Have you ever driven by a home for sale and noticed that sign indicates that the real estate agent was from an office that is in an entirely different area than where it’s listed? An example of this would be an agent listing a home in Castle Hills (Lewisville), but their office is out of Southlake. Or a “Castle Hills area expert” listing acreage in Mansfield…it makes you wonder if that agent has true Geographical Competency in the area they are selling in, and the “type” of real estate they are selling. This has become a major issue and is currently a really HOT topic at both TREC (Texas Real Estate Commission) and at The Texas Realtors Association. TREC says, Rule 531. 4:
The Texas Realtors Association says in an article dated November, 2019:
Legislation passed by the 86th Texas Legislature made clear that license holders must be knowledgeable about local market issues in the geographic area in which they work and the characteristics involved in the specific type of property being sold or leased. The Texas Real Estate Commission made corresponding changes to Section 535.2, Broker Responsibility, earlier this year which requires brokers to ensure their sponsored agents have geographic competence.
Everyone knows that there are fewer listings out there to go around due to the low housing inventory that we have in North Texas (& just about everywhere in the US!). So some agents may think it’s OK to sell outside of their area of expertise; but this is not doing any favors for both buyers and sellers! How can an agent know exactly what’s going on in a certain neighborhood if they don’t typically buy or sell there? Or how can they be an expert in Farm and Land sales if they normally sell residential homes. The short answer is, they can’t! So why should you trust that your real estate agent has your best interest in mind? A couple of exceptions may be:
- Your REALTOR® owns investment properties in one area, but their office is in another city. They would know that other area because they keep up with the neighborhood (which includes the school district, restaurant scene and services available nearby), the HOA CCR’s and the current real estate market there because they own property that is subject to re-leasing on a regular basis.
- They went through the entire new home construction process from contract to close with a Client, and that Client now wants to sell the home. Since this process typically takes up to a year or more, that Agent would definitely know the area AND can say that they have Geographical Competency there!
- The agent used to live in that area for years before moving some place else, and they still have friends or family that they visit there on a regular basis.
I personally have some real-life scenarios of Clients who relied on Agents who did not have Geographical Competency, but that would be a WHOLE other blog post! So, bottom line, hire a REALTOR® who knows their “stuff” and is a true expert in both the location and the type of real estate you are looking to buy or sell. Or rely on your real estate professional to refer you to someone they know who does!
