Are Real Estate Agents a Thing of the Past? (For Renting)

[Preston Schwartz]

Hi All,

This is my first post on here but I have been entrenched in real estate research and analysis for quite some time now. There is one question that I have been grappling with for awhile now that I would love to get input from some more seasoned real estate professionals on. Do we really still need real estate agents to rent properties? I live in Boston, a very competitive housing market, and it is a standard for real estate agencies to charge a 1 month's brokerage fee when you sign a lease for an apartment through them. This equates to, at minimum, usually another 1k out of an individual's pocket. With technology increasing people can view so many properties on their own, and can even tour virtually. Which leads me to think that this fee is not only high but almost unnecessary when you as the renter do pretty much all of the work besides opening the door to the show property and getting the lease agreement signed (which are for the most part just made from a boilerplate template). 

Would love to hear opinion's from others on if they think that the role of the real estate agent, specific to renting, is fading into the sunset as time goes on.

[Nathan Gesner]

You'll get a wide variety of answers. Some will come from people with no experience but a lot of opinion. Some will come from people with only good/bad experience, so they give a biased opinion. I recommend you consider all viewpoints.

I screen almost 1,000 applications per year. I stay current on local, state, and federal laws. I discuss property management and network with thousands of investors and Landlords around the country. I have systems in place to deal with problems quickly and efficiently. Yes, my team makes mistakes on occasion, but do you honestly think the average Landlord is going to be as good as we are at managing an asset and Tenants?

I'm a Landlord and a Property Manager. I've used Property Managers in the past and I will use them again because I understand the value they bring and it will better fit my lifestyle. I can show you dozens of Landlords that make more money after paying my fees than they used to make managing on their own. One lady that always comes to mind was literally being driven crazy by her tenants and she lost about $50,000 in just three years from unpaid rent and damages. In the three years I've managed her properties, she's had better tenants that maintain the rentals, each one rents for 15 - 20% more, she hasn't had more than 30 days of vacancy on any of them, and she literally has her sanity back.

Most people aren't that bad but most of my Landlords make more money after they've hired me because of the skills I bring to the table. You also have to consider the value of your freedom and peace of mind. People want the freedom to focus on other things rather than screening applications or taking calls about clogged toilets on a Saturday evening. The key is knowing how to find a good one and how to supervise them. If you just pick the first one in the phone book or a Google search, or based on the recommendation of some stranger on the interwebs, then you're likely to have a bad experience and see no value.

The same can be said for real estate sales. Some tasks can be automated to a degree, but you still need a real person for understanding markets, negotiating, answering questions, etc.