Photo courtesy of Allan Smith
Allan Smith
Mayor, town of Rocky Hill; Realtor, BHHS New England Realty; Member, GHAR board of directors
Industry experience: 9 years
Age:42
Rocky Hill Mayor Allan Smith wears two other, unusual hats: that of a practicing Realtor and a member of the Greater Hartford Association of Realtors board of directors.
That’s giving him a unique perspective, for a Connecticut politician, on a bill the General Assembly is currently evaluating that would make significant changes to the way real estate agents do business.
Connecticut Senate Bill 340 would see the terminology used to describe Realtors change as well as promote the active listing of properties instead of allowing for pocket listings to become common.
If the bill was to become law, Realtors would be described as “real estate agents” instead of “real estate salespersons.”
More importantly, the bill says that if a property is marketed through private or limited access avenues, marketing through a public channel must also occur. A seller would also be required to specifically opt out of publicly marketing their property – a reaction to the rise of off-market or “coming soon” listings nationwide.
Q: What are your thoughts on the Connecticut legislature weighing in on the debate surrounding private listings?
A: This bill has some sections that we’ve been advocating for a little bit, just changing language around, are you a real estate salesperson versus a real estate agent and then just some things around trying to encourage people to list their properties publicly. I think it’s something that has just been covered in the past by, if you’re a Realtor, then you’re in the MLS. If you’re in the MLS, the only people in the MLS are Realtors. Everything by default was done like that, you’re listing all of your residential properties because it’s part of the NAR Clear Cooperation stuff. In Connecticut, the MLS allows non-Realtors but you have to be a licensed real estate agent still to practice real estate in the state.
In the last couple years, there’s been more and more worry and activity about pocket listings. An agent says, “Oh yeah, I’ll find you a buyer.” And then they quietly market your place and find a buyer, and a lot of times the seller doesn’t understand that they’re not going out to the broader public. The worry is that, because you see this around wholesalers, the worry is that either an elderly client is not really fully aware of all their options or they assume that it’s being marketed to the broader public. The incentives are there, sometimes, for a bad actor to just try to work both sides of the deal. Dual agency is allowed in Connecticut. I feel like the current real estate market, it’s brought up some of these issues.
Q: What about the market might be causing these issues to pop up?
A: I think that almost every trend that you see in the the real estate market now comes back to a lack of inventory. Our inventory is still historically low. It was low coming into the pandemic, and now it is still incredibly low, where there’s just not a lot available for buyers to choose from. That means that everything that does become available sells for more than it ever has in the past. Every trend out there that you see is a symptom of that issue, whether it’s prices going up, whether it’s people waving inspections, whether it’s deals happening where a Realtor has both sides of it. You probably have anywhere between five to 20 times more buyers than you have sellers, because every home that is listed, as long as the price isn’t way out of whack, is going to sell. That’s not the way that it was even five to 10 years ago. The only homes right now that sit on the market for any longer than a couple weeks, they overshot the mark on the price, most likely.
If you go back to even, let’s say, the last housing crisis, the problem was that there were way too many homes for sale and not enough people were able to buy them. There was way more sellers than buyer so if you’ve got a home that’s sitting on the market for a month and you’re trying to sell it to people it’s not going to work because there’s not enough buyers out there. So they would have put all that online.
Right now, if you’ve got a house for sale, you can probably find somebody to buy it without putting it online because I’ve got half a dozen buyers just itching for a property. But is the seller going to get the most amount of money for it? Probably not. Are they going to get the best terms that work the best for them? Probably not, but there’s no way to tell unless it goes out to the broader market. I just think of all of this is it these are all just symptoms of a lack of inventory. If we had the inventory to meet the demand, it wouldn’t be an issue.
Q: You mentioned that another piece of this legislation is the difference between a Realtor and a salesperson. How important it is to maybe make that decision a distinction in today’s real estate landscape?
A: So throughout all of our real estate legislation and a lot of our disclosure documents through the Department of Consumer Protections, we are referred to as real estate salespersons, and the Connecticut Association of Realtors is advocating to just have that change from salespersons to real estate agents. I believe that has been in bills in the past couple couple years, and just never made it all the way through.
It feels like semantics, but the reality is that a salesperson is somebody who’s just trying to sell something and that doesn’t fully encompass what a real estate salesperson is. An agent is working on behalf of somebody, and only 50 percent of the time is that trying to sell something. Because when I’m representing a buyer, I’m not trying to sell anything, I’m just working as an agent to assist them in purchasing something. It’s just so much more accurate to call somebody an agent versus a salesperson. The definition of an agent, you’re working on behalf of somebody else and that’s what we’re doing. We’re working on behalf of somebody. Sometimes that’s selling something. Sometimes that’s helping them buy something and sometimes it’s just consulting. Sometimes it’s leasing and it’s a lot of things besides just sales.
Smith’s Five Favorite Cars
- Lamborghini Countach
- Buick Grand National GNX
- Dodge Viper
- Shelby Cobra
- Ferrari F-40
