Real Estate Industry Myths Debunked

As human beings, we often form ill-conceived notions about people based on our education, our upbringing, our experience. These notions, many of which on the surface appear to pose little threat, eventually stick to the signposts of our society becoming a sort of common knowledge.

Think about the used-car salesperson. What image did you conjure? Was it favourable? Likely not. The same applies to the real estate profession. 

For a multitude of reasons, there are a number of ill-conceived ideas shared by the public about the industry and those in it and that’s what we plan to examine today. “We’re rank slightly below lawyers and slightly above used car salesman,” says Laurin Jeffrey, a sales rep at Century 21 Regal Realty in Toronto. “A lot of people fit us in there.”

The reason, he surmises, has to do with the fact that clients think they are paying Realtor®s too much for the service they provide. There’s a saying in journalism that to get to the bottom of a story, you should follow the money. That saying could well be applied to our first misconception about Realtor®s. It’s the one that prescribes to the notion that real estate agents make a great deal of money doing very little for their clients.

“What they don’t understand is we’re responsible for everything,” Jeffrey points out. “I pay taxes, do my advertising, marketing, printing of business cards and signs, insurance and extra insurance to drive people around. I have no medical benefits. There’s a lot of risk that goes into that.” 

In addition, the industry has had a history of “less-than-ethical” characters, says Jeffrey, an image that it is starting to shed thanks to higher fees and tougher professional regulations. “It’s a lot more cutthroat now,” says Jeffrey. “Before the Internet, the only way you could get information on a property was through that slimy guy down the street. They knew that and they had you.” 

Steven Fudge laughs at the prospect that people think a career in real estate is easy money. Even in a hot market such as the one he currently works in in Toronto, his clients are typically bidding on six to 12 properties before they can secure one. That’s a lot of showings, home inspections, writing of offers in addition to a lot of heartbreak and disappointment to deal with. 

A sales rep for Bosley Real Estate Ltd., Fudge recently received a one-year anniversary gift from clients. When he looked somewhat perplexed by the gift, his clients sweetly reminded him that, yes, it’s been a full 12 months that they’ve been on the hunt for a home. 

In addition to the behind-the-scenes amounts of work Realtor®s put in, there is also the little-publicized fact that Realtor®s have to work while everyone else is having fun, says Fudge. 

Evenings, weekends and holidays are common as is working until 8 or 9 each evening. Fitting in a 70-hour work week is the norm for Fudge. By the same token, the career makes for great flexibility so Fudge allows time for daily work-outs with a trainer and late lunches with good friends. Still, the immediacy of technology in combination with a hot market means he must fly when called. “Often I have to drop what I’m doing so that by dinnertime, it doesn’t matter if I’m hosting a party, attending a recital...whatever,” says Fudge. “You do not have complete control of your time if you’re committed to being in complete control over your clients. I have missed my own birthday party.”

The perception that Realtor®s don’t have to work hard for their money is what has fuelled the For-Sale-By-Owner industry, but as Mississauga sale rep Marjorie Canales points out, that myth is seeing its own backlash. “That’s why most end up listing with traditional real estate,” says Canales. “They think they will put up a sign and maybe put up a little website for the property and so many things can go wrong. That’s why 90 per cent or more of homes are sold through a Realtor®.” 

Another related misconception about real estate is the belief that Realtor®s have oodles of freedom and spare time. “That is actually not the case,” she says. “You get out, what you put in and it’s very unstructured so you have to be disciplined with your time. It’s easy to derail and slack off. I wouldn’t call it easy money at all.” 

Furthermore, adds Canales, Realtor®s are one of the few professions that work on contingency and aren’t paid a dime till well after the property sells. “We’re taking a bigger risk from the get-go. Immediately, I have to go into my pocket and pay for marketing and if the house doesn’t sell, I don’t get paid.’ 

While OREA president Barb Sukkau agrees that the profession is the target of unfair criticism, she feels more can be done to put public thought back on the right track. “We don’t do a good enough job at telling consumers how valuable our service is,” Sukkau says. “There are a lot of misconceptions about Realtor®s and it comes from consumers that don’t appreciate the level of expertise we have and the knowledge we have.”

“People don’t realize we are bound to be ethical honest and we have certain obligations under the act that we have to follow and there are certain repercussions if we don’t.”

In addition, there is the continuing education that agents are required to complete in order to keep their license current. 

Real estate associations large and small are embarking on campaigns to help deliver the message to media and consumers about the value services Realtor®s provide, she says, referring to the www.howRealtor® website. 

In St. John’s, Bill Dilny often hears rumblings from people who believe that house prices are set by Realtor®s because it’s to their advantage to sell higher-priced homes. While Dilny doesn’t dispute that it is beneficial to some extent, the misconception that agents set prices is laughable. “But you don’t increase the price by 20 per cent because you’ll make more money,” says the Remax agent. “That’s ludicrous. It’s the market that drives prices.”

One fact about Realtor®s that Edmonton Realtor® Craig Pilgrim would like more people to know about is their high level of community mindedness. Despite mythical assertions that the profession embraces greed in its formula for making easy money, the high level of community involvement and payback would suggest there’s something more altruistic at play than simply mercenary means. “It is commonplace for Realtor®s to attend pretty much every social good function and fundraising event and to spend and donate both in terms of money, in kind donations, work and effort,” Pilgrim says. “Realtor®s are really committed to their communities and it does show.”

The Realtor®s’ Community Foundation in Edmonton, of which Pilgrim volunteers his time, is celebrating its 25th anniversary this year. Since its inception, the organization has returned in excess of $3-million to more than 100 Edmonton-based charities.

“The vast majority of Realtor®s just do these things -- they serve on boards and local charities and that’s typical and below the radar and that’s just done,” Pilgrim says. “I think the reason it’s so significant in our industry has to do with the flexibility in our industry. People are drawn to this profession because you’re seeing and touching so many people, their lives, their passions, their personal causes. It’s because of the connectedness of the industry.”



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