Insulating Against A Law Suit

Generally most of my posts are adaptable to sales in any industry. Today I am specifically addressing real estate sales. If someone practices real estate very long, they will face legal issues; especially if they sell a lot of real estate. There is a very simple explanation for it too. It’s impossible to please everyone, and especially, if you represent both the buyer and the seller. In this type situation the buyer feels like the seller took advantage of them, while the seller feels like the buyer took advantage of them. As a Realtor® who is wedged between both parties thinking the agent showed partiality to the other party in the transaction. To complicate matters worse, in a typical real estate sales transaction there are numerous entities that have specific requirements and guidelines that must be followed.

Managing Your Risks

Generally most of my posts are adaptable to sales in any industry. Today I am specifically addressing real estate sales. If someone practices real estate very long, they will face legal issues; especially if they sell a lot of real estate. There is a very simple explanation for it too. It’s impossible to please everyone, and especially, if you represent both the buyer and the seller. In this type situation the buyer feels like the seller took advantage of them, while the seller feels like the buyer took advantage of them. As a Realtor® who is wedged between both parties thinking the agent showed partiality to the other party in the transaction. To complicate matters worse, in a typical real estate sales transaction there are numerous entities that have specific requirements and guidelines that must be followed.

In most real estate sale transactions there are two separate agencies involved. 

More times than not one agency will have the listing and represent the seller while the other agency will represent the buyer. [Read more…]

Selecting A Farm Area

Real estate is very territorial. Having a license to sell real estate in Alabama permits one to sell anywhere in the state but common sense tells us we can’t provide quality service from one end of the state to the other. A person can have license in multiple states but that doesn’t mean they can provide quality service from their home town. I live in an area that only a few miles separate Florida, Alabama and Mississippi. Some people hold a license in each of those states. You can’t sufficiently service a county, not even a city within a county.

Farming Works

I am referring to a territory that a sales person will work within the boundary. This is considered their farm. Let’s narrow the field and focus on real estate sales. Farming is an older and more complete term for prospecting for new clients to work with. A few years ago the term “Prospecting” was replaced with the term “Lead Generating.” These two terms don’t encompass near as much as “Farming.”

Real estate is very territorial. Having a license to sell real estate in Alabama permits one to sell anywhere in the state but common sense tells us we can’t provide quality service from one end of the state to the other. A person can have license in multiple states but that doesn’t mean they can provide quality service from their home town. I live in an area that only a few miles separate Florida, Alabama and Mississippi. Some people hold a license in each of those states. You can’t sufficiently service a county, not even a city within a county.

If a person really wants to be successful in selling real estate, they should select an area of a city, or a subdivision to be their territory. They are going to farm this territory by focusing all their efforts on this territory much like an agricultural farmer tends to his crops. When concentrating on a small area, one can make it a priority to learn everything about that particular area. [Read more…]

Pride of Ownership

You have a beautiful home!

You have a beautiful home!

Most people have some sense of pride in some or all aspects of their daily activities. Because of my religious upbringing, the passage in the bible referring to pride comes to mind.  I John 2:16 says, “For all that is in the world, the lust of the flesh, and the lust of the eyes, and the pride of life, is not of the Father, but is of the world.” I want us to examine pride of ownership as it relates to sales; specifically to real estate sales.

First let’s look at the important role that pride plays into a successful automobile sale. Auto sales people play on your pride from the time you drive on their lot. Why do we need all the extras; if it were not for pride? What if you went to an automobile dealership and told them you wanted to pay cash for a new car and the only extra you wanted was [Read more…]

Success by Association

Run Your Own Race

Run Your Own Race

As a real estate educator, I am often confronted by students that are completing their prelicense course. These students inquire about various real estate companies and especially the companies that are national franchises. They are inquisitive about the various payment plans, monthly desk fees, and if the company provides training. Naturally I am more than willing to share my knowledge with them and even advise them if they ask.

After giving them a short dissertation about the agencies in their area, I quickly suggest that most companies are all good agencies. That is they all have good people working there and they have good intentions of providing professional services and growing their business to a high level of success. In most cases when I am pushed to suggest one company over another, I explain that the company they choose is a matter of choice. It’s important for a new agent to understand that almost all agencies are good; some are just more professional than others.

I don’t mean to be copping out on giving these students a straight answer. I work with many different brokerages and almost all of the national franchises so I have must remain somewhat mutual and not show partiality one over another. [Read more…]

Sidetracked by the Holidays

Traditional Holiday Meal

Traditional Holiday Meal

This is the time of the year that sales people get sidetracked by all the holiday festivities and then when the holidays are over, they wonder what happened to their income.  Sale markets drastically respond differently to the holidays. Some markets thieve during the holidays while other markets seem to die. Real estate sales aren’t affected that much but those that are in the looking stage will most likely postpone looking until the holidays are over. With shopping to do, and parties to go to, there is hardly time to spare for talking to a real estate agent. Most real estate agents consider the holiday season as a viable excuse for not selling during this time of the year.  The more experienced, more successful agents view this time of the year as greatly improved opportunities to establish a meaningful relationship.

Have you ever noticed that people in general are much nicer, and friendlier from Thanksgiving through Christmas, and even New Year’s? I’m not sure why but during this time of the year, people seem to be more thoughtful of others and less quick to express their anger or short tempers. This is a perfect time for me to talk to new prospective buyers for the first time. They may be too busy for an extended conversation but they are in a very receptive mood for an introduction phone call. Such a call might sound something like this.

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What Consumers Need to Know When Buying Real Estate in Alabama

Don’t Be Afraid–Be Aware

Representation

First and foremost the consumer needs to know for sure that they have a qualified Realtor® to represent them whether they are buying or selling. Don’t take this relationship for granted; know for certain. Agency relationships that establish representation cannot be assumed or implied. They must be in writing. Let me explain a few reasons why the consumer needs to be represented by someone.

First, buying and selling real estate is very technical in the sense that certain processes must be completed and in a particular order. Buying and selling real estate is also very legalistic. Most real estate transactions close without any major complications either prior to, or after closing. It is the exceptions to that rule when the consumer finds out just how technical and legalistic real estate sales can be. After- market conflicts are seldom settled between buyers and sellers. Tempers flare, distrust and disbelief sets in, accusations are made toward everyone involved in the transaction. Finally law suits are filed to settle the dispute.

Law suits create a need for both parties to hire legal counsel. In preparation of the case it is determined that you the consumer, was not represented by the Realtor® that you worked with. At the time you began looking at homes you didn’t want to sign any type of contractual agreements. In this situation, according to Alabama law, the Realtor® was working as a Transaction Broker and was limited to the duties they could perform for you. A Transaction Broker is a licensee who assists one or more parties in a contemplated real estate transaction without being an agent or fiduciary or advocate for the interest of that party to a transaction. In order to have been represented in Alabama you would have had to sign a Single Agency Agreement with a brokerage firm. Remember, agency relationships can’t be assumed or implied. They must be in writing. After the fact is a bad time to learn that your best interest was not represented when you made the largest investment of a life-time.

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