Quite often it is assumed that a real estate agent simply taps potential clients to purchase, sell or rent properties. But the reality is quite different. The responsibility on their shoulder is much more difficult. In order to maintain their position and status in the market, they need to crack good and profitable deals. They must have knowledge of how to evaluate properties in a correct manner so that they can gain the trust of their clients.
To climb the ladder of success in the real estate market one should keep in mind the following points.
Location: The area where the property is located plays a major role in its selling. A property with a good and a healthy environment will be easy selling rather than one with ‘not so appealing’ surroundings. Generally, such properties cost low and take time to sell-off.
Connectivity: In this world of urbanisation, everyone prefers to stay connected with the facilities available to them. Thus anyone should first have a look at the estate and its connection and then at its cost. Ideally, people are attracted to a property which is located in the centre and has access to everything be it a mall, hospital, market, mode of transport and much more. If one gets such a property then he is willing to pay even a higher price.
Know your numbers: Nowadays people think they have all the knowledge about every sector because of the availability of the internet and many of them try to over smart the real estate agents. So being a real estate agent and while talking numbers to the client, you must be sure of the following factors
Mortgage Payment: as agents, you must have the knowledge about the home loans as the clients expect to get the best deal possible. Moreover, you must be clear with the debt to income ratio i.e., the mortgage payment. It is a minimum of 36% for a standard owner-occupied house, up to 33% for the house payment, and 45% for an investment property.
Down payment: The agent must be clear with the down payment linked with every property.
Remember the 1% rule: The 1% Rule states that the property’s gross monthly income must be at 1% of the property’s purchase price. One can simply leave a property which doesn’t comply with the rule because nowadays it is very easy to locate properties that do meet the 1% Rule.
Follow the current market conditions: As a broker, you must carefully do research and analysis of the market and its happenings. It is important for a broker to know how changes in the economy affect its real estate market and it further affects the prices of the property. Following variables should be kept in mind while studying the market:
How many commercial and residential properties have been sold in the area in the past years
The ratios of the listed prices and the final prices sold in comparison
The average square meter cost of the properties that are similar to your own in the area
The average time that your property will sit on the market and how to make your property sell faster
The sales prices in your locality and how to increase the value of your property.
Your commission: You must take the reward of your hard work. Don’t forget to finalise your commission before signing any paperwork or agreement. Evaluate the property’s gross sale price and add taxes to the commission amount. Formula= Commission ÷ 100 × Property Value.
Keep yourself well-informed and guide your clients properly to build a long-term relationship and crack deals easily