Archive for June, 2009
Here are a few quick, proven tips for people just starting out in their real estate jobs. Steer clear of these traps:
10. Listing Over-priced Properties
Some sellers who are in no hurry to sell will put their homes on the market for an outrageous amount and see if they get an offer. In addition to wasting your time, this creates negative advertising for your name. People in the neighborhood will drive by the house and see that you still haven’t sold it yet after six months for a year and wonder why you can’t do your job. Chances are that no one else in that area will consider working with you.
9. Stealing Listings from an Agent in the Same Office
There is no better way to be known as a sleazy agent than to take listings from colleagues. Even if clients were unhappy with their previous agent and approach you to take over, politely decline the offer. Both the clients and your fellow agents will respect you for your integrity.
8. Lacking a Game Plan
As a real estate agent, you are essentially running a small business. You would never run a small business without a clear plan of how you are going to conduct daily business, long term goals, marketing strategies, etc. so there’s no reason you wouldn’t do the same for your estate career. Too many agents sit back and hope that their careers will fall into place.
7. Shortage of Savings
The general rule is that real estate agents should have a minimum of 3 months savings since they are guaranteed at least 60 days without savings. I say have as much savings as possible, since the average new agent makes 25K for the each of the first two years. Having money to cover the bills will allow new agents to focus on creating a strong foundation for their business, rather than taking on part time jobs to support themselves. A major reason for new agents to switch careers is that they did not have enough money to hold them through the first few slow years.
6. Driving Too Far
As a soft rule, avoid driving more than an hour to a listing. It’s a waste of time and gas.
5. Relying on Your Memory
Invest in a PDA or computer program to keep track of your clients. Record their names, birthdays, special facts about them (“likes fly fishing”), what kind of service you provided for them and when, the names and ages of their children, etc. These facts will come in handy when you call and say hello, send cards, or if they choose to use you again. When you have a few clients, it may seem easy to remember these things, but trust me, five years later and a hundred clients down the road, these details will be blurred.
4. Choosing the Wrong Brokerage
It may seem tempting to sign up with the first brokerage that offers you a job, but what you truly need is a brokerage that will provide hands on training. What you have learned through your limited pre-exam courses will not be enough to make you a successful agent. Your first brokerage should provide you a mentor, continuing education and support through your first few transactions. It is relatively easy to get hired since brokerages don’t pay their agents wages, so you have the luxury of being picky in whom you choose to work with.
3. Abusing your Job Flexibility
So just because you are allowed to come in at noon and take three day weekends does not mean that you should. Agents with set hours report higher productivity and more satisfied clients.
2. Relaxing at Closing Time
Once you make/accept an offer on the house, a large amount of behind the scenes work is crucial to making sure that the sale runs smoothly. Make sure all inspections are conducted according to schedule, that the clients know their finance options and that repairs and other improvements are made. If the other party appears to be stalling for time, make sure you know the reasons and place a firm deadline for a decision.
1. Sitting Back and Waiting for Clients to Call
It’s a struggle for new agents to start a career because they lack a client base for referrals and repeat business. One common way for new agents to meet clients is though “floor time,” a designated time at brokerages for real estate agents to take calls from people interested in buying or selling a house. Some real estate agents rely too heavily on this for business and mope around their desk the rest of the week. Be proactive! Call FSBOs, inherit client lists from agents no longer working for the brokerage, knock on doors… do whatever it takes to prevent too much “down time.”
By: Lisa Jenkins
Rental returns are still on the increase due to short supply of investors, particularly within 20km to the Sydney CBD. Several leading commentators of the real estate market have spoken out recently regarding this issue.
Steve Martin, President of the Real Estate Institute of New South Wales has spoken recently in the media about the rental crisis and has called for changes to taxation for property investors.
With winter here buyers are probably thinking let’s hibernate until spring time, well don’t. I have always found that in winter it is usually the vendors that have to sell putting their properties up for sale.
With a downturn in the market, and in most cases less competition through this period, you could be looking at a three to five percent difference in your purchase price, maybe even more.
There is no doubt that during winter you have a little less variety to choose from than you would during spring, but it is still worth getting out there.
Please remember buyers by the time you search, negotiate and settle your property you are looking at a minimum of around four to six months. If you need to sell a property you could even be looking at longer. So make sure you plan way ahead when you are buying and selling.
When investing in residential property one of the key factors to consider is your net return on monies invested. This will be a primary indicator on whether or not to proceed.
To assess the net return you will have to compare it with the average returns for similar properties. Too low a return may mean that alternative investments should be reviewed, while a very high relative yield may mean there is an accompanying risk factor that is higher than normal.
Please remember areas that produce lower yields predominately have a higher capital gain and at the end of the day that is what its all about when investing your money in property.
The yield is calculated by starting with the purchase price. This is the denominator. The numerator is your net yearly income.
To figure out the net income you take your yearly gross rent and subtract your outgoings. Outgoings for residential properties include your managerial fees paid to the letting agent, council and water rates for the year, estimated repairs and maintanence and land tax if applicable.
You should set aside a yearly amount for repairs and maintenance, since big expenses occur periodically and not necessarily yearly.
When investing in property plan to hold the property a minimum of five to seven years. This accounts for economic cycles and changing conditions.
By: Peter Kelaher
