Real estate agents and brokers have a thorough knowledge of the housing market in their community. They know which neighborhoods will best fit their clients' needs and budgets. They familiar with local zoning and tax laws, and know where to gain financing. Agents and brokers also act as an intermediary while negotiations between buyer and seller.
Brokers are independent business people who, for a fee, real estate owned by others and rent and manage properties. A broker's knowledge, resourcefulness, and creativity in arranging financing that is most favorable to the prospective buyer often mean the difference between success and failure in closing a sale. In some cases, agents assume the responsibility in closing sales, but, in many areas, this is done by lawyer's orders. Brokers also manage their own offices, advertise properties, and handle other business matters. Some combine other types of work, such as the sale of insurance or the practice of law, h their real estate business.
Before showing properties to potential buyers, the broker agent has an initial meeting with them to get a feeling for the e of home they would like and can afford. Often, an agent broker uses a computer to generate lists of properties for sale, estimate the location and description, and to identify available sources financing. Then, they take the clients to see a number of homes that are likely to meet their needs and income. Because buying real estate is such an important part of the average person's life, agents may have to meet several times with a prospective buyer to discuss available properties. In answering questions, agents emphasize those selling points that are likely to be most important to the buyer. To a young family looking at a house, for example, they may point out the convenient floor plan and the fact that quality schools and shopping centers are close by. To a potential investor seeking the tax advantages of owning a rental property, they may point out the proximity to the city and the ease of finding a renter. If bargaining overprice becomes necessary, agents must carefully follow their client's instructions and may have to present counteroffers in order to get the best possible price.
Once the contract has been signed by both parties, the real estate broker or agent must see to it that all special terms of the contract are met before the closing date. For example, if the seller has agreed to a home inspection or a termite and radon inspection, the agent must make sure that this is done. Also, if the seller has agreed to any repairs, the broker or agent must see to it that they have been made. Increasingly, brokers and agents must handle environmental problems or make sure the property they are selling meets environmental regulations. For example, they may be responsible for dealing with problems such as lead paint on the walls. While many details are handled by loan officers, attorneys, or other persons, the agent must check to make sure that they also are completed.
There is more to an agent's and broker's job, however, than just making a sale. Because they must have properties to sell, they may spend a significant amount of time obtaining "listings" (owner agreements to place properties for sale with the firm). When listing property for sale, agents and brokers compare the listed property with similar properties that have been sold recently to determine its competitive market price.
Most real estate agents and brokers sell residential property. A few, usually in large firms or small specialized firms, sell commercial, industrial, agricultural, or other types of real estate. Each specialty requires knowledge of that particular type of property and clientele. Selling or leasing business property, for example, requires an understanding of leasing practices, business trends, and location needs. Agents who sell or lease industrial properties must know about transportation, utilities, and labor supply. To sell residential properties, the agent or broker must know the location of schools, religious institutions, shopping facilities, and public transportation, and be familiar with tax rates and insurance coverage.
Because real estate transactions involve substantial financial commitments, parties to the transactions may seek the advice of real estate appraisers, who are objective experts who do not have a vested interest in the property. An appraisal is an unbiased estimate of the quality, value, and best use of a specific property. Appraisals may be used by prospective sellers to set a competitive price, by a lending institution to estimate the market value of a property as a condition for a mortgage loan, or by local governments to determine the assessed value of a property for tax purposes. Many real estate appraisers are independent fee appraisers or work for real estate appraisal firms while others are employees of banks, savings and loan associations, mortgage companies, government agencies, or multi-service real estate companies.
During a property inspection, real estate appraisers investigate the quality of the construction, the overall condition of the property, and its functional design. They gather information on properties by taking measurements, interviewing persons familiar with the properties' history, and searching public records of sales, leases, assessments, and other transactions. Appraisers compare the subject property with similar properties for which recent sale prices or rental data are available to arrive at an estimate of value. They may also estimate the current cost of reproducing any structures on the properties and how much the value of existing structures may have depreciated over time. Appraisers must consider the influence of the location of the properties, potential income, current market conditions, and real estate trends or impending changes that could influence the present and future value of the property. Depending on the purpose of the appraisal, they may estimate the market value of the property, the insurable value, the investment value, or other kinds of value. Appraisers must prepare formal written reports of their findings that meet the standards of The Appraisal Foundation.
Real estate appraisers often specialize in certain types of properties. Most appraise only homes, but others specialize in appraising apartment or office buildings, shopping centers, or a variety of other types of commercial, industrial, or agricultural properties.
