Please welcome our newest writer Matt Wilkins who is a young Realtor running a unique brokerage he will be talking about (among other things) over the coming weeks. He has an interesting perspective and is no stranger to controversy or critical thinking. We are excited to learn from him as he joins us, please let him know what you think of his article below and don’t hold back- he can take it!
Two Steps Forward, Three Steps Back?
As the years have gone by, it seems the way listings are accessed has taken a huge step backwards. In many markets more and more listings are using mechanical lockboxes in lieu of electronic ones that most of us were accustomed to seeing on all listings in years past.
How Did We Get Here?
Although many are quick to say that this shift is due to the increase in REO and short sale listings or politics among associations with regard to electronic lockbox systems, the root of the issue has to do with cost. As bottoms lines are squeezed, many look for quick ways to cut costs and and feel that using a $10-30 mechanical lockbox instead of an $90-120 electronic lockbox on a listing is a quick and easy way to maximize the budget. Although this may be a good move for now, it can lead to possible issues down the road.
Saving a Little Could Cost A Whole Lot More
Depending on your specific location, saving money on lockboxes could turn into a huge hit to both your pocketbook and reputation if issues arise with regard to property access. First and foremost, there is no definitive way to control and log access. Although some agents/brokers use showing services to log who requests access to the property, this does not prevent someone from using the code given to access the property on future occasions. Also, some listing agreements include verbiage regarding an electronic lockbox being used for property access so taking the cheap route may put you and your broker in breech of contract. Furthermore, E&O companies depending on the policy may not cover properties using a mechanical box as it does not show the agent/broker as making every effort to provide secure access to the property. This article by Matthew Rathbun, although specific to Northern Virginia, mentions many general points that apply to any area of the country.
What’s Next?
This is an issue that has strong proponents on both sides of the fence. From what I have seen and heard lately the issue is not developing new rules but enforcing the rules already in place. Brokers need to be more aware of the systems them and their agents are using and deal with the possible liability that can/will arise from it. Associations and MLSs need more enforcement and education on their rules and regulations regarding this issue (example of MLS listings where lockbox combos are published in remarks that are seen by consumers).
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Matt – First off, welcome. Nice one AgentGenius. I’ve chatted with Matt here and there and now I’ll have a chance to get to know him even better. Looking forward to it Matt!
Combo boxes are archaic at best. Electronic boxes and their logging capabilities are a step into the future. Why would we want to go backwards. You said it – cost. What’s next to get the axe? MLS because it’s too costly to maintain membership? Should we go back to having books in the office, just so a broker doesn’t need computers in the office? Do we make homemade, handwritten signs to put in the lawn of our listings while we try to squeeze every last penny out of our commissions? I’ve asked this before a million times in regards to other companies. What ever happened to the concept of “the cost of doing business?”
I often ask this most with my local electric company. Why should I pay more for electric power generated by wind – a free natural resource? Sure, there is a cost to building the wind farms, but why I am paying for something they will eventually profit off of. Building your own business is your job, not mine.
There our many costs associated with being an agent. I don’t like paying any of them. But they are concrete costs that help generate my income. They are the “cost of doing business.” Knowing how and where to allocate those costs is key, but cheap for cheaper’s sake at the consumer’s expense is wrong.
In reading Matt Stigliano’s comment…I tripped on this line and it resonated in my head strongly.
“cheap for cheaper’s sake at the consumer’s expense is wrong.”
Amen to that statement.
Matt Wilkins — Welcome to AG! Awesome article! I look forward to reading more of your articles in the future!
Being a person that has worked in REO as a Realtor and as the banker all I can say is in SOME neighborhoods, it does not matter how much the lock box cost. Destroyed and mutilated is destroyed and mutilated. I would rather loose the $10-$10 dollar lockbox any day!
Then there are the areas (Marion Ohio), that still use the practice of no lock box at all. You have to drive across town, pick the key up from the listing agent. Then drive across town to the showing, then drive back again to the listing agents office to drop the key off.
I guess my point is, it depends on the property, location, and custom’s and practice of the local area.
Good post buddy, glad to see you on AG!
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Matt – thanks for the props. I completely agree and it’s amazing the shift in this area of the industry even since I came onto the scene in 2003.
Rocky – I see your viewpoint and know that some REOs do require a comob box on thier listings for ease of access. THe brokers and agents who choose that methos whether it be by choice or by client’s instructions just need to be aware of and plan for any possible liability.
Welcome Matt.
What’s a lockbox? Ha, ha.
Seriously, I’ve been in the biz for 30 years. I remember the days and have worked in markets (Aspen) where you had to go to the listing agents office to pick up keys. I remember when we used the boxes with the long medal key and you had to move the metal tabs to line up with your key code.
In our market we use the electronic boxes and if we need to put on a combo for REO vendors, repair people, we do that too.
Enhanced security and safety for the seller should completely and obviously overwhelm the desire to save a few dollars for the agents.
Cheers
Matt – High Five
To answer your question, not very. An REO agent in our market rarely puts an electronic lock box on, wait a sec… never. If you show one of their properties you know the combo is the same for all 150 of the agents listings. And if you just happen to be on that email list for investors that the REO agent shoots out before the property hits the MLS, well then you know all those investors might know the code.
Last weekend while showing some a property in the $1.2 mil range there was a push button lock box sitting on a bench outside the listing. The email notification didn’t have the lock box code so I took a stab at the number, first try and got it.
Welcome to AG, Matt.
Very few Realtors are using the Supra box anymore and we were one of their first clients. When IDX came in and boards around us didn’t use electronic lockboxes, it died a slow death.
Supra is “suppose” to be coming up with a solution but as time has gone on, more agents are turning in the lockboxes.
I showed 10 houses a couple of weeks ago. Only one required my E-Key.
Welcome Matt! Our electronic Sentrilock costs the same as the combos – I use both. The Sentrilock is possibly the worst lockbox made. the batteries run out, the keybox sticks and it’s bulky.
Combos are becoming the norm even when they cost the same. I’m not sure why, but you make an excellent point about security, although we do use a showing service for all our listings.
On the other hand, I have heard of homes accessed even with an electronic lockbox.