When deciding to rent or purchase, lease, or sell a home, office, or business space, it becomes advantageous to know which type of real estate to invest in. We mention four types of real estate:-
- Residential real estate is property purposed for living spaces and is not for commercial use.
- Commercial real estate is property targeted towards business, income, and profits.
- Industrial real estate is property and land used for industrial activities
- Raw land
Typically, many people engage in residential or commercial real estate transactions and might hire the services of a real estate agent. Real estate agents have experience analyzing market trends, carry out property valuations, and guide clients and owners towards sound property investments.
Therefore, who are real estate agents? Why should you hire them when investing in real estate? Let us discuss a few pointers.
Real Estate Agents, Who They Are.
Real estate agents are also known as brokers or realtors. They are licensed professionals engaging in selling, renting, buying, leasing property for clients and owners. So, why should you hire a real estate agent? Do you need to hire a real estate agent? Knowing the pros and cons of working with real estate agents to sell a house or buying one can influence our decision.
Advantages of Hiring a Real Estate Agent
Rely on Expertise
Professional real estate agents have vast experience and know the best practices in the real estate business. They know the real estate market trends and can assist you to locate property, conduct property valuation, and negotiate on your behalf within your budget and represent your interests.
Real Estate Agents Save You Time
If you do not have sufficient time to visit and evaluate the potential property as per your requirements, hiring a real estate agent is to your advantage. The agent will research the available real estate within your budget, amenities (such as schools, playgrounds, businesses, stores in the vicinity), the public transport system, parking space availability, and other areas. Realtors have access to all properties listed by other agents in the area and their exclusive property listings.
While it is true that you, as a client, want to gain the best gain from the property you invest in, the same is true regarding the owner of the property. The owner of the property also seeks to gain the best deal in the transaction. This situation calls for the art of negotiation. Not all of us are negotiators and need the expertise of someone who has dealt with real estate. Herein, the expertise of the realtor’s negotiating skills is beneficial to you. Their articulation and objectivity when negotiating for a discount (for the client) or higher amounts (for the owner) will maximize the value of your investment property.
Handling the Transaction Paperwork
All said and done, to finalize the closing of a real estate transaction, signed paperwork is a requirement for both the client and the owner of the property. Documents include but are not limited to written offers, written counteroffers, property valuation appraisals, contracts, and the list goes on. A real estate agent understands the legal jargon and legalities of these documents and will handle the paperwork for you. It is crucial that you get to read and understand the contracts before you sign off on them. Your real estate agent becomes your guide on understanding needed documents.
Disadvantages of Hiring a Real Estate Agent
Hiring an experienced, professional, and full-time real estate agent is expensive. The owner or seller of the property pays the commission. The realtor’s commission is paid from the sale of a piece of real estate. In most cases, the commission is a percentage rate between 3% – 5%.
Lack of Diligence
Assuming that you are the only client for your real estate agent is not realistic. In a busy office, the real estate agent must simultaneously deal with your demands and that of other clients’ demands. Thus, dedicated diligence for your investment requirements will be lacking. Lack of diligence might lead to delays in selling or purchasing identified property or a less profitable deal.
Is it crucial for you to hire a real estate agent? The decision on whether you hire a real estate agent depends on you.