Respond to Michael—–There are many differences between listing and selling residential properties and listing and selling specialized properties. The first is the need to recognizing when a market is increasing in prices fast enough to be a speculation market. This requires being able to see when prices are rapidly increasing and know at what price a home would need to be able to sell at in order to return a profit to the seller. This would be known as a “spec” sale. A similar special situation is one in which a person wants to buy a customized home. The special skill comes in knowing how to value vacant lots and know whether building a home in that location would be a wise choice. Sometimes the buyer needs to be referred to a builder which should inspire agents to have a list of trusted builders on standby (Edwards, 2007).
Residential and multi-family investment properties are another type of special property. With these it must be determined what the ownership costs are minus the rents received in order to determine the pre-tax cash flow. The buyers after tax position needs to be determined and the transaction needs to handled so that the rent figures can be verified such as with a tax return. Business sales are closely related to income properties. Profit is the primary objective in determining the fruitfulness of the deal and may require the use of an accountant and a lawyer. Agents will need to be familiar with these service providers in order to steer buyers in the right direction and get them the answers they need (Edwards, 2007). The types of properties that are most interesting to me are the customized homes. The reason why is because they have all brand-new components and they can easily be equipped with the latest home technology like tankless water heaters and built in speakers for listening to music.
An agent must prepare for the appointment by having a thorough understanding of the property before they ever sit down with the client. Basic information should be obtained about it like the legal description, tax information and ownership information. A visit to the property should also be conducted in order to see the exterior and get a good feeling about the neighborhood. Complete a competitive market analyses to see recent sales activity. Bring a pre-assembled listing folder with all the documents and things you may need to give to the seller. During the appointment go over the market analysis and guide the seller to make the right decision on what the market price should be. Have information about yourself and the company ready in the event you are asked questions on why you and the company should be hired. Show them the actual forms they will be signing and go over a seller’s net proceeds computation so they know exactly how much they can expect to receive from the sale (Edwards, 2007).
Works Cited
Edwards, Kenneth W. 2007. Your Successful Real Estate Career: 5th Edition. AMACOM- American
Management Association. New York, NY.————————————– Respond to Patrick—————–In Listing Single Family Residential properties, most home will have the same basic features for the most part. Finished or unfinished basements, kitchen with or without appliances, bathrooms, family rooms and bedrooms. Comparative market analysis is based upon the square footage with credit(s) provided or deducted for common household features.
In specialized properties such as agricultural Land, businesses, Storefront or Professional Commercial Space and Industrial properties more needs to be considered for an assessment or Broker’s Price Opinion (BPO). Agricultural land may have timber or water rights, may qualify for residential or commercial zoning or provide for agricultural tax credits, all of which need to be researched for the highest and best use. In selling a business you need to consider the existing assets, profit and loss statements, growth potential and the value of the building and land. If the business property is leased, consideration must be given to the existing terms of the lease, whether it is assumable and option for new negotiation under more favorable terms. Professional and Storefront locations are typically leased locations and prices per square foot will vary based upon use. Medical will always remain on the high tier and general office on the lower tier. Industrial properties are the most challenging to perform a BPO or to find a tenant/buyer as everything has to be right. Each Industrial business is different and look for different features. Some of these are increased water lines, electrical capabilities, rail access, loading docks, ceiling height, access to the interstate system, tax credits and deferments just to name a few.
I prefer the Commercial Side of the house due to every and I mean every property is different. Buyers or Lessors are usually fully vetted and qualified prior to their contact with you and they normally have a specific list of requirements to provide to you to start the search. Negotiations are normally all business whereas in residential emotions can sometimes get in the way of a deal.
In preparing for a listing appointment I would have pulled information and financial data from the court house retrieval system and mentally prepared a basic price opinion. After touring the property and taking notes on condition and features I would provide a CMA or BPO to the respective seller for discussion and consideration. Upon agreement of listing price, I would execute the exclusive listing agreement along with disclosure forms ensuring that all interested parties sign. Following the execution of the agreement I would email a copy or deliver a true copy within 24 hours to the clients. From there a sign is placed on the property (with clients permission), entry into the MLS, CMLS, Loopnet, etc, systems.