Monday, June 18, 2018

Doctors versus Agents - What differences are there in the profession?

Q.
Wow, why so expensive you commission! You think you are a doctor?

A.
This idea was moulded when I sold the first property in a Road Show. Apparently, the perception of the public does not matter much with how young, old, experienced or newbie you are in the property industry. This is rather amazing to see as in most other profession, experience is the credential for winning a sale/bid.

Take for example, a doctor in practice. He who is experienced and had been there for consistent practice would likely win patient load. Those who are new to practice or looks very young and inexperience will not likely to get crowd.

Why it is not so for property sales?

The major reason are:
  1. Buying property is not an everyday job, so you would not likely see an agent in a long time.
  2. The profession does not have a distinction between who's who in the field. There is no difference between a senior negotiator compared to a junior negotiator.
  3. The rules and regulation of practice do not differentiate a field agent from a sitting in the office agent. It also does not differentiate an agent with 1000 listing from an agent with 10 listing.

Now, let me illustrate a scenario with a doctor versus an agent. REN - Real Estate Negotiator. PEA - Probationary Estate Agent. REA - Registered Estate Agent.

DOCTOR XYZ is a consultant paediatrician. This says a lot about a doctor, his specialty, training and years of experience.

First - He is a paediatrician, which means he has to be a medical trained doctor first before he can specialize in paediatrics. That is at least 5 years of medical school, 2 years of housemanship, and 4 years of work as medical officer in Government Hospital/Klinik Kesihatan.

Second - He is a paediatrician, which is a post graduate certification programme which likely took him 4 years of specialised training in a paediatrics setting (Master Programme in Malaysia - if MRCP around 3 years depending on how fast the exam was taken). At this stage, he would have at least 10 years of medical learning and 4 years of training in the field of paediatrics.

Third - He is a consultant, which means after he has attained paediatrics specialty, he had 10 years of experience working as a paediatrician. This period of specialized work would enable him to see enough cases to be called a consultant. All in all, a 24 years of medical learning and experience. Minus the 5 years medical school, he has worked 19 years!

AGENT ABC is a REN/PEA/REA. This says very little about an agent.

First - Is he a broker? Yes. He is a Licensed Broker. Before he was accepted by his current firm to be a Negotiator (REN), he should have attended a 2 day Negotiator Certification Course. Probably he has no formal education about estate agency practice and picked up the job while on the job. He might have learned from others, or learned all by himself.

Second - He is a PEA, which means he is a formally educated estate agent. Yet this formal education can be from various paths. He could be from a University/College (UM, UTM, UiTM, UTHM, TAR College or overseas Universities recognised by the Board). Or, from a part-time study from taking the Board Exam (LPPEP Estate Agent Exam). Lastly, he could be those who took the INSPEN Certificate Programme on Estate Agency which is a weekend class for those REN who aspire to become formally qualified.

Third - He is a REA, which means he has been doing the job for a few years - REA would have completed PEA training of more than 2 years upon which they took and passed the Test of Professional Competence (TPC). This whole process would have taken at least 3 years. So, a REA can claim to have at least 3 years of field experience. Many a time, he could have more than 10 years of field experience.

In real life, while a senior REN can be of 10 years of experience without actually completing any structured training. In delivering value, this 10 years REN is similar to a 10 years REA. Because there are lots of things you gain from the experience. This is like a senior GP can be as good as a Paediatrician engaging in child care. However, a GP cannot charge the fee of a Paediatrician.

Thus, you can see there is no difference between a REN or REA in their job specialization. A REN or REA/PEA basically does the same thing. To a client, they are all the same. You cannot say a REA is more specialized than a REN or PEA. Similarly, you can go see a GP and get your pack of medicine similar to the medication from a paediatrician. No difference. The only thing different is the consultation charges. And, in fact many consultant paediatricians are charging similar fee to a GP!

When a paediatrician markets his expertise, he claims his specialization. On the contrary, a GP (as experience as a paediatrician) cannot claim his expertise in child care. This is his professional liability, and while the outcome of treatment might be the same, the charges aren't.

For estate agency practice, the charges are the same. Seeing a REN or PEA or REA has no difference. The maximum fee for a sales transaction is 3%, be it a REN, PEA or REA. Hence, a client would not see value in a REN, PEA or REA in terms of Fee payment. Only thing is REA is the highest recognition in the profession, and usually a REA would be an Sitting in Office Agent as he leads a whole team of REN/PEA and focus on big and mega deals. Or, he might just be claiming a profit sharing with the team, and enjoy his quality of life in air-conditioned room!

To the general public, seeing a REN in the field only mean seeing someone who can answer his inquiries. There is no "problem" which requires "solution" in the like of illness when a child is seeing a paediatrician. Hence, there is no distinction of who is a good REN/PEA/REA.

Unless you have a real "problem" in real estate, you would prefer to see an expert - REA. Other than that, anyone who could talk to you and make you delighted is a good Real Estate Sales Person.

There is no distinction on who can deliver that "entertainment" be it a broker, an agent or just an entertainer.

Ref:
Own account.

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