Real Estate Update

Archive for December, 2010

Real Estate Agents…..

Who Are They…

Real estate agents are professionals instrumental in connecting the buyer with the seller.

Additionally, many real estate agents manage rentals wherein they introduce tenants to landlords and oversee the maintenance of the property on behalf of the landlords.

In most areas real estate agents are required to be highly educated, licensed and are regulated by a governing body.

Some real estate agents are also Realtors.

To use the title Realtor, a real estate agent must be a member of the National Association of Realtors which in addition to a number of other requirements, requires Realtors to adhere to a strict code of ethics and offers Realtors additional educational and designation opportunities.

Though not required by rule or law, it might be a wise decision to seek the services of a Realtor.

What Do They Do….

Real estate agents bring together two or more interested parties, perform those steps necessary to successfully conclude a transaction and charge a commission for their services.

For sales transactions, they charge commission to the seller while for rentals, commission is typically charged the landlord.

Real estate agents generally calculate their fee as a percentage of the selling price (in the case of a sale) and as part of the rent for rental units.

How Do They Do It…

People who want to sell or rent their property leave details of their property with the real estate agent.

Along with all property details the real estate agent will typically have keys to the house to facilitate showings.

The other interested party (i.e. the buyer/tenant), gets access to this information and to the property by contacting the real estate agent.

That’s how the real estate agent becomes a hub of information.

Contrary to some common misconceptions, real estate agents typically represent the seller or the buyer but rarely both.

Why Should I Use One…

First and foremost, to protect yourself. Real estate transactions are highly regulated, highly paper (document) intensive transactions.

The real estate agent possesses an in depth knowledge of the laws, rules, regulations, disclosures and documentation necessary to successfully complete the transaction to the satisfaction of the buyer, the seller and the law.

Because real estate agents are most familiar with local real estate market conditions, it is wise and makes sense to seek the advice of one to get an idea of the current trends and pricing for properties within that market.

A good real estate agent will know the prices (or price range) of various properties of different types and at various locations within the region.

Because of the real estate agent’s knowledge and expertise, property sellers often get a few thousand dollars more for their property.

Many home seekers, including seasoned real estate investors use the services of real estate agents to locate the best real estate bargains in the easiest and quickest manner.

Furthermore, the best agents analyze the wants and needs of a home buyer/tenant and provide valuable input as to the kinds of properties available to them within their budget. Therefore, a good real estate agent will not just present a list of available properties to the buyer/tenant but will actually discuss their needs and make suggestions.

The good real estate agent, working in this manner benefits in at least two ways…

First and most obviously, when the real estate agent is able to successfully complete the transaction the commission is earned and the real estate agent is paid…

and secondly, if they make the customer/client happy they earn a good reputation and often receive referrals (hence more business).

Worth Noting…

It is worth noting that there is a myth floating around that real estate agents only work on behalf of the seller, buyer beware.

This is not written in stone nor is it always the case. Real estate agents are, in most regions, highly regulated.

With few exceptions, real estate agents work either for the seller (as is the case with many listing agents) or for the buyer (as is the case for a buyer’s agent).

Additionally, some areas allow for dual agency where an agent can work for both the seller and the buyer or as a transaction broker where the agent represents the transaction itself and neither the seller nor buyer individually.

However, in the case of dual agency/transaction brokerage, note that rule, regulation (law) and ethics do not permit the agent to act in favor of either party while in detriment to the other.

If you are unsure of the relationship between you and your real estate agent, do not hesitate to ask.

Buying a house -  The realistic approach

This article is not about the secrets of buying a rental property for no money down and half the price of the market value of the house. I am not Tom Vu or Don Lapre and I am not in jail.

In Canada, the no money down home did use to exist, but not anymore. Some banks and/or lenders were willing to lend you the 5% down payment so that you don’t have to pay a dime out of your own pockets to purchase a home. However, given the current financial situation with tighter lending restrictions, there will be no bank or lenders who can do that in Canada.

The buying home for half price did use to exist as well. At one point, foreclosures in Canada would allow foreclosed homes to be sold at rock bottom prices. The new law, which has been in placed for many years now require the homes be sold at the highest possible price for foreclosed homes or else the lenders could be sued. Hence, sometimes foreclosed homes sell higher because Canadians have the misconception that foreclosed homes are a really good deal causing it to have a reverse affect. There have been many people buying foreclosed homes believing they got a good deal and not doing a thorough check as to the actual value of the home.
Now, clearing out the quick money maker myths of buying homes, there are still many things you need to be aware of before starting.

If there exist ever an industry with more sneaky sales tactics and money motivated people, it has got to the Real Estate industry. As a buyer, you could be dishing out 0 000 and everyone wants a piece. The Real Estate Agents want a piece. The lenders want a piece. The lawyers want a piece and the sellers want piece. No wonder there are so many scams in this industry.

The first thing to be aware of is the Real Estate Agent. A Real Estate Agent is suppose to act on your behalf to buy or sell the home. Both the buyer of the home and seller of the home will have their own Real Estate Agent called a Buyer’s Real Estate Agent and a Seller’s Real Estate Agent.

In Canada, each Real Estate Agent gets an average of 2.5% and sometimes 2% for the commission of selling the home. Some Real Estate Agents provide cash back rewards. Canadian Real Estate Agents gets higher commission than anywhere else. In United States, their Real Estate Agents only get 1% of the commission and their homes are actually much cheaper. Even though Real Estate Agents are the least educated of the parties involved in the buying home transaction, they seem to be getting the biggest piece of the pie.

Do not listen to mls.ca and their gimmicks on Real Estate Agents are ethical. (http://www.howrealtorshelp.ca/swf/). Where do they get the idea any Real Estate Agent off the street is ethical. Their claim is based on these tests that they pass to become a Real Estate Agent. Agents passing a test does not meant hey are ethical. It only means they can remember enough to pass the test.

One would believe it should be the Real Estate Agent’s job to help the buyer ensure the home is of value. Rightly so, many buyers depend on the Real Estate Agent to protect them and provide them advice and in my opinion, the ethical Real Estate Agent should do that. However, the true reality is that Real Estate Agents do not make money unless if the home is purchased. The reality is that the Real Estate Agent’s salary is not truly dependent on giving you advice. The Real Estate Agent’s job is to get the buyer to buy a home through them so they can get paid!

As a result of this, what ends up happening, are two types of Real Estate Agents with variations in between. The first type is the honest agent with the belief “If I work hard and treat my buyer right, the buyer will come back to buy more homes from me. The second type is the “I need to get the buyer to buy a house quickly so that I can move on to the next buyer (sucker) so that I can maximize my time for profit.” The bottom line is that you are looking for the first type and you want to avoid the second type.

We’ll call the first type, the Bad Real Estate Agent.
We’ll call the second type, the Good Real Estate Agent.

So what kind of characteristics does the Good Real Estate Agent have that the Good Real Estate Agent does not have?

1. The first characteristic is Patience.
Bad Real Estate Agents will attempt to sell you a home quickly to get the money quickly. Do not buy a house without spending a lot of time looking at several different homes. Be careful of tactics such as Real Estate Agents claiming it is the perfect and acting like a salesman rather than providing you information.

2. The second characteristic is information.
A good Real Estate Agent needs to provide you all the information to let you make the informed decision and we are not talking about their opinion. Real Estate’s opinion does not matter. Real Estate Agents have data such as the history of the house being sold at, homes being sold near the area and type. A Real Estate Agent should be able to provide you with a compilation of official documents that tells you these kinds of data to let YOU make an informed decision.

3. The third characteristic is care.
You will know this during the actual signing of the contract to purchase the home at a certain price. Once you become interested in a property and want to buy the property at a certain price set by YOU, you have to write up a contract. The contract consist atleast three conditions that will null the sale of the home and a security deposit.

The common three conditions are, buyer can get financing, the home passes inspection and the appraisal value of the home is above the price to be purchased. Generally, you will want the lenders to appraise the home so that you know the fair value of the home and the lenders would only lend of you are buying the home at fair market value.

The security deposit is an amount you will provide to lock the home from being sold to other buyers while you perform to checks to see whether these conditions have been met. If these conditions are not met, then you SHOULD get your security deposit back.

The Bad Real Estate Agents will want to you provide very few conditions and a big security deposit. Doing so ensure the home is more likely to be sold.

Do NOT go through the internet and pick the first agent you see or the agent that has the most advertisements. They are just spending marketing money which they intend to recover from you. I especially find the ones that are top ranked search engines to be the most conniving, especially the Mississauga location!!!

If you have any more questions or concerns, feel free to e-mail me at admin@freerentalads.ca
You are also certainly welcome to e-mail me your good and bad home buying experiences. I may or may not chose to post them up.

There has been a lot of talk and controversy about the All Cities Realty vs. Re/Max lawsuit over time. All Cities Realty is suing for alleged trademark infringement. The defendants have twisted the truth a lot. This is the reason why All Cities Realty, Inc.. have created a website with all the real facts of the case, backed up by documents and court transcripts. All Cities Realty, Inc. is a small business that operates in California and that has registered their trademark name only to have it pirated by CF Real Estate Loans Inc, which now poses as Re/Max All Cities Realty.

After all the painstaking work that the real All Cities Realty ® agency has put in to make a good name for them and to become known, this other Re/Max Company promoted the use of the trademark to a legion of 700 agents. In addition, they used thousand of Internet website pages all the while being aware of the fact that the registered All Cities Realty ® trademark belonged to someone else.

A lawsuit followed with many delays and costs. This particularly concerned the small company of All Cities Realty that had embarked on a journey to take back its name from Re/Max All Cities Realty who knowingly seized the trademark name. No matter what costs and no matter how much time the lawsuit may last, justice will be served eventually, as it is not normal or legal for a big company to come in and just attach a “house mark” in front of a registered mark.

In addition, with hundreds and hundreds of past and current lawsuits, this Re/Max Company has damaged the All Cities Realty trademark. The Re/Max lawsuit pages mentions documents that prove that this particular company’s agents have had court convictions related to real estate, hundreds of lawsuits, articles about the FBI, kickbacks, loan fraud, broker license revocation, bankruptcy that have now all been associated with the good name of All Cities Realty.

There is nothing more that a company can do to protect its name except to register its trademark as a federal trademark. Definite, unambiguous guidelines allow you to choose a trademark such as All Cities Realty and if the Federal Attorney approves it, there is little doubt that All Cities Realty can be a generic or descriptive term. Laws are there to protect us all, including small companies such as All Cities Realty ® from larger companies that seize their trademark. The Re/Max All Cities Realty lawsuit is a modern David versus Goliath battle, but even with fewer resources, agents, and money, the All City Realty ® Company will emerge victorious because the law is on their side.

The Re/Max All Cities Realty lawsuit will be a long and costly one, with this Re/Max, owned by CF Real Estate Loans, Inc. (Bob Todd / Kelli Todd) damaging the good name of All Cities Realty ®. They have tried everything from sending spies, to supplying inaccurate court documents to try and make the All Cities Realty headquarters sound like a small place on a forgotten street. This company has had millions of web visitors and has had clients all around the globe.

Far from over, the All Cities Realty vs. Re/Max All Cities Realty lawsuit will go on until a court verdict will be imposed. All Cities Realty® registered its trademark so that big companies or others cannot take others registered trademarks.

In today’s thriving real estate market, the average seller needs to have a strong tem of professionals on their side to give their home an advantage. Full service real estate companies can offer that advantage. How do they do this? There are a few ways that full service companies can offer superior service. The first of these things is marketing power. Larger firms have a larger budget for the marketing of individual homes.This translates into more advertising dollars for your home. It also means that the company likely has a well designed and intuitive website that your home is featured prominently on.

Perhaps the most attractive feature of a full service firm is the fact that there are usually both buyer’s and seller’s agents working in the same office. This can exponentially increase the number of prospective buyers that view your home. Several agents networking in an office can bring numbers to your home that are simply not attainable with an in dependant agent. Also with a large firm you have the peace of mind knowing that there is a full team of accredited professionals to back you up in any situation. If you need questions answered, figures worked out or just have some concerns about the buying or selling process, there is always someone available to assist you.

Another nice asset that a full service firm can offer is a lower commission rate due to a larger sales volume. This means great savings for you on your real estate transaction! These firms also have an impressive roster of professionals that are educated in all aspects of the real estate deal, from contracts to closing. The home buying or selling process can definitely be an emotionally charged time, having a team of professionals in your corner will do nothing but alleviate some of the stress and worry that comes naturally with such a large purchase or sale.