Chapter 1: A Career In Real Estate

Market Opportunities

 

Residential Resale 

Involve work with consumers and their changing needs and wants. Typical clients are selling the family home due to employment, monetary or family changes. Typical buyers relocating due to the same motivating factors as sellers. Be ready for irregular hours.

New Homes

This work involves listing functions or offers presentation, qualifying the buyers and closing the sale. Showing may consist furnishing info, demonstrating diagrams and plans.

Condominium 

A system of land ownership, where each individual holds title to a specific unit as well as owning a share of common property.

Commercial

• Industrial Real Estate: sale or lease of warehousing and manufacturing space. General purpose, special purpose, single purpose.
• Retail/Office: sale or leasing of all forms of retail or office facilities. Sales of business, with or without ownership of land.
• Investment: sale of industrial, office or residential income-producing real estate to investors - domestic or overseas.

Appraisal 

Requires detail knowledge of techniques and procedures to be applied in estimates of value for different property types.

Property Managment 

• Keeping the property leased
• Collecting income
• Paying the property expenses
• Maintaining soundness of property

Mortgage Financing

 

Choosing a Brokerage 

 

Franchise vs. Independent

Market presence within particular market segment, specific training tools as a benefit, public awareness

Full Service vs. Limited Service

Full service provides all services to the buyer and seller from start to finish. Limited - provide specific service with the limited commission or a flat rate.

Listing vs. Selling

Organized Real Estate vs. Non-Organazed

 

CREA (The Canadian Real Estate Association)

National and international representation. "To present and promote the interests of the members, enhance members' professionalism and ability to succeed, and advocate policies that ensure real estate property rights and ownership"

 

Understanding the Listing/Selling Process 

Listing 

The listing agreement is between the seller and the real estate brokerage, authorizing the brokerage to act as a seller's agent in offering the property for sale. broker or salesperson act on behalf of the brokerage.

Prospecting 

Involves search for qualified buyers for the listed property. "The property will qualify the buyer".

Qualifying and Showing

Qualifying involves determining the buyer's needs and wants. Typically - selecting a limited number of properties to be shown. the process of showing and providing accurate and complete info follows.

Offer Preparation 

In preparing an offer, the salesperson accepts a very serious responsibility to ensure that the document contains all terms and conditions required by the buyer and that the elements necessary to create a binding agreement, according to the common law of contract, are present.

Offer Presentation

Involves analysis of the document and discussion of such matters as market conditions and circumstances that the seller should take into consideration. The seller may accept, reject or counter the offer.

Follow Up

The brokerage and representative must follow through after the sale. If any changes - ex. agreement have 1 or more conditions that must be satisfied.

 

Sales Person Remuneration

Typically involves commission as a % of the sale or a flat fee.

• Commission sharing - if the salesperson lists and sells the property, the commission is paid to the brokerage and splits with a salesperson. Also, it can be allocated between listing and selling salespersons or brokerages.

Ex. 1

ABC listing and selling brokerage ($5000 commission received) - $2500 listing portion and $2500 selling portion - $1250 go to the listing salesperson and $1250 go to brokerage (50/50). $1750 go to selling salesperson and $750 tp brokerage (70/30).

Ex 2.

ABC listing brokerage ($5000 received) - $2500 distributed to XYZ selling brokerage. $2500 listing portion (60/40) and $2500 selling portion (90/10).