New search tool may make brokers squirm

Whether it’s about an individual’s tennis game, cooking ability or professional achievements, who would want to be rated?

Certainly not brokers, who have the same legitimate concerns that others possess.  Yet the practice is becoming increasingly common.  As Inman columnist Bernice Ross puts it:

With multiple listing services, companies and third-party vendors such as Trulia, Yelp and Zillow all posting agent reviews, there’s no escaping the fact that agent reviews are here to stay. About 20 percent of sellers currently receive a post-closing follow-up, as do about 25 percent of buyers.

Now, Streeteasy has announced that it is dipping its bytes into the cyberspace of broker assessments.  As critical as I can be of other real estate brokers, I have my doubts whether the tool is a good thing.

The “Shop for a Broker” tool aims to help property sellers and buyers choose a listing broker by making available the number of their closed transactions, the average number of days the listings stayed on the market, the average percentage discount from their last asking price, the average discount from the original asking price, and the total dollar volume of those transactions.

It is a crude tool, indeed, though burnished with the gloss of hard numbers. Among several reasons for my misgivings, here are several:

  • “Shop for a Broker” ignores market dynamics and conditions by segment and location;
  • Seller intransigence or flexibility are not taken into account;
  • Nor is any buyer disloyalty, hesitation or changed circumstance considered;
  • Days on the market overlooks holidays, co-op board turndowns and a buyer’s financing difficulties as well as time temporarily off the market for numerous other justifiable reasons;
  • The tool inevitably gives more weight to high-cost properties than more modest ones;
  • It also undervalues the skills needed to sell properties at different price points, for example, at times such as now when the market is glutted with one-bedroom units;
  • Broker personalities, responsiveness, integrity, professionalism and availability are not measured directly;
  • The number and amount of closed transactions does not completely reflect a broker’s competence;
  • A broker’s unavailability owing to vacations or extended illness is invisible.

I am sure you can come up with other reasons, but, to its credit, Streeteasy publishes caveats for using the system.  Says the Web site:

Use our tool as a starting point to find the agent who is right for you.

We encourage you to contact several agents and interview each of them to see which of them best suits you. Numbers and stats will only show you one dimension of a broker’s professional skills. Meeting them in person will provide the rest.

As great are my reservations about the tool for sellers, they are magnified for buyers.  Even Curbed.com, which praises the Streeteasy tool, agrees that it may be of little help to buyers.

Moreover, how meaningful are the statistics for brokers, of whom there are many, who limit the number of listings or buyers they’ll take on in order to ensure the best representation?

As for as I am concerned, the tool’s utility comes down to the standards applicable to any rating system: Do you render judgment based on quantity or quality?

While I’ll concede that a certain level of quality must be implied by an impressively large quantity of transactions, few days on the market and stellar pricing data, I believe that those figures may well be misleading.

I know that my preference for choosing, say, a physician, a stock broker or moving company is to opt for a personal recommendation, not an Internet summary.  That’s probably true for you as well.

As Streeteasy suggests, it’s unwise to choose a broker based merely on the data that the site provides.

Numbers cannot tell the whole story.

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Malcolm Carter
Licensed Associate Real Estate Broker
Senior Vice President
Charles Rutenberg Realty
127 E. 56th Street
New York, NY 10022

M: 347-886-0248
F: 347-438-3201

Malcolm@ServiceYouCanTrust.com
Web site

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