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Stricter standards for training and licensing sought

THE BALTIMORE SUN

Looking for a real estate agent to help you buy a home? Take care with your choice. Hair stylists and beauticians need more hours of instruction to get a license in Maryland than the person who would help you make one of the most important investments of your life.

That irony isn't lost on real estate agents, some of whom want the number of hours of education for agents to increase. Agents have to know more about the business of buying and selling homes now more than ever. Clients are well-educated themselves, and keeping up with legal, fair housing and financial changes means agents have to be at the top of their game.

"Agents require a lot more expertise than when the education requirements were first set up," said Bernadette McTighe, executive director of the Single Agency Realty Association in Columbia, a group of agents that advocates the use of buyer's agents. "They need to know a lot of things about a lot of things. The whole process of education for pre-licensing needs to be revamped."

Lisa Kinsman, director of education for the Maryland Association of Realtors in Annapolis, agrees. "The license law was written quite a while ago. To be honest it probably needs to be upgraded," Ms. Kinsman said. "There's a lot more emphasis now on legal issues and risk reduction. Agents have to make sure they are aware of all the legal ramifications of what they are doing."

Some brokers and agents are trying to raise the minimum level of instruction from 45 hours to 60. And since 1991, legislation has been offered to increase the continuing education that licensed agents must have from 12 hours to 24 hours of classes every two years. In May, that requirement will be raised to 15 hours.

But the call for more education is not unanimous.

Some argue that part-timers would be squeezed out because they could not afford the extra classes. And some doubt that more classes will help because continuing education classes do not include testing -- and many agents can, and do, merely sit and read the newspaper during class.

"I'm always a tad suspicious of bills in other industries that call for increasing continuing-ed requirements because it creates a barrier of entry to new people in the industry," said Maryland Sen. Christopher J. McCabe, a Montgomery County Republican who has opposed legislation calling for extra hours of real estate education.

Right now, anyone who wants a real estate license in Maryland has only to pay for a pre-licensing course, starting at about $150, take 45 hours of training and pass a state exam. About 65 providers in the state offer pre-licensing programs with curriculum approved by the Maryland Real Estate Commission.

Community colleges and public and private schools offer

sanctioned real estate education. So do Realtor boards, such as the Greater Baltimore Board of Realtors, and large real estate brokerages.

Students of the pre-licensing real estate course learn about real property and the law, real estate brokerages and their laws, listing agreements, legal descriptions, real estate taxes, title transfers, contracts, settlements, financing, appraisals and fair housing, among other topics.

If applicants pass the pre-licensing course, they are eligible to take a state exam. A passing grade of about 75 percent on that exam earns the applicant a license to sell real estate in Maryland. Agents also must further their education every two years to be relicensed.

Those continuing-ed courses cover all the federal, state and local legislative issues that affect brokers and their agents, including disclosure laws, fair housing laws and anti-trust laws. Courses also include ethics and professional standards. "If the additional hours are being proposed because the complexity of the industry is such that people need to be better prepared, or

because there are consumer problems, or agents aren't keeping up with the law, I guess I'd support that," Mr. McCabe said.

But he said he worries that increased requirements may keep part-time agents out of the industry. According to an MAR study last year, one-quarter of all agents are part-timers.

"I hesitate to automatically embrace more hours of continuing ed because it might place some part-time people in a position where they think they still want to keep up with this and wouldn't be able to."

Jamie Gregory, MAR government affairs director, concedes that many part-timers would leave the field.

"You do have a side effect, an unintended and unfortunate side )) effect, that a lot of part-timers would think it really isn't worth it anymore," to get their license, Mr. Gregory said. "That is not the real goal."

But he also said that full-timers believe that part-timers hurt the industry.

"The people that are full-time real estate professionals who view themselves as professionals don't like the image of the real estate agent," Mr. Gregory said. "They want to increase education requirements. There's even a subtle drive to increase membership dues to make people take the profession seriously," rather than as something they might dabble in between aerobics and ceramics courses.

Paying attention

Many agents say that before adding classes, those now required should be improved. Stories abound of agents going to one 12-hour class with a briefcase of papers and spending the time reading the newspaper or doing office work.

"I'm just not satisfied with the quality of courses that are being offered," said Sandra Blaker, president of Homeowner Consultants in Columbia. "I think the increase in required time is valid, as long as courses offered are worthwhile."

Industry executives admit that an agent merely has to show up for those courses; they are given no exams to test their knowledge. Mr. Gregory acknowledged that an agent could spend continuing-ed class time reading a newspaper and still be relicensed.

"That is essentially true," said James P. O'Conor, chairman of O'Conor, Piper & Flynn. But he and Mr. Gregory say the courses are more relevant now, and they find less of the "teach me something I don't already know" attitude among real estate agents today.

"If the people want to learn and people want to be up-to-date, the instructor is there with all the information," Mr. O'Conor said.

Street smarts

To improve its image, members of the association of Realtors can take extra classes and earn designations -- such as GRI or CRS -- that they can display after their names on business cards and office signs. The association -- which requires all members to take some additional training above the state mandate -- is trying to make these initials more recognizable to buyers and sellers and turn them into symbols of distinction.

The extra education a designation like GRI requires, Ms. Kinsman said, "pretty much shows a big commitment" on the part of the agent.

But Ms. Kinsman concedes that, to many buyers, fancy initials mean nothing if the agent doesn't have a successful track record of buying or selling homes. All the course training in the world can't teach experience and the intuitive sense that many agents acquire over time, educators admit. It's tough to teach street smarts in a class.

"They've got to have the 'reading, writing and arithmetic,' " Ms. Kinsman agreed. "But a lot of what happens is face-to-face and situational kinds of things."

ALPHABET SOUP

Pick up an agent's business card and prepare to translate. An alphabet soup of designations follows some agents' names. Here are what some of them mean:

GRI: Graduate Realtor Institute. Given to agents who take a 90-hour real estate education program, over and above the 45 hours of basic pre-licensing education agents are required to have. Agents pay about $750 to take the GRI exam.

CRS: Certified Residential Specialist. Given to agents who take an additional 40 hours of training beyond the GRI course. It's the highest designation awarded sales associates. Agents pay about $750 and must settle real property sales to earn this designation.

CRB: Certified Residential Broker. Given to brokerage managers who have completed about 125 hours of real estate training beyond the GRI course. Brokers pay about $3,200 for the course and title.

CCIM: Certified Commercial Investment Member. Given to commercial real estate sales pros who have taken 210 hours of specialized education beyond the GRI. It costs about $3,500.

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