How to Do a Sales Pitch in Commercial Real Estate

In commercial real estate, you will undertake a variety of presentations, in a variety of circumstances. Most of them are business-like in nature, focusing on the needs of the tenant, the property buyer, or the property seller.Get to the core issuesEach of these groups has unique property requirements and points of focus. It is their needs which must be identified and clearly addressed in the sales pitch or presentation. Many successful commercial real estate agents will have a preliminary meeting with the client or customer so that they can identify key issues and concerns. This allows the commercial agent to return to the client or customer in a few days with a well structured proposal that addresses the needs of the customer or client.It’s all about THEM, not YOU!When you design an investment or commercial property proposal for presentation, the document should be 90% regards the property and the client. Frequently you see this rule disregarded or broken with the proposal document being largely regards the agency and the personnel.Rarely is the property transaction a simple matter of the property rental, the property price, or the physical elements of the property. In most situations, it is the combination of these things which must satisfy a fundamental equation of need that the customer or client has. In getting them to this fundamental need, you will identify an element of pain that the customer or client is experiencing. This is what you focus on.They are ExperiencedIt is interesting to note that many clients and customers in commercial real estate are reasonably comfortable in circumstances of business negotiation. This means they may not tell you the total big picture or all the elements of a transaction until they are ready. Conversation and connection in the presentation process should be biased towards the client or customer using well selected questions which allow the agent to interpret the body language coming from the client’s response.When you believe you have identified the element of clients pain related to the property transaction, you start to magnify the problem in terms of today’s market, then offering stable and logical solutions that your real estate agency business can provide to the client or customer. Invariably, the commercial real estate transaction in today’s market centres on financial matters such as:
High vacancy factors
Other property choices and chances are available
Underperforming leases
Unstable cash flow
Unstable tenancy mix
Tenanted conflict
Escalating building operating costs
A shift in demographics which exposes the property to a unstable future
Mortgage payment pressures
Age of the asset
Needs for refurbishment or extension
Competition properties attracting tenants away from the subject property

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This type of information and interpretation requires your intimate knowledge of the local region. This is by both property type and by location. This is the higher value that you bring to the customer or client. Being able to distinctly define local market awareness is a major advantage in any commercial real estate presentation or sales pitch. You must be seen as the best knowledgeable solution to the problem.From ExperienceAfter many years working exclusively in the commercial real estate industry, I found that my unique skill was in market knowledge and the display of that in any formal presentation to the client. Being able to talk about market trends and financial performance in a solid and sound way will help the client understand that they need your services. Coupling that with your extensive and relevant database of enquiry clearly shows the client that they need you.A fantastic commercial real estate presentation is a function and balance of lots of things. Things like:
A well established pre-planning process is a strategic advantage for every commercial real estate presentation. Strategy is everything in commercial real estate. Every property presentation requires planning.
Making sure you are asking the right questions of the client or prospect. Plan your questions relative to the subject property so that you help the client think about opportunity and changes that are possible.
Using your market knowledge and giving good answers. Have a variety of market facts and trends available to call on. Feed them into your presentation; facts are always useful. They can also be used as a channel to direct the discussion when the client is forcing you to justify your approach or your experience. Confidence and control must be the basic rule of your property presentation. When the client takes control of the presentation you have lost.
Using your experience in the marketplace so that you are telling relevant stories of success in similar properties. Stories of other properties will always interest of the client.
Making sure your personal presentation is optimised for the connection in the presentation. It can be that you are using a combination of the proposal document, the marketing document, and computer slide presentation, samples of your database, photographs of the subject property projected on to slides, and photographs of comparable properties projected on to slides.
Choosing the placement of people at the table or strategically positioning them in the room is always important. Much has been written about where you should sit relative to the client. The basic rule is adjacent to the client rather than across an area of barrier such as a table. Being within arm’s reach allows you to pass documentation to the client at the appropriate time. Documentation should not be provided to the client until you are ready for them to review it; otherwise it is a distraction of their attention.
Make sure that your proposal is simple and yet well directed with a clearly defined outcomes of sale or lease. Many proposal documents in commercial real estate are much too wordy so the main messages are lost and not clearly defined. The best proposals are less wordy and more illustrative. The best balance of a commercial real estate proposal is a mixture of 25% words, 25% pictures, 25% graphs, and 25% white space. This becomes a document which is clearly read and understood.
Combine good illustrations and photographs of the subject property into the proposal or presentation so that any lengthy descriptions or paragraphs are broken up. This will keep interest of the client in your documentation.
Make sure that your marketing package is value for money, and yet reaching the target market that the property serves or needs to attract. All too often, we see examples of generic marketing by the commercial real estate agent to the broader and less specific marketplace. Showing the client that you clearly know and will attract best the target market will always help your conversion to a potential listing. Be very specific about the target market and how you will reach it.
Ensure that your commission costs are fair and reasonable for the location. In most circumstances, discounting your commission should not be an option as it will make you poor and remove or detract from your enthusiasm for the sale or lease. ‘Cheap’ means ‘cheap and without focus’ and the client needs to know this. The property deserves better. You are not cheap because you are the best and you do a great job. A fair commission is always paid for a positive property outcome.
Always provide testimonials that are relevant to the property transaction. When you combine relevant history and details of happy customers into your presentation you will make the client feel more comfortable.
Always display clear and sound market knowledge that impresses the client relative to their property. This will include extensive awareness of comparable properties that compete with the subject property. You should be able to talk solidly about property prices, comparable rents, rental growth, returns on investment, changes to the future demographics of the area, and properties in the immediate precinct of relevance. In many cases, it pays to walk around the local area just prior to any property presentation so that you bring immediate and clear pictures of the precinct to the discussion. Many times this has been of significant advantage in my presentation processes. Talking about neighbouring properties localises the client and their thought processes.
Come up with a variety of ways to serve the client. Innovation and relevance will always impress. In today’s market, this is relatively easy considering the marketing opportunities and tools provided by the internet & technology. Be proactive in your property promotion processes so that the listing for sale or lease stands uniquely different in its marketing campaign from the others in the area. This does not have to be expensive to the client or to your office, given that the internet and electronic technology is historically cost effective. In today’s market, the traditional methods of publicising the property in the property pages of the local paper, is becoming much less important in the marketing campaign. Most commercial property buyers and tenants research the market from the Internet first and foremost.
Almost every property agency will say that they have excellent communication and connection skills to support the property promotion process. From experience, this is largely incorrect and typically the average commercial salesperson or leasing person will exercise ordinary communication channels with the client. Put yourself in the shoes of the client. They expect and deserve frequent updates on the promotion of the property even when nothing is happening or when the adverts are producing little response. When a property campaign is not producing the results, it is important that you act or adjust with alternative recommendations and strategic changes to the promotional campaign for the client to consider. Rarely would you get to the property campaign correct in the first week. It is in this time that you must consider fine tuning the promotion process so that the target market is being reached in a timely and effective way. This means that every property enquiry generated from your promotions must be tabulated so that you understand what channels of marketing work most effectively with the property in question.
When addressing the client or the client group in a formal property presentation, the answers and information you give must be delivered well and provide relevant solid property knowledge, in a practiced and professional delivery. Any sales or presentation tools relative to the property must be relevant and you should know how to use them with exceptional skill. Fumbling and faking information is not tolerated by the client.

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So there you have it. These are some of the key skills to use in a commercial real estate presentation. Whilst many real estate agents think that they are the best alternative in the market to promote sell and rent commercial property, the reality is they do not get the message across when it matters most in front of the client.To be the best commercial real estate agent in your area, you must show that you are just so, and you do this in the first 10 minutes of the time that your presentation takes. The client will have formed an opinion by then.Be prepared to walk away from any demands for discounting that the client or customer demands. In this market they need a great commercial real estate agent providing a great job; discounting is not an option. Show pride in your services and walk away when the client demands discount in marketing or lower commissions.

Addicted to Real Estate – Why I Can’t Stop and Why You Should Start

The All-Money-Down TechniqueSo how does the all-money-down technique work by purchasing a home with cash? First of all, let me repeat that I really didn’t have any cash, but I had a significant amount of equity from Terry’s home and several homes that I owned put together to give me a substantial cash down payment. Banks and mortgage companies alike will accept money from a home-equity line of credit as cash to purchase a home. At least they did in 1997 under the financial guidelines of the day. What you must remember about mortgages and lending is that the guidelines change constantly, so this technique I used in 1997 may or may not be able to be used in the future. Whether it is or isn’t able to be used again doesn’t really matter to me as I believe that there will always be a way to buy real estate with limited money down sooner or later. There will always be a technique to acquire real estate but exactly how that will be done in the future I’m not completely sure.I began purchasing homes in the Mayfair section of Philadelphia with the prices in the $30,000 to $40,000 per home price range. I would purchase a home with three bedrooms and one bathroom on the second floor with a kitchen, dining room, and living room on the first floor and a basement. What we call a row home in Philadelphia would consist of a porch out front and a backyard the width of the home. Most row homes in Philadelphia are less than twenty-two feet wide. For those of you who are not from Philadelphia and can’t picture what a Philadelphia row home looks like, I suggest you watch the movie Rocky. Twenty-two homes on each side of every block will really test your ability to be a neighbor. Things that will usually cause an argument with your Philadelphia neighbors often stem from parking, noise your children make, where you leave your trash cans, parties, and the appearance of your home.In 1998 my girlfriend and I moved in together and to the suburbs of Philadelphia called Warminster. After living on a street in Tacony, much like Rocky did, I really looked forward to having space between my home and my next-door neighbor. I told Terry not to even think about talking with the people who lived next door to us. I told her if one of them comes over with a fruitcake I am going to take it and punt it like a football right into their backyard. I believe I was suffering from Philadelphia row home syndrome. My new neighbors in Warminster turned out to be wonderful people, but it took me eighteen months before I was willing to learn that.So you just bought your row home for $35,000 in Mayfair, and after $2000 in closing costs and $5000 in repair costs, you find yourself a good tenant who wants to rent the home. After renting the home with a positive cash flow of $200 a month, you now have an outstanding debt of $42,000 on your home equity line of credit that will have to be paid off. When purchasing the home, I did not get a mortgage as I just purchased a home for cash as it is said in the business. All monies I spent on this house were spent from the home-equity line of credit.

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The move now is to pay off your home-equity line of credit so you can go do it again. We now go to a bank with your fixed-up property and tell the mortgage department that you want to do a cash-out refinancing of your real estate investment. It helps to explain that the neighborhood you purchase your property in should have a wider range of pricing as the neighborhood of Mayfair did in the mid-90s. The pricing of homes in Mayfair is quite unusual as you would see a $3000 difference in home values from one block to the next. This was important when doing a cash-out refinancing because it’s pretty easy for the bank to see that I just bought my property for $35,000 regardless of the fact that I did many repairs. I could justify the fact that I’ve spent more money on my home to fix it up, and by putting a tenant in, it was now a profitable piece of real estate from an investment standpoint.If I was lucky like I was many times over doing this system of purchasing homes in Mayfair and the appraiser would use homes a block or two away and come back with an appraisal of $45,000. Back then there were programs allowing an investor to purchase a home for 10 percent down or left in as equity doing a 90 percent cash out refinance giving me back roughly $40,500. Utilizing this technique allowed me to get back most of the money I put down on the property. I basically paid just $1,500 down for this new home. Why did the mortgage companies and the appraisers keep giving me the numbers I wanted? I assume because they wanted the business. I would only tell the bank I need this to come in at $45,000 or I am just keeping it financed as is. They always seemed to give me what I wanted within reason.This whole process took three to four months during which time I may have saved a few thousand dollars. Between the money I saved from my job and my investments and cash out refinancing, I had replenished most or all of my funds from my home-equity line of credit that was now almost back to zero to begin the process again. And that is exactly what I intended to do. I used this system to purchase four to six homes a year utilizing the same money to purchase home after home after home over and over again. In reality, the technique is a no-money down or little money down technique. At the time maybe I had $60,000 in available funds to use to buy homes off of my HELOC, so I would buy a home and then replenish the money. It was a terrific technique that was legal, and I could see my dream of being a real estate investor full-time coming to an eventual reality even though I wasn’t there yet.During the years from 1995 to 2002, the real estate market in Philadelphia made gradual increases of maybe 6 percent as each year went on. I began to track my net worth that was 100 percent equity, meaning I had no other forms of investments to look at when calculating my net worth. Generally speaking, the first five years of my real estate career did not go well because of the bad decisions I made purchasing buildings and the decline in the market. Furthermore, my lack of knowledge and experience in repairs made it a rough. The second five years of my real estate career that I just finished explaining didn’t make much money either. I supported myself primarily through my career as a salesman, but I could definitely see the writing on the wall that down the road real estate was going to be my full-time gig.Realty Professionals of AmericaI own an office building that has a real estate company as a tenant called Realty Professionals of America. The company has a terrific plan where a new agent receives 75 percent of the commission and the broker gets only 25 percent. If you don’t know it, this is a pretty good deal, especially for a new real estate agent. The company also offers a 5 percent sponsorship fee to the agent who sponsors them on every deal they do. If you bring an individual who is a realtor in to the company that you have sponsored, the broker will pay you a 5 percent sponsorship out of the broker’s end so that the new realtor you sponsored can still earn 75 percent commissions. In addition to the above, Realty Professionals of America offers to increase the realtor’s commission by 5 percent after achieving cumulative commission benchmarks, up to a maximum of 90 percent. Once a commission benchmark is reached, an agent’s commission rate is only decreased if commissions in the following year do not reach a lower baseline amount. I currently keep 85 percent of all my deals’ commissions; plus I receive sponsorship checks of 5 percent from the commissions that the agents I sponsored earn. If you’d like to learn more about being sponsored into Realty Professionals of America’s wonderful plan, please call me directly at 267-988-2000.Getting My Real Estate LicenseOne of the things that I did in the summer of 2005 after leaving my full-time job was to make plans to get my real estate license. Getting my real estate license was something I always wanted to do but never seemed to have the time to do it. I’m sure you’ve heard that excuse a thousand times. People always say that they’re going to do something soon as they find the time to do it, but they never seem to find the time, do they? I try not to let myself make excuses for anything. So I’ve made up my mind before I ever left my full-time job that one of the first things I would do was to get my real estate license. I enrolled in a school called the American Real Estate Institute for a two-week full-time program to obtain my license to sell real estate in the state of Pennsylvania. Two terrific guys with a world of experience taught the class, and I enjoyed the time I spent there. Immediately after completing the course at the American Real Estate Institute, I booked the next available day offered by the state to take the state exam. My teachers’ advice to take the exam immediately after the class turned out to be an excellent suggestion. I passed the exam with flying colors and have used my license many times since to buy real estate and reduce the expenses. If you are going to be a full-time real estate investor or a commercial real estate investor, then you almost have to get a license. While I know a few people who don’t believe this, I’m convinced it’s the only way.

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I worked on one deal at $3 million where the commission to the buyer’s real estate agent was $75,000. By the time my broker took a share, I walked with $63,000 commission on that deal alone. With the average cost per year of being a realtor running about $1200 per year, this one deal alone would’ve paid for my real estate license for fifty-three years. Not to mention all the other fringe benefits like having access to the multiple listing service offered too many realtors in this country. While there are other ways to get access to the multiple listing services or another program similar to it, a real estate license is a great way to go.Some of the negatives I hear over and over again about having your real estate license is the fact that you have to disclose that you are realtor when buying a home if you’re representing yourself. Maybe I’m missing something, but I don’t see this as a negative at all. If you’re skilled in the art of negotiation, it’s just another hurdle that you have to deal with. I suppose you could end up in a lawsuit where a court of law could assume because you are realtor you should know all these things. I don’t spend my life worrying about the million ways I can be sued any more than I worry about getting hit by a car every time I cross the street.

Home Buyers and Sellers Real Estate Glossary

Every business has it’s jargon and residential real estate is no exception. Mark Nash author of 1001 Tips for Buying and Selling a Home shares commonly used terms with home buyers and sellers.1031 exchange or Starker exchange: The delayed exchange of properties that qualifies for tax purposes as a tax-deferred exchange.1099: The statement of income reported to the IRS for an independent contractor.A/I: A contract that is pending with attorney and inspection contingencies.Accompanied showings: Those showings where the listing agent must accompany an agent and his or her clients when viewing a listing.Addendum: An addition to; a document.Adjustable rate mortgage (ARM): A type of mortgage loan whose interest rate is tied to an economic index, which fluctuates with the market. Typical ARM periods are one, three, five, and seven years.Agent: The licensed real estate salesperson or broker who represents buyers or sellers.Annual percentage rate (APR): The total costs (interest rate, closing costs, fees, and so on) that are part of a borrower’s loan, expressed as a percentage rate of interest. The total costs are amortized over the term of the loan.Application fees: Fees that mortgage companies charge buyers at the time of written application for a loan; for example, fees for running credit reports of borrowers, property appraisal fees, and lender-specific fees.Appointments: Those times or time periods an agent shows properties to clients.Appraisal: A document of opinion of property value at a specific point in time.Appraised price (AP): The price the third-party relocation company offers (under most contracts) the seller for his or her property. Generally, the average of two or more independent appraisals.”As-is”: A contract or offer clause stating that the seller will not repair or correct any problems with the property. Also used in listings and marketing materials.Assumable mortgage: One in which the buyer agrees to fulfill the obligations of the existing loan agreement that the seller made with the lender. When assuming a mortgage, a buyer becomes personally liable for the payment of principal and interest. The original mortgagor should receive a written release from the liability when the buyer assumes the original mortgage.Back on market (BOM): When a property or listing is placed back on the market after being removed from the market recently.Back-up agent: A licensed agent who works with clients when their agent is unavailable.Balloon mortgage: A type of mortgage that is generally paid over a short period of time, but is amortized over a longer period of time. The borrower typically pays a combination of principal and interest. At the end of the loan term, the entire unpaid balance must be repaid.Back-up offer: When an offer is accepted contingent on the fall through or voiding of an accepted first offer on a property.Bill of sale: Transfers title to personal property in a transaction.Board of REALTORS® (local): An association of REALTORS® in a specific geographic area.Broker: A state licensed individual who acts as the agent for the seller or buyer.Broker of record: The person registered with his or her state licensing authority as the managing broker of a specific real estate sales office.Broker’s market analysis (BMA): The real estate broker’s opinion of the expected final net sale price, determined after acquisition of the property by the third-party company.Broker’s tour: A preset time and day when real estate sales agents can view listings by multiple brokerages in the market.Buyer: The purchaser of a property.Buyer agency: A real estate broker retained by the buyer who has a fiduciary duty to the buyer.Buyer agent: The agent who shows the buyer’s property, negotiates the contract or offer for the buyer, and works with the buyer to close the transaction.Carrying costs: Cost incurred to maintain a property (taxes, interest, insurance, utilities, and so on).Closing: The end of a transaction process where the deed is delivered, documents are signed, and funds are dispersed.CLUE (Comprehensive Loss Underwriting Exchange): The insurance industry’s national database that assigns individuals a risk score. CLUE also has an electronic file of a properties insurance history. These files are accessible by insurance companies nationally. These files could impact the ability to sell property as they might contain information that a prospective buyer might find objectionable, and in some cases not even insurable.Commission: The compensation paid to the listing brokerage by the seller for selling the property. A buyer may also be required to pay a commission to his or her agent.Commission split: The percentage split of commission compen-sation between the real estate sales brokerage and the real estate sales agent or broker.Competitive Market Analysis (CMA): The analysis used to provide market information to the seller and assist the real estate broker in securing the listing.Condominium association: An association of all owners in a condominium.Condominium budget: A financial forecast and report of a condominium association’s expenses and savings.

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Condominium by-laws: Rules passed by the condominium association used in administration of the condominium property.Condominium declarations: A document that legally establishes a condominium.Condominium right of first refusal: A person or an association that has the first opportunity to purchase condominium real estate when it becomes available or the right to meet any other offer.Condominium rules and regulation: Rules of a condominium association by which owners agree to abide.Contingency: A provision in a contract requiring certain acts to be completed before the contract is binding.Continue to show: When a property is under contract with contingencies, but the seller requests that the property continue to be shown to prospective buyers until contingencies are released.Contract for deed: A sales contract in which the buyer takes possession of the property but the seller holds title until the loan is paid. Also known as an installment sale contract.Conventional mortgage: A type of mortgage that has certain limitations placed on it to meet secondary market guidelines. Mortgage companies, banks, and savings and loans underwrite conventional mortgages.Cooperating commission: A commission offered to the buyer’s agent brokerage for bringing a buyer to the selling brokerage’s listing.Cooperative (Co-op): Where the shareholders of the corporation are the inhabitants of the building. Each shareholder has the right to lease a specific unit. The difference between a co-op and a condo is in a co-op, one owns shares in a corporation; in a condo one owns the unit fee simple.Counteroffer: The response to an offer or a bid by the seller or buyer after the original offer or bid.Credit report: Includes all of the history for a borrower’s credit accounts, outstanding debts, and payment timelines on past or current debts.Credit score: A score assigned to a borrower’s credit report based on information contained therein.Curb appeal: The visual impact a property projects from the street.Days on market: The number of days a property has been on the market.Decree: A judgment of the court that sets out the agreements and rights of the parties.Disclosures: Federal, state, county, and local requirements of disclosure that the seller provides and the buyer acknowledges.Divorce: The legal separation of a husband and wife effected by a court decree that totally dissolves the marriage relationship.DOM: Days on market.Down payment: The amount of cash put toward a purchase by the borrower.Drive-by: When a buyer or seller agent or broker drives by a property listing or potential listing.Dual agent: A state-licensed individual who represents the seller and the buyer in a single transaction.Earnest money deposit: The money given to the seller at the time the offer is made as a sign of the buyer’s good faith.Escrow account for real estate taxes and insurance: An account into which borrowers pay monthly prorations for real estate taxes and property insurance.Exclusions: Fixtures or personal property that are excluded from the contract or offer to purchase.Expired (listing): A property listing that has expired per the terms of the listing agreement.Fax rider: A document that treats facsimile transmission as the same legal effect as the original document.Feedback: The real estate sales agent and/or his or her client’s reaction to a listing or property. Requested by the listing agent.Fee simple: A form of property ownership where the owner has the right to use and dispose of property at will.FHA (Federal Housing Administration) Loan Guarantee: A guarantee by the FHA that a percentage of a loan will be underwritten by a mortgage company or banker.Fixture: Personal property that has become part of the property through permanent attachment.Flat fee: A predetermined amount of compensation received or paid for a specific service in a real estate transaction.For sale by owner (FSBO): A property that is for sale by the owner of the property.Gift letter: A letter to a lender stating that a gift of cash has been made to the buyer(s) and that the person gifting the cash to the buyer is not expecting the gift to be repaid. The exact wording of the gift letter should be requested of the lender.Good faith estimate: Under the Real Estate Settlement Procedures Act, within three days of an application submission, lenders are required to provide in writing to potential borrowers a good faith estimate of closing costs.Gross sale price: The sale price before any concessions.Hazard insurance: Insurance that covers losses to real estate from damages that might affect its value.Homeowner’s insurance: Coverage that includes personal liability and theft insurance in addition to hazard insurance.HUD/RESPA (Housing and Urban Development/Real Estate Settlement Procedures Act): A document and statement that details all of the monies paid out and received at a real estate property closing.Hybrid adjustable rate: Offers a fixed rate the first 5 years and then adjusts annually for the next 25 years.IDX (Internet Data Exchange): Allows real estate brokers to advertise each other’s listings posted to listing databases such as the multiple listing service.Inclusions: Fixtures or personal property that are included in a contract or offer to purchase.Independent contractor: A real estate sales agent who conducts real estate business through a broker. This agent does not receive salary or benefits from the broker.Inspection rider: Rider to purchase agreement between third party relocation company and buyer of transferee’s property stating that property is being sold “as is.” All inspection reports conducted by the third party company are disclosed to the buyer and it is the buyer’s duty to do his/her own inspections and tests.Installment land contract: A contract in which the buyer takes possession of the property while the seller retains the title to the property until the loan is paid.Interest rate float: The borrower decides to delay locking their interest rate on their loan. They can float their rate in expectation of the rate moving down. At the end of the float period they must lock a rate.Interest rate lock: When the borrower and lender agree to lock a rate on loan. Can have terms and conditions attached to the lock.List date: Actual date the property was listed with the current broker.List price: The price of a property through a listing agreement.Listing: Brokers written agreement to represent a seller and their property. Agents refer to their inventory of agreements with sellers as listings.Listing agent: The real estate sales agent that is representing the sellers and their property, through a listing agreement.Listing agreement: A document that establishes the real estate agent’s agreement with the sellers to represent their property in the market.Listing appointment: The time when a real estate sales agent meets with potential clients selling a property to secure a listing agreement.Listing exclusion: A clause included in the listing agreement when the seller (transferee) lists his or her property with a broker.Loan: An amount of money that is lent to a borrower who agrees to repay the amount plus interest.Loan application: A document that buyers who are requesting a loan fill out and submit to their lender.Loan closing costs: The costs a lender charges to close a borrower’s loan. These costs vary from lender to lender and from market to market.Loan commitment: A written document telling the borrowers that the mortgage company has agreed to lend them a specific amount of money at a specific interest rate for a specific period of time. The loan commitment may also contain conditions upon which the loan commitment is based.Loan package: The group of mortgage documents that the borrower’s lender sends to the closing or escrow.Loan processor: An administrative individual who is assigned to check, verify, and assemble all of the documents and the buyer’s funds and the borrower’s loan for closing.Loan underwriter: One who underwrites a loan for another. Some lenders have investors underwrite a buyer’s loan.Lockbox: A tool that allows secure storage of property keys on the premises for agent use. A combo uses a rotating dial to gain access with a combination; a Supra® (electronic lockbox or ELB) features a keypad.Managing broker: A person licensed by the state as a broker who is also the broker of record for a real estate sales office. This person manages the daily operations of a real estate sales office.Marketing period: The period of time in which the transferee may market his or her property (typically 45, 60, or 90 days), as directed by the third-party company’s contract with the employer.Mortgage banker: One who lends the bank’s funds to borrowers and brings lenders and borrowers together.Mortgage broker: A business that or an individual who unites lenders and borrowers and processes mortgage applications.Mortgage loan servicing company: A company that collects monthly mortgage payments from borrowers.Multiple listing service (MLS): A service that compiles available properties for sale by member brokers.Multiple offers: More than one buyers broker present an offer on one property where the offers are negotiated at the same time.National Association of REALTORS® (NAR): A national association comprised of real estate sales agents.Net sales price: Gross sales price less concessions to the buyers.Off market: A property listing that has been removed from the sale inventory in a market. A property can be temporarily or permanently off market.Offer to purchase: When a buyer proposes certain terms and presents these terms to the seller.Office tour/caravan: A walking or driving tour by a real estate sales office of listings represented by agents in the office. Usually held on a set day and time.Parcel identification number (PIN): A taxing authority’s tracking number for a property.Pending: A real estate contract that has been accepted on a property but the transaction has not closed.Personal assistant: A real estate sales agent administrative assistant.Planned unit development (PUD): Mixed-use development that sets aside areas for residential use, commercial use, and public areas such as schools, parks, and so on.Preapproval: A higher level of buyer/borrower prequalification required by a mortgage lender. Some preapprovals have conditions the borrower must meet.

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Prepaid interest: Funds paid by the borrower at closing based on the number of days left in the month of closing.Prepayment penalty: A fine imposed on the borrower by the lender when the loan is paid off before it comes due.Prequalification: The mortgage company tells a buyer in advance of the formal mortgage application, how much money the borrower can afford to borrow. Some prequalifications have conditions that the borrower must meet.Preview appointment: When a buyer’s agent views a property alone to see if it meets his or her buyer’s needs.Pricing: When the potential seller’s agent goes to the potential listing property to view it for marketing and pricing purposes.Principal: The amount of money a buyer borrows.Principal, interest, taxes, and insurance (PITI): The four parts that make up a borrower’s monthly mortgage payment. Private mortgage insurance (PMI): A special insurance paid by a borrower in monthly installments, typically of loans of more than 80 percent of the value of the property.Professional designation: Additional nonlicensed real estate education completed by a real estate professional.Professional regulation: A state licensing authority that oversees and disciplines licensees.Promissory note: A promise-to-pay document used with a contract or an offer to purchase.R & I: Estimated and actual repair and improvement costs.Real estate agent: An individual who is licensed by the state and who acts on behalf of his or her client, the buyer or seller. The real estate agent who does not have a broker’s license must work for a licensed broker.Real estate contract: A binding agreement between buyer and seller. It consists of an offer and an acceptance as well as consideration (i.e., money).REALTOR®: A registered trademark of the National Association of REALTORS® that can be used only by its members.Release deed: A written document stating that a seller or buyer has satisfied his or her obligation on a debt. This document is usually recorded.Relist: Property that was listed with another broker but relisted with a current broker.Rider: A separate document that is attached to a document in some way. This is done so that an entire document does not need to be rewritten.Salaried agent: A real estate sales agent or broker who receives all or part of his or her compensation in real estate sales in the form of a salary.Sale price: The price paid for a listing or property.Seller (owner): The owner of a property who has signed a listing agreement or a potential listing agreement.Showing: When a listing is shown to prospective buyers or the buyer’s agent (preview).Special assessment: A special and additional charge to a unit in a condominium or cooperative. Also a special real estate tax for improvements that benefit a property.State Association of REALTORS®: An association of REALTORS® in a specific state.Supra®: An electronic lockbox (ELB) that holds keys to a property. The user must have a Supra keypad to use the lockbox.Temporarily off market (TOM): A listed property that is taken off the market due to illness, travel, needed repairs, and so on.Temporary housing: Housing a transferee occupies until permanent housing is selected or becomes available.Transaction: The real estate process from offer to closing or escrow.Transaction management fee (TMF): A fee charged by listing brokers to the seller as part of the listing agreement.Transaction sides: The two sides of a transaction, sellers and buyers. The term used to record the number of transactions in which a real estate sales agent or broker was involved during a specific period.24-hour notice: Allowed by law, tenants must be informed of showing 24 hours before you arrive.Under contract: A property that has an accepted real estate contract between seller and buyer.VA (Veterans Administration) Loan Guarantee: A guarantee on a mortgage amount backed by the Department of Veterans Affairs.Virtual tour: An Internet web/cd-rom-based video presentation of a property.VOW’s (Virtual Office web sites): An Internet based real estate brokerage business model that works with real estate consumers in same way as a brick and mortar real estate brokerage.W-2: The Internal Revenue form issued by employer to employee to reflect compensation and deductions to compensation.W-9: The Internal Revenue form requesting taxpayer identification number and certification.Walk-through: A showing before closing or escrow that permits the buyers one final tour of the property they are purchasing.Will: A document by which a person disposes of his or her property after death.

5 Steps to an Extremely Profitable Real Estate Website

Real estate websites are popping up all over the internet so when will you get on the boat? I hope before it’s too late. CNN and CNBC talk about the Real Estate market in a recession every day and how it probably won’t come out for another year or so. There is no better day than today to get off your butt and create a profitable real estate site for your business. Whether you are an agent, realtor, broker or landlord, you need to have a site for your business in order to compete and succeed. Below you will find five steps to a profitable real estate website.If you have any questions, please feel free to ask by following the link to my website in the author resource box at the bottom of this article.1. Real Estate Website Design: The design of your real estate website should be simple, straight forward and logical. You will basically want to spoon feed information to your visitors. You will have less than 10 seconds to capture your visitor’s attention and keep them from clicking that nasty back button. If you don’t do this, your visitors will quickly realize that your site isn’t worth their time and they will click off of it just as quickly as they clicked on to it. So, how do you do this? I suggest starting with a blank slate. Either hire a professional website designer & developer to do the project for you (PLEASE DO NOT OUTSOURCE YOUR PROJECT OUT OF THE COUNTRY) or take on the project yourself. It might be a cost efficient way to produce your website, but you are hurting American jobs in the long run – one of the reasons why real estate in America is in a recession. Real estate web design is not a complicated task because it is basic and straight forward. I recommend using a site design that is professional, modern, clean, organized and classy. These are qualities that the average house buyer would probably like to see in their new home, so why not have them in your website? A good website design will consist of intuitive navigation, organized content/copy and use of professional images of happy people smiling.

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2. Real Estate Domain Names: Choosing a domain name may be one of the easiest tasks and it may be one of your most difficult tasks at the same time. Consider hiring a professional website design company such as MJM Design in Cleveland, Ohio (Google MJM Design Cleveland) to pick out a quality domain name for your real estate website. Choosing a catchy domain name will help draw in visitors and we all know it, it’s a fundamental truth, the more visitors the more business you will bring in. It’s like fishing, if there’s no fish why put your hook in the water in the first place? Real estate domain names are sometimes hard to get because they are registered already. If you realize that the domain name that you absolutely must have is already registered, you can try contacting the owner of the domain name. How you ask? Well you would use a service called WhoIs which tells you the name, address, phone number and sometimes even the email address of the website owner. Otherwise, you might try GoDaddy’s Back Order service where GoDaddy will wait until the domain name is about to expire then try to register it immediately. This is most likely only effective if the domain name is about to expire which WhoIs will also tell you the date to.3. Real Estate Website Hosting: Every site needs hosting, regardless if its eBay, Amazon or your website. Real estate web hosting is not a type of website hosting only created for real estate oriented websites. Website hosting accounts can be purchased from my company for as little as $240.00 per year which includes storage, unlimited email access, unlimited email accounts and unlimited databases. Real estate hosting allows you to link your Domain Name to your website. This means that when someone types into their web browser, http://www.yourrealestatewebsite.com it will take them directly to your site on your website hosting account.4. Dynamic or Static Website Content?: This is a question of usability and interaction of your website with its visitors. Will your real estate design require a database to showcase available properties or apartments for rent? If so, then your website will be a dynamic website which pulls information from a database stored on your site hosting account. I recommend a PHP real estate script to run your website. These real estate scripts range in complexity from basic integration of a basic layout and table structure to a complex solution consisting of landlord contact forms, tell-a-friend forms, custom amenities list, Google Maps integration and more. Using a dynamic system also allows for easier updating as these systems usually consist of an administration panel which is protected by a secure username and password. The administration panel is where you will be able to login, navigate the categories of the website to change, modify and administrate different settings on your real estate website.

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5. Converting Visitors into Customers: This fifth and final step covers converting your real estate visitors into actual customers or leads. When someone visits your website, they are basically nothing to you – completely useless unless you can capture their information to contact them. You can track your traffic through statistics programs that your real estate hosting company will provide you with. If your hosting company doesn’t provide you with the appropriate advanced traffic tracking software, then its time to move on. The most common way of capturing your customer’s contact information is through the use of a Contact Us page. This page usually consists of an HTML form where the visitor can fill in their name, phone number, email address and a message and click Submit to email you right from the website. Most visitors don’t prefer this style of generic contact form and would much rather use a custom “Request a Free Consultation” or “Have Us Call You Back” form. This makes them feel special and let them think they are getting something for free. Implementing one of these custom forms will help you get leads from your new real estate website.I hope that the information contained in this article helped you understand the 5 basic steps to establishing a profitable real estate website and bringing a real return on your investment.

What Your Buyer’s Real Estate Agent Won’t Tell You – Part 1

Buying a house – The realistic approachThis 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 $350 000 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.

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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 their gimmicks on Real Estate Agents are ethical. (http://www.howrealtorshelp.ca) 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.

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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 at least 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!More to Come!