes.
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New real estate agents need to develop a deep understanding of what their job is and what it isn’t. Agents can end up being responsible for things that they can’t control and that are outside of their area of expertise.
Agents can provide great customer service while staying in their own lane. Even the job of a real estate agent has a scope, and it has boundaries. Some of those boundaries can even be seen on a map.
Real estate agents do not have control over appraisals or any aspect of financing. Never promise a homeowner that they will get a certain amount for their home and never guarantee that the sale will close on time or at all.
Never tell buyers they can get a mortgage for a certain amount unless you are lending them the money. It’s alright to give them some commonly accepted guidelines that will give them an idea about how much they may qualify for.
I work with old houses, and I’m upfront with my buyers about my limitations when it comes to commenting on the condition of a home or its mechanicals. I may point out that the water heater is rusty or that some of the shingles on the roof are curled or that the furnace is definitely more than 30 years old, but I won’t say they need to be repaired or replaced.
Instead, I’ll suggest that they bring in a professional for an inspection and that I’m not the right person to make those assessments.
Let homebuyers know that anything in a home can break at any time. Just because something breaks doesn’t mean that the seller was hiding something or that anyone is at fault. Home repairs and maintenance are part of the homeownership journey. Do not take responsibility for anything that could break.
By the time our homebuyer clients get to closing, they have already signed something stating that we are not responsible for the condition of the property and that we don’t have any control over it.
Do not ever tell a homebuyer that something found on an inspection report isn’t a big deal — even if it really isn’t a big deal. In fact, it is best not to comment on homebuyer inspection reports. If you’re asked for advice, be very careful. Someone could get hurt or even die because of an issue found in a house.
Always let the buyer take charge of the inspection. Never exert influence over the inspector or the inspection. For example, sometimes, buyers want the agent to choose the inspector and schedule the inspection. Please don’t do that. Let them choose an inspector, and if they need help getting it scheduled, help them.
When working directly with clients, we should be giving advice and sharing knowledge so that they can make their own decisions. As a rule, real estate agents should not be telling clients what to do and should not be making decisions for them.
Real estate agents are consultants and salespeople. We don’t create market conditions or pricing, and we don’t need to take responsibility for them. We do, however, need to be aware of those market conditions and help our clients navigate them.
It’s also way outside the scope of a real estate agent’s job to recommend schools. Most real estate agents are not experts on public or private education. Recommending certain neighborhoods because of schools may be a fair housing violation. Having a real estate license does not make you an expert in education.
Never tell anyone anything about a property that isn’t a fact — like stating that the property comes with parking or a garage or a storage unit. Or that the home doesn’t have high levels of radon because other homes in the area don’t. Or that the material that’s wrapped around the pipes couldn’t possibly be asbestos.
What’s more, sometimes, helpful agents paint or clean for their clients. I recommend against this, but if you must, at least make sure that your insurance can handle it if the property or the owners’ personal belongings are damaged in the process.
A much better approach is to have the homeowner pay someone to do the work. If the homeowner lacks the funds, look for a contractor who will accept payment when the sale closes or work with them to sell the home as it is.
It is an accepted practice in the industry to recommend repair people and contractors to clients who need help.
Make sure the homeowner understands that the professional is not part of your company and that you have no control over their work or the project they are working on. I only recommend services that I myself have used or that my clients have used and will recommend.
Don’t promise homebuyers that they will always have a view of the river or that the ice cream shop on the next block will always be there. No one owns the view, and neighborhood businesses come and go.
We can assume property taxes will always go up, but it is best to refer homebuyers to the appropriate website to learn more about local taxes. In Minnesota, for example, licensees cannot give legal advice or tax advice. There are similar rules in most states.
Know where the line is between excellent customer service and getting into areas that are beyond the scope of being a real estate agent. Keep it professional and avoid going outside of your role when working with clients.
Teresa Boardman is a Realtor and broker/owner of Boardman Realty in St. Paul. She is also the founder of StPaulRealEstateBlog.com.