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What is the purpose of real estate agents? Why do you need a real estate license to sell real property? Real estate agents have not always been around. In the pre-20th century (Before 1900) real estate transactions were being conducted more and more. Each one was done its own way with no regulations which lead to a lot of fraud and other unethical practices. Transaction were often based on verbal agreements or simple written contracts. Consumers buying and selling had limited access to information regarding market conditions, comparable sales and how the process should go. This lead to misinformation and a lack of transparency in transactions. There were no laws or procedures that protected people so they often had to rely on friends and family for recommendations. Agents at the time were able to charge what ever they deemed fit and were not bound by a code of ethics which led to dishonest practices. List of properties for sale did not become readily available to the public and were often maintained by the agents. Due to the lack of regulation and the lack of transparency states began to mandate real estate licensing to ensure a standard of professionalism and accountability in the industry.
In 1908 National Association of Realtors was formed and in 1913 the Code of Ethics was adopted. The Code of Ethics held licensees to obligations that were higher than those mandated by law. Unlike other sales industries Realtors are held to a higher standard in order to protect clients, customers, the public and each other. Many people are unaware that just because you have a real estate license it does not mean you are a Realtor. In order to become a Realtor you are required to make an oath/ pledge.
The Realtor Pledge- 1954 edition
I AM A REALTOR®
I Pledge Myself
To protect the individual right of real estate ownership and to widen
the opportunity to enjoy it;
To be honorable and honest in all dealings;
To seek better to represent my clients by building my knowledge and
competence;
To act fairly towards all in the spirit of the Golden Rule;
To serve well my community, and through it, my country;
To observe the REALTORS’® Code of Ethics and conform my
conduct to its lofty ideals;
The Realtor Pledge- Revised
I AM A REALTOR®
I Pledge Myself
To strive to be honorable and to abide by the Golden Rule;
To strive to serve well my community, and through it, my country;
To abide by the REALTORS’® Code of Ethics and to strive to conform my conduct to its aspirational ideals;
To act honestly in all real estate dealings;
To protect the individual right of real estate ownership and to widen the opportunity to enjoy it;
To seek better to represent my clients by building my knowledge and competence
Before there were real estate licenses people had to trust one another. Many people referred to these as a deal made over a “hand shake.” There are still many people with the same mindset who have the best intentions when buying and selling and would never think somebody would take advantage of them. Many will never know they were taken advantage of. Same goes for those who hire real estate licensees. Sadly, like every industry, there are people that do not have your best interest at heart and just look at you as their next paycheck. That is why it is important to understand why there are real estate agents and the duties they are supposed to perform. Even though there are different experience levels of agents, the core of an agents values should be to serve their clients best interests and educate them so they can make the best informed decision.
