Why a Good Reputation Will Make You Money in Real Estate

As a real estate agent and investor I hear a lot of stories about unethical business practices. I even hear people comparing the real estate professional to used car salesman. There are definitely unethical real estate agents and investors, but there are also many ethical and awesome people in the industry. I have been in real estate for 15 years and my father has been in the business since 1978. We have always done business the right way and have a good reputation in our community. Not only will a good reputation let you sleep well at night, but it can make you more money as well.

Continue Reading Below

Why does the real estate industry have a bad reputation?

Both real estate agents and real estate investors can give themselves a bad reputation. Not everyone in the industry is unethical, but when you are dealing with an asset like houses doing the wrong thing gets a lot of attention and rightly so. Most people’s biggest investment is buying a house and they remember when someone acts in an unethical way. Here are a few things real estate investors and real estate agents have done and do that are unethical.


  • Some agents focus on selling one house and earning one commission. In order to get that commission they may not be totally honest with their clients. They may leave out important details or are not willing to advise their clients to terminate a deal when they know it is the best thing to do.
  • Some agents will not market a house as well as they should to other agents. They do this in hopes they will find a buyer and get both sides of the commission. Usually this results in a lower sale price for the seller.
  • It’s rare but some agents will go as low as committing fraud against those who don’t know any better. In my area some agents got together with builders, lenders and appraisers. They came up with a way to sell new houses for twice as much as they were worth, by selling them to immigrants. The loans were short ARMs that had very small initial payments, the appraisers used fraudulent appraisals to value the properties and the agents convinced the buyers they were getting a good deal. Luckily many of the people involved in this scam went to jail.


  • Some real estate investors will prey on the old or uninformed by buying their house for much less than they are worth. Buying off market properties can be a great way to get great deals, but there is a fine line between ripping someone off and helping them unload their home.
  • New wholesalers tend to get houses under contract without doing all their homework or having real buyers. This causes them to cancel their contract and give the good wholesalers a bad name. Many real estate agents are very wary of any buyers who are wholesalers, because so many wholesalers don’t follow through on their contracts.
  • Some investors will go to any means necessary to get a deal or save a few bucks. This could mean submitting hundreds of low ball offers, always asking for a price reduction with your inspection or screwing over real estate agents who showed them houses to save some money on commissions. These tactics might save money in the short-term but in the long run it usually hurts you much more than it helps.
  • I have seen extreme fraud with real estate investors as well. Some investors have forged deeds or other documents to get properties. I know a couple of investors who went to jail for forging documents. Some investors have forged leases to show their properties are making more money than they actually are, which in turn would allow them to refinance the property for much more than it is worth. In some cases the investors will then let these homes go into foreclosure.
  • Some rental property owners are known as slumlords because they don’t take care of their properties. This does not mean they have low-end rentals, just that they don’t make repairs when needed or don’t repair thinks right when they break.

Are all real estate agents and real estate investors unethical?

Things look pretty bleak in the real estate world after reading that previous list, but not everyone is unethical. After being in the business many years I rarely see unethical practices from agents or real estate investors. The truth is there are people who are unethical in every line of work, but when dealing with big dollar items like cars and houses, unethical behavior makes the news or is remembered.

When I see unethical behavior it usually comes from newer agents or investors who may not know any better. The agents who are involved in the most fraudulent activities, tend not to be traditional agents, but people who got their real estate license just for that activity. The agents and investors who have made a lot of money in this business tend to treat people right and do the right thing. There are always some exceptions, but overall the agents that last are very ethical and that helps build their business.

How can real estate agents and investors be ethical and build a good reputation?

Almost everyone thinks they are ethical, but when it comes to money some people are more willing to cross the line than others. It is pretty simple to know of you are acting ethical or not, most people know the difference between right and wrong. But many people justify what they know is wrong through a variety of means.

  • If someone else tells you it is okay to do something unethical, that does not make it okay! I see real estate investors use unethical tactics all the time, because they were taught them by a real estate guru or read online somewhere that someone else had done this. If you break the law, the judge will not care if someone you never met told you it was okay. Use your own judgment not someone else’s if you think there may be a problem.
  • If you are a real estate agent you must work under a broker. That broker is meant to provide over-site and help to their agents. If there is concern about ethical matters an agent should always talk to their real estate broker. The broker can help with determining what the right thing to do is.

If there is the possibility that what you are doing is unethical, ask someone who is a professional what their opinion is. In most situations if you have to ask someone else if what you are doing is ethical, you probably already know the answer. There are some situations that may be very close to the line on being ethical. In my experience it is best to stay away from that line. The best way to get a good reputation is to do what is best for your clients and not yourself.

What have I done in the past to promote my reputation?

Every situation is unique and different, but here are a few situations where we went above and beyond (this may sound like bragging, but I will show you how it helps my business soon).

  • As a real estate agent you run into many situations where the buyers and sellers cannot get together on price, but they are very close. I have reduced my commission more than a few times to make a deal work. I have also paid for repairs, or inspection items to make a deal work.
  • After selling flips we offer no guarantees on the work that is done. However, on multiple occasions we will go back to a house and fix items that the home owner discovered after they bought the house. In some cases like a sewer line, we did not even make any repairs or cause the problem, but we pride ourselves on selling houses in great condition.
  • When I make offers on houses that I want to buy, I always follow through on my offers unless something crazy comes up with the house. I do not ask for repairs on my inspections, unless there is something major that could not be known before the inspection.

How does building a good reputation make me more money?

Making a lot of money in real estate is all about building for the long-term. As a real estate agent you want to build up a client base that will buy and sell homes with you over and over as well as refer people to you. If you sacrifice your clients needs for short-term pay checks they will not come back to you over and over. While you might make one commission check by acting in your own best interests, you most likely lost many more checks in the future.

As a real estate investor by always coming through on buying houses, other agents know when I make an offer I will close. This allows me to get more deals, because when agents have a seller who must sell a house quickly they know I will not mess around with inspection issues or cancelling half of the offers I get accepted. I even have agents coming to me with great deals, asking if I would be interested in buying them. Agents remember the investors who are good to work with and the ones who are not.

Since I am a real estate agent and I am also a real estate investor having a good reputation helps me two-fold. When I repair a house after it closes or help bring a deal together by reducing my commission, I usually gain a new client. They may not buy or sell another house for years, but they usually tell their friends and family what I did and how I helped them.


Doing the right thing feels good and lets me sleep very well at night, but it also helps my business. In the long run, we are all better off doing the right thing, even if it hurts in the short-term.

Add Comment