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Realtor Referrals

It’s a Trust Issue

If you have ever shopped for a home inspector, I’m sure you’ve heard time and time again “you don’t accept your real estate agent’s referrals for a home inspector!!!”.  So often in fact, it gets parroted by big media and “timely” home inspection articles all the time.  I’m here to ask why not?

Before you sharpen the tines on your pitchfork or get a good steady burn out of your torch, hear me out!

Buying a house is a BIG decision, we all know this to be true.  So what’s the first thing you do to get the process going?  You ask a friend for a referral for a real estate agent or maybe you have a pre-existing relationship that you call up.  

Now, let’s pause right there on step one.

You contacted a friend, who you presumably trust (or else why are they your friend?) and asked them to recommend someone they in turn trust.  What!?  This is a big decision!  Aren’t you going to do your research, interview agents, weigh their pros and cons, haggle a commission, and arrive at a fully independent decision free from any bias or possibility of a conflict of interest? Well, not if you are like a vast majority of people.  The average person puts heavy weighting on the advice of close friends and family because the underlying feeling is that this person cares about me and will do me no harm.  Is this wrong headedness at its core, or can it be argued that they will, in fact, look out for you.  I tend to think towards the latter.

Let’s now look at scenario 2-you hire an agent you have worked with before.  This is an easy one.  They looked out for you once, and will likely do so again.  You have built up a relationship of trust with them and rely on them to help you navigate the process of purchasing a house.  Are they going to sabotage that relationship for some nefarious end in hopes of you won’t find out and hire them yet again?  Of course not!  They want happy clients who call them to say thank you.

So where does this advice to not trust your agent come from?  I think it stems from the old saying of “letting the fox guard the henhouse”.  There is the perception that since the agent stands to benefit from the sale of the house, they are going to recommend a “soft” inspector or maybe one who isn’t very thorough in hopes of sneaking something past you.  But stand back and look at that.  Why would someone you trust (either directly or through a personal contact) try to pull one over on you knowing full well that you are going to live in that house for years and are quite likely going to uncover these issues for yourself?  Furthermore, this purported deception would result in negative word of mouth and would all but kill any future referrals.

For a real estate agents understand this above anything else- referrals are life.   No referrals means weeks and months of expensive and tiring marketing, weeks and months of little to no income and all that this entails.

So knowing this, I tend to think the opposite of “don’t accept your real estate agents home inspector!!!” is more likely to be true!  I think they may be so worried about losing you and your referrals that they are only going to recommend home inspectors that they have worked with previously and have proven themselves to be effective and worthwhile.  On top of that, consider that most people don’t buy and sell homes everyday so their exposure to home inspectors is limited at best.  Compare that to an average agent who may see dozens if not hundreds of inspections and have first hand, multiple exposures with the inspectors they recommend.  A splashy website and a fancy tv show are great but when it’s time to get the job done, wouldn’t you want someone who knows what they are doing?

That said, every industry has miscreants and malcontents—real estate agents and home inspectors are no exception.  Of course there are real estate agents that would sell a known grow-op as being “agriculturally productive” or 300 sq.ft bungalow as “cozy” and of course there are inspectors that will look the other way on a leaky basement but it’s your job to make sure that person isn’t the one working for you.

Trust is the only currency that can’t be bought, sold or spent…only earned.  And once its gone, its gone.  Work with people you trust.