Chapter 26 | There are a Lot of Right Ways to Do It

Overview

The closing chapter discusses professional conduct and ethics, stressing the importance of maintaining a good reputation in the real estate industry.  Real estate is often about relationships and real estate professionals tend to do business with people they know, and more importantly, trust and respect.

Summary

It is vital to build and maintain a good reputation as a real estate professional to have a successful long-term career.  However, as a young professional, your challenge is how to build a reputation as someone with whom people want to do business.  Building a reputation is slow and difficult, but it can be lost unbelievably fast.

Ethics in real estate is not just about doing what is legal, it is about doing what is right, and while practicing real estate involves taking risks and encountering conflicts, there is often a fine line between doing what is right and what is wrong.  A common example for a conflict is differentiating between paying accommodation fees and paying a bribe. When doing business abroad, you are prohibited by U.S. law from bribery or other corrupt acts.  Even though certain behavior may be acceptable or even common practice in another country, always keep in mind the high price you will have to pay if your reputation gets damaged by short-term gains.  Having a couple of people in your life that you respect and with whom you regularly consult will come in handy when encountering such conflicts.

Finally, keep in mind, that a successful network is created by doing the right things for people, even if there is nothing in it for you.  It is about under-promising and over-delivering. These are the foundations of a respectable and trustworthy reputation.

Audio Interview

Being tough but ethical (7:08)

Key Term

Accommodation Fee – Under U.S. law, you can pay accommodation fees but are not allowed to pay bribes. The line between the two is fuzzy.

Chapter Headings

  • Ethics in Real Estate?
  • Right and Wrong
  • Bribes
  • But Everybody is Doing It!
  • Perverse Incentives
  • Favoritism
  • Do Not Expect Thanks
  • Conflict of Interest

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