Real Estate Broker
Can a real estate
agent really help me in buying and selling commercial property?
The answer is
When you're ready to think about buying or selling your property, you need
to ask yourself the following questions: Do you have the time, energy, sources
of information, and contacts to do the job yourself? If you were one of the
'do-it-yourself' people, would the results be as good or better than they
would be if you had professional assistance? Would it have gone smoother?
Would it have given you more personal time? Would you have purchased for
less, or sold for more, if a real estate agent was involved? Read the following
information and learn how a real estate agent can help you understand everything
you need to know about a real estate transaction.
The Buying Process
The process of buying
commercial real estate generally starts with determining your buying power;
that is, your financial reserves plus your borrowing capacity. If you give
a commercial real estate agent some basic information about your available
funds, income and current debt, they can refer you to lenders best qualified
to help you. Most lenders -- banks and mortgage companies -- offer limited
Once you know how
much you can and want to invest, the next step is to find the properties
that most nearly fit your needs. This is the time to choose a real estate
licensee. When picking a real estate agent look for one who is also a
Commercial Realtor®. A Commercial Realtor®
is a member of the National Association Of Realtors®, a real estate trade
association, and all members agree to abide by a 17 article Code of Ethics.
A Commercial Realtor® has many resources to assist you in that search.
Sometimes the property you are seeking is available but not actively advertised
in the market, and it will take some investigation by your agent to find
all available properties.
Your job is to make
the final selection of the right commercial property for you. Your real estate
agent can assist you in the selection process by providing objective information
about each property. Agents who are Commercial Realtors® have access
to a variety of informational resources. Commercial Realtors® can provide
local community information on utilities, zoning. values, etc.
There are a myriad
of negotiating factors, including, but not limited to price, financing, terms,
date of possession, and often the inclusion or exclusion of repairs and
furnishings or equipment. The purchase agreement should also provide a period
of time for you to complete appropriate inspections and investigations of
the commercial property before you are bound to complete the purchase. Your
agent can advise you as to which investigations and inspections are recommended
With a negotiated
agreement in hand, it is time to complete the evaluation of the commercial
property. Depending on the area and property, this could include inspections
for termites, dry rot, asbestos, faulty structure, roof condition, septic
tank and well tests, just to name a few. Your agent can assist you in finding
qualified responsible professionals to do most of these investigations and
provide you with written reports. You will also want to see a preliminary
report on the title of the property. Title indicates ownership of property
and can be mired in confusing status of past owners or rights of access.
The title to most properties will have some limitations; for example, easements
(access rights) for utilities. Your agent, title company or attorney can
help you resolve issues that might cause problems at a later date.
As soon as you are
reasonably sure the property is right for you, the process of obtaining financing
begins. Your agent can help you in understanding different financing options
and in identifying qualified lenders.
Closing or Settlement
Finally, there is
the closing, or settlement, as it is known in different parts of the country.
Every area has its own unique customs. In some areas, the title or escrow
company will handle this process. In other parts of the country, an attorney
does it all. Again, your real estate agent can guide you through this process
and make sure everything flows together smoothly.
Selling Real Estate
This process generally
begins with a determination of a reasonable asking price. Your real estate
agent can give you up-to-date information on what is happening in the marketplace
and the price, financing, terms, and condition of competing properties. These
are key factors in getting your property sold at the best price, quickly
and with minimum hassle.
The next step is a
marketing plan. Often, your agent can recommend repairs or cosmetic work
that will significantly enhance the salability of the property. Marketing
includes the exposure of your property to other real estate agents and the
public. In many markets across the country, over 50% of real estate sales
are cooperative sales; that is, a real estate agent other than yours brings
in the buyer. Your agent acts as the marketing coordinator, disbursing
information about your property to other real estate agents through a Multiple
Listing Service or other cooperative marketing networks, open houses for
agents, etc. The Realtor® Code of Ethics requires Realtors® to utilize
these cooperative relationships when they benefit their clients.
Advertising is part of marketing. The choice of media and frequency of
advertising depends a lot on the property and specific market. For example,
in some areas, newspaper advertising generates phone calls to the real estate
office but statistically has minimum effectiveness in selling a specific
property. Overexposure of a property in any media may give a buyer the impression
the property is distressed or the seller is desperate. Your real estate agent
will know when, where and how to advertise your property.
The negotiation process
deals with much the same issues for both buyers and sellers, as noted above
under the buying process. Your agent can help you objectively evaluate every
buyer's proposal without compromising your marketing position. This initial
agreement is only the beginning of a process of appraisals, inspections,
and financing -- a lot of possible pitfalls. Your agent can help you write
a legally binding, win-win agreement that will be more likely to make it
through the process.
Monitoring, Renegotiating and Closing
Between the initial
sales agreement and closing (or settlement), questions may arise. For example,
unexpected repairs are required to obtain financing or a cloud in the title
is discovered. The required paperwork alone is overwhelming for most sellers.
Your agent is the best person to objectively help you resolve these issues
and move the transaction to closing (or settlement).
How Do Real Estate Agents Get Paid?
Real estate agents
or brokers are generally paid through the sales commission paid by the seller
when a transaction closes. Agents have expenses and financial obligations
just like you, so it will be to your mutual benefit if you choose a real
estate agent and stick with that person. The agent will respect your loyalty
and respond with a sincere commitment to you.
Why A Realtor®?
All real estate licensees
are not the same. Only real estate licensees who are members of the National
Association of RRealtors® are properly called Realtors®. They proudly
display the "Realtor®" logo on the business card or other marketing and
sales literature. Realtors® are committed to treat all parties to a
transaction honestly. Realtors® subscribe to a strict code of ethics
and are expected to maintain a higher level of knowledge of the process of
buying and selling real estate. An independent survey reports that 84% of
buyers would use the same RealtorR® again.
National Association Of Realtors®
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