Section of the report
Dangers Impacting Agents
The real estate industry faces credibility issues due to many part-time, untrained, and unethical agents, resulting from low entry barriers and minimal education requirements.
The Dangers
Listed in the order they appear in the report. Each carries a danger index scored out of 100.
- A1
Masses of Marginal Agents Destroy Reputation
The real estate industry is saddled with a large number of part-time, untrained, unethical, and/or incompetent agents.
100Critical - A2
Commissions Spiral Downward
A variety of powerful forces exert significant downward pressure on real estate commissions.
87.5Critical - A3
Agent Teams Threaten the Survival of Brokerages
Teams cannibalize brokerage companies by siphoning off their profits, leaving them exposed to all the risk.
70Severe - A4
IRS Forces Exodus of Independent Contractors
An IRS ruling is handed down that reclassifies the legal status of real estate agents from independent contractors to employees.
63Severe - A5
The Decline in the Relevancy of Agents
The role, function, and perceived value of agents deteriorates as agents fail to properly assess and respond to changing consumer demands and expectations.
60High - A6
The Agent-Centric Era Ends
The disproportionate power that independent contractors have enjoyed over the past three decades goes out of vogue as capital or economies of scale change the rules and the Wall Street reign begins.
52.5High - A7
Housing Finance System Fails
Mortgage-backed securities as a method of financing is discontinued because it’s too risky and the related fines imposed on banks too severe.
48High - A8
Commoditization of Residential Real Estate
The concentration of residential ownership into the hands of a few large investors commoditizes residential real estate and impacts market dynamics and liquidity.
42High - A9
Commissions Concentrate into Fewer Hands
A very small group of very efficient and effective agents discover the winning formula and secure a disproportionate market share.
40Moderate - A10
The Agent is Removed from the Transaction
A tech company cracks the code and connects enough of the dots to conduct real estate transactions without the need of an agent.
31.5Moderate