5 Things Your Broker Must Know When You are Buying or Selling Your Property

Today we’re going to talk about the “5 Major Things your broker must know when buying or selling a property.”

Buying or selling a property is one of the most important stages in one’s life and when you are dealing with this very important and critical step in your life, it’s very important that you’re able to tap into BEST resource person available who will be able to give you the most professional advice.

Most especially, considering that it is one of the largest or ticket purchase that you will ever do in your life.

And when you’ve chosen a representative to take care of your property for you whether you are selling or buying or leasing a property, there are certain expectations that come with it that without these 5 basic things, we might have a difficult road ahead of you if we don’t look at these 5 basic things that your broker should know. This will act like a checklist but more than that it’s also a good standard or quality check for you as a property owner or a property buyer.

#1 MARKET VALUES

The first thing that your broker should know are market values.

They have to understand what the prevailing market values are in a certain area. Sometimes, there will only be one listing that the brokers is pitching but that is not a good excuse for them to only know about this particular property.

If they are pitching you a certain property, they have to be knowledgeable about the market values in the area so that they will be able to give you a proper advice whether it’s being sold at a fair price, a high price, or a low price.

They have to know these, OR at least a range will do. There are always typical market values in any given area.

For example, if you’re buying a property or condominium on a certain city, your broker should be able to tell what are the typical values that  the properties in that area has been signed on for or what are the asking prices currently in the area that are updated so that he will be able to give you a proper advice whether the unit you’re looking at is a justified price, overpriced property, or underpriced property which will either be a good buy or a bad buy for you.

So, having a competent broker that knows the market values is invaluable.

But sometimes it’s also quite difficult to understand what the fair or running market value is in the area because not all of the asking price is in a certain development are the correct prices because sometimes they close below the value or at least sometimes even higher than the prescribed value or the current asking prices of the property owners for the simple reason that they’ve introduced some improvements and thus adding value to the property.

Or sometimes, you never know the situation of the seller or the buyer if they’re rushing into buying the property, so there are discounts that they give and they come to a lower price compared to the asking price.

But the bottom line is your broker should be knowledgeable as far as the range of fair market values are concerned in the area so that they will be able to negotiate a better deal for you.

#2 DETAILS OF THE PROPERTY

The second thing that you should expect your broker should know are the details of their property.

Now, when it comes to selling a property, some brokers, they have a lot of properties but this is no excuse for them not to know the property that they’re taking you through a tour of. If they’re showing you the property, say, for example, a house. And you ask them how many bedrooms it has and he doesn’t even know what answer to come up with.

Then, how do you expect them to actually really give you a sale? An actively practicing professional and a real professional at that should know the details of the property that they are selling.

So knowing the details is one of the signs that your broker has taken the time to study the property for you and on your behalf. If you are this seller hiring him, it means that he is serious about taking care of the property, pitching it to your prospective buyers. If you are a buyer, it means that he has your best interest at heart: he took the time to check the property details, the layout, or probably the finishes that you might be enjoying inside the property once you move in, you know.

These little things are very very important for the buyer and for the seller. And you have to expect your broker to know these things so that you know you’re talking to a professional.

#3 PREPARATION OF LEGAL CONTRACTS

The third thing that your broker must know is they have to know how to structure deed of sales and legal contracts properly.

If your broker is just a sales guy and you know, it’s all fluff but they don’t have content, that’s quite scary at the least. Or it’s very difficult to close a deal with them because if they know how to do the sales, they can charm you in talking and they’re witty, they’re funny but they have no idea about the paperwork, then you’re in for one wild ride and we don’t want that to ever happen in your transactions.

Your broker should be very knowledgeable as far as the deed of sale is concerned, drafting them correctly, what other requirements will be concerned, how to look at the title, the liens, the encumbrances, how to know if there are tax liabilities for a property, doing proper due diligence, what’s lacking in their payment for the association dues?

Everything that you have to know about the property, your broker has to know to be able to elaborate you properly and to properly disclose even before closing the transaction, your broker has to be very good at this. He has to understand how to explain it to you properly. Also, he has to be well adept at drafting these contracts, it can’t be that he just knows how to sales talk and he doesn’t have any idea how to prepare these things for you. That’s just like fifty percent of the equation and you can’t have a fifty percent broker working for you.

It’s going to be difficult, you have a long ride ahead of you. So as far as the little documentations are concerned, your broker has to be well adept. They have to know how to check titles, to read the back end, the liens and the encumbrances, all of these things will be required to effectively transfer the property from the seller’s name to the buyer’s name.

#4 TAXES & FEES

The fourth thing that your broker has to be well adept and knowledgeable in is the taxes and fees that are required to transfer the property from the seller’s name to the buyer’s name.

When you are doing a transaction, there are required taxes that you have to pay such as capital gains tax, transfer tax, documentary stamp tax, and also other registration fees that will be involved when you are transferring a property from one person to another’s name.

Now, when they are doing this they have to be able to advice you what taxes are needed to paid and when and how much because if they are just there for, you know, just to sell the property and not help you with itemizing these things, it’s confusing and it’s unprofessional.

So, when we’re discussing the taxes that you have to settle when you are transacting a real estate transaction, your broker has to be able to advice you that “this is the due date,” “this is the amount that we have to pay.” And for the buyer, “these are the registration fees that we will be going through and you have to settle these on these certain days and you have to prepare these.” And if your broker simply doesn’t know these things, how can you expect them to process the title transfer for you.

So, having a knowledgeable broker whose gonna be able to help you explain what are the fees and taxes and when they should be paid and complied for to be very helpful for you in closing the sale.

#5 GOOD PEOPLE AND NEGOTIATION SKILLS

The fifth and final thing that you should see in your broker when you are choosing who to work with is good people and negotiation skills.

This is invaluable.

There are other who would know the details of the property but they have no people-sense or they have no people-skills whatsoever. You need to have a person whose good with people skills and they need to know the details of their property.

Not only that, they need to have great negotiation skills because if they don’t, and let’s say for example, you have a buyer that’s trying to low ball you into an offer and then your broker just says, “Okay sir, this is the offer and this is what we can do. That’s it.” And you cannot negotiate a better deal or you can’t even substantiate.

Then, you’re screwed. You’re leaving money in the table. But on the other hand, if your broker is able to understand that this is the certain market value in the area, the offer is quite near it and it’s a reasonable offer, and you’re talking to the owner and then, this is the goal that he wants, he wants to dispose the property but he doesn’t want to take too much of a hit but he’s willing to let go at a certain price and the buyer wants to move in quickly and he really loves the property.

Then, both of them can come to a close door agreement or something that will result into a sale. So, it’s very important that your broker is very good with people skills or negotiating skills because sometimes when you don’t have the negotiation skills, even if it’s almost a good deal for both of them because of this service or this skill, it will not happen.

The last say will always be depending on the buyer or the seller of the property. But as a professional, he has to see it from a third party perspective that will benefit them both and you have to keep their best interests at heart because if you’re just trying to, you know, close the deal for the sake of the sale and you don’t even know the property details, you have no idea of the fray of market values, you don’t even know how to draw up contracts, you don’t even know what to do.

He has to be able to be professionally serve them, show several units to your perspective tenant or to your buyer, let them choose, give them the pros and con of the unit.

For your seller, show them also the unit, make sure you know the details of the property, show the advantages of the property to your buyer. And then, make them decide. If they want this property, then you explain to both of them, if they meet in the middle then you’re good to go.

Now as far as investing is concerned, if you are able to explain to a person or to a perspective client the advantages of this particular pre-selling product. We’re just gonna possibly or potentially increase in value because of the way it’s positioned.

Then, you are doing good service for them as well because you are helping them increase their capital more.

So that way, you are also adding value to the person. This is where real service comes before the sale which is very very rare nowadays. But these are one of the things that you have to expect your broker has, so that you will be able to: number one, have a smooth transaction.

Number two, have a profitable investment.

And number three, and I think the most important of all, you will be assured that you’re making the right decision.

So, that’s it for today. I hope that this article was able to give you a better idea of what to expect from your broker and we do look forward to seeing you again here in our blog.

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