One of the most complex and significant financial events in peoples' lives is the purchase or sale of a home or investment property. Because of this complexity and significance, people typically seek the help of real estate brokers and sales agents when buying or selling real estate.
Real estate brokers and sales agents have a thorough knowledge of the real estate market in their communities. They know which neighborhoods will best fit clients' needs and budgets. They are familiar with local zoning and tax laws and know where to obtain financing. Agents and brokers also act as intermediaries in price negotiations between buyers and sellers.
When selling property, brokers and agents arrange for title searches to verify ownership and for meetings between buyers and sellers during which they agree to the details of the transactions and in a final meeting, the new owners take possession of the property. They also may help to arrange favorable financing from a lender for the prospective buyer; often, this makes the difference between success and failure in closing a sale. In some cases, brokers and agents assume primary responsibility for closing sales; in others, lawyers or lenders do.
Agents and brokers spend a significant amount of time looking for properties to sell. They obtain listings—agreements by owners to place properties for sale with the firm. When listing a property for sale, agents and brokers compare the listed property with similar properties that recently sold, in order to determine a competitive market price for the property. Following the sale of the property, both the agent who sold it and the agent who obtained the listing receive a portion of the commission. Thus, agents who sell a property that they themselves have listed can increase their commission.
Before showing residential properties to potential buyers, agents meet with them to get an idea of the type of home the buyers would like. In this prequalifying phase, the agent determines how much the buyers can afford to spend. In addition, the agent and the buyer usually sign a loyalty contract, which states that the agent will be the only one to show houses to the buyer. An agent or broker then generates lists of properties for sale, their location and description, and available sources of financing. In some cases, agents and brokers use computers to give buyers a virtual tour of properties that interest them.
Agents may meet several times with prospective buyers to discuss and visit available properties. Agents identify and emphasize the most pertinent selling points. To a young family looking for a house, for example, they may emphasize the convenient floor plan, the area's low crime rate, and the proximity to schools and shopping. To a potential investor, they may point out the tax advantages of owning a rental property and the ease of finding a renter. If bargaining over price becomes necessary, agents must follow their client's instructions carefully and may have to present counteroffers to get the best possible price.
Once the buyer and seller have signed a contract, the real estate broker or agent must make sure that all special terms of the contract are met before the closing date. The agent must make sure that any legally mandated or agreed-upon inspections, such as termite and radon inspections, take place. In addition, if the seller agrees to any repairs, the broker or agent ensures they are made. Increasingly, brokers and agents are handling environmental problems as well, by making sure that the properties they sell meet environmental regulations. For example, they may be responsible for dealing with lead paint on the walls. Loan officers, attorneys, or other people handle many details, but the agent must ensure that they are carried out.
Most real estate brokers and sales agents sell residential property. A small number—usually employed in large or specialized firms—sell commercial, industrial, agricultural, or other types of real estate. Every specialty requires knowledge of that particular type of property and clientele. Selling or leasing business property requires an understanding of leasing practices, business trends, and the location of the property. Agents who sell or lease industrial properties must know about the region's transportation, utilities, and labor supply. Whatever the type of property, the agent or broker must know how to meet the client's particular requirements.
Brokers and agents do the same type of work, but brokers are licensed to manage their own real estate businesses. Agents must work with a broker. They usually provide their services to a licensed real estate broker on a contract basis. In return, the broker pays the agent a portion of the commission earned from the agent's sale of the property. Brokers, as independent businesspeople, often sell real estate owned by others; they also may rent or manage properties for a fee.
Work environment. Advances in telecommunications and the ability to retrieve data about properties over the Internet allow many real estate brokers and sales agents to work out of their homes instead of real estate offices. Even with this convenience, workers spend much of their time away from their desks—showing properties to customers, analyzing properties for sale, meeting with prospective clients, or researching the real estate market.
Agents and brokers often work more than a standard 40-hour week. They usually work evenings and weekends and are usually on call to respond to the needs of clients. Although the hours are long and frequently irregular, most agents and brokers have the freedom to determine their own schedule. They can arrange their work so that they have time off when they want it. Business usually is slower during the winter season.
| 1. | Present purchase offers to sellers for consideration. |
| 2. | Confer with escrow companies, lenders, home inspectors, and pest control operators to ensure that terms and conditions of purchase agreements are met before closing dates. |
| 3. | Interview clients to determine what kinds of properties they are seeking. |
| 4. | Prepare documents such as representation contracts, purchase agreements, closing statements, deeds and leases. |
| 5. | Coordinate property closings, overseeing signing of documents and disbursement of funds. |
| 6. | Act as an intermediary in negotiations between buyers and sellers, generally representing one or the other. |
| 7. | Promote sales of properties through advertisements, open houses, and participation in multiple listing services. |
| 8. | Compare a property with similar properties that have recently sold to determine its competitive market price. |
| 9. | Coordinate appointments to show homes to prospective buyers. |
| 10. | Generate lists of properties that are compatible with buyers' needs and financial resources. |
| 11. | Display commercial, industrial, agricultural, and residential properties to clients and explain their features. |
| 12. | Arrange for title searches to determine whether clients have clear property titles. |
| 13. | Review plans for new construction with clients, enumerating and recommending available options and features. |
| 14. | Answer clients' questions regarding construction work, financing, maintenance, repairs, and appraisals. |
| 15. | Inspect condition of premises, and arrange for necessary maintenance or notify owners of maintenance needs. |
| 16. | Accompany buyers during visits to and inspections of property, advising them on the suitability and value of the homes they are visiting. |
| 17. | Advise sellers on how to make homes more appealing to potential buyers. |
| 18. | Arrange meetings between buyers and sellers when details of transactions need to be negotiated. |
| 19. | Advise clients on market conditions, prices, mortgages, legal requirements and related matters. |
| 20. | Evaluate mortgage options to help clients obtain financing at the best prevailing rates and terms. |
| 21. | Review property listings, trade journals, and relevant literature, and attend conventions, seminars, and staff and association meetings to remain knowledgeable about real estate markets. |
| 22. | Investigate clients' financial and credit status to determine eligibility for financing. |
| 23. | Contact property owners and advertise services to solicit property sales listings. |
| 24. | Develop networks of attorneys, mortgage lenders, and contractors to whom clients may be referred. |
| 25. | Visit properties to assess them before showing them to clients. |
| 26. | Contact utility companies for service hookups to clients' property. |
| 27. | Conduct seminars and training sessions for sales agents to improve sales techniques. |
| 28. | Appraise properties to determine loan values. |
| 29. | Solicit and compile listings of available rental properties. |
| 30. | Secure construction or purchase financing with own firm or mortgage company. |
| 31. | Rent or lease properties on behalf of clients. |
| 32. | Locate and appraise undeveloped areas for building sites, based on evaluations of area market conditions. |
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