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Posts Tagged ‘real estate agent’

Real estate is indeed one of the safest investments and a lot of people use real estate as an choice avenue. Real estate law is not the forte of real estate law firms and real estate agents only.

Every single real estate investor should understand at the very least the basics of real estate legislation. In fact, a short course or possibly a concise book on real estate legislations can sometimes be of great enable (and is generally sufficient for understanding the basics of real estate law). What you need to understand is the real estate legal requirements with respect to the legal treatments that you need to follow intended for ensuring a smooth transfer of identify to the property you acquire/sell and other related procedures.

You must know the fee structure (e.g. stamp tax, etc) that you need to deal with as per real estate law.

So, your study in real estate law should also cover all the aspects related to income taxes. How mortgages are treated in the particular perspective of real estate law is another thing that you should know concerning. Then again, the real estate law with respect to tenancy should be also well understood by people who want to rent out their property. However, you shouldn’t overdo that i.e. you should never start becoming hysterical about learning real estate law (lest you end up spending a lot of time in trying to learn everything about real estate law and turn left with no time to examine your real estate investment).

Leave the intricacies of real estate law using the real estate attorneys (and to some degree real estate brokers who too tend to be taught real estate law as portion of their course for obtaining broker license). Having the various legal terms referred to in real estate laws can help you within not only enhancing your understanding regarding real estate but also help to produce your conversations with real estate law firm/agents really fruitful. You should as well note that though some of the basic principles remain the same, the real est laws vary across various states.

Also, real estate laws (especially the taxes related real estate laws) can experience a change over a period of their time, so you need to keep a new tab on such changes. Any big changes will anyhow appear prominently in news and you will get to know of them anyhow. So knowing a little bit of real estate law can really be helpful.

Some people choose to use a real estate agent and some people choose to go it alone. One thing I have noticed over the years is that a number of seasoned investors looking in a new city will seek out a good agent while novice investors will frequently go it alone. I have even had a number of successful real estate agents seek out my help when they are moving to our city. Why do some of these seasoned investors choose to work with an agent? Below is a list of 7 benefits of using an agent.

1. Understand potential restrictions of the property. I recently heard a story from a friend at the city development office in Austin Texas. A couple had saved up for their retirement. They wanted to retire and live out in the hill country. They went to the foreclosure auctions. At the auction they purchased a lot for 500,000. It had great views and they were going to build their dream house on it. They had researched the lot before the auction and found it was zoned SFR which means a single family residence can be built on it. After purchasing the lot they started plans to build their retirement house. At this time they discovered the lot was in the 25 year floodplain. My friend at the city development office explained that the lot could not be built on and was basically worthless.

2. Know about new developments that might affect a properties value. A good realtor will know of proposed new developments that might affect different properties in which a buyer is interested. Whether these developments are positive or negative can be valuable information when weighing different housing options.

3. Find potential problems with a property. It is always a good idea to have a home inspector look at a potential house. However, a Realtor is a good first line of defense to see if a house has inherent problems. A Realtor that can know about common problems, such as foundation or electrical, that affect a particular neighborhood.

4. Understand contracts specifics. Whenever you buy or sell a house you are entering into a large personal transaction. It helps to have someone on your side that deals with these types of transactions on a daily basis. A Realtor can help you understand contracts and can explain what is typical for your area. The most common pitfall into which I see unrepresented buyers fall is to become involved in an atypical contract that is not to their benefit. For instance a seller will sign an offer that has an option period that is 4 times longer than what is typical. A buyer might put in offers on multiple properties with long option periods. The buyer will wait and see if the market appreciates. If the market has appreciated the buyer buys the house at now and undervalued price. If the market has gone down the buyer walks away.

5. Misperception of a benefit of going it alone. Buyers frequently think that by not using a buyers agent they will get a better deal from the seller. In most situation the listing agent asks for 6 percent from the seller. If a buyer comes with an agent the listing agent splits the 6 percent with the buyers agent. If an unrepresented buyer comes the listing agent keeps the whole 6 percent. On the selling side, For Sale By Owners (FSBO) often think they are saving alot of money by avoiding a listing agent. Nationally, FSBO homes sell for 14 percent less than agent listed homes in the same neighborhoods. In addition alot of FSBO’s still end up having a buyers agents involved. There is also money spent on advertising. Since an agent has experience marketing homes the agent often can spend money more effectively on advertising. Agents often know which advertising sources produce the most potential buyers.

6. Save time when looking for listings. Looking for listings without an agent can take up large chunks of time. When looking with an agent you can see several homes in a few hours. When going it alone you have to call the listing agent for each house and wait at the house for the agent to arrive and open up the house. In addition agents often know houses which are not listed or may have already identified potential problems with a particular house of interest.

7. Insure Security. When a home is listed with a broker, agents coming to the house have to usually log in. This allows the listing agent to keep a record of every party coming into the house. Since their business is on the line, agents are more likely to protect the house from damage or theft. For a variety of reasons, it is generally not a good idea to have random people you do not know come into your house. Often sellers simply have a phone number, but that phone could be their house, a friend’s house, a pay phone, or even a stolen phone.

Searching for a home can be stressful and difficult but it can also be fun. Whether you choose to look for a home on your own or with a Realtor its a good idea to be a extremely careful when you seek out your dream home.