This is me in today’s Arizona Republic (permanent link). This is familiar turf to readers here, but I’m wondering if consumers might invest more effort in contemplating the issue.
Questions answer why real estate license laws should be repealed
The idea of repealing real estate licensing laws continues to percolate in my email, and I’ve written more on the subject at BloodhoundBlog.com.
I think I can make understanding this issue easier. Give a look to these questions. If you answer them honestly, you will understand why the real estate licensing laws should be repealed — even though they won’t be.
In the absence of real estate licensing laws, are consumers more likely or less likely to investigate the education, qualifications and experience of prospective agents?
In the presence of real estate licensing laws, are new licensees more likely or less likely to equate their status as licensed real estate agents with better-educated, more-qualified, more-experienced agents?
Taking account that they make profits when they perform their functions well and suffer liabilities when they fail, do free-market oversight entities seem more likely or less likely to assure consumer protection than government bureaucracies?
The same question on a more practical level: When buying electrical equipment, if you could have either government regulation or oversight by the Underwriters Laboratories, but not both, which would you choose?
In the presence of real estate licensing laws, are free-market oversight entities focusing on real estate transactions more likely or less likely to come into existence?
In the presence of real estate licensing laws, are alternative business models — radically different from traditional real estate brokerages but offering consumers more choice and possibly substantial cash savings — more likely or less likely to come into existence?
In the presence of real estate licensing laws, are traditional real estate brokers more likely or less likely to try to outlaw alternative business models offering real estate brokerage services to consumers for reduced or even no compensation?
Is there any consumer interest that would not be better served by repealing the real estate licensing laws? Even if you wish to assert that the laws offer some benefits to consumers, can you argue that those benefits outweigh the damage done to consumers by those very same laws?
I don’t think there is any other way to address this issue.
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