Real estate agent is sort of broking job. A real estate agent should work out a deal for a property sale between a prospective buyer and a prospective seller. It can be a job of high earning potential. But the real estate agent should work hard to achieve that. A lot of real estate agents work as consultants. It may not be their full-time job. This can be done during the free time of another full-time job. But such juggling of jobs needs high-energy quotient and expertise in time management. Since it is not a full-time job, there is no fixed salary. The real estate agent gets a fixed percent of total amount of land sale from both the buyer and the seller.
There is absolutely no limit for the salary of a real estate agent, when working as freelance consultant. As they say in advertisements, sky is the limit for the salary of land brokers. The harder one works and more sales one engineers, the more will be the money one earns. But for earning a good monthly income, the freelance real estate agents should be highly industrious and have good inter-personal communication skills. In general, real estate agents should be well versed with the value of a property. They should be able to do a quick valuation of the property and should be able to explain the aspects that influence the price of the property and convince both parties about a reasonable price.
There are plenty of real estate firms and agencies that employ real estate agents. In such firms, the agents have a fixed monthly salary. The salary varies from agency to agency. Usually it depends on the volume of business done by the agency. There are some agencies that provide a pay based on the number of real estate sales materialized by a particular employee. In general, the annual salary of a real estate agent, who works in any of the established firms, varies from $25000 to $75000. There are a minority of real estate agents who earn a salary even less than $25000. Some agents working in start-up companies only earn an annual salary of only $10000. Such a large variation of salary can be explained by the fact that some real estate agencies have more business volume than some of smaller fish in the real estate fray.
Also the commission-wise salary and sales-wise salary affect the annual pay. There are some months, especially in the winter months of November, December and January, in which conventionally real estate business are somewhat fewer. So in the case sales-wise salary structure, the salary suffers a dip in those months. But the sales move up from March to September. So will be the salary in those months.
Tuesday, August 5, 2008
Understanding Fractional Real Estate
Fractional Real Estate is a fairly new concept in vacation homes and resort real estate. Unlike timeshare property, fractional ownership is deeded ownership to a house or condo type of property. These properties are usually furnished beautifully and are ready to occupy immediately.
To understand how fractional real estate transactions work, lets take a house and sell it to 4 different parties. Each party will own 25% ownership of the property. This entails each party to one weeks usage a month to use for themselves or to rent their week out. Typically there is an annual calendar that rotates the weeks so each owner will get a holiday week like Christmas every four years. You also have the option of switching weeks with another owner if the parties agree.
The benefits of fractional ownership give you the opportunity to own and use a million dollar home for a $250,000 initial purchase price. You get a luxury furnished property that is ready to use for a price that was unaffordable in the past. As the property appreciates, your quarter share gains in value also. This type of arrangement works great for people that only use their vacation homes part time. In addition, if you can't use it for your designated week you can rent that week and get income from the property.
Like all real estate transactions, a quarter share agreement should be a written agreement between the co-owners to share expenses and use of the property. This agreement specifies that title is to be in the name of the individual owners. Holding title in a corporate, Limited Liability Company or joint tenancy could create tax problems and prevent an owner from obtaining financing. Resort Lenders are now doing fractional real estate loans. If the property is a condo or townhouse, it's advisable to read the existing condo documents to make sure fractional ownership is allowed. In most cases it will be allowed.
Financing is the primary pit fall of fractional ownership. Many lenders don't understand the concept and if the seller of the property has a mortgage, this mortgage must be paid off in full to transfer ownership. Many times buyers of fractional real estate must wait until at least 3 shares are under contract before closing on their transaction to facilitate a complete release of the sellers existing mortgage. This is usually done with a reservation and deposit. When a person buys a fractional with other parties and decides to sell a few years later, any fractional mortgage can be immediately released at the closing.
The final issues to be worked out are provisions for first right of refusals, holding over, default for non-payment, remedies and prohibitions on further "division" of an interest. Also, use of the property, the budget, calendar, furnishings, pets, smoking, rentals, cleaning, property management, and personal storage are items that tend to be property specific. Each group of owners must make their own arrangements and agree on these items.
AnyFractional ownership agreements should be drafted by a knowledgeable attorney since no two are exactly the same.
To understand how fractional real estate transactions work, lets take a house and sell it to 4 different parties. Each party will own 25% ownership of the property. This entails each party to one weeks usage a month to use for themselves or to rent their week out. Typically there is an annual calendar that rotates the weeks so each owner will get a holiday week like Christmas every four years. You also have the option of switching weeks with another owner if the parties agree.
The benefits of fractional ownership give you the opportunity to own and use a million dollar home for a $250,000 initial purchase price. You get a luxury furnished property that is ready to use for a price that was unaffordable in the past. As the property appreciates, your quarter share gains in value also. This type of arrangement works great for people that only use their vacation homes part time. In addition, if you can't use it for your designated week you can rent that week and get income from the property.
Like all real estate transactions, a quarter share agreement should be a written agreement between the co-owners to share expenses and use of the property. This agreement specifies that title is to be in the name of the individual owners. Holding title in a corporate, Limited Liability Company or joint tenancy could create tax problems and prevent an owner from obtaining financing. Resort Lenders are now doing fractional real estate loans. If the property is a condo or townhouse, it's advisable to read the existing condo documents to make sure fractional ownership is allowed. In most cases it will be allowed.
Financing is the primary pit fall of fractional ownership. Many lenders don't understand the concept and if the seller of the property has a mortgage, this mortgage must be paid off in full to transfer ownership. Many times buyers of fractional real estate must wait until at least 3 shares are under contract before closing on their transaction to facilitate a complete release of the sellers existing mortgage. This is usually done with a reservation and deposit. When a person buys a fractional with other parties and decides to sell a few years later, any fractional mortgage can be immediately released at the closing.
The final issues to be worked out are provisions for first right of refusals, holding over, default for non-payment, remedies and prohibitions on further "division" of an interest. Also, use of the property, the budget, calendar, furnishings, pets, smoking, rentals, cleaning, property management, and personal storage are items that tend to be property specific. Each group of owners must make their own arrangements and agree on these items.
AnyFractional ownership agreements should be drafted by a knowledgeable attorney since no two are exactly the same.
Make Money in a Slow Real Estate Market
The world is getting more expensive to live in, isn't it? The cost of living has no where to go but up, up and up. There seems to be no end. So, what can you do about it? Ever thought of earning through property marketing or real estate? If you haven't, then try considering it. It's a great way to earn money. A lot of people have made a living out of it.
How It Works
There are a lot of ways that you can earn money through real estate. You can work as an agent and sell a house or two every now and again. Or you could buy a property, improve it and sell it for double or triple the amount you spent. It may seem like a risky business. But, as long as you have the skill and you have an in depth knowledge about the business - you have nothing to fear.
Getting Started
Keep in mind that 'Little Knowledge is Dangerous'. That is why it is highly recommended that you know as much as you can about this type of business before you plunge head first. Never assume anything. If you don't know something - do your research! Ask the experts. Study all the materials that you can get your hands on. Spend time on the web looking for sites that offer information regarding the world of real estate. You can also further your knowledge by working as a junior agent in a real estate firm. That way you can learn the ins and outs of how to sell a house or a property.
Investing Can Be Steep
The main thing that scares people away about this type of business is the fact that they have to invest a lot of money in order to get started. Some people take out loans while others use their life savings. Some start with their own house. They renovate it, sell it, move to another house and repeat the cycle. The only problem with that last strategy is that life can get nomadic. And not a lot of people want a nomadic lifestyle.
Sell, Sell, Sell
Once you know all you need to know about the world of real estate and you have the financial support to meet your drive. Then, it's time to get started. Start small, think big. Buy a property that you know will attract buyers. Improve on it, sell it and enjoy your revenue. If you get lost along the way just think what Jeff (Jeff Lewis from "Flipping Out") would do.
How It Works
There are a lot of ways that you can earn money through real estate. You can work as an agent and sell a house or two every now and again. Or you could buy a property, improve it and sell it for double or triple the amount you spent. It may seem like a risky business. But, as long as you have the skill and you have an in depth knowledge about the business - you have nothing to fear.
Getting Started
Keep in mind that 'Little Knowledge is Dangerous'. That is why it is highly recommended that you know as much as you can about this type of business before you plunge head first. Never assume anything. If you don't know something - do your research! Ask the experts. Study all the materials that you can get your hands on. Spend time on the web looking for sites that offer information regarding the world of real estate. You can also further your knowledge by working as a junior agent in a real estate firm. That way you can learn the ins and outs of how to sell a house or a property.
Investing Can Be Steep
The main thing that scares people away about this type of business is the fact that they have to invest a lot of money in order to get started. Some people take out loans while others use their life savings. Some start with their own house. They renovate it, sell it, move to another house and repeat the cycle. The only problem with that last strategy is that life can get nomadic. And not a lot of people want a nomadic lifestyle.
Sell, Sell, Sell
Once you know all you need to know about the world of real estate and you have the financial support to meet your drive. Then, it's time to get started. Start small, think big. Buy a property that you know will attract buyers. Improve on it, sell it and enjoy your revenue. If you get lost along the way just think what Jeff (Jeff Lewis from "Flipping Out") would do.
Real Estate Inventory
Real Estate inventory is at an all time high PLUS Interest rates are low. A large number of buyers remain in the market, but their behavior is decidedly cautious. For those of you selling in this market, it's important to remain patient, to plan for a longer sales cycle, and to avoid overpricing your home. Buyers in the current market will have a variety of choices, and will have the ability to negotiate favorable contract terms. Get expert representation from an agent who will talk straight about the value of a house or the condition of the local market.
With inventory close to all time highs, anemic sales volumes, rising inflation and banks about to unleash a wave of interest rate hikes; inventory is at the highest levels ever seen. Bargain purchasing will be gone when undervalued strong markets snap back to fair value or even earlier when the knowledge becomes commonplace. The values that went up with the rising tide are now going down with the ebbing tide and there isn't much that sellers can do for the time being. When the market turns, and it will, housing will once again be increasing in value almost everywhere. Real estate has always been a good value and will regain that position again shortly. Property values are rising everyday and the pressure on real estate inventory is always there.
Buyers are anxious to buy, but they want to make intelligent purchases. Buyers are not able to qualify or are unwilling to pay for the mortgage at higher rates. Buyers control the value of the real estate marketplace, not sellers. Buyers, not sellers, determine what the value of a home will be. Buyers return when the risks are accurately priced into the market. The result is a slowdown in sales activity, as the disconnect widens between sellers holding out for high prices and buyers looking for a bargain. But ultimately, more choices for buyers leads to fewer deals being made. Because most buyers in this market are not having to compete against other buyers for the same home, buyers are not having to waive their right to inspections in order to make their offer more attractive. Today, buyers can enjoy more affordable homes, because of the fewer number of investors active in the market.
With inventory close to all time highs, anemic sales volumes, rising inflation and banks about to unleash a wave of interest rate hikes; inventory is at the highest levels ever seen. Bargain purchasing will be gone when undervalued strong markets snap back to fair value or even earlier when the knowledge becomes commonplace. The values that went up with the rising tide are now going down with the ebbing tide and there isn't much that sellers can do for the time being. When the market turns, and it will, housing will once again be increasing in value almost everywhere. Real estate has always been a good value and will regain that position again shortly. Property values are rising everyday and the pressure on real estate inventory is always there.
Buyers are anxious to buy, but they want to make intelligent purchases. Buyers are not able to qualify or are unwilling to pay for the mortgage at higher rates. Buyers control the value of the real estate marketplace, not sellers. Buyers, not sellers, determine what the value of a home will be. Buyers return when the risks are accurately priced into the market. The result is a slowdown in sales activity, as the disconnect widens between sellers holding out for high prices and buyers looking for a bargain. But ultimately, more choices for buyers leads to fewer deals being made. Because most buyers in this market are not having to compete against other buyers for the same home, buyers are not having to waive their right to inspections in order to make their offer more attractive. Today, buyers can enjoy more affordable homes, because of the fewer number of investors active in the market.
The Real Estate Market Starts Climbing Again
During the past couple of years we've all seen a tremendous change in real estate in the country.
This change actually has spread all over, businesses loosing money while gas prices are extremely high.
The real estate market has become a big issue for all of us out there, we've seen many homeowners loosing their homes and struggling to find a home to rent because of their credit.
What happen to us?
Remember the bubble 4 years ago?
That's exactly the answer, from years of prosperity and times of spending, traveling and investing in stocks and real estate, we are now experiencing another bubble but this time the bubble is going in a different direction and we are wondering what to do.
So real estate was going down and it's still going down, some economists say that it will get stable in 2 years from now.
The sellers market became a buyers market, and today we all know it by now.
Investors and renters that saved their money for better days to buy to make money are in the market today, that's making the real estate market busy.
Real estate agents that learn how to change with the market also learned how to make money from the changes, these real estate professionals are making lots of money and while we are all struggling for business they're making the business.
Today you can get a home directly from the banks for almost half the price.
I've seen homeowners that are so desperate that they're willing to give their homes for free, just come and take their loan and continue their payments.
On the other hand, investors are looking to buy homes in bulk, they can get homes $.50 on the dollar.
Some banks like bank of America and countrywide are selling hundreds of homes in bulk to investors at a discount prices.
So real estate agents are busy getting hundreds of listings and reo's from banks, then they're selling these homes at a low price to future homeowners and investors.
It's definitely a buyer's market like we had in the early 90's, so if you're an investor or a homeowner.
This is your time!
This change actually has spread all over, businesses loosing money while gas prices are extremely high.
The real estate market has become a big issue for all of us out there, we've seen many homeowners loosing their homes and struggling to find a home to rent because of their credit.
What happen to us?
Remember the bubble 4 years ago?
That's exactly the answer, from years of prosperity and times of spending, traveling and investing in stocks and real estate, we are now experiencing another bubble but this time the bubble is going in a different direction and we are wondering what to do.
So real estate was going down and it's still going down, some economists say that it will get stable in 2 years from now.
The sellers market became a buyers market, and today we all know it by now.
Investors and renters that saved their money for better days to buy to make money are in the market today, that's making the real estate market busy.
Real estate agents that learn how to change with the market also learned how to make money from the changes, these real estate professionals are making lots of money and while we are all struggling for business they're making the business.
Today you can get a home directly from the banks for almost half the price.
I've seen homeowners that are so desperate that they're willing to give their homes for free, just come and take their loan and continue their payments.
On the other hand, investors are looking to buy homes in bulk, they can get homes $.50 on the dollar.
Some banks like bank of America and countrywide are selling hundreds of homes in bulk to investors at a discount prices.
So real estate agents are busy getting hundreds of listings and reo's from banks, then they're selling these homes at a low price to future homeowners and investors.
It's definitely a buyer's market like we had in the early 90's, so if you're an investor or a homeowner.
This is your time!
The New Real Estate Demographic - Young Single Women
Now more than ever single women are stepping up to the plate as some of the prime movers and shakers in the real estate market. Currently they make up for nearly 22% of all homeowners, and are beating out their single male counterparts who seems more and more content to remain nestled at home in the family nest before opting get into the real estate market.
If you're a single women heading into the purchase of your first home, here are some helpful hints to consider:
Get Clear on What You Can Afford
With this being your first time entry into the world of real estate, and possibly the largest purchase you've ever made - and by a long shot, you'll want to make the transition relatively easy. You can do this by being very clear on your budget, and setting your sights on something that won't break your monthly budget. Once you've settled in, and are more secure with making ends meet and all the trials and tribulations of homeownership, you can then consider selling and moving up. So, the suggestion here is to be somewhat slow and cautious on your way towards building equity. Start small, and dream big and you'll be well on your way.
Peek a Boo!: Research Hidden Costs
Most young women entering into the real estate market are looking at the purchase of a townhouse or condo. It's very important to educate yourself on how the association you're looking to buy into deals with monthly fees, potential raises in monthly fees (community association dues) and utility costs. You'll also want to know all that your condo fees won't cover, so you can estimate what other monthly/yearly hosts may be lurking about.
Other costs that you must factor into the purchase of any home include homeowner's insurance, property taxes, and home maintenance.
A Mortgage Broker Can Help
A good mortgage broker can demystify the mortgage process and ideally help you leverage and make the most out of your one-person income. Wrapping your head around the myriad numbers you'll be confronted with can be daunting, but a good broker will make all the difference in the world.
Can't Quite Make An Adequate Down Payment : Consider a Loan from Family or Friends
One win-win situation to consider is having a friend loan you the money with an interest rate that's lower than what you'd pay at a regular bank, but higher than what they might receive from similar investments. Another option is to make them a sort of investor, such that in return for the loan you offer them a percentage of the appreciation when you decide to sell.
Don't Skimp On Safety
For most women one paramount parameter in their home search is that the neighborhood or building they invest in is secure and safe. This is a smart way to go and shouldn't be overlooked as you continue the house hunt. In this regard make sure you investigate neighborhoods during all hours of the day and night to see what sort of activity goes on there. Talk to neighbors and find out how safe they feel living there.
Go to the local police station and get solid stats on crime in the area.
Find out if there's and active Neighborhood Watch in the neighborhood.
If you're looking at a condo or town home, thoroughly investigate the safety features included. Many women opt for a unit on the second floor or higher, primarily for a better sense of security and privacy.
Lifestyle, lifestyle, lifestyle
The fact that you don't have a significant other or dependents means you can truly focus on "lifestyle" as your primary search parameter. If you love all the amenities of downtown and have a close group friends there, then by all means look for a suitably urban choice in housing. If entertaining is big on your list of activities then you might want to hunt down a home where the kitchen is the centerpiece.
Buy With Resale in Mind
As much as you need to love the home you buy, you'll want to ensure that you have a good exit strategy. After all, you never know what'll happen in the coming years. A home with easy resale is generally one that is well constructed and maintained, is aesthetically appealing and located in a good, safe neighborhood. Before purchasing find out more about where the neighborhood you're looking in may head in the next five years in terms of development. This will give you a good idea of what your investing in.
If you're a single women heading into the purchase of your first home, here are some helpful hints to consider:
Get Clear on What You Can Afford
With this being your first time entry into the world of real estate, and possibly the largest purchase you've ever made - and by a long shot, you'll want to make the transition relatively easy. You can do this by being very clear on your budget, and setting your sights on something that won't break your monthly budget. Once you've settled in, and are more secure with making ends meet and all the trials and tribulations of homeownership, you can then consider selling and moving up. So, the suggestion here is to be somewhat slow and cautious on your way towards building equity. Start small, and dream big and you'll be well on your way.
Peek a Boo!: Research Hidden Costs
Most young women entering into the real estate market are looking at the purchase of a townhouse or condo. It's very important to educate yourself on how the association you're looking to buy into deals with monthly fees, potential raises in monthly fees (community association dues) and utility costs. You'll also want to know all that your condo fees won't cover, so you can estimate what other monthly/yearly hosts may be lurking about.
Other costs that you must factor into the purchase of any home include homeowner's insurance, property taxes, and home maintenance.
A Mortgage Broker Can Help
A good mortgage broker can demystify the mortgage process and ideally help you leverage and make the most out of your one-person income. Wrapping your head around the myriad numbers you'll be confronted with can be daunting, but a good broker will make all the difference in the world.
Can't Quite Make An Adequate Down Payment : Consider a Loan from Family or Friends
One win-win situation to consider is having a friend loan you the money with an interest rate that's lower than what you'd pay at a regular bank, but higher than what they might receive from similar investments. Another option is to make them a sort of investor, such that in return for the loan you offer them a percentage of the appreciation when you decide to sell.
Don't Skimp On Safety
For most women one paramount parameter in their home search is that the neighborhood or building they invest in is secure and safe. This is a smart way to go and shouldn't be overlooked as you continue the house hunt. In this regard make sure you investigate neighborhoods during all hours of the day and night to see what sort of activity goes on there. Talk to neighbors and find out how safe they feel living there.
Go to the local police station and get solid stats on crime in the area.
Find out if there's and active Neighborhood Watch in the neighborhood.
If you're looking at a condo or town home, thoroughly investigate the safety features included. Many women opt for a unit on the second floor or higher, primarily for a better sense of security and privacy.
Lifestyle, lifestyle, lifestyle
The fact that you don't have a significant other or dependents means you can truly focus on "lifestyle" as your primary search parameter. If you love all the amenities of downtown and have a close group friends there, then by all means look for a suitably urban choice in housing. If entertaining is big on your list of activities then you might want to hunt down a home where the kitchen is the centerpiece.
Buy With Resale in Mind
As much as you need to love the home you buy, you'll want to ensure that you have a good exit strategy. After all, you never know what'll happen in the coming years. A home with easy resale is generally one that is well constructed and maintained, is aesthetically appealing and located in a good, safe neighborhood. Before purchasing find out more about where the neighborhood you're looking in may head in the next five years in terms of development. This will give you a good idea of what your investing in.
Property Management - The Key to Increasing Your Real Estate Brokerage's Income
With the demand of prime properties worldwide, real estate communities are boasting of profits and capital gains when it comes to their acquired real estate. But despite the knowledge of these investors in the business, there is a way to consolidate as many properties as they can to maximize their profits.
Tenancy in Common or TIC allows the real estate community to share an ownership of a certain property with two or more people. The individual's share may depend on how much they invested on the property upon its acquisition, as stipulated in the deed, will or title for the joint venture.
Advantages of TIC for the Real Estate Community
Real estate community can highly profit from tenancy in common. By partly investing on one property with another investor, the person may allocate their money to other investments which allows them to double their total earnings, rather than sticking with one real estate alone.
Also, the law states that those who are into TIC should equally contribute to payments of expenses depending on the percentage of their shares - this includes expenses such as rent, services (lights, water and communication), and so on. Though repair and construction responsibilities are not shared, but depend on the co-owners who wish to have them done. This allows each individual in the real estate community to lessen their cost of expense which gives them more flexibility in managing their finances.
Real Estate Community Concerns
Though most big-time real estate community investors deal with property acquisition on their own, the main concern however is still on the profit to be had on the venture. Commercial investors on real estate will not dish out any money for the property if there is no profit or capital gains to be had - the risk is just too much for one person to handle on their own.
Right of survivorship doesn't exist in a TIC agreement. In other words, the share of the property or estate will be passed on as inheritance to the heir as stated on the will or any legal documents pertaining to the joint venture. In this case, the risk of losing the share of the real estate acquired will be lessened, or face legal sanctions as dictated by the Court.
But with TIC, the risks are divided according to the number of individuals in the joint venture. If one of the party wishes to "destroy" the tenancy in common, they can do so in two ways: 1) the party can obtain a "partition of the property" which will divide the land into distinctively owned lots, if permitted by the State; and 2) the Court may decide to force a sale of the property and divide the proceeds according to the percentage of each individuals' investment.
Tenancy in Common or TIC allows the real estate community to share an ownership of a certain property with two or more people. The individual's share may depend on how much they invested on the property upon its acquisition, as stipulated in the deed, will or title for the joint venture.
Advantages of TIC for the Real Estate Community
Real estate community can highly profit from tenancy in common. By partly investing on one property with another investor, the person may allocate their money to other investments which allows them to double their total earnings, rather than sticking with one real estate alone.
Also, the law states that those who are into TIC should equally contribute to payments of expenses depending on the percentage of their shares - this includes expenses such as rent, services (lights, water and communication), and so on. Though repair and construction responsibilities are not shared, but depend on the co-owners who wish to have them done. This allows each individual in the real estate community to lessen their cost of expense which gives them more flexibility in managing their finances.
Real Estate Community Concerns
Though most big-time real estate community investors deal with property acquisition on their own, the main concern however is still on the profit to be had on the venture. Commercial investors on real estate will not dish out any money for the property if there is no profit or capital gains to be had - the risk is just too much for one person to handle on their own.
Right of survivorship doesn't exist in a TIC agreement. In other words, the share of the property or estate will be passed on as inheritance to the heir as stated on the will or any legal documents pertaining to the joint venture. In this case, the risk of losing the share of the real estate acquired will be lessened, or face legal sanctions as dictated by the Court.
But with TIC, the risks are divided according to the number of individuals in the joint venture. If one of the party wishes to "destroy" the tenancy in common, they can do so in two ways: 1) the party can obtain a "partition of the property" which will divide the land into distinctively owned lots, if permitted by the State; and 2) the Court may decide to force a sale of the property and divide the proceeds according to the percentage of each individuals' investment.
How to Interview a Real Estate Agent When You Are Buying Or Selling a Home
Most home sellers and especially homebuyers have no clue as to how to interview their future real estate agent. You have the right to have someone represent you as a buyer client even though the seller pays the commission. This is called buyer agency. Most states require that you sign an agreement in writing that you want representation. This document can be terminated so you don't have to feel that you have hired someone that is not worthy of your business.
Hiring the right agent is tricky because your motive is not always their motive. Your motive is to find the best house. Their motive is to make some money from your transaction. So, follow the steps below to hire the best real estate agent for you.
Questions to Ask and Ideas to Follow to Find the Best Agent:
1. Question: How many transactions have you done in the last 6 months? Answer: If the answer is less than 6, keep looking. Less than 6 transactions mean less than 1 transaction per month. This person is rusty at best.
2. Question: How many seller clients and how many buyer clients do you have presently? Answer: Should be at least 4.
3. Question: What is your game plan for finding me the best house OR the best buyer? Answer: Should be thought out and not winging it.
4. Question: What are your business hours? Answer: It should be real times of the day and there should be a cut-off point. Agents who over-service their clients are not working with enough clients to have experience where experience counts - transactions.
5. Question: If I don't like your representation, what are my options? Answer: Should have precise step-by-step answer to exiting the written agreement.
6. Question: Do you have a partner, assistant or a team? Answer: You have to decide if this is important to you. Many buyers and sellers tell me that they were frustrated with their "one-man band" agent when they got sick, took vacation or had another client for the day when they wanted to see homes or when their offer came in.
7. Question: Do you have another job? Answer: Again, you have to decide. However, if you are needy or a typically demanding person, you will not like this person calling you after they get off work or you having to call them at "their other job".
8. For Sellers: Question: How do you feel about the St. Joseph Statute? * FYI: The St. Joseph statute, myth or not, some people firmly believe is a contributing factor or the sole reason that their house sold. Answer: The point is that you do not want an agent who is stuck in the box. The agent should have the opinion that they will do whatever it takes to get the house sold and will consider all options.
So, take your job seriously when interviewing both a buyer's agent and a listing agent. Don't just think that you have to use your good friend that just got their real estate license last month because you have gone to church with her for the last hundred years. Be serious about the professional that is going to represent you and expect professional results.
Hiring the right agent is tricky because your motive is not always their motive. Your motive is to find the best house. Their motive is to make some money from your transaction. So, follow the steps below to hire the best real estate agent for you.
Questions to Ask and Ideas to Follow to Find the Best Agent:
1. Question: How many transactions have you done in the last 6 months? Answer: If the answer is less than 6, keep looking. Less than 6 transactions mean less than 1 transaction per month. This person is rusty at best.
2. Question: How many seller clients and how many buyer clients do you have presently? Answer: Should be at least 4.
3. Question: What is your game plan for finding me the best house OR the best buyer? Answer: Should be thought out and not winging it.
4. Question: What are your business hours? Answer: It should be real times of the day and there should be a cut-off point. Agents who over-service their clients are not working with enough clients to have experience where experience counts - transactions.
5. Question: If I don't like your representation, what are my options? Answer: Should have precise step-by-step answer to exiting the written agreement.
6. Question: Do you have a partner, assistant or a team? Answer: You have to decide if this is important to you. Many buyers and sellers tell me that they were frustrated with their "one-man band" agent when they got sick, took vacation or had another client for the day when they wanted to see homes or when their offer came in.
7. Question: Do you have another job? Answer: Again, you have to decide. However, if you are needy or a typically demanding person, you will not like this person calling you after they get off work or you having to call them at "their other job".
8. For Sellers: Question: How do you feel about the St. Joseph Statute? * FYI: The St. Joseph statute, myth or not, some people firmly believe is a contributing factor or the sole reason that their house sold. Answer: The point is that you do not want an agent who is stuck in the box. The agent should have the opinion that they will do whatever it takes to get the house sold and will consider all options.
So, take your job seriously when interviewing both a buyer's agent and a listing agent. Don't just think that you have to use your good friend that just got their real estate license last month because you have gone to church with her for the last hundred years. Be serious about the professional that is going to represent you and expect professional results.
Understanding Volume Real Estate
Volume real estate transactions often baffle the average agent. In fact, the average agent is lucky to close 20 transactions in a year, which equals only 1.5 transactions per month. And yet, it would be highly unlikely that there is a need to spend 160 hours on any transaction. This stems from a lack of processes, no boundaries when it comes to time with a client and a lack of common sense about what it takes to work with too many clients at one time.
It is a fact that in the traditional world of real estate, many agents believe that you should make client calls until you can not reach the person that you are calling. That could be midnight and sometimes later if you are negotiating a deal. Why?
This misunderstanding of the profession leaves the agent using their time inefficiently, with no boundaries and often you hear that the agent is burned out. They need a vacation. But oh no, the agent can not take a vacation, they have a client that needs them. And this is the agent that is lucky to do 20 transactions per year. Yes, it yielded them into the Million-Dollar Club, but it has not yielded them an income that is sustainable or a life that is balanced.
What is Volume Real Estate?
In a nutshell, volume real estate is working with so many clients that if one flakes out on you and does not sell or buy a house; it does not effect your performance or income. Simply they are not needed. Volume real estate is a conscious decision to accept as many clients as you can and that you will figure out if you need help with them later, while you are in the game, not just thinking about the game.
Volume real estate recognizes that you must be marketing all the time, not just when you decide that you need more clients because you have just closed your pipeline or it has dried up. A volume real estate person overbooks himself or herself knowing that they have team members that can help out if needed. Volume real estate is where you make money that you didn't even know was possible because you have a process that is smooth and has very little or no flaws.
Volume real estate has boundaries that say when you close for business, when you re-open for business and ultimately this will allow you to go on vacation. Volume real estate is the wave of the future if the wave is not already on us. The question is, will you go under with the wave or will you ride the wave?
How Do You Do Volume Real Estate
1. Learn from someone who has perfected volume real estate. Someone who carries hundreds of listings at a time, not tens of listings or less.
2. Stay away from naysayers and others who don't want anyone to succeed, including themselves.
3. Understand that you can never service someone in real estate, you can only support them to make a decision that is best for them. You have no power.
4. Stop feeling worried for people who have gotten themselves into financial messes.
5. Stop feeling guilty for charging people too much money and charge less - the real fee that it costs you to do business. In other words, instead of clubbing 20 people to death for your annual revenue, just pinprick 2,000. You'll make more money and your clients will save more individually, allowing them to accept more offers, quicker.
6. Make yourself referable so that your clients can actually refer you to others.
7. Build processes that keep everyone on the same page including the clients.
8. Stop over servicing people to feel good about yourself.
9. Stop underestimating that people can't do things for themselves like fill their own flyer box.
10. Stop overcharging clients because you don't have enough clients - get more.
11. Stop over-promising clients and delivering less results than promised.
12. Stop over-promising clients and resent your over-promise.
13. Set boundaries for your personal life that you are willing to enforce and let those spread into your business life.
Recognize that real estate needs for sellers and buyers have changed and get on the band wagon of people who are making millions while you are making less than you imagined or feel you deserve. Don't just make enough to pay your bills, make real money.
It is a fact that in the traditional world of real estate, many agents believe that you should make client calls until you can not reach the person that you are calling. That could be midnight and sometimes later if you are negotiating a deal. Why?
This misunderstanding of the profession leaves the agent using their time inefficiently, with no boundaries and often you hear that the agent is burned out. They need a vacation. But oh no, the agent can not take a vacation, they have a client that needs them. And this is the agent that is lucky to do 20 transactions per year. Yes, it yielded them into the Million-Dollar Club, but it has not yielded them an income that is sustainable or a life that is balanced.
What is Volume Real Estate?
In a nutshell, volume real estate is working with so many clients that if one flakes out on you and does not sell or buy a house; it does not effect your performance or income. Simply they are not needed. Volume real estate is a conscious decision to accept as many clients as you can and that you will figure out if you need help with them later, while you are in the game, not just thinking about the game.
Volume real estate recognizes that you must be marketing all the time, not just when you decide that you need more clients because you have just closed your pipeline or it has dried up. A volume real estate person overbooks himself or herself knowing that they have team members that can help out if needed. Volume real estate is where you make money that you didn't even know was possible because you have a process that is smooth and has very little or no flaws.
Volume real estate has boundaries that say when you close for business, when you re-open for business and ultimately this will allow you to go on vacation. Volume real estate is the wave of the future if the wave is not already on us. The question is, will you go under with the wave or will you ride the wave?
How Do You Do Volume Real Estate
1. Learn from someone who has perfected volume real estate. Someone who carries hundreds of listings at a time, not tens of listings or less.
2. Stay away from naysayers and others who don't want anyone to succeed, including themselves.
3. Understand that you can never service someone in real estate, you can only support them to make a decision that is best for them. You have no power.
4. Stop feeling worried for people who have gotten themselves into financial messes.
5. Stop feeling guilty for charging people too much money and charge less - the real fee that it costs you to do business. In other words, instead of clubbing 20 people to death for your annual revenue, just pinprick 2,000. You'll make more money and your clients will save more individually, allowing them to accept more offers, quicker.
6. Make yourself referable so that your clients can actually refer you to others.
7. Build processes that keep everyone on the same page including the clients.
8. Stop over servicing people to feel good about yourself.
9. Stop underestimating that people can't do things for themselves like fill their own flyer box.
10. Stop overcharging clients because you don't have enough clients - get more.
11. Stop over-promising clients and delivering less results than promised.
12. Stop over-promising clients and resent your over-promise.
13. Set boundaries for your personal life that you are willing to enforce and let those spread into your business life.
Recognize that real estate needs for sellers and buyers have changed and get on the band wagon of people who are making millions while you are making less than you imagined or feel you deserve. Don't just make enough to pay your bills, make real money.
The Art of Negotiating a Real Estate Contract
Well, this seems simple enough - don't lose your shirt. All kidding aside, most people don't know how to negotiate a contract, or at least one that they won't regret later. So, here are some guidelines to making a sound decision while making some money.
This article is for home sellers, but you homebuyers, just reverse the ideas here. These are very black and white suggestions so don't attempt to make them grey just because you want something today that you might not want next week.
Simple Steps to Winning or Let's Say Making a Win-Win
1. This is a business transaction. Keep your cool. How do you do that you might ask? Well, the first step is to remove yourself from the idea that you might be selling your home to someone that you don't like, that the neighbors don't like or someone that you said you would never sell your home to. Ignore all of those feelings and realize that you are selling your home. Period.
2. Leave all prejudices about certain people at the curb. Most buyers who are in your home CAN afford your home and with certain guidelines stipulated in the contract, you will soon find out if they will buy or not.
3. Look at all monetary concessions as just that, a concession. Figure your bottom net with the money that is offered. Don't forget that you will most likely have a negotiation period and that you might give up some more money after the inspection. Use your gut to figure out what that amount might be, or do a really smart thing and have your home inspected before you put it on the market so you know what to expect and so you can have any necessary repairs made prior to going under contract. When you make repairs prior to attracting a buyer, they can scheduled with the contractor of your choice, and not just who's available, and at a price pre-determined, not one set with you over the barrel of needing to close in 2 weeks.
4. Don't take the buyer's requests that are personal too seriously. This goes with step 3. For example, many times buyers request that the home be professionally cleaned. This does not mean that you or your wife that has stayed home and kept house weekly for the last 12 years is a bad housekeeper. Just figure the amount of money that it will take to bring in a cleaning crew and add it as a concession.
5. Really focus on your selling price and bridging the middle with the buyer instead of all the piddley stuff. So, for instance, if you are asking $250K and the buyer makes an offer at $230K and you can sell for $240K, figure the concessions and make an offer that will yield you $240K, but make sure that you list the concessions and at what price they are worth to you. An example may be if the buyer wants your refrigerator that you got last year. You paid $1800.00 for it then and figure that it is worth $1250.00 now. List that for the buyer to see so that they know where you are figuring that concession to be valued.
6. If the buyer really wants a closing date that will be inconvenient for you, consider moving that date with help, if they pay more of a sales price.
7. Home warranties help with negotiation of inspection items. Make sure that you know that this is an option and what it covers to ease the buyer's concerns. Most home warranties have a deductible of around $55.00 per occurrence. If you have a hot water heater for instance that is old, but still works, and the buyer is asking for a replacement, tell them that you will pay for the warranty and give them an additional $220.00 for 4 visits under the warranty.
8. Anything that you have to say to the buyer should be on a cover sheet with your counter offer and faxed with the offer and never left for your agent to translate. Speak to your buyer directly when you can.
9. Make the buyer feel good by offering to serve them lunch in advance during the inspection and tell them that you want to share with them all the important stuff about the neighborhood at that time and that you will also ask your neighbors on the right and left side to come over and introduce themselves at that time too.
10. Any qualification for a loan should be rushed and if the buyer is already approved, not pre-approved, you should consider taking less money for the house (just a little) and treat this buyer with kit-gloves. I know that this counteracts some of what I said in number 2, but you will understand when you are in the transaction.
11. Use very tight timeframes for both you and your buyer to respond so that your buyer does not cool off. You really have to focus during this time to push the contract through to binding. If your agent will agree, ask them to conference call you and the buyer's agent and possibly the buyer in at the same time to talk about any issues. That way there is no resentment on what might not have been said. This way your wishes are clearly conveyed to all parties. Again, nothing will get lost in the translation.
Remember that negotiating is fun and should not be stressful. If you are stressed, you are either judging the buyer, you are not looking at the transaction as a bottom line net or you are taking the special stipulations or requests too seriously.
This article is for home sellers, but you homebuyers, just reverse the ideas here. These are very black and white suggestions so don't attempt to make them grey just because you want something today that you might not want next week.
Simple Steps to Winning or Let's Say Making a Win-Win
1. This is a business transaction. Keep your cool. How do you do that you might ask? Well, the first step is to remove yourself from the idea that you might be selling your home to someone that you don't like, that the neighbors don't like or someone that you said you would never sell your home to. Ignore all of those feelings and realize that you are selling your home. Period.
2. Leave all prejudices about certain people at the curb. Most buyers who are in your home CAN afford your home and with certain guidelines stipulated in the contract, you will soon find out if they will buy or not.
3. Look at all monetary concessions as just that, a concession. Figure your bottom net with the money that is offered. Don't forget that you will most likely have a negotiation period and that you might give up some more money after the inspection. Use your gut to figure out what that amount might be, or do a really smart thing and have your home inspected before you put it on the market so you know what to expect and so you can have any necessary repairs made prior to going under contract. When you make repairs prior to attracting a buyer, they can scheduled with the contractor of your choice, and not just who's available, and at a price pre-determined, not one set with you over the barrel of needing to close in 2 weeks.
4. Don't take the buyer's requests that are personal too seriously. This goes with step 3. For example, many times buyers request that the home be professionally cleaned. This does not mean that you or your wife that has stayed home and kept house weekly for the last 12 years is a bad housekeeper. Just figure the amount of money that it will take to bring in a cleaning crew and add it as a concession.
5. Really focus on your selling price and bridging the middle with the buyer instead of all the piddley stuff. So, for instance, if you are asking $250K and the buyer makes an offer at $230K and you can sell for $240K, figure the concessions and make an offer that will yield you $240K, but make sure that you list the concessions and at what price they are worth to you. An example may be if the buyer wants your refrigerator that you got last year. You paid $1800.00 for it then and figure that it is worth $1250.00 now. List that for the buyer to see so that they know where you are figuring that concession to be valued.
6. If the buyer really wants a closing date that will be inconvenient for you, consider moving that date with help, if they pay more of a sales price.
7. Home warranties help with negotiation of inspection items. Make sure that you know that this is an option and what it covers to ease the buyer's concerns. Most home warranties have a deductible of around $55.00 per occurrence. If you have a hot water heater for instance that is old, but still works, and the buyer is asking for a replacement, tell them that you will pay for the warranty and give them an additional $220.00 for 4 visits under the warranty.
8. Anything that you have to say to the buyer should be on a cover sheet with your counter offer and faxed with the offer and never left for your agent to translate. Speak to your buyer directly when you can.
9. Make the buyer feel good by offering to serve them lunch in advance during the inspection and tell them that you want to share with them all the important stuff about the neighborhood at that time and that you will also ask your neighbors on the right and left side to come over and introduce themselves at that time too.
10. Any qualification for a loan should be rushed and if the buyer is already approved, not pre-approved, you should consider taking less money for the house (just a little) and treat this buyer with kit-gloves. I know that this counteracts some of what I said in number 2, but you will understand when you are in the transaction.
11. Use very tight timeframes for both you and your buyer to respond so that your buyer does not cool off. You really have to focus during this time to push the contract through to binding. If your agent will agree, ask them to conference call you and the buyer's agent and possibly the buyer in at the same time to talk about any issues. That way there is no resentment on what might not have been said. This way your wishes are clearly conveyed to all parties. Again, nothing will get lost in the translation.
Remember that negotiating is fun and should not be stressful. If you are stressed, you are either judging the buyer, you are not looking at the transaction as a bottom line net or you are taking the special stipulations or requests too seriously.
Real Estate Agent - What is It?
A real estate agent is a person that is used as an expert to facilitate the selling of real estate. In my opinion, a real estate agent should be open to new things, including innovative marketing ideas and cutting-edge changes that impact buyers and sellers. A real estate agent should be someone who listens to buyers, sellers and renters to figure out what the public hates about agents and proactively make changes in their own business plan accordingly. A real estate agent should have business hours that are applicable to other professionals that are paid thousands of dollars per transaction.
A real estate agent should practice their skills by using them everyday. A real estate agent should not be part-time in the business. This means they should not have a full-time job and sell real estate when they need some extra money. A real estate agent should be skilled at keeping their cool when something goes wrong. A real estate agent should be professional and never hang up on a client or another real estate agent, no matter what was said or done.
A real estate agent should be responsible to learn, understand and keep up with all marketing tools that could and probably should be employed in selling or buying a home. The fact that a real estate agent is "not comfortable with the Internet" when most homes are now sold via the viewing on the Internet by a buyer is no longer an excuse. A real estate agent should be diligent about understanding modes of communication and marketing via every type of media from which a buyer can search and ultimately buy a home.
A real estate agent should not have to turn on their fax machine when they return from the store. They should be in business, full-time, and be set up to do business anytime inside their business hours. A real estate agent should not leave town without backup and just leave a deal hanging as a result. No one cares that the real estate agent is on vacation other than the agent himself. A real estate agent should never tell a seller that open houses don't work, when in fact, open houses sell properties, everyday. A real estate agent should never be so in-the-box that they laugh at someone for discussing the use of a St. Joseph's statute. They shouldn't scoff at the fact that apple pie scent may or may not sell a house just because they don't want to go to the trouble to explain what may or may not work to the seller.
A real estate agent should not cry when a seller tells them that they no longer want to sell their home or that they are not going to use them to sell the home. A real estate agent should not steal yard signs from lawns or directional signs from subdivisions just because someone did not choose to list the house with them but a competitor. A real estate agent should not bash other business models. They should simply point out the things that they bring to the table and why they feel their business model works better.
A real estate agent should not open the house for a buyer and let them stay in there alone, just because the buyer looks nice. A real estate agent should always look at the identification of a buyer because they recognize that they are responsible for the seller's property. A real estate agent should always be grateful that someone is willing to pay them thousands of dollars for a job that has never been fully explained to the public as to how little knowledge an agent needs and how little you're trained when getting your license.
America is unfortunately the only place where all of these standards, or should I say the lack of standards, are applauded everyday as good and acceptable behavior. The public needs to be reminded that an overwhelming number of inexperienced, part-time real estate agents hold in their hands the fate of most people's largest asset. When will we put our foot down and say enough is enough... real estate is a real profession that requires skill, knowledge and a constant reach to perform strategies and results for clients.
A real estate agent should practice their skills by using them everyday. A real estate agent should not be part-time in the business. This means they should not have a full-time job and sell real estate when they need some extra money. A real estate agent should be skilled at keeping their cool when something goes wrong. A real estate agent should be professional and never hang up on a client or another real estate agent, no matter what was said or done.
A real estate agent should be responsible to learn, understand and keep up with all marketing tools that could and probably should be employed in selling or buying a home. The fact that a real estate agent is "not comfortable with the Internet" when most homes are now sold via the viewing on the Internet by a buyer is no longer an excuse. A real estate agent should be diligent about understanding modes of communication and marketing via every type of media from which a buyer can search and ultimately buy a home.
A real estate agent should not have to turn on their fax machine when they return from the store. They should be in business, full-time, and be set up to do business anytime inside their business hours. A real estate agent should not leave town without backup and just leave a deal hanging as a result. No one cares that the real estate agent is on vacation other than the agent himself. A real estate agent should never tell a seller that open houses don't work, when in fact, open houses sell properties, everyday. A real estate agent should never be so in-the-box that they laugh at someone for discussing the use of a St. Joseph's statute. They shouldn't scoff at the fact that apple pie scent may or may not sell a house just because they don't want to go to the trouble to explain what may or may not work to the seller.
A real estate agent should not cry when a seller tells them that they no longer want to sell their home or that they are not going to use them to sell the home. A real estate agent should not steal yard signs from lawns or directional signs from subdivisions just because someone did not choose to list the house with them but a competitor. A real estate agent should not bash other business models. They should simply point out the things that they bring to the table and why they feel their business model works better.
A real estate agent should not open the house for a buyer and let them stay in there alone, just because the buyer looks nice. A real estate agent should always look at the identification of a buyer because they recognize that they are responsible for the seller's property. A real estate agent should always be grateful that someone is willing to pay them thousands of dollars for a job that has never been fully explained to the public as to how little knowledge an agent needs and how little you're trained when getting your license.
America is unfortunately the only place where all of these standards, or should I say the lack of standards, are applauded everyday as good and acceptable behavior. The public needs to be reminded that an overwhelming number of inexperienced, part-time real estate agents hold in their hands the fate of most people's largest asset. When will we put our foot down and say enough is enough... real estate is a real profession that requires skill, knowledge and a constant reach to perform strategies and results for clients.
The Seven Secrets to Financial Empowerment
As you work to fulfill your dreams in the field of real estate investing I want you to embrace your future and do everything in your power to help ensure your success despite the challenges you'll face along the way. I've identified 7 financial keys that can unlock the door to success for you and others you may come in contact with along the way.
There are a lot of things you can do every day that can help determine whether you reach the pinnacle of success or remain in the valley of missed opportunity, but very few things will figure as prominently as your finances. Financial gurus got it right when they say that if you don't control your money it controls you! Here's how to regain control of your financial future one step at a time.
Control Your Spending - By taking control of your spending you can have a much bigger say in the types of deals you have available to you. This process starts with having - and sticking to - a realistic and attainable budget. I'm not suggesting you should sell your TV and hit your kids up for gas money in exchange for taking them to t-ball practice. What I am saying, however, is that if you're clear about exactly where your money goes you'll have more control over reducing unnecessary, frivolous expenses. Think before you say, "Charge it!" If you don't really need another John Tesh video - don't buy it! Sooner or later Blockbuster will have it for 49 cents.
Control Your Debt - In many ways this goes hand in hand with controlling your spending because for many investors (especially brand new ones with unrealistic expectations) their first inclination is to whip out a credit card for routine purchases. By keeping your balances low you free up additional funds for additional property purchases. Not only can credit cards charge hefty interest rates, they make it very easy to spend more than you otherwise might. Fast food restaurants don't take plastic because they're dedicated to superior customer service. They want to make it as easy as possible to Super Size - your waist line and their bottom line.
Control Your Saving - By getting into the habit of regularly setting money aside for a rainy day, you can systematically build a rainy day fund that you can tap into for unplanned expenses. By having 3-6 months of expenses in an interest earning money market account you have cash available in case of a short term need. If you have this cash you can take advantage of more property opportunities. Sometimes a seller will agree to your terms if you can meet their need for cash. If you have a few thousand dollars sitting in an account you can access it quickly and still get a lucrative deal while it's still available!
Control Your Habits - I don't want to offend anyone here, but it's very easy to have expensive habits that can reduce the pool of money you have when you need it. It could be $4-$5 cups of coffee, cigarettes, or other substances. Aside from the potential long term impact some habits can have on your health, they can also take money away from your investing activities. Take control of the kinds of things you spend your money on. You'll be surprised by how much extra cash you can come up with after just 30 days!
Control Your Giving - There's nothing more empowering and fulfilling than giving money away. You want to make a regular habit of giving to charities or organizations you believe in. But it is possible to go overboard by trying to help too much. There is a direct connection between giving and receiving - just make sure you really believe in the organizations you're giving your money to!
Control Your Time - This is one of the most difficult areas to control because time is a commodity that is in such short supply. It's very easy to waste countless hours in front of a television set or hunched over a computer surfing from one web site to another. By taking control of how and where you spend your time you can financially empower yourself by freeing up precious minutes - and hours - for more lucrative opportunities. A great way to save time is by outsourcing routine or mundane tasks to others. Not only will you close more deals, but you'll have more free time for your family and leisure activities you enjoy.
Control Your Thinking - You should get motivated and fired up every day! Instead of listening to negative people complain about high gas prices, inflation, or politics, tap into a good motivational book, CD, or seminar that will do something for you other than raise your blood pressure. Unless you're a member of OPEC or on the board of an oil company you can't control prices. However, by controlling your thinking and your thought processes you can build your own cartel of real estate investment properties!
These are just a few things you can do to financially empower yourself. Put these into practice today, perfect them - and make them your own! The secret to financial empowerment is really no secret at all. The secret lies in actually applying them in your life today and make tomorrow lucrative. Start now and live the life you've been dreaming about!
There are a lot of things you can do every day that can help determine whether you reach the pinnacle of success or remain in the valley of missed opportunity, but very few things will figure as prominently as your finances. Financial gurus got it right when they say that if you don't control your money it controls you! Here's how to regain control of your financial future one step at a time.
Control Your Spending - By taking control of your spending you can have a much bigger say in the types of deals you have available to you. This process starts with having - and sticking to - a realistic and attainable budget. I'm not suggesting you should sell your TV and hit your kids up for gas money in exchange for taking them to t-ball practice. What I am saying, however, is that if you're clear about exactly where your money goes you'll have more control over reducing unnecessary, frivolous expenses. Think before you say, "Charge it!" If you don't really need another John Tesh video - don't buy it! Sooner or later Blockbuster will have it for 49 cents.
Control Your Debt - In many ways this goes hand in hand with controlling your spending because for many investors (especially brand new ones with unrealistic expectations) their first inclination is to whip out a credit card for routine purchases. By keeping your balances low you free up additional funds for additional property purchases. Not only can credit cards charge hefty interest rates, they make it very easy to spend more than you otherwise might. Fast food restaurants don't take plastic because they're dedicated to superior customer service. They want to make it as easy as possible to Super Size - your waist line and their bottom line.
Control Your Saving - By getting into the habit of regularly setting money aside for a rainy day, you can systematically build a rainy day fund that you can tap into for unplanned expenses. By having 3-6 months of expenses in an interest earning money market account you have cash available in case of a short term need. If you have this cash you can take advantage of more property opportunities. Sometimes a seller will agree to your terms if you can meet their need for cash. If you have a few thousand dollars sitting in an account you can access it quickly and still get a lucrative deal while it's still available!
Control Your Habits - I don't want to offend anyone here, but it's very easy to have expensive habits that can reduce the pool of money you have when you need it. It could be $4-$5 cups of coffee, cigarettes, or other substances. Aside from the potential long term impact some habits can have on your health, they can also take money away from your investing activities. Take control of the kinds of things you spend your money on. You'll be surprised by how much extra cash you can come up with after just 30 days!
Control Your Giving - There's nothing more empowering and fulfilling than giving money away. You want to make a regular habit of giving to charities or organizations you believe in. But it is possible to go overboard by trying to help too much. There is a direct connection between giving and receiving - just make sure you really believe in the organizations you're giving your money to!
Control Your Time - This is one of the most difficult areas to control because time is a commodity that is in such short supply. It's very easy to waste countless hours in front of a television set or hunched over a computer surfing from one web site to another. By taking control of how and where you spend your time you can financially empower yourself by freeing up precious minutes - and hours - for more lucrative opportunities. A great way to save time is by outsourcing routine or mundane tasks to others. Not only will you close more deals, but you'll have more free time for your family and leisure activities you enjoy.
Control Your Thinking - You should get motivated and fired up every day! Instead of listening to negative people complain about high gas prices, inflation, or politics, tap into a good motivational book, CD, or seminar that will do something for you other than raise your blood pressure. Unless you're a member of OPEC or on the board of an oil company you can't control prices. However, by controlling your thinking and your thought processes you can build your own cartel of real estate investment properties!
These are just a few things you can do to financially empower yourself. Put these into practice today, perfect them - and make them your own! The secret to financial empowerment is really no secret at all. The secret lies in actually applying them in your life today and make tomorrow lucrative. Start now and live the life you've been dreaming about!
Everything You Want to Know About Real Estate Wholesaler Fees
I've been getting quite a few questions about how wholesaler fees work, how much they are, whether I need to be licensed or not and so on. So, I figured I would take some time to address these questions formally in an article.
What is a real estate wholesaler fee?
The fee a wholesaler earns is the difference between the price you, as the wholesaler, put the house under contract for, and the price you sell it for to your end buyer (whether that is an investor or a retail buyer). So, if you put a house under contract for $100,000 and sell it to another investor for $110,000, the wholesale fee is $10,000.
Do I need a real estate license to earn these fees?
If you are putting the house under contract yourself and then selling your rights to the contract, then it is my understanding that you do not need a real estate license. I am not a lawyer though, but that is how I understand it.
Do I earn a commission on the sale?
No. Commissions are for licensed real estate agents or brokers. You earn the difference between what you put the house under contract to buy it for and what you ultimately assign the contract for.
If I am part of your wholesaler program, do you get part of the wholesale fee?
Not automatically, no. You can use the articles, tools, and courses that we have on the Wholesaler Control Panel (part of the Wholesaler Network program) to learn how to wholesale and not pay us anything. So, you can wholesale the deal completely on your own and not pay us a thing.
This is optional: If you want us to send the deal out to our list of investor buyers, you must agree to pay 3% of the total sales price (not to be confused with the wholesale fee you collect - these are very different) to an agent that brings the buyer. Whenever someone inquires about a deal submitted by a wholesaler from the website, we send that buyer with a licensed real estate agent representing them to buy the property. The 3% commission goes to that agent. In case you are wondering, we are usually, but not always, paid part of the agent's commission.
This is also optional: If you want us to participate in the deal and help you via the telephone, then we do offer that on a 50/50 split of the gross wholesale fee. This is primarily for new wholesalers that want someone to walk them through their first deal (or two or three). It is not required in any way, but if you need someone to walk you through the process, we do offer this as an option. We will NOT do it for you; this is for you to learn how to do it and we then split the fee. I can do these types of deals on my own and earn 100% of the wholesale fee so there is no incentive for me to do it all for you.
How do I collect my wholesale fee?
There are several variations, but you can collect it directly from your buyer or, more commonly, collect it from the title company at closing.
What is a real estate wholesaler fee?
The fee a wholesaler earns is the difference between the price you, as the wholesaler, put the house under contract for, and the price you sell it for to your end buyer (whether that is an investor or a retail buyer). So, if you put a house under contract for $100,000 and sell it to another investor for $110,000, the wholesale fee is $10,000.
Do I need a real estate license to earn these fees?
If you are putting the house under contract yourself and then selling your rights to the contract, then it is my understanding that you do not need a real estate license. I am not a lawyer though, but that is how I understand it.
Do I earn a commission on the sale?
No. Commissions are for licensed real estate agents or brokers. You earn the difference between what you put the house under contract to buy it for and what you ultimately assign the contract for.
If I am part of your wholesaler program, do you get part of the wholesale fee?
Not automatically, no. You can use the articles, tools, and courses that we have on the Wholesaler Control Panel (part of the Wholesaler Network program) to learn how to wholesale and not pay us anything. So, you can wholesale the deal completely on your own and not pay us a thing.
This is optional: If you want us to send the deal out to our list of investor buyers, you must agree to pay 3% of the total sales price (not to be confused with the wholesale fee you collect - these are very different) to an agent that brings the buyer. Whenever someone inquires about a deal submitted by a wholesaler from the website, we send that buyer with a licensed real estate agent representing them to buy the property. The 3% commission goes to that agent. In case you are wondering, we are usually, but not always, paid part of the agent's commission.
This is also optional: If you want us to participate in the deal and help you via the telephone, then we do offer that on a 50/50 split of the gross wholesale fee. This is primarily for new wholesalers that want someone to walk them through their first deal (or two or three). It is not required in any way, but if you need someone to walk you through the process, we do offer this as an option. We will NOT do it for you; this is for you to learn how to do it and we then split the fee. I can do these types of deals on my own and earn 100% of the wholesale fee so there is no incentive for me to do it all for you.
How do I collect my wholesale fee?
There are several variations, but you can collect it directly from your buyer or, more commonly, collect it from the title company at closing.
Property Sales - It's Not a Boom Anymore, But Why the Doom & Gloom?
Most of the western world, if not the entire first world, seems to be reporting that property market price inflation is decreasing or stalled. In the worst-hit areas we even hear tales of a lowering of house prices and negative equity for some unfortunate new homeowners who jumped on to the property bandwagon at the peak of the recent property boom. High Street inflation never lets up, so it's natural for property investors large and small to feel that the end of the world is nigh.
This state of mind is undoubtedly an over-reaction. The human psyche drives modern man to ensure he has a place he can call home in the shortest possible time after leaving his childhood days behind in the former family house. Fair enough - but does this man of our times actually have to own his home outright, in theory at best? And more tellingly, does this man have a god-given right to expect that with home ownership comes enough lifetime's wealth to be able to retire from working for an income at his chosen time? The latter scenario is a common desire, and it is based upon the premise that property values will always rise faster than other commodities.
We are now finding that we have come to the end of a period where property value inflation was outstripping general living cost rises. But we should not be surprised because we have had these ups and downs before. The general trend though is that property prices commonly rise again fairly rapidly after periods of stagnation. It's all about supply and demand.
The demand for new homes or at least of people looking to move house will never cease. Why? Because many old homes become dilapidated for a start. Then we have the new young families who need their own space and cannot expand into the limited space of parental homes. On top of that, the modern world economy relies upon many workers who must be mobile throughout most of their working lives, thereby prompting housing development and property transactions countrywide and often internationally. And don't forget those that choose to upgrade or downsize by choice due to family or personal needs.
What about the supply side? The builders can't build fast enough in boom times because handsome returns on their property investments are almost guaranteed. If land banks are purchased just prior to a stalling of property prices, then naturally there is no rush to build and sell at reduced profit margins. So any oversupply rate reduces until it balances demand. This is the period being experienced in many parts of the US and Europe at present.
As soon as a local property market detects increased demand, sellers start hiking up prices and builders and developers start building. So the conclusion is "don't panic" and take some time to reflect on why existing homeowners feel uneasy every time this cycle reaches its low point.
Property is a reasonably sound investment, and it gives the buyer the obvious immediate attraction of having somewhere to live (or work in the case of commercial premises). However there are other ways to exist comfortably which don't involve organizing your life around the demands of meeting hefty monthly mortgage repayments and fretting about why the value of your property doesn't always rise at a consistent rate.
Many young people are opting to rent property. The so-called home-owning critics immediately shout that house rent is "dead money". To a degree, yes, but if renting frees up income to invest in markets which don't fluctuate in boom & bust cycles, then isn't the oft-struggling homeowner something of a hypocrite? And who actually owns the majority of private domestic homes anyway? If a homeowner misses a mortgage payment you soon find out that the big financial institutions cold-heartedly treat lenders as no better than tenants of real estate upon which their businesses are founded. And furthermore, as tenants with much less rights than conventional renters of property who have fair and equitable rental agreements to rely upon in times of hardship.
It's interesting to note that in previous generations the majority of house dwellers were tenants, particularly in towns and cities. Most homeowners can probably quote that their parents or grandparents lived in rented accommodation, and that is a reason why they strive to ensure that they and their dependents have the security of home ownership. What security, if you worry about why your investment and lifestyle is not always as good as you dreamed? Our ancestors survived, without the disposable income levels of today, so perhaps the property rental option should not be dismissed so readily.
Maybe the biggest lesson to be learned by property investors when global economy growth recedes is that only a few property types are guaranteed to grow in value (in the longer term) at a rate generally in excess of other inflationary factors. These are the well-maintained properties in desirable locations whether they be urban or rural. Funnily enough, my experience tells me that these properties are likely to fall into the cheaper price category or the other extreme, the high-end luxury home. The middle range property, by its very nature, forms the bulk of property sale listings, so the seller struggles to promote his property above the multitudes of similar priced homes or sites.
I suppose it can be summed up as follows:
• First-time buyers, transient workers, students and 2nd home buyers will always provide a ready market for low-end "affordable" property, particularly in urban settings.
• High earners will always want to upgrade to luxury properties in secure and private surroundings, particularly in established districts of like-minded people.
• The rest of us, by far the majority, continue to buy or rent in the mid-price range through necessity of location or finance limitations and a natural desire to match or slightly better our neighbors' lifestyles.
The exclusive luxury homes and the lower-end smaller properties are instantly brought to the fore from hundreds of listings by easy-to-use search functions which detect price range and/or location. The more attractive middle range properties also benefit in that household features and property type listings enable the website browser to easily compare the best value for money of numerous properties in a chosen location.
In Ireland, I can report that Property Agents say that Property Portals have contributed greatly to stability in the mid-price range domestic property market. Sale closures in this category, for sensibly priced houses, are regular and commonplace, thereby propping up the market in general. This contradicts the doom & gloom reported in the media, no doubt created by "worried" homeowners who aren't even active in the buying and selling of property. The lazy expectation that easy money can be made simply by buying and living in a home for life smacks of greed, not reality. These merchants of doom should be ignored. We also read in the press about the owners of expensive houses for sale having to dramatically slash prices to arouse interest. Probably, not maybe, the asking price was unrealistic and based upon outdated market value. The eventual selling price of a luxury home will still have made the purchase a sound investment if it was bought at any time except the very peak of the recent boom. Again, I can report in Ireland that Agents say that there is still a waiting list for desirable upmarket properties. The best of these homes are sold via website mailing lists or by the uploading of the property brochure to Propertysteps.ie and similar internet property portals.
For a fraction of the cost of press advertising, our best value for money website gets quick results. Often you never even see a For Sale sign being erected for property in the more exclusive address category, yet new occupiers appear and everyone involved in the transaction is delighted. You don't read about these everyday success stories in the media; it appears to me that only boom, doom or gloom stories sell newspapers when the local economy is discussed.
This state of mind is undoubtedly an over-reaction. The human psyche drives modern man to ensure he has a place he can call home in the shortest possible time after leaving his childhood days behind in the former family house. Fair enough - but does this man of our times actually have to own his home outright, in theory at best? And more tellingly, does this man have a god-given right to expect that with home ownership comes enough lifetime's wealth to be able to retire from working for an income at his chosen time? The latter scenario is a common desire, and it is based upon the premise that property values will always rise faster than other commodities.
We are now finding that we have come to the end of a period where property value inflation was outstripping general living cost rises. But we should not be surprised because we have had these ups and downs before. The general trend though is that property prices commonly rise again fairly rapidly after periods of stagnation. It's all about supply and demand.
The demand for new homes or at least of people looking to move house will never cease. Why? Because many old homes become dilapidated for a start. Then we have the new young families who need their own space and cannot expand into the limited space of parental homes. On top of that, the modern world economy relies upon many workers who must be mobile throughout most of their working lives, thereby prompting housing development and property transactions countrywide and often internationally. And don't forget those that choose to upgrade or downsize by choice due to family or personal needs.
What about the supply side? The builders can't build fast enough in boom times because handsome returns on their property investments are almost guaranteed. If land banks are purchased just prior to a stalling of property prices, then naturally there is no rush to build and sell at reduced profit margins. So any oversupply rate reduces until it balances demand. This is the period being experienced in many parts of the US and Europe at present.
As soon as a local property market detects increased demand, sellers start hiking up prices and builders and developers start building. So the conclusion is "don't panic" and take some time to reflect on why existing homeowners feel uneasy every time this cycle reaches its low point.
Property is a reasonably sound investment, and it gives the buyer the obvious immediate attraction of having somewhere to live (or work in the case of commercial premises). However there are other ways to exist comfortably which don't involve organizing your life around the demands of meeting hefty monthly mortgage repayments and fretting about why the value of your property doesn't always rise at a consistent rate.
Many young people are opting to rent property. The so-called home-owning critics immediately shout that house rent is "dead money". To a degree, yes, but if renting frees up income to invest in markets which don't fluctuate in boom & bust cycles, then isn't the oft-struggling homeowner something of a hypocrite? And who actually owns the majority of private domestic homes anyway? If a homeowner misses a mortgage payment you soon find out that the big financial institutions cold-heartedly treat lenders as no better than tenants of real estate upon which their businesses are founded. And furthermore, as tenants with much less rights than conventional renters of property who have fair and equitable rental agreements to rely upon in times of hardship.
It's interesting to note that in previous generations the majority of house dwellers were tenants, particularly in towns and cities. Most homeowners can probably quote that their parents or grandparents lived in rented accommodation, and that is a reason why they strive to ensure that they and their dependents have the security of home ownership. What security, if you worry about why your investment and lifestyle is not always as good as you dreamed? Our ancestors survived, without the disposable income levels of today, so perhaps the property rental option should not be dismissed so readily.
Maybe the biggest lesson to be learned by property investors when global economy growth recedes is that only a few property types are guaranteed to grow in value (in the longer term) at a rate generally in excess of other inflationary factors. These are the well-maintained properties in desirable locations whether they be urban or rural. Funnily enough, my experience tells me that these properties are likely to fall into the cheaper price category or the other extreme, the high-end luxury home. The middle range property, by its very nature, forms the bulk of property sale listings, so the seller struggles to promote his property above the multitudes of similar priced homes or sites.
I suppose it can be summed up as follows:
• First-time buyers, transient workers, students and 2nd home buyers will always provide a ready market for low-end "affordable" property, particularly in urban settings.
• High earners will always want to upgrade to luxury properties in secure and private surroundings, particularly in established districts of like-minded people.
• The rest of us, by far the majority, continue to buy or rent in the mid-price range through necessity of location or finance limitations and a natural desire to match or slightly better our neighbors' lifestyles.
The exclusive luxury homes and the lower-end smaller properties are instantly brought to the fore from hundreds of listings by easy-to-use search functions which detect price range and/or location. The more attractive middle range properties also benefit in that household features and property type listings enable the website browser to easily compare the best value for money of numerous properties in a chosen location.
In Ireland, I can report that Property Agents say that Property Portals have contributed greatly to stability in the mid-price range domestic property market. Sale closures in this category, for sensibly priced houses, are regular and commonplace, thereby propping up the market in general. This contradicts the doom & gloom reported in the media, no doubt created by "worried" homeowners who aren't even active in the buying and selling of property. The lazy expectation that easy money can be made simply by buying and living in a home for life smacks of greed, not reality. These merchants of doom should be ignored. We also read in the press about the owners of expensive houses for sale having to dramatically slash prices to arouse interest. Probably, not maybe, the asking price was unrealistic and based upon outdated market value. The eventual selling price of a luxury home will still have made the purchase a sound investment if it was bought at any time except the very peak of the recent boom. Again, I can report in Ireland that Agents say that there is still a waiting list for desirable upmarket properties. The best of these homes are sold via website mailing lists or by the uploading of the property brochure to Propertysteps.ie and similar internet property portals.
For a fraction of the cost of press advertising, our best value for money website gets quick results. Often you never even see a For Sale sign being erected for property in the more exclusive address category, yet new occupiers appear and everyone involved in the transaction is delighted. You don't read about these everyday success stories in the media; it appears to me that only boom, doom or gloom stories sell newspapers when the local economy is discussed.
How to Be a Successful Real Estate Agent
While it's true that the real estate market isn't in the best shape right now, a successful real estate agent can still earn a handsome income buying and selling property. True, certain real estate markets are in a slump right now, but prime land and properties are always in demand. Here are a few success secrets to maximize business in real estate.
Get to know the market. Right now it's a buyer's market, which means that sellers are having to unload their properties at prices that are under traditional market value. To be a successful real estate agent in a buyer's market you have to act quickly when an opportunity arises to grab a piece of prime real estate. The key to maximizing your profits in any business is to buy low and sell high. And with real estate prices being especially low right now, it's a perfect time to make those deals that will pay off once the market rebounds, which it always does.
Pay attention. When the real estate market is slow, as it is right now, many outstanding properties sit on the market because people are afraid to buy. Take a look around and see which properties may have been on the market for a long time. Usually, the seller is tired of waiting, and will be more open to any reasonable offer. Being a successful real estate agent means seeing opportunities where others don't. But you can't find these opportunities if you're not out looking for them.
Look for fixer-upper opportunities. Traditionally, properties that require a lot of work don't sell well simply because most buyers prefer to have a home that's ready to move right into. It's the same reason most people don't buy cars that don't run right. However, there are some amazing deals to be made for someone who can buy a property that needs work at a low price, put a few bucks into it and then turn it around for huge profits. If you've ever seen the hit show Flip This House then you know that there's money to be made doing this. Just be careful; you won't make money trying to flip a home in a run-down neighborhood - in fact, you'll probably lose your shirt. If you take a look around there are plenty of properties in well-to-do neighborhoods that need more work than most buyers are willing to put in. Target these and you'll reap the rewards.
There are many more success secrets to maximize business in real estate that can be explored. Simply put: The reason that so many people choose real estate to build wealth is because property is always in demand. It's a market that will fluctuate like any other, but will never go away.
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