Whether you're a student preparing for the next steps after completing your real estate courses and passing the exam, or you’ve just received that thrilling 'Pass' notification, one question likely comes
Whether you're a student preparing for the next steps after completing your real estate courses and passing the exam, or you’ve just received that thrilling 'Pass' notification, one question likely comes to mind:
What’s next?
Passing the California real estate exam is a significant milestone—one that deserves to be celebrated. However, it's important to remember that this achievement is just the beginning of your journey toward becoming a licensed real estate agent.
In this article, I’ll guide you through the essential next steps to help you transform that hard-earned 'Pass' notice into a thriving real estate career.
Step 1. Receive Your Exam Results
The California Department of Real Estate (DRE) typically provides exam results quickly since the real estate exam is administered electronically. In rare cases—such as when the state’s computer systems are temporarily down—the test may be conducted using paper and pencil. However, this is an uncommon scenario and usually occurs only if technical issues arise.
In the past, the state released exam results immediately for test-takers, but this practice has been discontinued in recent years. One possible reason could be to prevent emotional reactions—whether celebratory or otherwise—in the hallways of exam centers. In rare cases where the exam is administered using pencil and paper, results may take longer to process.
Seeing that "Pass" notification is exhilarating, but remember, it doesn't mean you're officially licensed yet.
2. Submit Your License Application and Fingerprints
If you didn’t apply for your exam and license together—a step we highly recommend—you’ll need to submit your license application separately after passing the exam. Applying for both simultaneously saves time, as it allows the DRE to start processing your license immediately upon passing. If you only applied for the exam, submitting your license application afterward can add a month or more to the process.
To apply for your license after passing the exam, you’ll need to include proof of exam passage, fingerprints and the required real estate license fees. Be sure to double-check all documentation for accuracy to avoid delays.
California also requires all license applicants to complete a Live Scan fingerprinting process. This involves digitally scanning your fingerprints at an authorized location, such as a UPS store, police station, or private provider like ADHI Schools. A complete list of Live Scan locations is available on the California Department of Justice website. The DRE uses these fingerprints for a thorough background check.
3. Pay the Licensing Fees
Be prepared to pay the associated licensing fees, which include:
License application fee: Currently $350 for sales and $450 for broker
Live Scan fingerprinting fee: This fee varies depending on the location but typically ranges from $75-$90
4. Choose a Real Estate Brokerage
Be sure to start looking around before your license is approved!
As mentioned, you can begin exploring brokerages while waiting for the DRE. You must associate with a licensed real estate broker in California to activate your license. Choosing the right brokerage is a crucial decision for your career. Consider factors like:
Mentorship and Training:
Does the brokerage offer comprehensive training programs for new agents?
Are there experienced mentors available to guide you?
Do they provide ongoing professional development opportunities?
Commission Splits and Fees:
What is the brokerage's commission structure?
Are there any desk fees or other associated costs?
How are marketing and administrative expenses handled?
Reputation and Market Presence:
What is the brokerage's reputation in the community?
Do they have a strong market presence in your desired area?
What kind of marketing and branding support do they offer?
5. “Activate” Your Real Estate License With That Broker
Once you've selected a brokerage, they will help you officially activate your license through the DRE. Remember, you can only legally conduct real estate transactions once your license is placed with a broker.
6. Start Networking and Marketing Yourself
You're officially a California real estate agent! Now, it's time to hit the ground running.
Build Your Brand: Create professional business cards and establish an online presence through a website or social media profiles.
Join Industry Associations: Join the California Association of Realtors (CAR) and your local Multiple Listing Service (MLS). CAR offers valuable resources, education, and networking opportunities for California real estate professionals.
Network Actively:
Attend local real estate meetups and industry events to connect with other professionals.
Leverage LinkedIn to build your professional network and engage in industry conversations.
Attend community events and open houses, and network within your influence to build relationships with potential clients.
California-Specific Considerations:
California has a robust and competitive real estate market with specific licensing requirements. The process outlined here is unique to California and may differ from other states regarding fees, application timelines, and background check procedures.
Looking Ahead:
Remember, the journey doesn't end with getting your real estate license. To maintain your California real estate license and ensure continued success, you must stay informed about industry trends, legal updates, and best practices. Commit to ongoing learning and professional development to provide excellent service to your clients and stay ahead in this dynamic industry.
Passing the California real estate exam is a significant milestone, but the journey continues. By following these proven steps, you'll be on your way to launching a successful career in real estate. Stay proactive, embrace the learning process, and remember that dedication, resilience and hard work are key to thriving in this exciting industry.
Love,
Kartik
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Choosing the right real estate school is a big step if you want to succeed in our industry. It's like picking the best map for a road trip—you need clear and reliable directions to reach your destination.
Choosing the right real estate school is a big step if you want to succeed in our industry. It's like picking the best map for a road trip—you need clear and reliable directions to reach your destination. The real estate school you choose should guide you, providing the essential knowledge and skill
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Live Scan is an electronic fingerprinting process in California that captures fingerprints digitally and sends them directly to specific agencies, such as the California Department of Justice (DOJ) and
Live Scan is an electronic fingerprinting process in California that captures fingerprints digitally and sends them directly to specific agencies, such as the California Department of Justice (DOJ) and the Federal Bureau of Investigation (FBI), for a background check. This process is commonly used for employment, licensing, and certification purposes.
Here's how it typically works:
Fingerprinting Appointment: You must schedule an appointment with a Live Scan service provider. During the appointment, your fingerprints are taken electronically, without the need for the traditional ink and paper method.
Filling Out the Form: Before taking your fingerprints, you'll fill out a Live Scan form that includes your personal information and the type of background check required. This form will also specify the agencies that will receive your background check results.
Taking Fingerprints: The technician uses a scanner to capture images of your fingerprints. This process is quick and usually takes about 10 to 15 minutes.
Submission for Background Check: The fingerprints and your details from the Live Scan form are electronically transmitted to the appropriate agencies.
Processing: The DOJ and possibly the FBI process your fingerprints to check for criminal records or other relevant information.
Results: The background check results are sent directly to the employer or agency that requested them. The turnaround time can vary, but it typically takes a few days to a few weeks.
Privacy and Security: The data transmitted during the Live Scan process is encrypted to ensure privacy and security.
Live Scan is preferred over traditional methods because it's faster, and the digital method reduces the chance of errors commonly associated with ink fingerprinting.
An applicant for any real estate license is required to provide one set of fingerprints that are classifiable and accepted by the State Department of Justice (DOJ). Fingerprints can be taken either after applying for the examination or once the examination has been passed. If an applicant fails the examination, fingerprint processing fees will not be refunded. Social security numbers must be included on examination applications to ensure that the fingerprint reports are accurately matched and sent to the Department of Real Estate (DRE).
Fingerprints must be submitted through the DOJ's Live Scan Program, which captures and sends fingerprints to both the DOJ and the Federal Bureau of Investigation (FBI) using the Live Scan Service Request (RE 237) form, which is a PDF document. An original license will only be issued once the DRE has received and reviewed reports from both the DOJ and the FBI.
To have your fingerprints taken, bring the Live Scan Service Request (RE 237) form to a Live Scan service provider participating in the program. There is a fingerprint processing fee of $49, plus an additional fee charged by the Live Scan provider, both of which are payable directly at the service provider (not to the DRE). After having your fingerprints taken, submit a copy of the Live Scan Service Request (RE 237) form with Part 3 completed to the DRE.
For those not residing in California, you can get fingerprinted at a Live Scan service provider within California by following the instructions mentioned above, or outside of California using two FBI Applicant Fingerprint Cards (FD-258). If using fingerprint cards, take them to a local law enforcement agency to be filled out and send them directly to the DRE along with the completed license application, the license application fee, and the $49 fingerprint processing fee (a combined payment for exam/license and fingerprint fees is acceptable).
ADHI Schools is here to help you apply for the exam and we can even roll your fingerprints for you if you are local to Rancho Cucamonga. While the Livescan won’t give us a copy of your background check, be sure to disclose anything requested on the application in terms of background items. The DRE may not issue you a license if they deem that your background would warrant denial of a license.
Love,
Kartik
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Choosing to start a career in real estate is exciting and full of opportunities. But before jumping in, it makes sense to find out what real estate school is about. Doing your homework helps you know what
Choosing to start a career in real estate is exciting and full of opportunities. But before jumping in, it makes sense to find out what real estate school is about. Doing your homework helps you know what to expect, making it easier to handle the challenges and succeed.
Real estate school should teach you more than just how to pass an exam; it gives you the skills and knowledge you need for your future job. It's essential to check that the school's courses match what you want from your career and that you're ready for the time and work it requires.
Knowing about our school's setup and what the classes are like helps you prepare better. It also shows you what it means to work in real estate, not just how to get your license.
In short, learning about real estate school before you enroll is a smart move. It helps you go in prepared and confident, ready to take on the challenges and grab the opportunities that come with a career in real estate.
Curriculum Deep Dive: Core Components of Your Real Estate Education
To become a licensed real estate agent in California, three specific courses are required: Real Estate Principles, Real Estate Practice, and one elective. Each course is designed to equip aspiring real estate professionals with the knowledge they need to succeed in the industry. Let's explore what each course covers, their importance, and why ADHI Schools recommends "Legal Aspects of Real Estate" as the elective course.
Real Estate Principles
The Real Estate Principles course lays the foundational knowledge every agent needs. It covers a broad spectrum of topics, including property ownership and land use controls, real estate law, and the nuances of property valuation. Understanding these principles is crucial as it provides the groundwork for making informed decisions in buying, selling, leasing, and managing real property. This course is essential because it teaches the theoretical aspects of real estate that are critical for passing the state licensing exam and effectively serving future clients.
Real Estate Practice
Real Estate Practice focuses on the day-to-day operations in real estate, such as listing, selling, leasing, buying, and managing property. This course provides practical knowledge on conducting real estate transactions, including marketing properties, understanding buyer and seller needs, and completing some contract forms. It also teaches critical skills in negotiation and closing transactions. This vital course bridges the gap between theoretical knowledge and practical application, preparing students for real-world real estate activities.
Elective Course: Legal Aspects of Real Estate
ADHI Schools strongly recommends "Legal Aspects of Real Estate " for the elective. This course dives deeper into the legal intricacies of real estate transactions and property law. It covers topics such as contracts, property rights, the legal implications of real estate finance, and recent changes in real estate law and tax regulations. Understanding these aspects is vital for anyone in the field, as it helps protect agents and their clients from legal pitfalls.
By completing these courses, students are well-prepared to take the California real estate licensing exam and embark on a successful career.
Learning Formats & Study Tips: ADHI's Modern Approach to Real Estate Education
At ADHI Schools, we recognize that real estate education needs to be flexible, accessible, and efficient. That's why we've tailored our course offerings to meet the demands of today's learners and industry standards, emphasizing the advantages of remote learning while addressing the limitations of traditional classroom settings.
Self-Study and Instructor-Led Courses
We offer two primary learning formats: self-study and instructor-led courses. Our self-study options provide the utmost flexibility, allowing students to progress at their own pace and schedule. This is ideal for those who need to balance other commitments, such as work or family, but still want comprehensive access to quality educational content.
Our instructor-led courses are delivered via Zoom for those who thrive under guided instruction. This format combines the convenience of online study with the benefits of live interaction. Students can engage directly with experienced instructors and peers in real time, enjoying a dynamic learning environment without commuting. This saves time, reduces travel costs, and lessens the environmental impact of traditional classroom settings.
The Outdated Model of In-Person Classes
Traditional in-person coursework must be updated for today's fast-paced, digital world. The future of real estate education lies in digital accessibility and interactive learning environments. In-person classes often need more flexibility than many aspiring real estate professionals. They can be a barrier to those who cannot commit to rigid schedules or travel to distant locations.
The Best of Both Worlds
Our Zoom-led instructor courses offer the best of both worlds: the ease of online access with the personalized touch of in-person training. This hybrid model ensures that all students, regardless of location or schedule, can benefit from high-quality real estate education and interactive sessions that foster a more profound understanding and retention of course material.
By choosing ADHI Schools, you're not just enrolling in a real estate school—you're embracing a modern, innovative approach to learning that prepares you for success in the real estate market. Our formats are designed to equip you with the knowledge and skills necessary to excel, utilizing traditional educational principles and cutting-edge technology.
Embarking on a new educational journey in real estate shouldn’t have to mean putting your life on hold. You don't need to be a full-time student to achieve your dreams of becoming a licensed real estate professional.
Prepping for the Real Estate Exam with CrashCourseOnline.com
Once you finish the pre-license courses, the next step is to prepare for the real estate exam. This is where you consolidate all your learning and prepare to succeed. A robust tool in your arsenal should be CrashCourseOnline.com, specifically designed to optimize your exam preparation.
CrashCourseOnline.com offers a comprehensive suite of resources tailored to the real estate license exam's structure and content. Familiarizing yourself with the exam format is essential, and our platform covers multiple-choice questions, simulations, and potential essay components. What sets CrashCourseOnline.com apart is its focus on interactivity and real-world simulation, providing practice exams that mimic the testing environment.
Our iPhone and Android apps make studying flexible and accessible, allowing you to prepare on the go and fit study sessions into your busy schedule. The apps are designed to enhance learning efficiency with features like timed quizzes, answer explanations, and progress tracking.
These tools help you master test-taking strategies such as question analysis, time management, and critical thinking under exam conditions.
Encouragement Every Step of the Way
We believe in encouraging our students through every step of their real estate education. At ADHI Schools, you're not just another student but part of a community that cares about your success. Our instructors are dedicated professionals who are as invested in your achievements as you are. They are readily available to help you navigate your courses and confidently prepare for the real estate exam.
Becoming a real estate agent is a personal and professional growth journey. With ADHI Schools, you have a partner in education who provides the tools and support you need to excel without overwhelming your daily life. Enroll with us, and take the first step towards a successful career in real estate with the flexibility and encouragement you deserve.
Love,
Kartik
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Are you thinking about a career in real estate? Great decision! I know you want to make the best choice and keep everything the same. Let me show you what to look for before you pick a real estate school.
Are you thinking about a career in real estate? Great decision! I know you want to make the best choice and keep everything the same. Let me show you what to look for before you pick a real estate school. This way, you can start this exciting path feeling sure and confident.
Accreditation and Why It Matters
The first step is to ensure that the real estate school you choose offers state-approved coursework. Accreditation confirms that the school adheres to high educational standards and that licensing authorities will recognize your education. Specifically, look for schools with courses approved by the California Department of Real Estate to ensure a quality education that enhances professional credibility.
Of course, ADHI Schools is fully approved.
Success Rates
A vital indicator of a school's effectiveness is its success rate—specifically, what percentage of its graduates pass the real estate licensing exam on their first try. High success rates are a testament to the quality of education and preparation students receive. At ADHI Schools, we pride ourselves on our high pass rates, which consistently exceed the state average. This success is attributed to our comprehensive curriculum and the personalized support we offer each student.
Beyond the Test
At ADHI Schools, we take immense pride in the accomplishments of our graduates. Our "Success Stories" page is a powerful testament to the real-world impact of our comprehensive real estate education. Here, you can delve into the inspiring journeys of many of our alumni who have achieved their career goals and made significant contributions to the real estate industry. Our students have collectively sold billions of dollars worth of real estate, showcasing their expertise and commitment to excellence in their field. These stories highlight the profound influence our training has on their professional success and underline the value of an education from ADHI Schools.
Why Our Success Stories Matter
Each story reflects our commitment to providing an educational foundation that supports learning and thriving in the real estate market. These narratives offer prospective students a glimpse into what is possible when they join ADHI Schools, highlighting the direct correlation between our training and real career outcomes.
Industry Recognition
The reputation of a school within the industry is also critical. A school that is well-regarded by real estate professionals and has a strong record of producing successful agents will enhance your credentials. ADHI Schools is recognized in the industry for its rigorous academic standards and commitment to shaping the next generation of real estate professionals.
Our graduates are known for their competence, professionalism, and ethical standards, making them highly sought after by real estate firms.
Practical Considerations
Beyond the already mentioned aspects, consider these practical factors:
Location: Is the school conveniently located, or are you comfortable with online learning? Speaking of which...
Online vs. In-person: Online real estate schools offer flexibility, while in-person classes provide more direct interaction. Choose the format that best suits your learning style and schedule. ADHI Schools offers the best of both worlds: interactive Zoom sessions available and the flexibility of self-study.
Class schedules: Ensure the school offers classes that fit your availability. ADHI Schools offers night, day, and weekend lectures.
Understanding Cost vs. Value in Real Estate Education
When shopping for a real estate school, cost is an understandable concern. However, it's essential to weigh the tuition price against the value of the education you will receive. Opting for the cheapest option might save you money upfront, but it could save you money in the long run if it doesn't provide the quality education needed to succeed in the competitive real estate market.
Taking the real estate exam costs money, time, and effort. Every time you fail the exam in California, you must pay the state a $100 fee. Plus, retaking the exam means more money spent on gas, parking, and taking time off work. These extra hassles can make the process even more stressful. At ADHI Schools, we thoroughly prepare you to help avoid these issues. We aim to equip you with the knowledge and skills to pass the exam on your first try, saving you time, money, and frustration.
Look Beyond the Price Tag
While the tuition fees are a significant factor, consider what you get for your investment. Evaluate the resources, materials, instructor expertise, and support services the school offers. While you might pay a little more, ADHI Schools gives you access to extensive real estate exam prep resources, access to a vast alumni network, and ongoing career support that can be crucial for your long-term success.
Consider the Return on Investment
The ultimate goal of attending a real estate school is to become a successful real estate professional. Thus, consider the school's record of graduate success and how well it prepares students for the real estate market. Schools with higher job placement rates or a strong reputation in the industry offer better returns on your educational investment, even if their tuition is higher.
Value Over Cost
Ultimately, choosing a real estate school should be a balance of cost and value. Opt for a school with the best quality education, support, and career opportunities within your budget. Remember, investing in a reputable and effective school can lead to higher earnings and a more successful career in the long term.
Licensing and Post-Graduation Support
Once you complete your real estate education, you'll be ready to pass your state's licensing exam. Accredited real estate schools often provide resources and support to help you prepare.
Inquire about the schools' post-graduation support. Do they offer job placement assistance, mentorship, or continuing education opportunities? These resources can be invaluable as you launch your real estate career.
Of course - ADHI Schools offers all of these.
Choosing the right real estate school is a significant step toward a successful career. By carefully considering factors like accreditation, reputation, curriculum, and practical considerations, you can make an informed decision that sets you up for success.
Ready to take the next step? Contact us today to learn more about our accredited real estate programs and how we can help you achieve your career goals! Or, visit www.adhischools.com to explore our offerings.
Love,
Kartik
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The real estate industry is built on trust. Clients rely on agents to guide them through complex transactions, often involving significant financial and emotional investment. Maintaining this trust requires
The real estate industry is built on trust. Clients rely on agents to guide them through complex transactions, often involving significant financial and emotional investment. Maintaining this trust requires a solid commitment to ethical conduct, especially when managing conflicts of interest.
Definition of Conflict of Interest
A conflict of interest arises when an agent's interests or duties to another client interfere with their ability to act in the best interests of their current client. This can involve financial gain, personal relationships, or any situation where the agent's objectivity is compromised.
Imagine you're a real estate agent with two clients interested in the same house. One of the clients is a close family friend. Even though you might naturally want to help your friend more, as a real estate agent, you must treat both clients fairly and equally. This situation could lead to a conflict of interest because your relationship with your friend might influence your professional judgment. You can give your friend inside tips or encourage the seller to accept their offer over the other client's, even if it's not the highest offer. In real estate, agents must always act in the best interest of their clients and maintain professional integrity by avoiding any actions that could benefit them personally or favor one client unfairly over another.
Importance of Addressing Conflicts
Failing to address conflicts of interest can damage client relationships, lead to legal disputes, and tarnish an agent's reputation. Proactively managing these situations is crucial for maintaining professionalism and upholding the integrity of the real estate industry.
Common Scenarios Leading to Conflicts of Interest
Dual Agency: Representing the buyer and seller in a transaction presents a significant conflict. While allowed in some states with informed consent, it can be challenging to ensure both parties receive unbiased advice and negotiation.
Family or Personal Relationships: Transactions involving family members or close friends can create conflicts, even if the agent believes they can remain impartial. Perceived favoritism can undermine trust.
Financial Interests: An agent with a financial stake in a property or related business—like a real estate broker who also owns a mortgage company—can create a conflict if it influences their recommendations to clients.
Ethical Ways to Handle Conflicts of Interest
Full Disclosure: Openly disclose any potential or perceived conflict to all parties involved. This includes the nature of the conflict and how it might affect the transaction.
Obtaining Informed Consent: After full disclosure, obtain written consent from all parties acknowledging the conflict and agreeing to proceed with the agent's representation.
Refusing or Handing Off Representation: In some cases, the best approach is to decline or withdraw from the transaction to avoid compromising ethical obligations. This might involve referring the client to another agent.
Real Estate Board Policies: Navigating Conflicts of Interest
Local and national real estate boards, such as the National Association of REALTORS® (NAR), play a vital role in maintaining ethical standards within the industry. These organizations often establish detailed codes of ethics that serve as a framework for handling potential conflicts of interest and ensuring professional integrity.
For instance, the NAR's Code of Ethics and Standards of Practice outlines clear expectations for REALTORS® to act honestly, transparently, and in the best interests of their clients. Article 1 emphasizes the obligation to protect and promote clients' interests, while Article 2 requires the disclosure of all pertinent facts about a property that may affect its value or desirability. These principles guide agents in avoiding situations where personal or financial interests might conflict with their duty to the client.
Local real estate boards also adopt similar ethical standards tailored to their specific regions. These policies help agents navigate conflicts of interest, such as representing both a buyer and seller in the same transaction (dual agency) or having a financial stake in a property being sold. Boards often require agents to disclose such relationships fully and ensure the client's informed consent.
By adhering to these ethical guidelines, real estate professionals can maintain the trust of their clients and the public while fostering a culture of accountability and fairness within the industry.
The Bad Foundation Example
Imagine an agent representing a buyer discovers that the property they are interested in has significant, undisclosed foundation issues. The seller, eager to close the deal, pressures the agent to minimize the severity of the problem or avoid mentioning it altogether. However, the agent knows their fiduciary duty is to act in their client's best interest, the buyer.
Rather than succumbing to the seller's demands, the agent immediately informs the buyer about the potential foundation issues. They recommend that the buyer hire a licensed professional to conduct a thorough inspection before purchasing. By doing so, the agent ensures the buyer has all the necessary information to make an informed decision, demonstrating integrity and professionalism.
This example highlights the importance of upholding fiduciary duties, even in challenging situations. It underscores the agent's responsibility to prioritize their client's interests over external pressures, ultimately protecting them from potential financial or legal risks.
Best Practices for Real Estate Professionals
Training and Education: Continue education on ethical practices and conflict management to stay informed about best practices and legal requirements.
Consulting Legal Professionals: Consult a real estate attorney or experienced mentor for guidance when facing a complex conflict.
Maintaining Transparency: Prioritize transparency in all client interactions. Proactive communication and clear documentation can help prevent misunderstandings and mitigate potential conflicts.
Navigating conflicts of interest is an essential skill for real estate professionals. Agents can build trust, protect their reputation, adhere to ethical principles, prioritize client interests, maintain transparency, and contribute to a more moral and professional real estate industry.
Conflicts of interest are an inevitable challenge in the real estate industry, but how professionals handle these situations defines their integrity and success. Agents can confidently navigate these complexities by understanding the nature of conflicts, adhering to ethical standards, and leveraging tools like full disclosure and informed consent.
Addressing conflicts of interest is not merely about complying with rules—it's about building and preserving trust, the cornerstone of every client relationship. When agents prioritize their fiduciary duty, maintain transparency, and stay committed to ethical practices, they not only protect their clients but also enhance the professionalism and reputation of the industry.
Managing conflicts ethically is a hallmark of a successful real estate professional. Agents can foster stronger relationships and contribute to a real estate landscape defined by accountability, fairness, and trust by continuing to learn, consult, and apply best practices.
Love,
Kartik
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The real estate industry is built on trust. Buying or selling a property is often the most significant financial decision in a person's life, and clients depend on their agents for expert guidance and
The real estate industry is built on trust. Buying or selling a property is often the most significant financial decision in a person's life, and clients depend on their agents for expert guidance and support. This reliance makes ethical conduct vital for every real estate professional. Ethical agents don't just follow the rules; they prioritize honesty, transparency, and their client's best interests in every interaction. This commitment to integrity builds strong client relationships and forms the bedrock of a successful and fulfilling career.
Understanding Your Role as a Fiduciary
Real estate agents hold a unique position of trust. They act as fiduciaries for their clients, meaning they have a legal and ethical obligation always to put their clients' needs first. This fiduciary duty encompasses several vital principles: loyalty, always prioritizing the client's interests; confidentiality, safeguarding sensitive information; disclosure, providing all relevant information, even if it's not favorable; obedience, following lawful client instructions; reasonable care and diligence, providing competent and skilled service; and accounting, handling funds and property responsibly.
Transparency: The Key to Building Trust
Open and honest communication is essential for building strong client relationships. Be upfront about potential challenges, market conditions, and any factors influencing their decisions.
Transparency goes beyond simply answering questions; it means proactively sharing information and setting realistic expectations. Communicate timelines, potential obstacles, and the intricacies of the real estate process. Keep your clients informed and engaged through regular updates and feedback, ensuring they feel heard and understood throughout their journey.
Example: The Power of Transparency in Real Estate
A seasoned real estate agent, Emma met with Alex and Mia, a young couple eager to purchase their first home. They were captivated by a charming, older house with a history of foundation issues. Understanding the importance of honesty, Emma openly shared her findings with the couple, explaining the potential for future complications and the competitive market conditions.
Determined to ensure their first investment was sound, Emma discussed the benefits and drawbacks of older versus newer homes, highlighting possible challenges and setting realistic expectations for the buying process. She maintained frequent communication, providing updates and addressing their concerns, which made them feel supported and valued.
Appreciating her candidness, Alex and Mia explored other listings and eventually purchased a newer home that offered stability without unforeseen costs. Grateful for Emma's guidance, they later expressed their happiness and confidence in their decision, thanking her for her transparency.
Emma's commitment to transparent, honest communication helped them find the right home and solidified a trusting client relationship, showcasing the critical role of transparency in real estate transactions.
Navigating Ethical Dilemmas
Even with the best intentions, real estate professionals often encounter ethical dilemmas. These situations require careful consideration and a commitment to upholding your fiduciary duties.
Dual Agency: Representing the buyer and seller in the same transaction presents unique challenges. Disclose this relationship clearly and obtain informed consent from both parties. Strive to maintain neutrality and ensure that both clients receive fair and equal representation.
Misrepresentation and Fraud Avoid any temptation to exaggerate or misrepresent facts. Providing false or misleading information can have severe legal and ethical consequences. Always prioritize honesty and accuracy in your dealings.
Confidentiality: Protecting client privacy is paramount. Handle sensitive information with discretion and use it only for the intended purpose. Avoid discussing client matters with unauthorized individuals.
Multiple Offers: When managing multiple offers, present all offers pretty and transparently to the seller. Avoid any actions that could give one buyer an unfair advantage and guide your client to make informed decisions based on their best interests.
The Importance of Ongoing Learning
Real estate is a dynamic field with ever-changing laws and regulations. Commit to continuing education to stay informed about the latest legal requirements, market trends, and best practices. This ongoing learning demonstrates your dedication to professionalism and enhances your ability to serve your clients effectively.
Ethics as a Competitive Advantage
Ethics can be a powerful differentiator in today's competitive real estate market. Clients are increasingly seeking agents they can trust, professionals who prioritize integrity over quick deals. By showcasing your commitment to ethical conduct, you attract clients who value these principles and build a loyal client base that fuels long-term success.
Building a Legacy of Integrity
Ethical conduct is not just a set of rules to follow; it's a way of doing business that reflects your values and commitment to your clients. By consistently acting with integrity, you build a reputation that attracts clients, earns referrals, and fosters lasting relationships. Embrace ethical practices in every aspect of your real estate business, and you'll achieve professional success and contribute to a more trustworthy and respected real estate industry.
Love,
Kartik
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What are the 5 Things Real Estate Agents Struggle With the Most?
Have you ever dreamed of a career that not only pays well but also gives you the freedom to manage your own schedule and make a
What are the 5 Things Real Estate Agents Struggle With the Most?
Have you ever dreamed of a career that not only pays well but also gives you the freedom to manage your own schedule and make a real impact on people's lives? Becoming a real estate agent might be the perfect fit. This career path offers incredible flexibility, potential for high earnings, and the unique satisfaction of helping clients navigate one of the most significant decisions they will ever make: buying or selling a home.
Yet, like any promising career, it comes with its set of challenges. From generating leads to managing complex transactions, the world of real estate demands resilience, strategic thinking, and continuous learning. Whether you're considering a shift from your current job or you're a seasoned professional looking to enhance your skills, understanding these challenges is the first step toward a thriving career in real estate.
Generating Quality Leads Every real estate agent needs a steady flow of good leads. Without people interested in buying or selling homes, there are no deals to make. Finding these leads can be tough, especially with methods like cold calling or door knocking that don't always work well.
How to Overcome It:
Strong Online Presence: Keep a professional website, highlight your listings, and post interesting content on social media.
Targeted Advertising: Use online ads on platforms like Google or Facebook to reach specific groups of people in your market.
Build Relationships:Attend local events, work with businesses that complement yours, and be known as a local expert.
Fierce Competition The real estate market is full of agents, so standing out is essential. New agents may find it hard to compete with experienced ones, and even seasoned agents face competition from online services and discount brokers.
How to Overcome It:
Define Your Niche: Focus on a specific type of property or area to become the expert people go to.
Offer Exceptional Value: Provide extra services like staging tips or detailed market analysis.
Showcase Your Success: Use testimonials from happy clients in your marketing.
Fluctuating Market Conditions The real estate market changes often because of different interest rates, economic shifts, and local trends. Agents need to adjust their strategies to keep up.
How to Overcome It:
Stay Informed: Follow real estate news closely and attend industry events.
Adjust Your Approach: Be ready to switch your strategies depending on whether it’s a buyer's or seller's market.
Focus on Long-Term Relationships: Keep in touch with past clients and help them whenever you can, even when the market is slow.
Time Management and Work-Life Balance Real estate agents usually work long and odd hours, which can make balancing work and personal life difficult. Being available for clients is important, but so is taking care of yourself.
How to Overcome It:
Set Boundaries: Decide on your work hours and stick to them. Use tools that help automate your tasks.
Outsource/Delegate: If possible, hire an assistant to handle routine tasks.
Prioritize Self-Care: Make time for yourself to relax and enjoy hobbies or time with family.
Dealing with Difficult Clients Buying or selling a home is stressful, and clients can be hard to handle. It’s important for agents to stay professional and patient.
How to Overcome It:
Set Clear Expectations: Talk about the process, timelines, and possible issues at the start.
Active Listening: Pay close attention to what your clients want and need.
Know When to Walk Away: If a client relationship isn’t working, it’s okay to end it to avoid further stress.
Understanding and managing these challenges will help you build a successful career in real estate.
while the journey to becoming a successful real estate agent is filled with challenges, it is also immensely rewarding. By recognizing and addressing the five major hurdles—generating quality leads, navigating fierce competition, adapting to fluctuating market conditions, managing time effectively, and dealing with difficult clients—you set the foundation for a fulfilling career. Remember, each challenge presents an opportunity to grow stronger and become more adept at your craft.
Embrace these challenges with a proactive mindset, and use the strategies discussed to turn potential setbacks into victories. Maintain a strong online presence, define your niche, stay informed about market trends, set personal boundaries, and prioritize communication with your clients. By doing so, you will not only enhance your professional skills but also increase your satisfaction and success in the real estate industry.
Whether you are just starting out or looking to refine your expertise, remember that your journey is unique. Stay committed, continue learning, and never underestimate the impact you have on your clients' lives. With determination and the right approach, you can navigate the complexities of the real estate market and emerge as a top-performing agent. So, take the leap, build your skills, and start shaping your successful real estate career today!
Love,
Kartik
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Is the Real Estate Market Going to Crash in 2025?
In recent years, the real estate market has been a true rollercoaster, experiencing sky-high prices, wildly fluctuating mortgage rates, and a persistent
Is the Real Estate Market Going to Crash in 2025?
In recent years, the real estate market has been a true rollercoaster, experiencing sky-high prices, wildly fluctuating mortgage rates, and a persistent imbalance between supply and demand. As the chatter about a potential 2025 real estate market crash intensifies, many are curious if we are approaching the bursting point of what some call a housing market bubble.
I wanted to write an article to dive into the key factors contributing to this uncertainty and offer insights into potential market directions
Understanding Market Dynamics
Homeowners Staying Put: With the historically low interest rates of 2021-2022, many homeowners seized the opportunity to lock in low rates. Despite the recent decline in interest rates, many homeowners are still reluctant to sell, fearing they won't secure similarly favorable rates today. This reluctance has led to a reduced number of homes on the market, exacerbating the current supply shortage.
Fewer New Listings and Increased Buyer Competition: Many potential sellers are holding off on entering the market, cautious of higher mortgage costs despite lower interest rates. Meanwhile, the affordability brought on by the lower rates has widened the buyer pool, intensifying competition and driving prices up. This situation presents challenges particularly for first-time buyers and those with limited budgets, adding pressure to an already heated market.
A Market on Shaky Ground
As we saw through 2024, home prices reached unprecedented heights, while the 2023 spike in mortgage rates stretched affordability thin for many. Although there has been a slight easing in mortgage rates, the fundamental mismatch between supply and demand persists, further fueling price growth and competition. This dynamic raises concerns about whether the market is on the verge of a significant correction or if it will stabilize under current conditions.
Expert Opinions: A Range of Predictions
The opinions among economists and real estate analysts about what will happen in the housing market are quite different. Some experts think a big downturn could happen soon because the market has been too hot, with house prices going way up too fast. They believe that things might cool down sharply because homes are becoming too expensive for many people to buy.
However, another group of experts thinks the market will cool down slowly, not suddenly crash. They say that even though houses are expensive, many people still want to buy homes, and there aren't enough homes available, which could keep the market stable. These experts think any changes will happen gradually.
With all these different opinions and factors, people who are interested in buying or selling homes, or those who work in real estate and are getting their real estate license, need to stay alert and keep learning about the market.
The Looming Question: Crash or Correction?
Predicting the exact trajectory of the real estate market is complex, with 2025 poised as a critical year for determining whether the market will crash, correct, or continue its upward trend. For those looking to navigate this uncertain landscape—whether buyers, sellers, or real estate license school students —the key is preparation and informed decision-making.
Preparing for Market Fluctuations
In this unpredictable environment, readiness is crucial. Buyers should consider current market conditions against their personal financial situations. Sellers need to set realistic pricing to avoid prolonged market listings. Investors are advised to perform thorough market analyses to understand potential risks and opportunities.
Navigating the complexities of the real estate market requires up-to-date knowledge and strategic thinking—skills taught at leading real estate schools. By staying informed and applying practical, evidence-based strategies, buyers and sellers can protect their interests and capitalize on opportunities in the real estate market, no matter the economic climate.
Love,
Kartik
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Choosing the right real estate license school is a major step for anyone looking to succeed in California’s real estate market. A good real estate school will do more than teach you facts; they lay the
Choosing the right real estate license school is a major step for anyone looking to succeed in California’s real estate market. A good real estate school will do more than teach you facts; they lay the groundwork for your career. In California, to become a licensed real estate agent, you must pass a state exam that tests your knowledge and readiness to work professionally.
Your school should teach you about real estate laws, how to help clients buy and sell properties, and how to act ethically in your job. The education you get not only helps you pass your exam but also prepares you to face the challenges and grab the opportunities in the real estate world. So, picking the right school is crucial because it shapes your future as a professional agent.
The Importance of Accreditation
Accreditation is another crucial factor to consider when selecting a real estate license school. Accredited schools like ADHI Schools have been reviewed and validated for quality and efficacy by the Department of Real Estate. This isn’t just about meeting minimum standards; accreditation is a seal of quality that ensures the education you receive will be respected and recognized. It also signals to employers and clients that you have been trained under rigorous educational standards, boosting your credibility and professional standing in the competitive real estate industry.
Benefits of Online and Online “Live” Real Estate Courses
Online real estate courses offer several advantages, particularly in terms of flexibility, accessibility, and self-paced learning. These courses are ideal for those who have busy schedules or who live far from traditional classroom locations. They allow students to access materials at any time and from anywhere, making it easier to fit learning into a hectic lifestyle. Standout features of our online courses often include:
Video Tutorials: Engaging video lessons that can be paused and replayed, helping you to understand complex topics at your own speed.
Interactive Modules: Interactive learning experiences that keep you engaged and test your knowledge as you progress.
Mobile-Friendly Platforms: The ability to study on the go with courses optimized for smartphones and tablets, ensuring you can learn even when you’re away from your computer.
Hybrid Learning Options
Hybrid courses combine the best aspects of online and classroom learning. These programs typically involve a mix of online coursework to cover theoretical knowledge and scheduled in-person sessions for more practical, hands-on training. This format can be particularly beneficial as it offers:
Flexibility and Interaction: You can enjoy the flexibility of online learning while still benefiting from the interpersonal and experiential advantages of traditional classroom attendance.
Balanced Structure: The structure of hybrid models provides a balanced approach, catering to different learning preferences and needs.
The Value of Experienced Instructors
The experience and teaching styles of instructors at a real estate license school play a critical role in shaping the quality of education. Experienced instructors bring a wealth of real-world knowledge to their teaching, offering insights that go beyond textbooks and theoretical concepts. They are often well-versed in the latest industry trends and regulatory changes, which can provide students with a more comprehensive understanding of the real estate landscape.
Teaching style also significantly impacts learning outcomes. Instructors who employ interactive and adaptive teaching methods can cater to various learning styles, ensuring that all students grasp complex topics. This versatility is crucial for effectively preparing students for the varied scenarios they will encounter on the real estate exam and in their future careers.
The presence of knowledgeable instructors is particularly important for real estate exam success. These professionals can pinpoint the most important content that is likely to appear on the exam and provide students with strategies to tackle difficult questions. Moreover, their ability to clarify doubts and provide real-time feedback is invaluable in building confidence and competence among students.
CrashCourseOnline.com
CrashCourseOnline.com offers a unique advantage in real estate exam preparation with its comprehensive suite of study tools designed specifically for California real estate licensure. What sets CrashCourseOnline.com apart includes:
Tailored Content: All resources are specifically designed to meet the requirements of the California real estate exam, ensuring that students study the most relevant and up-to-date information.
Interactive Learning Tools: The platform includes interactive features like practice quizzes and real-time feedback, which help reinforce learning and build confidence as students see their progress.
Accessibility and Flexibility: With courses and materials available online, students can prepare on their schedule and at their pace, which is crucial for adult learners who may be balancing other responsibilities.
Expert Guidance: CrashCourseOnline.com provides access to seasoned real estate educators who offer live exam prep sessions. These sessions delve into exam strategies, breakdown challenging areas, and answer student questions in real time, providing a level of personalized preparation that can be hard to find elsewhere.
By using these preparation materials and engaging with platforms like CrashCourseOnline.com, students can greatly enhance their chances of success on the California real estate exam. The comprehensive resources and expert guidance available can give them a competitive edge in a challenging field.
Choosing the right real estate license school is a pivotal decision that can impact your career for years to come. As you make this decision, consider the following key factors:
Accreditation and DRE Approval: Ensure that the school is approved by the California Department of Real Estate and accredited by relevant authorities.
Learning Formats: Reflect on whether online, classroom-based, or hybrid learning environments suit your learning style and schedule best.
Experienced Instructors: Look for schools with knowledgeable and experienced instructors who can provide not only the curriculum but also valuable industry insights.
Support Resources: Evaluate the availability of student support services such as tutoring, forums, and dedicated staff to help you through your studies.
Exam Preparation: Consider the quality and effectiveness of the exam preparation materials offered, such as mock exams, study guides, and live prep courses.
It’s essential to do thorough research and choose a school that aligns with your career goals and educational needs. Take the time to read reviews, talk to alumni, and perhaps attend a few introductory sessions or webinars to get a feel for the school’s environment and offerings.
Ready to take the first step towards a successful career in real estate? Enroll today at ADHI Schools or start your preparation with CrashCourseOnline.com.
Love,
Kartik
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How Long Does the California Real Estate Exam Take?
If you’re planning to become a real estate agent in California, one of the key steps is passing the California real estate exam. Knowing how long
How Long Does the California Real Estate Exam Take?
If you’re planning to become a real estate agent in California, one of the key steps is passing the California real estate exam. Knowing how long the exam will take helps in preparing effectively and managing your time on the day of the test. This article will cover everything you need to know about the duration of the exam and how to approach it efficiently.
Total Duration of the Exam
The California real estate exam is designed to test your knowledge in various real estate topics, including property ownership, laws, valuation, financing, and contracts. For the sales license exam, it consists of 150 multiple-choice questions, and you are given up to 3 hours to complete it. This means you have about 1 minute and 11 seconds per question on average. It’s a manageable pace if you're prepared, but rushing or spending too much time on a single question can impact your ability to finish the exam.
For those taking the broker exam, it is longer, consisting of 200 multiple-choice questions with 4 hours allotted to complete the exam.
Breakdown of the Exam:
Sales License Exam:
Number of Questions: 150 multiple-choice questions.
Time Allotted: 3 hours (180 minutes).
Broker Exam:
Number of Questions: 200 multiple-choice questions.
Time Allotted: 4 hours (240 minutes).
Key Considerations
Here are some tips to manage your time during the exam:
Practice Time Management: When practicing for the exam, completing practice tests within the time limit is crucial. This builds comfort with the pacing and prepares you for the actual test day. Our blog on Effective StudyTechniques for the Real Estate Exam offers additional insights and strategies.
Skip and Return to Hard Questions: If you encounter a tough question, it’s often better to move on and come back to it later. This approach ensures you don't waste too much time on any single question and that you cover more ground.
Read Questions Carefully: While keeping an eye on the clock, make sure to read each question thoroughly. Misreading can lead to easy mistakes.
Watch the Clock: Monitoring your time can help adjust your strategy on the fly, ensuring you answer as many questions as possible. Our additional resources provide tactics on maintaining a good pace throughout the test.
What Happens After the Exam?
Once you’ve completed the exam, the next step is to wait for your results. The California Department of Real Estate (DRE) typically provides results at the time the test is concluded, but sometimes it could take a few days.
The California real estate exam is a comprehensive test that requires thorough preparation and good time management. With different durations for the sales license and broker exams, it’s important to practice completing sample exams within the time limits to ensure you’re comfortable with the pacing. By preparing effectively, you’ll increase your chances of passing the exam and moving closer to your goal of becoming a licensed real estate agent.
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Understanding California's Mortgage-Free Challenges
In California, a place famous for its sunshine, cool tech, and lively culture, there's a big problem — housing is really expensive. It's especially
Understanding California's Mortgage-Free Challenges
In California, a place famous for its sunshine, cool tech, and lively culture, there's a big problem — housing is really expensive. It's especially tough for people who want to pay off their homesand live without a mortgage. Recent data from 2023 shows that many people in California find it hard to reach this important money goal.
The State of Homeownership in California
Many people in California dream of owning a home outright, but for most homeowners, it remains just a dream. Only 18% of homes in California are paid off with no mortgage. This is much lower than the national average of 26%. Looking around the country, Washington D.C. has an even lower rate of 10% of homes without a mortgage, while West Virginia is way higher at 40%. This shows a big difference in how people own homes without a mortgage in different parts of the United States.
Homeownership with Mortgages
In California, the vast majority of households own their homes with the help of a mortgage. This can be traced back to several key factors, primarily the high property prices across the state. In many California cities, real estate prices are significantly higher than the national average, which forces many residents to take on large mortgages that can take decades to pay off.
Economic pressures also play a crucial role in this scenario. The cost of living in California is among the highest in the country, which includes not just housing but also taxes, utilities, and general living expenses. This economic environment makes it challenging for many families to save enough money to buy a home without financial assistance. As a result, long-term mortgage plans become a necessary option for many Californians, binding them to years of debt as they work towards owning their home completely. This situation reflects a broader issue of accessibility and affordability in California's housing market, impacting how residents achieve financial stability and homeownership.
Renting in California
In California, a lot of people rent their homes instead of owning them. About 43% of households in California are rentals, which is the third highest rate in the whole country. Only Washington D.C., where 60% of homes are rented, and New York, with 45%, have higher rates. The average across the United States is only 33%. This means that in California, renting is a lot more common than in many other places.
There are a few reasons why so many people in California rent their homes. First, the cost of buying a house in California is very high, which makes it tough for many people to afford to buy a home. Also, California has a lot of good jobs and opportunities, which attracts people from all over. However, because so many people want to live and work there, the competition for housing is intense, and this drives up rental prices too. So, renting becomes the best or only option for many who move to California looking for work or who simply can't afford to buy a home yet.
The Curious Case of Rent-Free Tenants
Interestingly, a small percentage of Californian tenants, specifically 1.4%, live in rent-free conditions. This is slightly less than the national average, which stands at 1.6%. This unique living situation invites us to delve deeper into the types of arrangements and the social dynamics that make rent-free living possible.
Several factors contribute to these rent-free scenarios. One common arrangement is when individuals live with family members who own the property and do not charge them rent. This could include young adults living with parents, extended family helping each other out, or elderly parents moving in with their adult children.
Another scenario involves living arrangements with generous landlords. These landlords might offer rent-free living as part of a barter system, where tenants provide services like property maintenance, caretaking, or other work in exchange for living space. In some cases, landlords might provide free housing to individuals as a form of charity or support, especially if the tenants are in difficult financial situations or are close friends or family members.
The True Cost of Mortgage-Free Living
Living without a mortgage in California doesn't mean homeowners are free from ongoing expenses. These homeowners face median monthly expenses of $834, considerably higher than the national median of $629. This difference underscores the additional financial burdens that California homeowners must manage, even after paying off their mortgages.
One significant component of these costs is property taxes. California is known for its high property values, which, while beneficial in terms of asset value, also lead to higher property taxes. These taxes are calculated based on the assessed value of the home, and in California, this can mean substantial annual expenses for homeowners.
Insurance premiums also play a major role in the monthly costs for California homeowners. Given California’s susceptibility to natural disasters such as wildfires, earthquakes, and floods, insurance costs can be high as they need to cover a wider range of potential damages compared to other states. Homeowners must often purchase additional policies for adequate protection, which increases their insurance expenses.
Maintenance expenses also contribute to the financial load. The cost of maintaining a home in California can be higher than in other states due to the higher costs of services and materials. Regular maintenance is crucial to preserving the home's value and ensuring it remains a safe and pleasant place to live, but this also comes with a recurring cost.
Together, these factors—property taxes, insurance premiums, and maintenance costs—combine to create a significant ongoing financial commitment for California homeowners, illustrating that the absence of a mortgage does not equate to the absence of housing-related expenditures. These expenses require careful financial planning and management, particularly in a state where the cost of living is already high.
Achieving a mortgage-free status in California is more an exception than a norm, influenced by high real estate prices and a competitive housing market. For many Californians, remaining in a mortgage is not only a necessity but a strategic choice to manage other living expenses in a state known for its high cost of living. My goal with this article was to shed light on the challenges and invite a broader conversation on potential solutions to improve housing affordability and economic stability in California.
Love,
Kartik
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Recent Changes to the California Real Estate License Exam
The California Department of Real Estate (DRE) has recently implemented changes to the real estate license exam, which may impact how
Recent Changes to the California Real Estate License Exam
The California Department of Real Estate (DRE) has recently implemented changes to the real estate license exam, which may impact how you prepare and take the test. Over the past few months, the DRE has stopped providing calculators and whiteboards during the exam. This shift means that test-takers will need to adjust their strategies to succeed without relying on these tools.
What This Means for You
No Calculators: The removal of calculators means you will have to complete any math-related questions manually. While there are hardly any math problems in the real estate exam, it’s still important to practice solving basic calculations, such as determining commission splits, prorations, or property taxes, without a calculator.
No Whiteboards: Previously, whiteboards were provided for taking notes or working through questions. Without them, you’ll need to rely on mental calculations and keep track of important points without jotting them down. This change highlights the importance of sharpening your memory and mental math skills during preparation.
How to Prepare for the California Real Estate Exam Without Calculators or Whiteboards
To succeed under these new conditions, follow these tips:
Practice Mental Math: Get comfortable doing basic real estate calculations in your head or on scratch paper. You can practice solving simple math problems regularly to ensure you’re prepared for the exam.
Memorize Key Formulas: Memorizing common real estate formulas (such as commission calculations, loan-to-value ratios, and property tax estimations) will help you tackle math questions confidently without needing a calculator.
Focus on Conceptual Understanding: The real estate exam is not just about numbers; it’s also about understanding important concepts such as property law, real estate finance, and contracts. The better you understand these topics, the more you can rely on your knowledge, even in math-related questions.
Take Mock Exams: Practice real estate exams are a great way to prepare under the new conditions. These simulations can help you get used to solving problems without additional tools and will give you a better sense of your readiness for test day.
How to Pass the California Real Estate Exam
Passing the California real estate exam requires more than just adjusting to the new no-calculator and no-whiteboard rules. Here are some key strategies to increase your chances of success:
Thoroughly Review the Course Material: A solid understanding of the topics covered in your real estate courses is crucial. Make sure you go over everything from property management to ethics and legal issues.
Attend Our Crash Course: Consider enrolling in our real estate crash course that focuses on exam preparation. These intensive reviews can sharpen your knowledge and fill any gaps before test day.
Take Multiple Mock Exams: Aim to consistently score above 80% on your practice tests. This will ensure you’re prepared and confident about your understanding of the material.
Stay Calm and Focused: Test anxiety can affect your performance, so be sure to approach the exam with confidence and a clear mind. Practice mindfulness or relaxation techniques leading up to the exam.
The recent changes to the California real estate license exam may seem daunting, but with the right preparation, you can still succeed. Focus on understanding key concepts, practice solving math problems manually, and simulate exam conditions to ensure you're ready.
Remember, passing the exam is just the first step toward a successful real estate career. Stay persistent and dedicated, and you’ll be well on your way to becoming a licensed real estate agent in California.
Love,
Kartik
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Understanding Your Local Real Estate
Market: A Guide for New Agents
Why Market Knowledge is Critical for Success
Obtaining a California real estate license and starting a career in real estate
Understanding Your Local Real Estate
Market: A Guide for New Agents
Why Market Knowledge is Critical for Success
Obtaining a California real estate license and starting a career in real estate can be both exhilarating and daunting. The real estate market is dynamic with nuances that can dramatically affect both the buying and selling process. For agents, particularly those new to the field, understanding the local market isn't just a bonus—it's crucial for success.
Having a high level of market knowledge means agents have the ability to make informed decisions, provide credible advice to clients, and forecast market trends. This insight can prove invaluable when negotiating deals, setting realistic expectations, and ultimately ensuring client satisfaction. For a real estate agent, comprehensive market understanding can dramatically influence income and career longevity. In fact, one of the primary factors that influence real estate agent income is how well they adapt and respond to market conditions.
Market Analysis Techniques: How to Analyze Housing Trends, Pricing, and Client Demands
Analyzing Housing Trends
Understanding housing trends is foundational for any real estate professional. This involves:
Historical Analysis: Reviewing the past price fluctuations and sales volumes in the area to predict future trends.
New Developments: Keeping tabs on new constructions, zoning changes, and community projects which can affect property values.
Market Indicators: Observing indicators such as average days on market (DOM), inventory levels, and price changes to gauge market health.
Understanding Pricing
Pricing strategy is crucial and can be honed by:
Comparative Market Analysis (CMA): This technique involves comparing the prices of recently sold properties that are similar in size, location, and condition to determine the market value of a listed property.
Supply and Demand Dynamics: Understanding the balance between buyers and sellers in the area can help set competitive pricing and anticipate market shifts.
Assessing Client Demands
Knowing what the buyers and sellers want is key:
Buyer Preferences: Stay informed about the features and amenities that are most desirable to buyers in your local market.
Seller Expectations: Gauge what sellers are looking for from an agent and how you can align your services to meet their needs.
Staying Informed: Tips for Keeping Up with Local Real Estate News and Updates
Regular Updates
Agents must stay updated with real-time information:
Local News and Journals: Subscribe to real estate publications.
Online Resources: Utilize platforms like realtor.com and Zillow to follow market trends and updates.
Networking
Building a network can provide insights and opportunities:
Real Estate Groups: Join local real estate groups and associations to connect with peers.
Seminars and Webinars: Attend industry seminars and webinars to learn from experienced professionals.
Continuous Education
Never stop learning:
Continuing Education: Enroll in continuing education courses at a real estate license school to keep up with new laws and market strategies.
Certifications: Obtain additional certifications that can boost your expertise and marketability.
Data Interpretation
Understanding data is as important as gathering it:
Market Reports: Generate and study market reports which highlight trends, shifts, and potential growth areas.
Client Data Management: Use CRM systems to manage client data effectively, tracking preferences, interactions, and feedback.
Social Media Insights
Social media platforms can be a goldmine of information:
Market Sentiment Analysis: Gauge buyer and seller sentiments through comments and discussions on platforms like Facebook and Twitter.
Targeted Advertising: Use the data from social media advertising to understand demographic preferences and behaviors.
How Deep Market Knowledge Can Attract Your First Clients
For new real estate agents, mastering the local market is more than a skill—it's a necessity. Deep market knowledge not only helps in attracting the first few clients but also sets the foundation for a robust, long-term career. Being well-versed in market analysis techniques, staying informed through reliable sources, and effectively using data to make informed decisions are crucial steps in becoming a successful agent.
Agents equipped with thorough market understanding are able to offer tailored advice, predict market trends, and serve their clients' best interests. Moreover, in a competitive field like real estate, being knowledgeable is a major selling point—it builds trust and credibility with clients.
Remember, the journey from a novice to a skilled agent is continuous. Every piece of information helps build a clearer picture of the market. Whether you are just starting at a real estate license school, attending seminars, or networking with other professionals, each effort contributes significantly to your success in real estate.
By combining passion with knowledge, and ongoing education, new agents can not only meet but exceed expectations, turning challenges into opportunities and inquiries into successful transactions. Start strong, stay curious, and keep learning—your path in real estate is paved with potential.
Love,
Kartik
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Factors Influencing Real Estate Agent Income
The allure of the real estate profession is undeniable: the potential for financial freedom, flexible work schedules, and the satisfaction of helping clients
Factors Influencing Real Estate Agent Income
The allure of the real estate profession is undeniable: the potential for financial freedom, flexible work schedules, and the satisfaction of helping clients find their dream homes. Yet, the reality is that income in real estate can vary. While some agents earn well into the six or seven figures, others struggle to make ends meet. So, what factors influence real estate agent income?
Understanding these factors is essential for anyone considering a career in real estate, or for existing agents seeking to increase their earnings.
Location
Geographic location can play a major role in an agent's earning potential. Since most real estate agents earn a percentage of the sales price of a property, practicing in high-cost urban areas can lead to larger commissions. In contrast, agents in lower priced or more rural locations may deal with lower property values and, consequently, lower commissions. However, it's important to note that the cost of living can also vary significantly between locations.
While setting up shop in Beverly Hills might seem tempting, remember that high-priced areas often attract lots of agents because of the big commissions they can earn. In busy areas like Manhattan Beach or Newport Beach, there are so many agents that it becomes really competitive. To stand out, agents need to be great at marketing themselves, negotiating deals, and making connections. They also need to close deals regularly to afford the high cost of living in these areas and maintain their lifestyle.
Market Conditions
Economic factors like interest rates, housing demand, and local market trends can have a profound impact on agent income. When interest rates are low and demand is high, it's a seller's market, and agents can earn more. Conversely, in a buyer's market with high interest rates and low demand, transactions may be slower, impacting agent income. Additionally, seasonal fluctuations can affect real estate activity. Spring and summer tend to be busier seasons, while the market may slow down during the fall and winter months.
Experience and Skills
Experience levels often correlate with income. Seasoned agents have a larger network, better negotiation skills, and in-depth market knowledge. This allows them to close deals more and command higher commissions. Moreover, niche expertise and specialized knowledge in areas like luxury homes, commercial real estate, or investment properties can be lucrative. Continuous learning and professional development are also crucial for staying ahead in a competitive market.
Business Model and Commission Splits
The way commissions are split between a real estate agent and their brokerage can greatly influence their earnings. Common splits can vary widely, but an agent generally keeps more as they gain more experience and close more deals. Some brokerages offer even better terms or a 100% commission model, where agents keep all the commission but pay a monthly or transaction fee to the brokerage.
While these offers might sound good, agents should think carefully about what they might lose in terms of support and resources from traditional brokerages. For instance, brokerages offering lower splits often provide more resources, such as CRM systems or postcard marketing and mailing services. Therefore, while an agent on a higher split might earn more per deal, their overall profit could be lower as they might end up paying for these services out of pocket. Understanding the compensation structure is crucial when picking a brokerage because it directly impacts how much money an agent can make and their overall financial success.
Marketing and Lead Generation
Effective marketing and lead generation strategies are crucial for success in real estate. Agents need to create a strong online presence while utilizing social media. Digital marketing campaigns are a must to attract potential clients. Building a personal brand and establishing oneself as a trusted expert in a specific area can also lead to increased visibility and higher earnings. Lead nurturing and conversion strategies are equally important for turning leads into closed deals.
Client Relations and Reputation
Exceptional customer service and client satisfaction are key to generating repeat business and referrals. Agents who prioritize building strong relationships with their clients and providing a seamless experience are more likely to see long-term success. A positive reputation can lead to organic growth and increased income over time.
Specialization and Niche Markets
Specializing in certain types of properties or catering to specific demographics can be a strategic way to enhance income. By becoming the go-to expert in a niche market, such as eco-friendly homes, senior living communities, or vacation rentals, agents can attract a loyal clientele and potentially command premium commissions.
Real estate offers tremendous opportunities for motivated individuals to achieve financial success and build a rewarding career. However, it's essential to recognize that income is influenced by a multitude of factors.
By understanding these factors and adapting their strategies, agents position themselves for success in this dynamic industry.
When creating your business plan, keep the above factors in mind. You might not be able to immediately change where you practice, and reputation isn't built overnight, but you can always turn up the marketing and keep plugging away. Real estate sales is a career that is built brick-by-brick not overnight.
Love,
Kartik
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In the competitive and often unpredictable world of real estate, success hinges not just on knowledge, but also on how well you prepare and adapt. I wanted to write an article exploring the critical roles
In the competitive and often unpredictable world of real estate, success hinges not just on knowledge, but also on how well you prepare and adapt. I wanted to write an article exploring the critical roles of a well-honed strategy and a resilient mindset, and offer practical advice for real estate professionals aiming to excel in their careers and navigate the complexities of the market confidently.
The Importance of Preparation
In real estate, meticulous preparation is key to managing a complex schedule effectively. For agents, staying organized is crucial for handling multiple listings, client meetings, and dynamic market conditions. A structured schedule allows for allocating adequate time to each client, providing personalized service that addresses unique needs and challenges. This readiness not only enhances professionalism but also builds trust and reliability among clients—cornerstones of long-term success in the industry.
Managing Distractions as a Self-Employed Agent
Distractions can undermine even the best-prepared agents. As a self-employed professional, it's vital to manage your time and workspace effectively. Setting a daily schedule mimicking a traditional office environment, creating a dedicated workspace, and using technology wisely can significantly enhance focus and productivity. Prioritizing tasks and taking regular breaks are also essential practices that help maintain efficiency and prevent burnout.
Maintaining focus can be difficult without the structured environment of a traditional office. Distractions are a significant challenge for real estate agents, mainly because many operate as self-employed professionals, which requires a high degree of self-management and discipline. Poor time management and reduced productivity can directly impact an agent’s ability to serve clients effectively. Real estate agents must respond quickly to client needs and market changes; thus, any delay or oversight caused by distractions can result in missed opportunities or diminished service quality.
Real estate can demand a high degree of accuracy in handling transactions and paperwork. Distractions that lead to errors can have serious consequences, potentially harming the agent’s reputation and client relationships. Managing distractions effectively is crucial for maintaining professionalism, ensuring client satisfaction, and upholding the reliability expected in the real estate industry.
Finding Solutions to Common Real Estate Problems
Real estate transactions involve multiple parties and interests, often leading to complex challenges. Whether dealing with property title issues, financing setbacks, or unexpected inspection results, there is always a potential solution. Effective strategies include:
Proactive Communication: Keep all parties informed to prevent misunderstandings and build trust.
Flexibility and Creativity: If initial solutions falter, think outside the box. For instance, if financing falls through, suggest alternative lenders or creative financing options like seller financing.
Leverage Expertise: Consult with seasoned colleagues or specialists, such as real estate attorneys or title agents, to gain new perspectives and solutions.
Stay Updated: Keeping abreast of changes in real estate laws and regulations can preempt and mitigate potential issues.
The Power of Positive Self-Talk
The way we converse with ourselves significantly influences our actions and outlook, especially in high-stakes situations like negotiations or competitive markets. Positive self-talk, such as affirming "I am a skilled negotiator" or "I can handle this challenge," can shift your perspective and boost your confidence, thereby enhancing your performance.
Consistency Leads to Mastery
Success in real estate isn't just about big moves; it’s also about the accumulation of small, consistent actions. Regularly engaging in activities that enhance your skills, like market analysis or client relationship management, builds expertise over time. This principle of consistency is particularly pertinent in real estate, where persistence and resilience often determine long-term success.
Embracing thorough preparation and maintaining an optimistic outlook are indispensable in enhancing your professional performance and managing personal challenges in real estate. By equipping yourself with the tools to find solutions and succeed, you can confidently navigate every aspect of your career. Remember, in the dynamic field of real estate, every problem indeed has a solution—it's up to you to find it.
Love,
Kartik
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Rediscovering Your Drive in the Real Estate Industry
Real estate agents need to read this article.
Remember when you first got your real estate license—those early days blended fear, excitement,
Rediscovering Your Drive in the Real Estate Industry
Real estate agents need to read this article.
Remember when you first got your real estate license—those early days blended fear, excitement, and formidable challenges. When you first get your real estate license, new agents are armed with raw ambition and the pressure to learn quickly, adapt, and carve out a path to success.
Do you remember that intense drive when you first started? That sense of urgency that spurred you to make calls, try new strategies, and relentlessly pursue your goals?
The Lost Spark: Nostalgia for Simpler Times
Many seasoned professionals in the industry often find themselves longing for the market of the past, even as recent as the pandemic era, when the real estate market was ablaze with activity, and deals seemed more straightforward. However, as the market has evolved, so have the challenges, demanding a different kind of resilience and adaptability.
During this period, many markets experienced unprecedented buyer interest and sales activity, fueled by low interest rates and a surge in demand for residential properties. This led to quicker sales, often with multiple offers that drove prices up and simplified the selling process for many agents.
However, the market has since shifted. Interest rates have risen, economic uncertainties have increased, and buyer behavior has changed, leading to a more balanced or even a buyer's market in some areas. These changes have introduced new complexities to the transaction process, including longer sales cycles, more price negotiations, and sometimes increased difficulty in securing buyers' financing.
Adapting to Today's Real Estate Market
In a competitive real estate market, success now demands a proactive approach. Whether you're aiming to acquire a California real estate license or striving to excel at our top real estate school, the essence of progress lies in your willingness to dive deep into your responsibilities.
The market today does not favor the passive. It rewards those prepared to roll up their sleeves and engage directly with the work that matters—through conversations, appointments, and proactive engagements.
Core Strategies for Success
I suggest a few things you can do to achieve success in the right mindset. Consider the below:
Engage in Strategic Planning: Focus on specific outcomes rather than just tasks. Ask yourself, "What measurable results do I want to achieve today?" This approach helps steer your efforts toward impactful activities.
Practice Through Role-Playing: Regularly engage in role-playing with peers or alone to refine your skills in handling objections, negotiations, and client interactions, which boosts your confidence and effectiveness.
Diligent Follow-ups and Communication: Consistent communication is crucial. Please make it a non-negotiable part of your day to reach out to existing connections and forge new ones, ensuring you remain at the top of your mind and build trust.
Leverage Technology and Tools: Embrace the latest real estate technologies, such as CRM systems, virtual tour software, and market analysis tools. Efficient use of technology can streamline workflows, enhance client presentations, and keep you ahead in a competitive market. It also helps maintain accurate records and provides analytics for better decision-making.
Cultivate a Strong Online Presence: In today's world, having a robust online presence is crucial. Regularly update your professional profiles on social media and real estate platforms. Share insightful articles, market updates, and success stories to engage your audience and increase your visibility. This approach helps build a personal brand that attracts potential clients.
Expand Your Network: Attend industry conferences, seminars, and community events to meet potential clients and other real estate professionals. Networking is vital in real estate as it opens doors to new opportunities, referrals, and partnerships. Encourage your team to build a diverse network supporting various aspects of real estate transactions.
Personal Development and Continuous Learning: Encourage ongoing education through courses, certifications, and training. The real estate market is continually evolving, and staying updated with the latest regulations, technologies, and sales techniques can give you an edge. Personal development also includes improving negotiation and interpersonal skills, which are crucial in real estate.
Reflecting and Reigniting Passion
Reflect on what initially drove you to this industry. What goals and aspirations once pushed you out of your comfort zone? If you find it hard to answer, it might be time to reignite your passion. Set inspiring goals, create structures to minimize distractions, and hold yourself accountable—perhaps through commitments to loved ones or charitable pledges.
Embrace the Journey
Remember the zeal of your early days as we navigate the demanding real estate market. The industry might have changed, but the fundamental principles of hard work, passion, and persistence remain the same. Whether you're just out of real estate school or seasoned enough to mentor others, success is paved with the efforts you're willing to put in. What's your next move? How will you adjust your strategies to thrive in today's estate landscape?
Remember, the path to extraordinary achievement is paved with ordinary, consistent actions. Start today, and who knows where you will be in a year?
Love,
Kartik
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How Do I Pass the Real Estate Exam the First Time?
Passing the real estate exam on your first attempt is a significant milestone for anyone looking to enter the real estate field. It's an achievement
How Do I Pass the Real Estate Exam the First Time?
Passing the real estate exam on your first attempt is a significant milestone for anyone looking to enter the real estate field. It's an achievement that sets the tone for a promising career ahead. However, many aspiring agents wonder, "How hard is the California real estate exam?" The truth is, with the proper preparation and resources, you can pass the first time. This article will provide strategic insights and tips from a real estate license school perspective to ensure you're well-prepared.
Understanding the Exam's Difficulty
The California real estate exam is known for its rigorous nature. The test is designed to ensure that candidates thoroughly understand property laws, real estate principles, and ethical practices. While the exam can be challenging, the difficulty often lies in how well you prepare. Engaging in a real estate crash course is a proactive way to get up to speed with the exam's requirements.
The good thing about California's real estate license exam is that there is no national component, only a state one, so you can focus all your study efforts on understanding California-specific laws, regulations, and real estate practices without worrying about additional national standards.
Choosing the Right Real Estate License School
The first step in your journey should be selecting a reputable California real estate license school. A good school prepares you academically and provides insights into the practical aspects of real estate. Look for schools that offer comprehensive study materials, experienced instructors, and additional support such as tutoring or study groups.
Why Take a Crash Course
Taking a real estate crash course is like giving yourself a turbo boost in a video game. It's a fast and focused way to learn everything you need to know for the real estate exam. Like how a sprinter trains right before a big race to perform their best, a crash course helps you sharpen your knowledge and skills quickly.
In the ADHI Schools crash course, you'll dive into the key topics on the exam. It's not just about memorizing facts; it's about understanding how things work in real estate. You'll learn about laws, how properties are bought and sold, and what rights and responsibilities both buyers and sellers have.
Think of it as a super condensed learning session where all the essential details are packed into shorter, more manageable chunks of time. This makes it easier to grasp the bigger picture and retain the finer points of the subject. Plus, it's designed to keep you engaged and active in your learning, so you're not just passively reading but interacting with the material.
By the end of the crash course, you'll feel more prepared and confident about taking the exam. It's a smart move for anyone who wants to step up their game and get a head start in their real estate career. So, if you're ready to hit the ground running, jumping into a real estate crash course is the way to go! Check out www.crashcourseonline.com for more info.
Comprehensive Study and Preparation
Study Regularly: Create a schedule that covers all the material without cramming. Regular, consistent study sessions are more effective than last-minute marathons.
Use Practice Tests: ADHI Schools’ practice exams help you get accustomed to the format of the actual exam and identify areas where you need more focus.
Attend a Real Estate Crash Course: As previously mentioned, a real estate crash course can be invaluable. These intensive courses review vital topics and often provide tips and tricks for remembering complex information.
Understand Key Concepts: Make sure you have a firm grasp of critical concepts such as property ownership types, appraisal methods, financing principles, and contract laws.
Stay Updated: The real estate market and laws can evolve. Stay updated with any changes by following real estate news and updates from your school or educational institution.
Managing Exam Day
On the day of the exam, it's essential to manage your time and stress effectively:
Arrive Early: Get to the exam center early to avoid any last-minute stress.
Read Questions Carefully: Take your time to read through each question thoroughly.
Manage Your Time: Watch the clock and allocate your time wisely to ensure you answer all questions.
Passing the California real estate exam on your first try is an achievable goal. You can confidently approach the exam with the proper preparation through a trusted real estate license school, the utilization of real estate crash courses, and a disciplined study routine.
Remember, your effort is directly reflected in your exam results. Start your journey with determination and focus, and success will follow.
Love,
Kartik
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How Long Are California Real Estate Courses Valid?
For those considering becoming a real estate agent in California, several questions come to mind. One of the most common being: "Is a California
How Long Are California Real Estate Courses Valid?
For those considering becoming a real estate agent in California, several questions come to mind. One of the most common being: "Is a California real estate license worth it?" After all, you have to take some classes, study and pass and exam and obtain the license.
What if you want to dip your toe in the water and sign up for real estate school, but aren’t quite ready to apply for your license?
The good news is that once you complete your real estate courses, they don’t expire. You can take the exam whenever you're ready, as long as the rules don’t change.
Choosing the Right Real Estate School
Selecting a reputable real estate school like ADHI Schools is crucial. We are recognized for meeting the educational standards required by the state, ensuring that you're well-prepared not only for the exam but also for your future career in real estate.
Stay Updated with Legislative Changes
While the real estate courses don't expire, it's still important to keep an eye on changes in the law that might affect the validity of the courses. For example, a new law called Senate Bill 1495 (SB 1495) was introduced and took effect on January 1, 2024. This law added new requirements to the Real Estate Practice course, including topics on implicit bias and fair housing laws. These topics are designed to help you understand the underlying biases affecting housing decisions and learn the laws ensuring housing fairness.
If you plan to take your licensing exam after January 1, 2024, you must have completed a course that includes these new topics. If your previous courses didn't include these, you will have to retake this course.
Why It Matters
Choosing a school that stays updated with the latest legal requirements is essential. We ensure that our curriculum is always aligned with the latest laws, helping you avoid surprises when you decide to take your exam.
While the courses you take are valid indefinitely under current regulations, the requirements for becoming a licensed real estate agent can and sometimes do change. Being proactive and informed about these changes and choosing a reputable school can significantly impact your career.
Even Though the Education Doesn’t Expire - Apply for Your License Promptly
Once you've completed your real estate courses, it's crucial to take the next step and apply for your license without delay. Procrastination can be a significant hurdle. Lots of students, filled with relief and satisfaction after finishing their coursework, might feel tempted to take a break before applying for the license. However, delaying this critical step can lead to unnecessary setbacks.
Applying for your license immediately after completing your courses has several benefits. Firstly, the information you've learned is still fresh in your mind, which can be advantageous when taking the licensing exam. Secondly, beginning your career sooner rather than later allows you to capitalize on the momentum and enthusiasm you've built up during your studies with ADHI Schools.
Moreover, getting licensed quickly enables you to enter the real estate market when your drive is at its peak, potentially leading to a more successful start. Delaying the process might not only diminish your preparedness but could also impact your motivation and the likelihood of pursuing a career in real estate altogether.
In essence, treat the completion of your courses not as the finish line, but as a springboard into your real estate career. By applying for your license promptly, you ensure that you maintain the momentum necessary for a successful transition from student to practicing agent. Remember, in real estate, timing is everything, and the sooner you start, the sooner you can begin shaping your successful career.
In the end, a California real estate license is valuable, especially when you are well-prepared with the right education from the right real estate license school.
TLDR: Courses don’t expire in California, but sometimes the requirements to get a license change.
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Is the California Real Estate Exam Multiple Choice?
If you're considering a career in real estate in California, attending a California real estate school will prepare you for an important milestone:
Is the California Real Estate Exam Multiple Choice?
If you're considering a career in real estate in California, attending a California real estate school will prepare you for an important milestone: the California real estate exam. Many aspiring agents ask: "Is the California real estate exam multiple choice?" This is often asked alongside the question of “How hard is the California real estate exam?”
Let's examine the exam's structure and discuss the advantages and disadvantages of being a multiple-choice test.
Structure of the California Real Estate Exam
The California real estate exam is indeed a multiple-choice test. This format assesses your knowledge and understanding of California real estate principles and laws. When you enroll in a real estate school in California like ADHI Schools, you'll be trained to tackle this exam, which is crucial for obtaining your real estate license.
The sales license exam consists of 150 questions (the broker test in California has 50 more); you are given three hours to complete it (four hours for the broker exam). The questions cover a wide range of topics, including property ownership, land use controls and regulations, valuation and market analysis, property disclosures, contracts, financing, and much more. This comprehensive test requires a solid understanding of all these areas, which is why attending a reputable real estate school like ADHI Schools is beneficial.
Pros of Multiple Choice Exams
Straightforward and Fast to Answer: Multiple-choice questions allow for quick answers. You select the option that best fits the question. This can make the testing process faster and less subjective than essay-type questions.
Objective Grading: One of the most significant advantages of multiple-choice tests is their objectivity in grading. Since the answers are fixed, there is no room for bias, and scoring is clear-cut.
Covers Broad Material: Multiple-choice exams can cover a more comprehensive range of topics than other exams, ensuring a thorough assessment of a candidate's knowledge.
Cons of Multiple Choice Exams
Guesswork: One downside is the possibility of guessing. Test-takers might select the correct answer by chance without truly understanding the material.
Test-Taking Strategies Over Knowledge: Sometimes, students focus more on mastering
test-taking strategies than on the actual content. This can lead to a lack of deep understanding of real estate principles.
Limited Depth of Knowledge Testing: Multiple-choice questions often test recognition of facts rather than a deep understanding. This can be a drawback for subjects that require complex problem-solving skills.
Exam Format: Multiple Choice Only
A significant feature of the California real estate exam is its exclusive use of multiple-choice questions. Unlike many other exams you might encounter during your educational or professional career, this test does not include true/false questions, essays, or short-answer questions.
Here's what this means for you as a test-taker:
No True/False Questions: True/false questions can sometimes be tricky, requiring absolute certainty. The California real estate exam avoids this format, so you won't have to worry about oversimplifications or the nuances that often make true/false questions challenging.
No Essays: Without essay questions, you won't need to formulate complex arguments or write lengthy responses during the exam. While this can be seen as a relief to those less confident in their writing skills, it also means that the exam focuses on assessing your quick recall and recognition of fundamental concepts rather than your ability to elaborate on or argue a point in depth.
No Short Answer Questions: The exam avoids testing your ability to recall and concisely explain specific details without short answer questions. This format removes the stress of remembering exact terminology or definitions without the cue of multiple-choice options.
Focused Preparation: Knowing that the exam consists solely of multiple-choice questions allows you to tailor your study strategy. Focus on understanding key concepts thoroughly enough to recognize the correct answer among the options provided. This involves more than memorization; it's about understanding relationships, processes, and principles in real estate practice.
Strategic Answering: In a multiple-choice format, you can use strategies like the process of elimination to work towards the correct answer, even if you're initially unsure. This can be particularly helpful in a comprehensive test like this, where your breadth of knowledge is as crucial as your depth.
Time Management: Without essays or short answers to slow you down, you can manage your time more effectively during the exam. Allocate enough time to read each question carefully and consider all the options before selecting.
The structure of the California real estate exam as a multiple-choice-only test influences both the preparation approach and the testing experience. While it eliminates the challenges associated with other question types, it emphasizes a solid understanding of various topics. Adequate preparation at a California real estate school can equip you with the necessary knowledge and test-taking strategies to excel, ensuring you're not just choosing answers at random but making informed decisions throughout the exam.
This focused approach to the format and implications of the exam's structure should help bolster your preparation efforts and increase your confidence as you prepare to take the California real estate license examination.
TLDR: Both the sales and broker exams in California are multiple choice.
Love,
Kartik
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How Many Times Can You Fail the California Real Estate Exam?
Failing any exam can be a disheartening experience, but it's crucial to remember that persistence is vital when it comes to the California
How Many Times Can You Fail the California Real Estate Exam?
Failing any exam can be a disheartening experience, but it's crucial to remember that persistence is vital when it comes to the California real estate license exam. If you're wondering, "How hard is the California real estate exam?" you're not alone. It's a common question among aspiring agents and brokers, reflecting the challenging nature of the exam.
Unlimited Opportunities to Succeed
In California, salespersons and brokers can retake the real estate licensing exam as often as they want until they pass or give up.
The state does not limit the number of attempts, allowing candidates to continue striving for success until they pass.
While the opportunity to retake the California real estate exam as often as needed might seem super generous, it's essential to recognize the potential financial implications. The state collects fees each time you schedule an exam, whether it's your first attempt or a subsequent retake.
These fees serve as a steady revenue stream for the state, incentivizing them not to discourage frequent retakes.
Financial Considerations of Multiple Exam Attempts
Here is closer look at how the fees break down and the potential cost implications if you find yourself needing multiple attempts:
Original Examination Fee: $100 for salespersons, $150 for brokers
Re-Examination Fee: $100 for salespersons, $150 for brokers
First Rescheduled Exam Fee: $40 for salespersons, $45 for brokers
Subsequent Rescheduled Exam Fee: $40 for salespersons, $45 for brokers
While the state allows unlimited retakes, each attempt incurs a cost. These costs can accumulate, turning what seems like a flexible system into a financial burden. For example, if a candidate fails the exam twice and schedules two more retakes, the total cost can escalate quickly. This doesn't even include the cost of additional study materials or courses necessary to prepare for further attempts.
These fees allow candidates to approach the exam with less pressure, knowing that they can try again if they do not succeed on the first try. However, the costs can add up, emphasizing the importance of thorough preparation.
The Strategic Advantage of Comprehensive Preparation
This financial model underscores the importance of being well-prepared for your first exam attempt. Investing in a reputable real estate school like ADHI Schools isn't just about passing the exam; it's also about minimizing financial costs and reducing the time it takes to start your career in real estate.
The Role of a Quality Real Estate School
While the state allows unlimited retakes, the goal should always be to pass the exam on your first attempt. This is where the value of a reputable real estate school comes into play. Enrolling in a recognized school like ADHI Schools, a leading real estate school in California, can significantly increase your chances of passing the exam.
A dedicated real estate education provider, such as ADHI Schools, offers comprehensive courses that cover all the necessary material you need to know to pass your exam. More than just helping you memorize facts, these courses aim to provide a deep understanding of the industry and the day-to-day tasks of a real estate professional.
Why Choose ADHI Schools?
Choosing the right education provider is crucial. Here you should consider enrolling with ADHI Schools:
Expert Instructors: Learn from experienced professionals who know precisely what it takes to succeed in the industry.
Comprehensive Material: Access up-to-date, detailed course materials covering every California real estate exam aspect.
Supportive Environment: Enjoy a learning environment geared towards helping you succeed, with support available whenever needed.
Failing the California real estate exam can happen, but it doesn't have to be a recurring challenge. With the proper preparation and support from a top-tier real estate school like ADHI Schools, you can make your next attempt your last.
Love,
Kartik
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What is the Hardest Part of the Real Estate Exam?
Becoming a licensed real estate professional in California is a significant achievement that opens many doors in the industry. However, obtaining your
What is the Hardest Part of the Real Estate Exam?
Becoming a licensed real estate professional in California is a significant achievement that opens many doors in the industry. However, obtaining your license, specifically passing the California real estate exam, can be daunting. At ADHI Schools, we understand the complexities and challenges of this crucial test.
After all, we have been training and licensing students in California for over 20 years.
The Challenge of Focus and Stamina - The hardest part of the real estate exam process
Based on all the students we have spoken to over the years, the most challenging part of preparing for the California real estate exam isn't necessarily the content itself but the ability to maintain concentration and stamina throughout the exam. The salesperson exam lasts up to 3 hours, while the broker exam lasts 4 hours. This requires a sustained focus that can be challenging for many candidates. Preparing to stay mentally alert for such a lengthy period is crucial and often determines one's success on the exam day.
Cell phones have changed the way we focus. They constantly send us notifications and alerts from social media, emails, and news apps, which can be distracting. Every time we get a notification, it interrupts whatever we're doing. This can make it hard to stay focused on any one thing for a long time. Plus, because everything on our phones happens so fast, we always expect quick answers and results. This can make us less patient and less likely to stick with tasks requiring more effort.
This can cause a problem not just on exam day, but also in the process of studying and preparing for the test.
Practice of Real Estate and Mandated Disclosures - A Big Deal
The "Practice of Real Estate and Mandated Disclosures" section, makes up approximately 25% of the real estate license exam in California, is often regarded as the hardest part of the real estate test. This significant portion challenges candidates attending any real estate school in California due to its comprehensive nature and the depth of understanding required.
Trust Account Management and Record Keeping Requirements demand strict adherence to financial and documentation standards, which are critical for legal compliance in real estate practice. Mastery of these topics is crucial, as any misstep can lead to severe consequences, illustrating how hard the real estate exam can be.
Fair Housing Laws, Truth in Advertising, and General Ethics cover essential ethical and legal standards designed to ensure fairness and honesty in real estate transactions. These areas not only require memorizing specific regulations but also a profound understanding of their ethical implications across various scenarios, making them some of the most complex topics for students.
Agency Supervision and Permitted Activities of Unlicensed Sales Assistants involve precise knowledge of the legal responsibilities within a real estate agency, including understanding the tasks that can legally be delegated, which is vital for maintaining operational legality.
DRE Jurisdiction and Disciplinary Actions, Licensing, and Continuing Education Requirements and Procedures, along with the California Real Estate Recovery Fund, cover lots of regulatory details. These segments are often challenging to grasp without a solid understanding of the legal framework, contributing to discussions around how hard the real estate exam is.
Technology and Property Management require both practical application and theoretical knowledge, from utilizing real estate software to managing properties effectively, demanding both technical skills and strategic insight.
Lastly, critical disclosures such as the Transfer Disclosure Statement, Natural Hazard Disclosure Statements, and Disclosure of Material Facts Affecting Property Value emphasize the importance of transparency. Understanding the intricacies of what must be disclosed and the procedures for inspections and verifications reflects the detailed and complex nature of the hardest part of the real estate test.
This extensive coverage in the exam underlines why attending a well-structured real estate school in California is crucial for candidates, as it equips them with the necessary knowledge and skills to navigate these challenging topics effectively.
Exam Content Overview
The California real estate exams cover various topics to assess candidates' understanding of real estate principles, practices, and laws relevant to their future careers. The Salesperson Exam Content and Broker Exam Content provided by the California Department of Real Estate (DRE) give detailed outlines of the subjects tested.
The real estate license exam in California tests your knowledge and understanding of real estate principles, practices, and laws. The sales license exam consists of multiple-choice questions; you are given up to 3 hours to complete it. The total number of questions is 150, covering various topics relevant to California's real estate transactions and regulations.
To pass the exam, you need to score at least 70%. This means you must answer at least 105 questions correctly.
The broker exam has 200 questions, and you have up to 4 hours to complete it. The passing score is 75%.
The format of the exam is straightforward, with each question providing four options to choose from. It's essential to prepare thoroughly, as the exam covers a wide range of material, and passing it is a critical step towards becoming a licensed real estate professional in California.
Minimal Mathematical Calculations
A common misconception about the California real estate exam is the emphasis on math. In reality, there is very little math involved. The exam focuses more on legal aspects, ethical practices, real estate principles, and problem-solving through scenario-based questions.
Strategic Exam Preparation Tips
Structured Study Schedule: Dedicate specific hours each day to studying the different topics outlined in the DRE's content specifications. This systematic approach helps you cover all necessary material without overwhelming yourself.
Practice Tests: Regularly taking practice exams can help you understand the exam format and identify weaker areas. At ADHI Schools, we provide extensive practice materials tailored to the California real estate exam structure.
Rest and Nutrition: Do not underestimate the power of good rest and proper nutrition before your exam. A well-rested mind is more efficient, and a nourished body can maintain energy levels throughout the exam.
Focus on Weak Areas: Spend additional time reinforcing your understanding of the topics you find most challenging on our real estate crash course system. This targeted study can transform weaknesses into strengths.
Relaxation Techniques: Learn and practice relaxation techniques to manage exam stress. Techniques such as deep breathing or visualization can help maintain calm and focus during the test.
So to answer the question of “How Hard is the California Real Estate Exam” - In California, the pass rate for the real estate license exam typically hovers around 50%, a statistic that remains consistent regardless of the exam period. This notably low success rate is primarily attributed to inadequate preparation by candidates. Folks tend to underestimate the required breadth and depth of knowledge and need to spend more time studying the necessary material.
Thorough preparation is crucial to increasing your chances of passing. A resource like crashcourseonline.com can be highly beneficial. Our site offers comprehensive study materials tailored to the specifics of the California real estate exam. Using the "Training" mode on the website is advisable, ensuring that you go through all the questions at least twice.
Additionally, scoring consistently at 90% or better on mock exams provided by the site can give you a reliable indication of your readiness for the test. This level of preparation can significantly boost your confidence and competence, improving your odds of passing the exam on your first attempt.
At our California real estate school, we are committed to providing the highest-quality education to future real estate professionals. Whether you are preparing for your salesperson or broker exam, we offer a variety of resources and courses to ensure you are fully prepared to pass it and excel in your career.
Remember, the key to conquering the California real estate exam is not just understanding the material but mastering the art of test-taking. Equip yourself with the right tools and mindset with ADHI Schools, your partner in real estate education.
Love,
Kartik
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Mastering Self-Representation in Real Estate Transactions
As a licensed real estate professional, you face a critical decision: should you hire an agent or handle your property transactions independently?
Mastering Self-Representation in Real Estate Transactions
As a licensed real estate professional, you face a critical decision: should you hire an agent or handle your property transactions independently? For those contemplating self-representation, this choice blends challenges with rewards. This article explores the nuances of representing oneself in real estate deals and offers a strategic approach for agents considering this path.
Legal Viability of Self-Representation
Yes, as a licensed real estate agent in California under the employ of a broker, you are fully capable of representing yourself in property transactions. However, this autonomy necessitates clear upfront disclosure of your dual role as both agent and party in the transaction.
Brokerage Affiliation: A Crucial Step
Before venturing into self-representation, it is essential to secure affiliation with a reputable brokerage. This relationship often involves sharing a portion of your commission in exchange for their support and services. The process includes choosing a brokerage that aligns with your professional values, undergoing interviews, and formally associating your license with them.
Advantages of Self-Representation
The financial benefits of self-representation are notable. Typically, a buyer’s agent splits a commission with the seller’s agent. By acting as your own agent, you could retain the entire commission, potentially saving thousands. Additionally, having direct control over negotiations, listings, and transaction coordination enhances efficiency and minimizes reliance on third parties, which is particularly beneficial for seasoned agents with strong market knowledge and negotiation skills.
Risks and Considerations
Despite its advantages, self-representation carries risks, especially for less experienced agents. The complexities of transaction processes, legal requirements, and market dynamics require extensive knowledge and experience. Mishandling paperwork, disclosures, or legal compliance can lead to significant financial and legal repercussions.
For Novice Agents: Consider Collaboration
If you are a new licensee or unfamiliar with local market dynamics, collaborating with an experienced agent could be advantageous. This partnership allows you to learn while still earning through shared commissions—an effective strategy to build experience and confidence before undertaking transactions independently.
Benefits of a Local Expert
Partnering with an agent knowledgeable about your target area can be invaluable. Their expertise can aid in accurately assessing property values, understanding neighborhood trends, and making informed decisions that maximize investment returns.
Experienced Agents: Less Risk, More Reward
For seasoned professionals, self-representation offers a pathway to maximize earnings and transaction volumes. However, it’s crucial to adhere to state regulations and coordinate with your brokerage to ensure all practices are compliant.
Emotional Considerations in Transactions
Even the most experienced agents find real estate transactions emotionally charged. Working with another agent can provide a buffer against emotional decisions that might negatively impact the transaction. A home is more than a building; it’s a repository of memories and aspirations, making any transaction feel personal and emotionally intense.
Here's how another agent can help: they act as a neutral party, unattached to the house or its memories, allowing them to view the deal more objectively. They can provide advice based on market data and facts, ensuring decisions are made with clarity and professionalism, not swayed by emotions.
Is a Real Estate License Worth It for Self-Representation?
Obtaining a real estate license for self-representation offers more than commission savings. It also provides networking opportunities and a potential new career trajectory. However, consider the ongoing costs of maintaining a license and the commitment required to stay active and informed in the industry.
Representing yourself in real estate transactions offers financial benefits and greater control over the process, but it requires careful consideration, preparation, and adherence to legal standards. With the right experience and strategic approach, self-representation can be a rewarding endeavor, enriching both your professional capabilities and financial portfolio.
Love,
Kartik
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Should I Become a Realtor?
Deciding a new career path can be exciting and daunting, especially when considering potentially lucrative fields like real estate. I wanted to write an article to guide
Should I Become a Realtor?
Deciding a new career path can be exciting and daunting, especially when considering potentially lucrative fields like real estate. I wanted to write an article to guide you through the considerations of becoming a Realtor. Interest in obtaining a real estate license has grown due to flexible work hours, the potential for high earnings, and the personal satisfaction of helping people find their dream homes. As more people get interested in real estate, it’s important to know what you need to do well in this tough field.
Let’s explore the profession's benefits and challenges, helping you make an informed decision about whether this is the right path for you. Join us and uncover the realities and rewards of pursuing a career as a Realtor.
How Should I Make This Decision?
Becoming a Realtor is not merely a career choice; it's a lifestyle decision that requires careful consideration of your motivations and long-term career goals. Understanding why you want to enter the real estate field is crucial. Are you drawn to being your boss, or do you find the potential financial rewards appealing? Are you motivated by the prospect of helping others achieve the dream of homeownership? Each of these motivations carries its own set of expectations and realities.
Evaluating your skills and interests is equally important. Real estate is fundamentally about sales, negotiation, and customer service. Ask yourself: Do you enjoy interacting with different people every day? Are you comfortable with the art of negotiation and persuasion? Can you handle the emotional ups and downs of clients? Your answers to these questions will help determine how well you fit into the real estate industry.
Finally, consider your financial position. As a Realtor, your income would be commission-based, which can lead to significant fluctuations in your earnings, especially as you build your business. Financial stability and having a buffer to manage periods of uncertainty are critical as you build your clientele and reputation. If consistent and immediate income is crucial for your financial security; you should carefully consider jumping into real estate until you're more financially prepared.
Even if you don't plan to start as a full-time Realtor, obtaining a real estate license is a wise choice because it is both easy and inexpensive to acquire. A real estate license provides flexibility, allowing you to engage in transactions whenever you're financially ready. This approach can be particularly beneficial while you're building a financial buffer to handle the natural fluctuations in earnings that come with commission-based work, without the pressure of relying on it as your sole income source.
By carefully weighing these aspects, you can make a more informed decision about whether becoming a Realtor aligns with your personal and professional aspirations.
What Are Some Good Reasons to Become a Real Estate Agent?
Becoming a real estate agent offers a unique blend of benefits that can appeal to those with an entrepreneurial spirit and a desire to help others. Here are some compelling reasons to consider this career path:
Flexibility: One of the most attractive aspects of a real estate career is its flexibility. Unlike typical 9-to-5 jobs, real estate agents can set their schedules. This flexibility allows you to attend family events, pursue hobbies, or manage other commitments alongside your career. You can schedule client meetings, showings, and open houses around your personal life, giving you control over your daily activities.
Potential for High Earnings: There is no cap on how much you can earn as a real estate agent; your earnings are directly tied to your ability to close deals and sell properties. The more effort you put into your career, the higher the financial rewards. This performance-based income structure is perfect for self-motivated individuals driven to excel and increase their earnings through hard work and successful sales.
Entrepreneurial Freedom: Real estate agents essentially run their own business. You can decide how to market your services, manage your time, and grow your client base. This entrepreneurial aspect encourages creativity and innovation, allowing you to build a personal brand and tailor your business strategies to suit your market and clientele.
Helping Others: Few careers offer the personal satisfaction of helping others achieve their dreams. As a real estate agent, you guide clients through one of their life's most significant decisions: buying a first home or selling a cherished family property. The gratitude and happiness of clients who find their perfect home or sell their property can be immensely fulfilling.
Market Knowledge and Investment Opportunities: Working in real estate provides deep insights into the housing market, which can be an invaluable asset. This knowledge helps you serve your clients better and opens up personal investment opportunities. Understanding market trends and property values can lead to profitable investments, making real estate a wise career choice for those interested in building personal wealth through real estate investments. Each of these reasons highlights the unique advantages of a career as a real estate agent, combining flexibility, potential wealth, entrepreneurial control, personal satisfaction, and investment opportunities into one dynamic profession.
There Are Some Responsibilities
While the benefits of becoming a real estate agent are compelling, it's also essential to understand the role's responsibilities. Here's what you need to know about the duties and obligations of a real estate professional:
Licensing Requirements: You must obtain a real estate license before practicing as a real estate agent. In California, for example, this process involves completing 135 hours in real estate education from a real estate school like ADHI Schools, followed by passing the real estate examination.
Renewing Your California License Every 4 Years: Real estate licenses must be renewed every four years in California. To renew your real estate license, you must complete 45 hours of continuing education every four years. These courses help you stay updated on real estate laws, regulations, and best practices, ensuring that your knowledge remains current and you continue providing the best service to your clients.
Financial Commitments: Pursuing a career in real estate involves various financial commitments. These include paying for your initial and continuing education, state licensing, and examination fees. Once licensed, you'll likely pay annual dues to the local real estate board and the Multiple Listing Service (MLS). Additionally, as you establish and grow your business, you will likely incur marketing, client meetings, and travel expenses. These costs are necessary investments in your professional growth and success.
Professional Standards: Real estate agents must adhere to ethical and professional standards. This includes maintaining honesty in all transactions, protecting client interests, and conducting business with integrity. The National Association of Realtors (NAR) enforces a strict code of ethics that all members must follow. Adhering to these standards is crucial for legal compliance and building trust and a strong reputation in the industry.
Ultimately, becoming a real estate agent offers a unique blend of independence, potential financial rewards, and the satisfaction of helping others achieve their property dreams. Throughout this post, I wanted to go over the flexibility of setting your schedule, the limitless earnings potential based on your drive and sales success, and the entrepreneurial freedom to run your own business. Additionally, there’s a profound joy in assisting clients with significant life moments and the strategic advantage of gaining comprehensive market knowledge.
However, this career does come with responsibilities, such as passing the real estate exam and maintaining a real estate license, fulfilling continuing education requirements, managing financial commitments, and upholding high professional and ethical standards. These responsibilities ensure that you are well-equipped to serve your clients with the utmost integrity and expertise as a Realtor.
If this blend of opportunities and responsibilities aligns with your personal and professional aspirations, a career in real estate might be the perfect path for you. To take the next step, contact us to learn more about the licensing process.
The journey to becoming a real estate agent is filled with potential and promises a rewarding professional life for those who are committed and passionate.
Love,
Kartik
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Homeownership Benefits and Financial Stability through Real Estate
Back in 2002, right after I got my real estate license, I was in a class at Prudential California Realty, a prominent real estate
Homeownership Benefits and Financial Stability through Real Estate
Back in 2002, right after I got my real estate license, I was in a class at Prudential California Realty, a prominent real estate company at that time. The broker who was teaching us held up a newspaper and shared a story that really stuck with me. It was about Jo Bessell, a tenant who had lived in the same apartment in Newport Beach for over 30 years. She loved her community and felt at home there. However, her rent increase suddenly made the place unaffordable, as she was already on a tight budget with her fixed income. This story highlighted the rental market volatility and showed me how unstable renting can be, especially when you can't keep up with rising costs. It made me realize just how vital homeownership benefits are, as owning a home provides stable and predictable costs each month.
With the cost of rent soaring in 2024, I want to discuss why selling real estate involves more than just completing “a deal”—it's a crucial service that empowers individuals to secure financial stability through real estate and reduce living-related stress.
The Growing Financial Burden of Housing
The affordability of housing in the United States has increasingly become a pressing issue, not just for renters but even for homeowners. A recent report from Harvard University's Joint Center for Housing Studies illuminates this growing housing affordability crisis, revealing troubling trends that have escalated, particularly in the wake of the pandemic.
The Harvard study points out a concerning truth: almost one in four homeowners now spend an alarmingly large part of their income on housing. This means a significant number of people are struggling with housing costs that stretch their budgets to the breaking point. For renters, the situation is even worse. The report shows that for many years, rents have been increasing faster than incomes. This issue became even more severe during the pandemic, leading to what the study calls an “unprecedented affordability crisis.”
Specifically, the number of renters dedicating more than half of their household income to housing and utilities spiked dramatically. In 2022, this figure reached a record high of 12.1 million people, an increase of 1.5 million from pre-pandemic levels. This excessive financial burden places these households in a precarious position, highly vulnerable to becoming unhoused in the face of any unforeseen financial turmoil, such as an unexpected medical bill, a sudden loss of employment, or even something as small as a new set of tires on the family car.
The Benefits of Homeownership
Owning a home is more than just having a roof over your head; it's a long-term investment with numerous financial and personal advantages. One of the most significant benefits is the stability offered by fixed-rate mortgages. Unlike renting, where monthly payments fluctuate with market conditions, a fixed-rate mortgage provides predictable payments for the entire loan term. This predictability allows homeowners to budget effectively, knowing their housing costs won't suddenly increase.
Furthermore, owning a home can protect against inflation and increasing rents. As inflation decreases the value of the dollar, rent costs usually go up. However, homeowners, particularly those with fixed-rate mortgages, are shielded from these hikes. Their monthly payments and even property taxes basically stay fixed, while the value of their property generally goes up over time. This growth builds equity and increases wealth.
In addition to these financial benefits, homeownership offers other intangible advantages such as pride of ownership, a sense of community, and the freedom to personalize your living space. While the path to affordable homeownership may require careful planning and financial discipline, the long-term benefits make it a worthwhile goal for many.
Challenges Faced by Renters
Renters across the United States, especially in high-cost states like California, face many challenges that stem primarily from a volatile housing market. These challenges are particularly pronounced in urban areas like San Francisco and Los Angeles, where the California housing crisis makes the cost of living far exceed national averages.
One interesting twist in California’s housing crisis is the unexpected role of high-income renters. Normally, you'd expect people with higher incomes to buy homes. However, due to a shortage of affordable homes and a highly competitive market, many well-off individuals continue to rent. Back in 1980, the average income of California renters was 13% higher than renters in other parts of the country. By 2022, this difference had grown to 40%. Now, one third of California’s renters make over $100,000 a year—twice as many as in the rest of the U.S. This surge of wealthy renters in the market pushes up rental prices, which ironically makes it tougher for lower-income renters to find affordable places to live.
The statistical data paints a stark picture of the affordability crisis. According to the latest U.S. Census Bureau's Pulse survey, an alarming number of households are financially overstretched by rent. Nearly a million California households are currently behind on their rent payments, and about 150,000 expect eviction could be imminent. This situation highlights the grim reality that, despite their best efforts, many lower-income renters find themselves perpetually one paycheck away from losing their homes.
Personal Reflections and Real Estate's Role
The story of Jo Bessell, which I encountered early in my career, has profoundly shaped my perspective on real estate. Jo's experience of being forced out of her long-term home due to an unaffordable rent increase highlighted the stark realities many renters face. This realization has instilled in me a deep sense of purpose and responsibility. As a real estate professional, we are not merely facilitating transactions but guiding individuals toward achieving stability and security through homeownership.
Real estate professionals play an indispensable role in helping clients negotiate the best real estate deal possible and navigate the complexities of the market. Our expertise and insight can demystify the often intimidating process of buying a home, providing clients with the knowledge they need to make informed decisions. More importantly, we can help them understand the long-term benefits of securing a fixed-rate mortgage, which offers predictable monthly expenses and protection against the volatility of rental markets. This stability is crucial for financial planning and peace of mind, enabling homeowners to invest in their futures without the looming threat of unexpected rent increases.
Beyond its financial asset role, owning a home can be a powerful tool for social good. Homeownership can anchor families within communities, fostering a sense of belonging and civic engagement. Evidence suggests it contributes to better educational outcome for children and provides a foundation for building generational wealth, particularly in underserved communities. We can help close the housing gap and address systemic inequalities by promoting policies that increase access to affordable homeownership.
The narrative of Jo Bessell remains a poignant reminder of why our work matters. It drives home the importance of advocating for policies that protect and empower renters and homeowners alike. As real estate professionals, we have the opportunity—and the obligation—to ensure that real estate's benefits extend beyond the individual, supporting broader social and economic stability. Through our efforts, we can help transform real estate into a cornerstone of a more equitable society.
As I’ve tried to communicate, the benefits of homeownership extend far beyond having a place to call your own. It's an investment in your future, a hedge against inflation, and a source of pride and belonging. Homeownership can be a life-changing decision for renters facing rising costs and uncertainty, providing a secure and stable foundation for their families.
Remember, real estate is more than just a transaction. It can be a cornerstone to a stable and prosperous life, a catalyst for personal growth, and a powerful tool for building stronger communities. By embracing the power of real estate, you can unlock a brighter future for yourself, your family, and your community—and your career as a real estate professional.
Love,
Kartik
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Real Estate License Expiration in California: What Are Your Options?
The California real estate market is bustling with opportunities. Yet, life's unpredictable nature sometimes calls for a pause,
Real Estate License Expiration in California: What Are Your Options?
The California real estate market is bustling with opportunities. Yet, life's unpredictable nature sometimes calls for a pause, leading many agents to an inactive license status. Did you know that thousands of California real estate licenses move into an expired status each year due to various personal and professional reasons? If you're one of many facing this scenario, exploring your options and making informed decisions to manage your career trajectory effectively is crucial.
Understanding License Inactivity
In California, a real estate license is deemed expired if not renewed prior to expiration. Reasons for this may range from a career shift or relocation to personal commitments or simply taking a break from the industry. Holding an expired license means you're prohibited from engaging in any activities requiring an active license.
Understanding Late Renewal of The License
If you don't renew your license before it expires, you are granted a two-year grace period for late renewal. During this period, you must refrain from any activities that require a valid real estate license until your renewal is processed and approved.
Options for Expired Licensees
1. Reactivation:
Reactivating your license is a straightforward process outlined by the California Department of Real Estate (DRE). It involves completing required continuing education hours and paying the applicable fees. If you renew late, you must pay the license renewal fee plus a late fee. The specific courses needed vary depending on whether it is your first real estate license renewal or subsequent renewal.
2. Letting the License Expire:
If you're sure you won't return to real estate, you might choose to just let your license expire out.
There are several drawbacks to this approach:
Future uncertainty: Even if you are currently confident in your decision, your circumstances or interests may change in the future. Keeping your license active provides you with the flexibility to return to real estate if an opportunity arises.
Reapplication challenges: If you decide to re-enter the field later, you'll have to start from scratch, repeating the entire licensing process, which can be time-consuming and costly.
Professional network: Maintaining an active license can help you stay connected to the real estate industry and its network, which could be beneficial even in other career paths.
While letting your license expire might seem appealing in the short term, it could limit your options and create unnecessary hurdles if you ever decide to return to real estate.
Risks In Letting the License Expire
Consider a scenario where you obtained a real estate broker's license in 2004. At that time, a four-year college degree could count towards the two years of real estate experience required to qualify for a broker license. However, regulations changed significantly by January 1, 2013. From then on, only a degree specifically in real estate or two years of actual real estate experience would meet the qualifications for a broker's license.
Now, imagine that you allowed that broker license to expire in 2008. If you were to seek requalification after 2013 under the new rules, your previous degree (unless in real estate) would no longer suffice. Additionally, by 2024, new requirements were introduced, including completing a Real Estate Practice course that incorporates training on implicit bias—recognizing and addressing unconscious prejudices in professional settings.
The lesson here is clear: maintaining your licensure continuously can shield you from the impact of such regulatory changes. Keeping your license active means you retain qualification under the conditions that existed when you were first licensed—often referred to as being 'grandfathered in.' Letting your license lapse, however, could mean facing more stringent, updated requirements should you decide to re-enter the field.
Benefits of Reactivating Your License
Reactivating your license can reopen numerous economic and professional doors. By diving back into the thriving California real estate market, you can capitalize on emerging trends and leverage your existing network and expertise. Consider the significant effort required to retake and pass the real estate license exam again, especially after you've already completed the required courses through a real estate license school. Reactivating your license avoids this hassle. Many agents have found renewed success and satisfaction in their careers after reactivating their licenses, demonstrating the clear advantages of maintaining active status.
How to Plan for Reactivation
Effective planning ensures a smooth return to active status. Start by familiarizing yourself with the continuing education requirements and by setting aside funds for associated fees. Engage with your network, stay abreast of industry trends, and consult a mentor or career coach to strategize your reentry.
Whether you reactivate, maintain, or let your license expire, understanding your options is fundamental for effective career management in real estate. Proactively addressing your license status positions you for future success in California's dynamic real estate environment.
Ready to reactivate your real estate license or need more guidance on your options? Contact us today for a free consultation to tailor a plan that best suits your professional needs. Let us help you navigate your journey back to active status quickly and confidently!
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Are Classes Required for a California Real Estate License?
There's a myth that anyone can take the California real estate licensing exam and obtain a real estate license without taking any formal
Are Classes Required for a California Real Estate License?
There's a myth that anyone can take the California real estate licensing exam and obtain a real estate license without taking any formal education. While there's a grain of truth to this for members of the California bar, most aspiring real estate agents need to complete mandatory pre-licensing coursework before they can even sit for the exam. Let's clear up the confusion with accurate information and guidance.
Overview of California Real Estate Licensing Requirements
To become a licensed real estate agent in California, you must meet several key requirements set by the California Department of Real Estate (DRE). These include:
Age: Be at least 18 years old.
Honesty: Have an acceptable criminal record, as criminal convictions may lead to license denial.
Education: Complete 135 hours of approved pre-licensing education consisting of 45 hours of Real Estate Principles, 45 hours of Real Estate Practice and 45 hours of one elective course.
Mandatory Pre-Licensing Education
Pre-licensing education is crucial for several reasons:
Foundational Knowledge: It covers essential principles of real estate law, practice, finance, and ethics.
Exam Preparation: The courses directly prepare you for the content and format of the state exam.
Career Success: A solid educational foundation sets you up for a smoother transition into the real estate profession.
Student Testimonial:
Joe Buck:
"The courses at Adhi Real Estate School not only prepared me for the exam but also gave me the confidence to start my career. The Real Estate Practice course was particularly impactful,"
The Lawyer Exemption
Due to their extensive legal training, lawyers licensed to practice in California are exempt from the pre-licensing education requirement. However, they still must pass the state licensing exam. You can read more about this exemption here.
How to Enroll in Pre-Licensing Classes
If you're not a lawyer, your next step is enrolling in pre-licensing classes. Choose an accredited real estate school like ADHI Schools. We offer comprehensive courses to prepare you for the exam and career.
To succeed in your coursework:
Attend Classes Regularly: Active participation enhances learning.
Ask Questions: Don't hesitate to seek clarification.
Study Diligently: Review materials outside of class.
Utilize School Resources: We offer additional study guides and practice exams.
Understanding the pre-licensing requirements is essential for anyone pursuing a real estate career in California. While lawyers have a unique exemption, most aspiring agents must complete mandatory coursework. This investment in education is a stepping stone to a rewarding career.
Ready to start your real estate journey? Contact Adhi Real Estate School today to learn more about our pre-licensing courses and expert guidance. We're committed to your success and look forward to helping you achieve your career goals!
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Demystifying the California Real Estate Exam: Is It Open Book?
The California real estate exam is a pivotal step for aspiring real estate professionals aiming to launch their careers. A common question
Demystifying the California Real Estate Exam: Is It Open Book?
The California real estate exam is a pivotal step for aspiring real estate professionals aiming to launch their careers. A common question that often surfaces is whether this exam is open book. Since we get this question so often at our school, I wanted to write an article to explore the exam format, clearly define its closed book nature, and contrast this with the open book format of the qualifying courses, and provide valuable insights for effective exam preparation.
Understanding the California Real Estate Exam: A Closed Book Format
I hate to be the one to have to tell you this if you’re wondering, but the California real estate exam is closed book. Virtually nothing can be taken into the exam site with you when you go to take the real estate test.
There are lockers at the state testing site in case you need to store your cell phone or other items you may have brought into the facility.
Both exams are multiple choice. The sales license exam is 150 questions and candidates are given up to three hours to take it. The broker exam is 200 questions and must be completed in four hours. Passing scores are 70% and 75% respectively.
Unlike the qualifying courses, this crucial exam is not open book.
Why the California Real Estate Exam Is Not Open Book
The closed book format of the exam is designed to assess a candidate's ability to internalize and recall critical real estate principles, terminology, and laws without external aids. This ensures that future real estate agents are well-equipped to handle transactions confidently and competently.
The Open Book Nature of Qualifying Courses
In contrast to the final exam, the three qualifying courses (Real Estate Principles, Real Estate Practice and one Elective course) required for the California real estate license are generally open book. This format allows candidates to use textbooks and notes, fostering a deeper understanding of the material through active learning and reference. This approach helps ensure that candidates are thoroughly prepared when it comes time to take the closed book exam.
Challenges of a Closed Book Exam and How to Overcome Them
Recalling extensive information under exam conditions can be nerve-racking. However, effective preparation strategies can mitigate these challenges:
Thorough Study: Leverage comprehensive study materials including textbooks and online resources.
Going through the correct pre-license program: Going through the correct pre-license program is crucial. Choosing the right real estate license course prepares you thoroughly for the licensing exam and equips you with the practical knowledge and skills essential for a successful career in real estate.
Practice Tests: Engage with practice exams to become comfortable with the exam format and identify areas for improvement.
Focus on Key Areas: Emphasize real estate laws, contracts, financing, and ethical practices in your studies.
Preparing for Success in the California Real Estate Exam
Effective exam preparation combines active learning with practical application:
Create a Study Schedule: Allocate regular periods for study and revision.
Enroll in a Prep Course: Consider courses from reputable real estate schools like ADHI Schools, designed to enhance understanding and retention of essential real estate concepts.
Utilize Practice Exams: These simulate the testing environment and help assess readiness.
Frequently Asked Questions (FAQ)
How long should I prepare for the exam? Preparation times vary, but at least 3 weeks of dedicated study is typically recommended.
What topics are covered in the California real estate exam? Topics include real estate principles, law, practice, financing, appraisal, and ethics. Learn more about the distribution of questions on the exam here.
Are practice exams available? Numerous practice exams are available through various educational resources and online platforms.
The California real estate exam is a closed book assessment designed to evaluate foundational knowledge in real estate. Through effective study techniques and resource utilization, aspiring agents can significantly enhance their chances of success.
Ready to Start Your Real Estate Career?
Contact ADHI Schools today to learn more about our comprehensive real estate exam preparation courses and resources. Let us guide you through your real estate educational journey and help you unlock the doors to your successful career!
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Navigating the Complexities of Dual Agency: A Comprehensive Guide for New Real Estate Agents
Dual agency, is a scenario where a single real estate agent or brokerage represents both the buyer and seller
Navigating the Complexities of Dual Agency: A Comprehensive Guide for New Real Estate Agents
Dual agency, is a scenario where a single real estate agent or brokerage represents both the buyer and seller in a real estate transaction, is a multifaceted practice fraught with ethical and legal complexities. While it offers a streamlined approach, it demands careful navigation due to potential conflicts of interest. A thorough understanding of its nuances is essential for new real estate agents venturing into this arena.
Unraveling the Dual Agency Landscape
Dual agency occurs when one agent or multiple agents from the same brokerage represent both the buyer and the seller in a real estate deal. This situation requires the agent(s) to carefully balance both parties' interests fairly and without favoring one side over the other.
For instance, consider a situation where an agent from XYZ Realty is representing both John, the seller, and Jane, the buyer, in the sale of a home. The agent must navigate this dual agency with extreme care. They need to provide impartial advice to both parties, ensuring that both John and Jane feel their interests are being respected and protected. For example, when discussing the price, the agent must not disclose how low John would go or how high Jane would go, but rather help them reach a fair agreement based on market data and individual circumstances.
Legal Status: A Patchwork of Regulations
The legal status of dual agency varies significantly from state to state, creating a patchwork of regulations across the United States. In several states, dual agency is expressly prohibited due to the perceived conflicts of interest it entails, such as in Alaska, Colorado, Florida, Kansas, Maryland, Texas, Vermont, and Wyoming. In these jurisdictions, real estate agents are forbidden from representing both the buyer and seller in the same transaction, as this is seen as a potential threat to the fairness and integrity of the process.
Ethical Considerations: A Moral Compass for Agents
Understanding the ethical dimensions of dual agency is crucial for new real estate agents. Agents must prioritize full disclosure, openly communicating their role and the nature of dual agency to both parties. This includes discussing potential conflicts of interest and ensuring that both parties fully comprehend the implications of the arrangement.
Maintaining Confidentiality
Keeping confidentiality is crucial. Agents must protect private information from both the buyer and the seller, making sure that no sensitive details are shared improperly between the two. This requires careful communication and record-keeping, as well as an understanding of the legal and ethical rules about private information.
Example: Imagine an agent representing both a buyer who wants to pay as little as possible and a seller who hints at accepting a lower price due to an urgent need to sell. The agent must not reveal the seller’s urgency to the buyer to secure a lower offer, as doing so would breach confidentiality and favor the buyer’s interests over the seller’s.
Navigating the Dual Agency Landscape: Practical Strategies
For agents who find themselves in a dual-agency situation, several strategies can help navigate this complex terrain. Transparency, obtaining written consent, and maintaining open communication channels are paramount. Regular communication with both parties can help identify and address potential issues early on, minimizing the risk of conflicts or misunderstandings.
Maintaining fairness and impartiality is a continuous effort in dual agency. This may involve seeking external advice or mediation in situations where conflicts arise.
Ultimately, dual agency in real estate is a nuanced and complex practice that demands careful consideration. New real estate agents must be aware of the legal and ethical dimensions involved and the potential challenges and risks. By prioritizing transparency, fairness, and open communication, agents can successfully navigate dual agency while upholding their fiduciary duties to the buyer and seller.
Love,
Kartik
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Trapped by a Good Deal: The Lock-in Effect Gripping the Housing Market
The American dream of owning a home has always been a central part of our culture. However, recent events in the housing market
Trapped by a Good Deal: The Lock-in Effect Gripping the Housing Market
The American dream of owning a home has always been a central part of our culture. However, recent events in the housing market have created a peculiar situation where many homeowners find themselves "trapped" in their homes, having secured incredibly low mortgage rates during the pandemic. Just when you thought you had learned all the real estate vocabulary out there, there is a new term known as the "lock-in effect," which is causing ripples throughout the housing market and the broader economy.
What is the Lock-in Effect?
Imagine you bought (or refinanced) a house a few years ago when interest rates were at historic lows, say around 3%. You're now sitting pretty with a fantastic mortgage deal. However, interest rates have since skyrocketed to around 7%. If you were to sell your home and buy a new one, you'd be forced to take out a new mortgage at this much higher rate, likely increasing your monthly payments. This financial reality is discouraging many homeowners from moving, even if they want to.
This hesitation to sell is causing a ripple effect throughout the housing market. Fewer homes are being put up for sale, leading to decreased inventory and increased competition among buyers. This, in turn, drives up prices, making it even harder for first-time buyers to enter the market. The lock-in effect is estimated to have prevented around 1.3 million home sales from spring 2022 to the end of 2023.
Why is This Happening Now?
The lock-in effect is not a new phenomenon, but its current scale is unprecedented. Several factors have contributed to this situation:
Historically Low Rates: The pandemic-era interest rates were exceptionally low, enticing many to purchase homes or refinance existing mortgages.
Rapid Rate Increase: The Federal Reserve's efforts to combat inflation have led to a rapid increase in interest rates, creating a stark contrast with the locked-in rates many homeowners enjoy.
Long Mortgage Terms: Most mortgages in the US are 30-year fixed-rate loans, meaning the low rates secured during the pandemic will remain in effect for many years.
The Impact on Homeowners
While having a low mortgage rate might seem like a blessing, the lock-in effect has created several challenges for homeowners:
Limited Mobility: Homeowners who want to move for better jobs, downsize, or upsize find themselves financially constrained by their low mortgage rates.
Missed Opportunities: They may be missing out on potentially better housing situations or career advancements due to their reluctance to sell.
Financial Stress: The knowledge that moving would significantly increase their housing costs can cause stress and anxiety.
Broader Economic Consequences
The lock-in effect doesn't just impact individual homeowners. It has far-reaching consequences for the economy:
Decreased Labor Mobility: The inability of homeowners to relocate for better job opportunities can hinder economic growth and productivity.
Wage Stagnation: When workers are unable to move to areas with higher wages, it can contribute to wage stagnation.
Reduced Economic Activity: Fewer home sales mean less spending on furniture, appliances, and other related goods and services, impacting various industries.
What Can Be Done?
President Biden has acknowledged the issue and proposed temporary tax credits to incentivize new home buyers and sellers. However, the effectiveness of this measure remains to be seen. Some economists argue that the lock-in effect is likely to persist until interest rates decrease or stabilize, which may take time.
In the meantime, homeowners who are considering selling their homes need to carefully weigh the financial implications. While moving might mean giving up a great mortgage rate, it could also open up new opportunities and improve their overall quality of life. It's essential to consult with financial advisors and real estate professionals to make informed decisions.
The Bottom Line
The lock-in effect is a complex issue with no easy solutions. While it presents challenges for homeowners and the housing market, it also underscores the importance of understanding the long-term implications of financial decisions, especially when it comes to something as significant as a mortgage. As the market evolves, it will be interesting to see how this phenomenon plays out and what measures will be taken to address its consequences.
Love,
Kartik
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Understanding how local education is funded in California is not just crucial, it's empowering for homeowners, parents, voters, and even those in real estate license schools. One of the key components
Understanding how local education is funded in California is not just crucial, it's empowering for homeowners, parents, voters, and even those in real estate license schools. One of the key components of this funding comes from property taxes. I wanted to write an article to explain how property taxes contribute to local education funding, what that means for your community, and why every Californian should be informed. By understanding this, you gain the power to influence and shape your community's educational landscape.
Understanding Property Taxes
Property taxes are levied on all real estate by governments and primarily used to fund various local services, including schools, roads, and public safety. For homeowners, understanding property taxes is crucial as it directly impacts their financial obligations and property values. In California, property taxes are calculated based on the assessed value of your property, with rates varying by location but typically set at around 1% of the assessed value due to Proposition 13, which was passed in 1978.
The Connection Between Property Taxes and Education Funding
Allocation of Funds
A significant portion of property taxes are allocated to public schools. The exact percentage can vary depending on the municipality and the community's needs. Generally, these funds are used to cover expenses such as:
Teacher salaries
School supplies
Building maintenance and repairs
Technology upgrades
Extracurricular activities
Local Control Funding Formula (LCFF)
In 2013, California implemented the Local Control Funding Formula (LCFF), significantly changing how state education funds are distributed to public schools. LCFF aims to provide a more equitable, student-focused approach to school funding and increases the importance of local property taxes as they contribute to the base grants that every school receives.
Before 2013, all public schools in California got money from the state based on a system that some people thought was confusing and unfair. In 2013, California started using a new system called the Local Control Funding Formula, or LCFF for short, to make things more fair.
Here's how LCFF works:
More Money Where It's Needed: LCFF ensures that schools receive money based on their students' specific needs. Schools with more students who need extra help (like those learning English as a second language, coming from low-income families, or being foster children) receive more money. This helps ensure that all students have a fair chance at a good education.
Local Control: Under LCFF, local communities have more say in how their schools use the money. This means parents and teachers can have a more significant impact on deciding what the school needs most.
Property Taxes: The money that schools get from LCFF includes a base amount that comes partly from local property taxes. This means that the money collected from homeowners in the area helps to fund the local schools. Since each area might have different property tax income, this still ties school funding somewhat to a neighborhood's wealth, but LCFF helps balance it out with extra funds where they're needed most.
In simple terms, LCFF was created to ensure that money for schools is shared more fairly, focusing more on what students in each school actually need to succeed. This system, with its focus on fairness and equity, should reassure you that every child, regardless of their background, has an equal opportunity to succeed in their education.
Impact on Quality of Education
The quality of local schools often reflects the community's property tax base. Neighborhoods with higher property values generate more tax revenue, which can lead to better-funded schools and, typically, better educational outcomes. This disparity highlights the importance of understanding and participating in local tax discussions and assessments.
In California, the relationship between property values, local property taxes, and school quality is complex due to the state's unique tax laws, specifically the implications of Proposition 13. Passed in 1978, Proposition 13 caps the amount that property taxes can increase each year, regardless of increases in property values. This means that, unlike many other places, rising property values in California do not automatically lead to proportionally increased property tax revenues.
However, areas with higher property values still tend to have better-funded schools for a couple of reasons:
Higher Baseline Taxes: Even with Proposition 13, neighborhoods with higher property values start from a higher baseline tax amount, which provides more funding to local schools.
Local Funding Measures: Communities with higher property values often pass local parcel taxes or bond measures to fund schools, which go beyond the limitations set by Proposition 13. These measures are typically voted on in local elections and can significantly impact school budgets.
A prime example is Palo Alto in Silicon Valley. Despite Proposition 13's limitations, the city's schools benefit from a community with high property values and strong support for education, often reflected in local voting patterns favoring school funding measures. This results in Palo Alto schools having more resources and generally better performance compared to schools in less affluent areas.
Why Every Californian Should Care
Educational Equity
Understanding how property taxes impact local schools is key to addressing educational equity. Advocating for fair property assessments and equitable funding formulas can help ensure all children receive a quality education.
Home Values
Good schools increase property values. Homeowners should understand how supporting their local schools through property taxes can help their long-term value.
In many communities, a cycle begins with high property values, which lead to better-funded schools through higher property tax revenues and community support for school-related funding measures. As these schools improve — with better facilities, more resources, and qualified teachers — they enhance the educational outcomes and reputation of the district.
This reputation for excellent education increases the neighborhood's attractiveness to prospective homeowners, particularly those with children, looking for the best possible schooling options. This demand further drives up property values, enhancing the tax base and providing even more school funding.
Thus, a self-reinforcing cycle is established: higher property values finance better schools, which in turn boost property values even more. Homeowners benefit from this cycle, as the continuous improvement in school quality helps sustain and increase their property's value over time. This makes support for local schools through property taxes and other funding initiatives not just a matter of civic duty but a wise investment that promotes a cycle of mutual benefit between educational institutions and property owners.
Why Real Estate Agents Should Care
Educating Clients: Real estate agents need to provide accurate and comprehensive information to their clients. Knowing the specifics of property taxes helps agents explain potential costs associated with owning a property. This is especially important for buyers moving from different states or regions where tax rates and structures might differ significantly.
Assessing Property Value: Property taxes are often based on assessed property values. Agents who understand how these assessments are conducted can better evaluate and compare property values, which is essential for advising clients on buying and selling properties.
Budget Planning: For many homeowners, property taxes represent a significant portion of their annual housing expenses. Agents must be able to help clients estimate these costs accurately so they can budget appropriately. This is particularly important in areas with high tax rates or where property values rapidly increase.
Understanding Community Benefits: Property taxes typically fund critical local services and infrastructure, such as public schools, police and fire departments, and public parks. A real estate agent who can articulate what these taxes contribute can provide deeper insights into the quality of life in a particular community. This knowledge can be a deciding factor for buyers considering different neighborhoods.
Negotiating Deals: Knowledge of how property taxes impact a real estate deal is vital. For instance, if an area is due for a tax reassessment or has pending tax legislation, this could affect the buyer's willingness to close a deal at a proposed price. An informed agent can negotiate better terms by anticipating changes in property taxes.
Investment Insight: Investors often look to real estate agents for advice on properties that offer the best return on investment. Understanding property taxes helps agents recommend investments wisely, considering the long-term tax implications and the potential for property tax hikes.
Market Trends: Changes in property tax policies can influence real estate market trends. Agents aware of these changes can better predict market movements and advise clients when to buy or sell to maximize their financial outcomes.
Overall, an in-depth understanding of property taxes enhances a real estate agent's professionalism and capability to provide strategic advice, thus fostering client trust and credibility.
Property taxes play a crucial role in funding local education in California. By understanding this role, Californians can make informed decisions that support their communities and foster educational environments where all students thrive.
Love,
Kartik
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Understanding Mello-Roos in California: What Homebuyers Need to Know
At ADHI Schools, we recognize the role of comprehensive knowledge in shaping your real estate investment decisions in
Understanding Mello-Roos in California: What Homebuyers Need to Know
At ADHI Schools, we recognize the role of comprehensive knowledge in shaping your real estate investment decisions in California. One significant factor, particularly in newer developments, is the Mello-Roos tax. This unique assessment can have a profound impact on property owners. Potential homebuyers and investors need to understand these taxes' purpose, assessment, coverage, and impact. I'd like to provide a detailed overview of Mello-Roos taxes, equipping you with the necessary information to make informed real estate decisions.
What is Mello-Roos?
Mello-Roos is a special tax imposed on property owners in specific districts. Its primary purpose is to finance major infrastructure and public services not covered by regular property taxes. This tax was established in 1982 through the Community Facilities District Act, passed by the California legislature to provide local governments with a means to raise funds after Proposition 13 significantly limited their ability to levy real estate taxes.
Proposition 13, passed by California voters in 1978, significantly changed how local governments could assess property taxes, fundamentally altering the state's public funding landscape. This measure was designed to address the rapidly escalating property taxes of the time, which caused significant financial distress to homeowners.
Key Provisions of Proposition 13
Tax Rate Limitation: Proposition 13 capped property tax rates at 1% of the property's assessed value at the time of acquisition. This rate could only be adjusted upon a change in ownership or completion of new construction.
Assessment Increase Limitation: Increases in assessed value were limited to no more than 2% per year as long as the property was not sold or newly constructed.
Impact of Proposition 13
The implementation of Proposition 13 had a profound impact on the revenue generation capacity of local governments from property taxes. Before Proposition 13, local governments could assess property taxes based on current market values and community funding needs. This allowed them to adjust tax rates and reassess property values to meet public services and infrastructure project budget requirements.
However, with the limitations imposed by Proposition 13, local governments found themselves with insufficient funds to cover the costs of new projects and the maintenance of public services, particularly in rapidly growing communities. The tax base became inadequate due to the capped rate and limited growth of property tax assessments, which did not necessarily correlate with the actual increase in property values or economic conditions.
Introduction of Mello-Roos Taxes
In response to these challenges, the California legislature enacted the Community Facilities District Act in 1982, allowing local governments to form Community Facilities Districts (CFDs) and levy what is known as Mello-Roos taxes. These taxes, charged on top of regular property taxes, are crucial in funding infrastructure projects and public services, specifically within those districts. Mello-Roos taxes are not just additional financial burdens, but they are essential mechanisms for local governments to generate the necessary funds to support new development and ensure the provision of essential public services, such as schools, roads, and police and fire protection, especially in areas experiencing rapid growth and development.
The establishment of Mello-Roos was a direct consequence of the fiscal constraints imposed by Proposition 13. It serves as a vital tool for municipalities to adapt to ongoing financial needs without overstepping the tax restrictions placed by Proposition 13. This tax has enabled communities to develop and maintain critical infrastructure, supporting California's growth and addressing the public funding deficits from Proposition 13's limitations.
Why Do Mello-Roos Taxes Exist?
Mello-Roos taxes primarily aim to finance significant community infrastructure projects, such as schools, roads, fire and police services, parks, and libraries. These taxes are usually levied in newer developments where additional funding is needed to support the construction and maintenance of essential infrastructure and services that the existing tax base cannot sufficiently support.
How are Mello-Roos Taxes Assessed?
Mello-Roos taxes are assessed to property owners within a Community Facilities District (CFD) created by a local government, city, or county. These taxes are based on the bonded indebtedness required to fund specific projects within the district. The amount may vary between properties in the district depending on the property's size, the home's square footage, and the area's specific needs.
What Do Mello-Roos Taxes Cover?
The revenues collected from Mello-Roos taxes can be used for various services and facilities. Typically, these taxes fund infrastructure improvements, school facilities, police and fire protection, ambulance services, roads, and libraries. Notably, the funds generated by Mello-Roos taxes must be used for the specific purposes outlined when the tax was approved and cannot be used for unrelated projects.
Impact on Property Values
The impact of Mello-Roos taxes on property values can be mixed. On one hand, these taxes can increase the overall tax burden on a property, which might deter some buyers. However, the enhancements and new facilities funded by Mello-Roos can make a neighborhood more attractive, potentially boosting property values. For many buyers, the improved infrastructure and amenities justify the additional tax, and they see it as an investment in the future value of their property.
Technical Detail and Precision: Understanding the Financial Impact of Mello-Roos Taxes
It is beneficial to consider specific examples and comparative scenarios to grasp the financial implications of Mello-Roos taxes truly. Let’s explore how these taxes influence property values and owner expenses in two scenarios.
Scenario 1: New Development with Mello-Roos Taxes
In a new housing development in Irvine, California, the local government has established a Community Facilities District (CFD) to fund necessary infrastructure such as roads, schools, and parks. A typical single-family home in this development is assessed at $800,000. The Mello-Roos tax for the property is set at 0.8% of the assessed value annually, which amounts to an additional $6,400 per year in property taxes.
Financial Comparison:
Total Annual Property Taxes with Mello-Roos: Assuming the standard property tax rate (including the Mello-Roos tax) totals 1.8%, the annual tax payment would be $14,400.
Total Annual Property Taxes without Mello-Roos: Without the Mello-Roos tax, at a rate of 1%, the annual tax payment would be $8,000.
This scenario illustrates that while Mello-Roos increases the tax burden by $6,400 annually, it also supports infrastructure developments that can enhance property value over time.
Scenario 2: Established Area without Mello-Roos Taxes
Consider a similar property in an older neighborhood of Irvine, where there is no Mello-Roos tax. The home, valued at $800,000, incurs standard property taxes without additional Mello-Roos assessments.
Financial Comparison:
Total Annual Property Taxes: The homeowner pays the standard rate of 1%, totaling $8,000 annually.
Infrastructure and Amenities: Unlike the new development, this area might see a different level of new infrastructure investment, which could affect long-term property values differently.
Long-term Financial Impact:
Owners of new developments may see a higher initial tax rate. Still, the funded amenities could significantly increase property value due to improved infrastructure and community services. In contrast, the older neighborhood may have lower initial taxes but could lack the same potential for increased property values due to older amenities and infrastructure.
By analyzing these scenarios, potential buyers can better understand the balance between upfront costs and the long-term benefits of Mello-Roos taxes. This decision-making process is crucial, especially for those considering properties in districts with these special assessments. Through careful evaluation of the projects funded by Mello-Roos taxes, investors and homeowners can gauge the potential for property value appreciation and make informed decisions tailored to their financial and living situation.
Important Considerations for Homebuyers
If you are considering purchasing a home in a district with Mello-Roos taxes, it's essential to:
Inquire about the tax's expiration date: Mello-Roos taxes are not permanent and generally expire within 25 to 40 years from the CFD's formation date.
Understand what is being funded: Knowing what projects your Mello-Roos taxes are funding can provide insight into potential community enhancements that could increase property values.
Consider the overall tax impact: Evaluate how Mello-Roos taxes fit into the area's overall tax scenario to understand the full financial responsibility.
Understanding Mello-Roos taxes is essential for any potential real estate license school student, California homebuyer or real estate investor. While they can increase the cost of owning a home, they also fund critical infrastructure and services that can significantly enhance the quality of life and potentially increase property values. As with any real estate investment, thorough due diligence is essential to making an informed decision.
By understanding Mello-Roos, homebuyers can better assess the long-term value and costs of purchasing a new home in California's developing areas.
Love,
Kartik
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Can a Foreigner Become a Real Estate Agent in California?
California's thriving real estate market attracts investors, professionals, and those from around the globe. The allure of diverse cities like
Can a Foreigner Become a Real Estate Agent in California?
California's thriving real estate market attracts investors, professionals, and those from around the globe. The allure of diverse cities like Los Angeles, San Francisco, and San Diego makes the state a hotspot for real estate activity, prompting many to consider a career in our dynamic field.
For foreigners, the path to becoming a real estate agent in California holds unique prospects and challenges. This article explores the feasibility of non-U.S. citizens' earning a real estate license in the Golden State. Specifically, I wanted to delve into what it takes to meet the requirements set forth by the Department of Real Estate in California.
Whether you're looking to start a new career or expand your existing real estate portfolio internationally, understanding the licensing process is the first step toward success in California's lucrative market.
Understanding Real Estate Licensing in California
To work as a real estate agent in California, you must obtain a salesperson license through the California Department of Real Estate (DRE) after taking real estate courses through an approved real estate school like ADHI Schools. Here's an overview of the requirements and the general steps you'll need to take:
Basic Requirements
Age: Be at least 18 years of age.
Background: Clear a background check While past convictions may not automatically disqualify you, they must be disclosed to the DRE for review.
Education: Complete 135 hours of approved pre-licensing education. This includes three core courses:
Real Estate Principles
Real Estate Practice
An elective course
Language Considerations: While some online courses might be offered in languages other than English, confirm this with the school before enrolling. However, note that the California real estate exam is only administered in English.
Steps to Obtain Your License
Complete Pre-Licensing Courses: Enroll in the required coursework at an approved real estate school like ADHI Schools.
Pass the California Real Estate Exam: Successfully pass the state licensing exam administered by the DRE.
Apply for the License: Submit a formal application to the DRE, including fingerprinting and background check information.
Secure a Sponsoring Broker: In California, you must work under the supervision of a licensed broker in order to practice real estate legally.
Eligibility Criteria for Foreigners
Residency Requirements
Contrary to what many might assume, California does not require real estate agents to be U.S. citizens or permanent residents. However, all applicants must be legally authorized to work in the United States and clear criminal background.
Social Security Number or ITIN Requirements
To apply for a real estate license in California, every candidate must provide a Social Security Number (SSN) or an Individual Taxpayer Identification Number (ITIN). For those who do not have an SSN, obtaining an ITIN is a crucial step. The ITIN serves as a tax processing number issued by the Internal Revenue Service (IRS) to individuals who are required to have a U.S. taxpayer identification number but who do not have, and are not eligible to obtain, an SSN.
Specific Conditions or Exceptions for Non-US Citizens
Foreign nationals must be particularly diligent in complying with all regulatory requirements. This includes the employment mentioned above, tax identification prerequisites, and completing the exact educational and examination requirements as U.S. citizens. It's important to note that certain visas may restrict the ability to conduct business, so consulting with an immigration lawyer can provide personalized guidance.
Challenges and Considerations for Foreigners
While the California real estate market presents exciting opportunities, foreigners seeking to become licensed agents may face some specific challenges:
Language Barriers: Fluency in English is essential for understanding contracts, communicating with clients, and navigating legal terminology. A solid conversational level might need to improve when dealing with complex real estate documents.
Legal Hurdles: Visa requirements, work permits, and tax implications for non-U.S. residents can add complexity. Consulting with an immigration attorney or a tax professional specializing in international clients is advisable.
Cultural Differences: Understanding local real estate practices, negotiating styles, and client expectations within the California market can take time and experience.
Tips for Overcoming Challenges
Improve English Proficiency: If English isn't your first language, invest in language courses or tutors focusing on business and real estate terminology.
Seek Legal Guidance: Consult professionals to ensure you understand all the legal requirements and restrictions regarding your specific visa or residency status.
Build a Network: Connect with other foreign-born real estate agents or join professional associations catering to diverse communities. Their experience and mentorship can be invaluable.
Leverage Your Background: Your language skills and cultural understanding may be significant in serving specific clientele, especially in California's diverse real estate landscape.
Patience and Persistence: Adapting to a new market and overcoming challenges takes time. Stay focused on your goals and be willing to learn and adapt.
Resources and Support
Navigating the path to becoming a real estate agent in California can feel less daunting when you have the right resources and a supportive network. Here are some places foreigners can look for help:
California Department of Real Estate (DRE): The DRE website is your primary source for official information, licensing requirements, and approved education providers.
Real Estate Schools: Many real estate schools cater to diverse populations and may offer language support or additional resources for international students.
Multicultural Real Estate Associations: Organizations like the National Association of Hispanic Real Estate Professionals (NAHREP) or the Asian Real Estate Association of America (AREAA) have local chapters that can provide mentorship and networking opportunities.
Online Forums and Communities: Join online groups or forums dedicated to real estate professionals in California. Seek out those who welcome and support international members.
Remember, you are not alone! Others have successfully achieved their real estate goals in California despite coming from abroad. Proactively seeking out these resources will make your journey smoother.
Entering the California real estate market presents a significant opportunity for growth and success, particularly given the state's dynamic and diverse property landscape. However, foreigners wishing to participate in this vibrant market must navigate challenges and requirements unique to their status.
Despite these hurdles, California's real estate market opportunities are substantial. The state's economy is one of the largest and most diverse in the world, encompassing booming tech sectors, luxurious residential communities, and expansive agricultural lands. This diversity offers a wide range of niches and specializations for real estate professionals.
To those considering this journey, it is essential to approach it with determination and motivation. The process may seem daunting, but the rewards can be equally significant. By meeting the standards the California Department of Real Estate set forth, you demonstrate your commitment and professionalism, which are highly valued qualities in our competitive market.
Love,
Kartik
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California's bustling real estate market shines for anyone aiming to make their mark in the real estate world. Starting a career in California real estate can unlock endless possibilities and the chance
California's bustling real estate market shines for anyone aiming to make their mark in the real estate world. Starting a career in California real estate can unlock endless possibilities and the chance for significant financial rewards. It's easy to see why people are drawn to the real estate business. Not only does our industry offer the flexibility to craft a personal brand and business, but it also provides the chance to significantly impact individuals' and families' lives by helping them find their dream homes. For those ready to dive into this thriving market, enrolling in a California real estate license school is the first step toward achieving your goals.
This article focuses specifically on the costs of obtaining a real estate license in California With a comprehensive breakdown of all associated costs, from educational fees to licensing and examination expenses, I want to offer a clear and detailed understanding of what to expect on your journey. Whether considering a career change or looking to enter the workforce with a bang, understanding the costs associated with an accredited California real estate license school is crucial Let's delve into the financial investment required to successfully start a career in California real estate.
Pre-Licensing Education Costs: Finding the Right Fit for Your Budget and Learning Style ADHI Schools' cost: $150-$499
California offers some flexibility when fulfilling your mandatory 135 hours of pre-licensing education. Consider these options to find a program that aligns with your needs and resources:
Online California Real Estate License Schools: Online programs often provide the most affordable and convenient way to complete your coursework. Look for "affordable California real estate license school" options, with ADHI Schools' prices starting at $150. Be sure to consider whether the school offers other resources that could save you money in the long run.
Instructor-led California Real Estate License Schools: ADHI Schools offers instructor-led options that may better suit some learners. While our program is slightly more expensive (ranging from $399 to $499), it provides the benefit of direct interaction with instructors and peers.
Factors Influencing Cost:
School Reputation: Well-established schools with a proven track record, like ADHI, may charge slightly more.
Features and Resources: Programs with comprehensive exam preparation tools, live instructor support, or additional resources may cost slightly more.
Course Format: Self-paced online courses are more budget-friendly than live online or with set schedules.
Remember: Researching the best online California real estate license schools or reputable in-person programs in your area is critical to finding the perfect balance of quality and affordability.
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Taking the Exam and Getting A License: Costs Revealed
$100 for the sales license exam $150 for the broker exam
$350 for the sales license issuance fee and $450 for the broker license fee
Becoming a licensed real estate agent in California includes a pivotal step: passing the California real estate license examination. This process is meticulously designed to assess an applicant's knowledge and understanding of real estate laws, practices, and principles crucial for a successful career in our industry. As part of the preparation for this journey, it's essential to be aware of the examination fees, which are a mandatory aspect of the licensing process.
As of the most recent guidelines, the California real estate salesperson examination fee is $100 and the broker exam is $150. This fee is payable at the time of application and is required for each attempt at the examination. To reiterate, the state charges every time you take and fail the exam, which is why enrolling with a reputable California real estate license school like ADHI Schools is important. It's also important to remember that this fee is subject to change, so applicants should verify the current costs with the California Department of Real Estate (DRE) at the time of their application.
In addition to the examination fee, candidates who pass the exam must also pay a license issuance fee. The current fee for issuing a salesperson license is $350 and $450 for the broker license. This brings the total cost for examination and initial licensing to $450 for the sales exam and $600 for the broker - not including any preparatory course fees or additional materials that may be needed for study purposes.
Examination Fees
Salesperson
Broker
Original Examination
$100
$150
Re-Examination
$100
$150
First Rescheduled Exam
$40
$45
Subsequent Rescheduled Exam
$40
$45
Combination Examination and License Application
For those applicants who want to file their examination and license application at the same time. For more information, salesperson applicants may review Salesperson Exam/License Application (RE 435) and broker applicants may review the Broker Exam/License Application (RE 436) .
Salesperson
Examination Fee
$100
License Fee
$350
Fingerprint Fee
*
Total Due to DRE with RE 435
$450
Broker
Examination Fee
$150
License Fee
$450
Fingerprint Fee
*
Total Due to DRE with RE 436
$600
Price Comparison
One of the initial steps in your journey to becoming a licensed real estate agent in California should be to shop around for California real estate license school providers carefully. The market offers many educational institutions offering pre-licensing courses, each with its unique pricing structure. Feel free to request detailed information on what each course package includes, such as textbooks, additional resources, and exam prep tools. Comparing prices and course offerings can significantly impact your overall budget, allowing you to find a program that fits your financial constraints and meets your learning needs.
Of course, I recommend ADHI Schools.
Budget Breakdown
Creating a realistic budget plan is critical for managing your licensing costs effectively. Start by listing all potential expenses, including pre-licensing education, examination fees, license issuance fees, and any additional study materials or resources you might need. Once you have a comprehensive list, allocate a specific amount towards each cost, considering your current financial situation.
Beyond the Initial Investment: Ongoing Costs for a Thriving Career
Getting your California real estate license is a significant accomplishment, but it's only the first step on your journey. To build a successful and sustainable real estate career, it's essential to factor in these ongoing expenses:
Marketing and Business Expenses: Think of marketing as fueling your growth. You'll need to invest in advertising, building your online presence, networking with potential clients, and acquiring essential business tools. These costs are crucial to attracting leads and growing your client base.
Continuing Education: California mandates that real estate professionals complete continuing education courses to maintain an active license. Renewal fees and the cost of these courses are an ongoing investment in your professional development and allow you to stay up-to-date on industry changes.
Pro Tip: Budgeting for these recurring costs from the outset ensures you will know the situation later. Consider them part of your overall business plan for long-term success in real estate. Achieving a real estate license in California is a pivotal step towards a career with significant personal and financial growth potential. As you stand at the threshold of this dynamic profession, equipped with knowledge of the necessary financial investments to initiate your journey, it's essential to look ahead and understand that the pathway to success in real estate extends beyond the initial licensure process. The foundation of a prosperous real estate career is built on obtaining your license and your commitment to continuous growth, learning, and adaptation.
The real estate industry, particularly in a market as competitive and vibrant as California's, demands ongoing investments in marketing, business development, and education. These are not mere expenditures but vital investments in your future. Effective marketing and business operations are crucial for expanding your client base and establishing a robust network. At the same time, continuous education ensures you remain at the forefront of industry developments and legal requirements.
As you venture into this promising career, remember that the costs of obtaining your license are just the beginning. Embracing the ongoing expenses of marketing, business development, and education is essential for nurturing a thriving career. These investments contribute to your professional growth, enabling you to provide exceptional service to your clients, stay ahead in the market, and, ultimately, achieve your career aspirations in California real estate.
Love,
Kartik
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Building a Personal Brand in Real Estate: A Step-by-Step Guide
The real estate market is a crowded field. To navigate this competitive landscape, building a solid personal brand is essential for any
Building a Personal Brand in Real Estate: A Step-by-Step Guide
The real estate market is a crowded field. To navigate this competitive landscape, building a solid personal brand is essential for any Realtor looking to stand out, attract their dream clients, and achieve long-term success. But what exactly is a personal brand, and how is it different from the branding of your brokerage?
Your personal brand is how you present yourself to the world. It's the unique combination of your skills, experience, personality, and values that makes you stand apart from all the other agents out there. A strong brand creates trust, fosters recognition, and ultimately positions you as the go-to expert in your niche.
Let’s look at this from the perspective of someone who wants to brand themselves as a luxury real estate professional.
Why Personal Branding Matters in Real Estate
Sets You Apart: In a market full of agents, a well-defined personal brand makes you memorable and helps you cut through the noise.
Builds Trust & Credibility: Clients want to work with professionals they like and trust. Your brand showcases your expertise and establishes you as a reliable source of information.
Attracts Your Ideal Clients: A clear brand lets the right clients find you, saving you time and energy on leads that aren't a good fit.
Step 1: Define Your Unique Value Proposition (UVP)
Your Unique Value Proposition (UVP) is simply a clear statement of what makes you different and why clients should choose you. Here's how to start uncovering yours:
Know Your Strengths: What are you exceptionally good at? Do you have a knack for negotiation, a talent for staging homes, or an in-depth market knowledge of a particular neighborhood?
Tap into Your Passions: Do you specialize in a certain type of property (luxury homes, first-time buyer properties, etc.) or have a particular passion related to real estate?
Client Feedback is Gold: Think back to positive client testimonials or reviews. What did they praise you for? These comments often reveal your true value proposition.
Examples of Real Estate UVPs
The Data-Driven Negotiator: "I help my clients make informed decisions with my market expertise and get the best possible deal."
The Luxury Home Specialist: "I elevate the experience of buying and selling high-end properties with my refined service and market knowledge."
The First-Time Buyer's Advocate: "I make your dream of homeownership a reality with guidance, patience, and unwavering support."
Additional Questions for Reflection
What problems do you consistently solve for your clients?
What type of client experience do you want to be known for? (efficient, warm and friendly, etc.)
Is there a specific community or neighborhood you focus on and know inside out?
The "Only I" Exercise
Complete this sentence: "I am the only Realtor who..."
...specializes in historic homes in [city/neighborhood]
...is both a real estate agent and a certified home stager.
...offers a complete relocation package for out-of-state buyers.
Step 2: Identify Your Target Audience
You can't be everything to everyone. Understanding your ideal client is key to focusing your branding and marketing efforts. Here's where to start:
Think Beyond Demographics: Age, income, and location are important, but go deeper. What are their lifestyle goals, pain points, and motivations when it comes to buying or selling?
Visualize Your Dream Client: Create a 'buyer persona' that gives your ideal client a name, a job, hobbies, and any other details that help you imagine them as a real person.
Step 3: Develop a Professional Image
First impressions matter, and this applies to your online and offline presence. Your professional image is an extension of your brand and needs to be consistent across all platforms. Here's where to focus:
Professional Photography: Invest in high-quality headshots and, if relevant, photos of you working with clients or showcasing your listings.
Branding Materials: Create visually appealing business cards, brochures, or presentation materials that reflect your chosen brand style and colors.
Consistent Theme: Maintain a consistent look and feel across your website, social media, and email signature. This creates a sense of professionalism and builds recognition.
Appearance and Demeanor: When meeting clients in person, dress professionally and maintain a courteous, approachable demeanor.
Your Website: Think of your website as your virtual storefront. It should be user-friendly, visually appealing, and clearly convey your brand and services. Include your UVP, professional bio, testimonials, and easy-to-use contact forms.
Optimize for Search (SEO): Employ basic SEO (Search Engine Optimization) techniques so potential clients can easily find you online. This involves using relevant keywords throughout your website's content.
Social Media Strategy: Choose the social media platforms where your target audience is most active (Facebook, Instagram, LinkedIn, etc.) Maintain a consistent tone and visual style with your other branding. Focus on providing value over self-promotion.
Questions for Reflection:
Does your current headshot and attire accurately reflect the image you want to project?
Could your branding materials like business cards be improved?
Tailoring Your Image to Your Audience
Consider how your ideal client uses technology and tailor your online presence accordingly. Here are a few examples:
Tech-Savvy Millennials: A modern website with slick design and video content might appeal to young, first-time buyers.
Busy Professionals: This audience might appreciate efficient information delivery on your website and prefer streamlined communication options like text or live chat.
Luxury Clientele: High-quality photography, elegant website design, and a presence on sophisticated platforms like LinkedIn might be the right approach.
Step 4: Develop a Professional Image (Luxury Clientele Focus As An Example)
I'll expand this section with points specifically geared towards conveying sophistication and refined taste:
Website Design: Emphasize an elegant design aesthetic, clean lines, and ample white space, reflecting the luxurious experience you offer.
Photography & Videography: Invest in top-notch photographers or videographers for showcasing listings. Consider drone footage or virtual walkthroughs for a premium feel.
Discretion and Confidentiality: Highlight your ability to handle transactions with the utmost discretion, as this is often a top priority for high-net-worth clients.
Tailored Social Media: While LinkedIn is important, consider platforms like Instagram as well. Showcase your access to high-end listings, share tasteful glimpses of luxury lifestyle elements, but always maintain professionalism.
Step 5: Optimize Your Online Presence (Luxury Focus As An Example)
Website Refinement: Include sections dedicated to luxury listings and market analysis specific to sought-after neighborhoods.
SEO Deep Dive: Research high-value keywords used by luxury buyers (e.g., waterfront properties, golf course communities, etc.) and incorporate them strategically.
Targeted Social Media: Focus on platforms like LinkedIn for professional networking. Share insights into the luxury market and connect with high-net-worth individuals. Consider curating Instagram content on design or architectural trends relevant to this market segment.
Step 6: Create Valuable Content (Luxury Focus)
High-value Blog Posts: Topics like "Understanding the Luxury Home Appraisal Process" or "5 Smart Home Features Luxury Buyers Love."
Luxury Market Reports: Compile data and visuals to offer insights valuable to affluent clients.
Email Newsletters: Stay top-of-mind with a curated newsletter featuring new luxury listings, exclusive market stats, and upcoming luxury-focused events (previews, art shows, etc.).
Step 7: Network and Collaborate (Luxury Focus)
Relevant Associations: Join real estate organizations specifically for the luxury market.
Industry Events: Attend charity benefits, galas, or upscale trade shows where you can network with potential clients or referral partners.
Collaborations with Luxury Brands: Explore potential collaborations with businesses catering to an affluent clientele (landscape architects, interior designers, etc.).
Step 8: Gather and Utilize Testimonials (Luxury Focus)
Highlight Exclusivity: Encourage testimonials that emphasize your discretion, deep understanding of their needs, and successful outcomes in luxury transactions.
Step 9: Analyze and Adjust Your Strategy (Luxury Focus)
Metrics that Matter: Focus on website traffic from affluent zip codes, high-quality leads, engagement on luxury-focused content.
Building a personal brand in the real estate industry, especially within the luxury market, is a journey that requires dedication, strategy, and a personal touch. By defining your unique value proposition, understanding your target audience, and creating a professional image tailored to your ideal clients, you lay the groundwork for a brand that resonates and stands out. The steps outlined—from optimizing your online presence to creating valuable content and leveraging testimonials—serve as a blueprint for establishing a brand that not only attracts but also retains high-net-worth clients.
Remember, the essence of a strong personal brand lies in the consistency of your message, the quality of your interactions, and your ability to adapt and refine your strategies based on feedback and evolving market trends. As you navigate the complexities of the luxury real estate market, let your personal brand be the beacon that guides your ideal clients to you, establishing you as the go-to expert in your niche. With persistence and attention to detail, your personal brand will become your most valuable asset, driving your success in the real estate industry.
Love,
Kartik
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How to Excel in Real Estate Negotiations: Strategies and Real-Life Scenarios
Negotiation is the heartbeat of the real estate industry. Whether you're representing buyers or sellers or navigating a
How to Excel in Real Estate Negotiations: Strategies and Real-Life Scenarios
Negotiation is the heartbeat of the real estate industry. Whether you're representing buyers or sellers or navigating a lease agreement, your ability to negotiate effectively will directly impact your success. This comprehensive guide will arm you with the knowledge, tactics, and real-world insights to become a formidable force at the negotiation table.
Understanding Real Estate Negotiation Fundamentals
Successful real estate negotiation requires a firm grasp of these core concepts:
Principles of Negotiation: Real estate negotiations thrive on the concept of mutual gain, where the objective isn't just for one party to win at the expense of another, but rather for all involved to find value in the agreement. This approach requires a deep understanding of what each party values most, enabling skilled negotiators to devise innovative arrangements that address those needs, thereby fostering a positive outcome for everyone involved.
Common Terms and Conditions: Price is important but only one of the focuses. Earnest money deposits, inspection periods, appraisal contingencies, and repair requests—an understanding of these common terms empowers you to negotiate with confidence.
Psychological Aspects: Real estate is emotional. Sellers may have deep attachments to their homes; buyers might be desperate to move quickly. Recognizing and addressing these emotions can tip the scales in your favor.
Preparation: The Cornerstone of Success
Fail to prepare, prepare to fail – this adage holds especially true in real estate negotiations. Meticulous preparation includes:
Market Analysis: Don't just know the neighborhood; understand the micro-market. What are genuinely comparable homes selling for? What are the average days-on-market? Data is your most potent weapon.
Setting Objectives: Are you laser-focused on price, or are flexible closing dates more critical to your client? Define your non-negotiables and the areas where you have room to compromise.
Negotiation Toolkit: Have all your ducks in a row – comps, pre-approval letters (if you're a buyer's agent), and disclosure documents. The more organized you are, the more credible you'll appear.
Effective Negotiation Strategies
Master these strategies to gain the upper hand in negotiations:
Building Rapport: People do business with people they like. Take genuine time to connect with the other party – find common ground, and share a little about yourself. This investment pays dividends.
The Art of Listening: Ask open-ended questions and listen to the answers. You'll uncover needs and pain points, allowing you to tailor offers that genuinely resonate.
Strategic Concession-Making: Don't hold all your cards close to your chest. Conceding on smaller items (repairs, paint allowance) can make the other side feel like they're winning, encouraging them to compromise on more significant issues like who pays for closing costs.
The Power of Patience: The first offer is rarely the best. Don't be afraid of silence, and know when to walk away (or give the appearance of being ready to do so).
Advanced Negotiation Techniques
To truly separate yourself, consider mastering these nuanced techniques:
Psychological Tactics: Learn about anchoring (setting an initial reference point), framing (how you present information), and even social proof (citing comparable sales) to subtly influence the negotiation. Anchoring, framing, and social proof are psychological tactics that, when skillfully applied, can significantly influence real estate negotiations. Anchoring sets an initial reference point, such as a price or condition, that shapes the rest of the negotiation, subtly nudging the other party's perception of what's reasonable towards this figure. Meanwhile, framing allows a negotiator to present information in a way that emphasizes certain aspects, influencing how the information is received and interpreted. For example, highlighting the uniqueness of a property can enhance its perceived value, while framing refurbishment as an investment can alter perceptions regarding cost. Social proof capitalizes on the tendency of individuals to look to the actions and decisions of others when making their choices. In the context of real estate, mentioning the interest of other buyers or citing comparable sales can generate a sense of urgency or validation, making the deal more attractive. Together, these tactics offer powerful tools for negotiators to subtly steer discussions to achieve favorable outcomes, leveraging human psychology to create win-win situations.
Leverage: Don't just have information, wield it. Is the seller in a hurry? Does the buyer have multiple offers? Use these factors to bolster your position.
Creative Problem-Solving: Think beyond dollars and cents. Can you structure an earn-out to bridge a price gap? Offer a rent-back agreement to ease the seller's moving stress. Get creative for a win-win.
Overcoming Roadblocks
No negotiation is without challenges. Be prepared for:
Difficult Personalities: Being a real estate agent is hard enough without trying to engage in ego battles. Stay calm, focus on your client's goal, and try to remove emotion from the transaction when it doesn’t help you. This requires a blend of diplomacy and strategy. Rather than engaging in confrontations that can escalate tensions and hinder progress, it's crucial to maintain a level of professional detachment, prioritizing the objectives over personal reactions. By doing so, you can more effectively manage challenging interactions, steering the conversation back to the core issues at hand and keeping the focus on achieving your client's goals. Additionally, recognizing when to employ techniques such as active listening or strategic compromise can turn potential conflicts into opportunities for finding common ground, further smoothing the path toward a successful negotiation.
Deadlocks: If progress stalls, try re-framing the issue. Can a price impasse be broken by adjusting terms? Don't be afraid to take a calculated break and revisit with fresh eyes.
Beyond the Table – Ensuring a Smooth Closing
Negotiations don't end at signing. To foster trust and a successful outcome, proactively manage the escrow process, anticipate potential hurdles, and over-communicate with your client.
Continuous Improvement
Treat every negotiation as a learning experience. Debrief with your broker, mentor, or colleagues. What went well? Where could you grow? This self-reflection makes you a more assertive negotiator with each transaction.
Excelling in real estate negotiations is an art that combines understanding fundamental principles with the skillful application of advanced tactics and strategies. Remember, successful negotiation is not about winning at the expense of others, but about finding mutually beneficial solutions that meet the needs of all parties involved. By staying calm in the face of difficult personalities, leveraging information effectively, and thinking creatively, you can become a formidable negotiator. Beyond the negotiation table, ensuring a smooth closing and engaging in continuous self-reflection and improvement will further enhance your skills and success in the real estate industry. Armed with these strategies and a commitment to ethical negotiation, you are well on your way to achieving outstanding results for your clients and setting yourself apart as a leader in the field.
Example of active listening and asking the right questions:
Clara had an appointment with the Robinsons, a couple looking to buy their first home. The Robinsons were visibly anxious, their dream home checklist in hand, filled with specifics that seemed almost impossible to meet within their budget. Clara greeted them with a warm smile and led them to her office, where the dance of negotiation was about to begin.
Instead of diving straight into listings or pitching sales tactics, Clara did something different. She asked, "What does your perfect home feel like when you walk through the door?" This open-ended question opened a floodgate of responses from the Robinsons. They spoke not just of physical attributes but of feelings, memories they hoped to create, and fears of financial strain.
Clara listened. Truly listened. Not just to respond, but to understand. As the Robinsons spoke, she noted not only the specifics of their dream home but also their underlying concerns about safety, community, and financial flexibility.
After the conversation, Clara had a deep understanding of what the Robinsons truly needed, beyond their initial checklist. She could have bombarded them with listings that checked off boxes, but instead, she tailored her approach, focusing on homes in neighborhoods known for their community spirit and safety, which also offered financial incentives for first-time buyers.
A few days later, Clara presented a home that wasn't on the Robinsons' radar. It met their desires in ways they hadn't articulated but Clara had intuited. The house was in a friendly neighborhood with a renowned local school, and it offered a sizable backyard for their children to play in—a detail Clara had discerned from their stories.
The Robinsons were hesitant initially, as the house needed some work, but Clara reminded them of their shared conversations about making a house a home and building memories. She had listened to their dreams and now presented them in a form they hadn't quite imagined but felt right.
In the weeks that followed, as the Robinsons settled into their new home, they often reflected on how Clara had understood their needs better than they had themselves. It was her ability to ask open-ended questions and truly listen to their answers that guided them to their dream home—a home that resonated with their unspoken wishes.
Clara's story spread throughout the Robinson’s sphere of influence - not just as a tale of a real estate agent who made a great sale, but as a story of someone who mastered the art of listening, transforming the dreams of a young couple into reality. This art didn't just negotiate a transaction; it built a bridge between dreams and reality, illustrating that listening, truly listening, is the most powerful tool in any negotiation.
Love,
Kartik
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Picture this: you've just passed your real estate exam, your license is now in hand, and your heart races with anticipation and nerves. You're ready to conquer the world, but the path seems uncertain.
Picture this: you've just passed your real estate exam, your license is now in hand, and your heart races with anticipation and nerves. You're ready to conquer the world, but the path seems uncertain. Don't worry, you're not alone. New real estate agents often walk a familiar road and by learning from your own missteps and those of others, you'll gain the knowledge and resilience to thrive in this dynamic field.
After over 20 years in the real estate industry, I’ve put together a list of common mistakes that newer real estate agents make after completing real estate license school and some potential solutions to these problems.
Mistake 1: Not Understanding Real Estate is a Direct Sales Job
Description: Some people new to selling houses don't realize that their job is really about direct sales, like selling a product directly to customers. This misunderstanding can make them less successful because they're not prepared for what the job actually involves. Real estate agents don't just sell houses; they're selling their own skills and trustworthiness to help people through the big deal of buying or selling a home. If they fail to recognize their job as centered on sales, they may avoid seeking new clients or improving their sales skills, both of which are crucial for success in their role.
Solution: Embrace the sales nature of real estate by developing strong sales and negotiation skills. This includes learning how to effectively communicate your value proposition, understanding the needs and wants of your clients, and mastering the arts of prospecting and closing. Building a strong personal brand and marketing yourself effectively are also key components of successful sales strategies in real estate. Networking, both online and in-person, is essential for generating leads and getting referrals. Understanding that real estate is fundamentally a direct sales job is the first step towards aligning your efforts with the demands of the industry and setting the stage for a thriving career.
Mistake 2: Failing to Set a Business Plan
Description: One of the most common pitfalls for new realtors is the need for a concrete business plan. Diving into the real estate industry without a clear strategy is like having a sailboat with no sail - the ship goes adrift. A well-thought-out business plan sets a clear direction for your real estate career and helps you establish achievable goals and strategies for reaching them. It should outline your market analysis, target audience, marketing strategies, financial planning, and growth objectives, providing a roadmap to success and a mechanism to measure progress.
Solution: Creating a robust business plan is your first step towards a successful career in real estate. Begin by defining your mission statement and unique value proposition—what sets you apart from the competition. Next, conduct a thorough market analysis to understand your local real estate market's needs, trends, and gaps. Set SMART (Specific, Measurable, Achievable, Relevant, Time-bound) goals to give your efforts direction and focus. Outline your marketing strategies: how do you plan to reach your target audience? Is this through digital marketing, networking events, or other channels? Lastly, draft a financial plan that includes your budget, expected income, and expenditure. This plan will guide you through the ups and downs of your real estate journey, enabling you to make informed decisions and adjust your strategies as the market evolves. The broker you work with should help chart this out.
Mistake 3: Neglecting Networking Opportunities
Problem: New real estate agents can easily get caught up in the immediate tasks of listing properties and chasing leads. However, overlooking the power of networking is a significant missed opportunity. Building relationships with other real estate professionals, industry professionals, and potential clients is crucial for generating referrals and expanding your knowledge base. Consider out-of-area networking also as you are less likely to get a referral from another agent in your area.
Solution:
Attend Industry Events: Make an effort to attend local real estate association meetings, open houses hosted by other agents, and community events related to homeownership. These provide platforms to meet new people and introduce yourself.
Join Online Communities: Leverage social media groups and online real estate forums to engage with other professionals, ask questions, share insights, and build a network of connections that extends beyond your geographical area. Referral fees are common in the real estate industry and the bigger your network is, the more money you can expect to make.
Focus on Relationship Building: Networking isn't just about collecting business cards. Prioritize genuine connections, offer help without expecting immediate returns, and position yourself as a valuable resource within the community.
Mistake 4: Not Fully Understanding the Local Market
Description: A deep understanding of the local real estate market is crucial for any real estate agent, yet it's an area where many newer licensees find themselves playing catch-up. Without a thorough understanding of the local marketplace you're essentially operating in the dark, unable to provide accurate advice to clients or make informed pricing, marketing, and negotiation decisions. This lack of insight can lead to overpriced listings that languish on the market or missed opportunities in emerging neighborhoods.
Solution: To avoid this pitfall, commit to becoming an expert in your local market. Start by analyzing your area's current listings, recent sales, and historical trends. Attend local real estate meetings, seminars, and workshops to network with other professionals and stay abreast of new developments. Utilize tools and platforms that provide real-time data and analytics on your market. Regularly reviewing the Multiple Listing Service can provide insights into property values. Most importantly, engage with your community. The more you understand the people and the unique characteristics of different neighborhoods, the better equipped you'll be to serve your client's needs and become a trusted local expert.
Mistake 5: Overlooking the Power of Online Marketing
Problem: A solid online presence is essential for Realtors in today's digital landscape. Failing to utilize online marketing tools effectively means missing out on countless leads and severely limiting your visibility as an agent. Potential clients almost always begin their home search online and if you're not there, you're invisible.
Solution:
Build a Professional Website: Your website should be your digital storefront. It should highlight your expertise, listings, and client testimonials and provide easy ways for potential clients to contact you.
Embrace Social Media: Actively engage on platforms where your target audience spends time (e.g., Facebook, Instagram). Share listings, provide market insights, and showcase your personality to build a loyal following.
Invest in SEO (Search Engine Optimization): Optimizing your website and content will help you rank higher in search results, driving more organic traffic and leads your way.
Mistake 6: Ignoring the Need for Continuing Education
Description: The real estate industry constantly moves with new laws, evolving market trends, changing marketing strategies, and technological advancements. Failing to keep up with these changes can lead to stagnation. New real estate agents must pay attention to ongoing training even after passing their initial licensing exams. Failure to do so will put them at a significant disadvantage in an increasingly competitive market. Continuous learning is not merely about fulfilling licensing requirements—it's about staying competitive, informed, and at the forefront of the industry.
Solution:
1.Adopt a philosophy of lifelong learning to ensure you remain relevant and practical in your profession.
Pursue additional qualifications, certifications, and courses that cover a wide range of topics, from digital marketing to real estate law.
Participate in workshops, attend conferences, and join webinars to get acquainted with industry trends and practices.
Check your local Association of Realtors and see what training they have available in addition to company provided training.
Mistake 7: Poor Time Management
Description: The flexible nature of a real estate career can be a double-edged sword. A lack of effective time management can lead to missed appointments, neglected leads, and a constant feeling of being overwhelmed. As a result, promising opportunities slip away, and your business growth suffers.
Solution:
Time Blocking: Dedicate specific blocks of time to different tasks - lead generation, client meetings, administrative work, etc. This helps prevent reactive work patterns and maintains focus. Your schedule is your boss in real estate.
Prioritize High-Value Activities: Analyze and prioritize which tasks generate the most income. Delegate or outsource other tasks when feasible.
Embrace Technology: Use a CRM (Customer Relationship Management) system to track client interactions, set reminders, and automate follow-ups, streamlining your workflow.
Schedule Breaks and Recharge: Real estate can be demanding. Intentionally schedule breaks and time for self-care to prevent burnout and maintain productivity.
Mistake 8: Not Setting Aside Savings for Slow Periods
Description: Real estate is an industry characterized by its cyclical nature, with highs and lows that can significantly impact income. A common oversight is failing to prepare for inevitable fluctuations. This lack of financial preparation can lead to stress and instability during slower periods when sales are fewer and far between. Understanding and planning for these fluctuations is essential for maintaining financial stability and ensuring longevity in the industry.
Solution: An essential strategy for managing this aspect of your real estate career is diligent financial planning, which includes setting aside a portion of your earnings during busier times to cover expenses during slower periods. A general recommendation is to save at least 20-30% of each commission check. Additionally, diversifying your income sources, such as rental income or other investments, can provide a steadier cash flow. Creating a detailed budget that accounts for personal and professional expenses will help you understand your financial needs and better prepare for the future.
Additional Tips:
Find a Mentor: A seasoned agent as a mentor can provide invaluable guidance, share their experiences, and accelerate your learning curve.
Embrace Technology: Stay ahead by incorporating the latest technologies and tools to optimize your processes and reach a greater audience.
Never Stop Learning: The real estate industry is constantly evolving. Commit to continuing education to stay informed and remain a trusted advisor for your clients.
With the right approach, the challenges of starting your real estate career can become your most significant growth opportunities!
Love,
Kartik
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Embarking on a real estate career can be exciting and daunting, especially when meeting the qualifications for obtaining a license. One question that arises among aspiring real estate professionals in
Embarking on a real estate career can be exciting and daunting, especially when meeting the qualifications for obtaining a license. One question that arises among aspiring real estate professionals in California is: "Can you take the real estate exam in California without any classes?" This question is crucial for those eager to dive into the industry but must decide on the required educational commitments. I wanted to address this question head-on while incorporating insights from related topics pertinent to launching a successful career in real estate.
California, known for its dynamic real estate market, sets forth specific requirements for individuals aiming to become licensed real estate agents. The California Department of Real Estate (DRE) mandates that applicants complete some coursework before sitting for the state licensing exam. Specifically, you must complete three college-level courses in real estate principles, practice, and one elective course from a list from an approved California real estate license school However, exceptions exist for individuals if they are a lawyer who wants a real estate license in California. Lawyers who are members of the State Bar of California are exempt from the college-level course prerequisites, allowing them to proceed directly to the licensing exam. This exemption acknowledges the extensive legal education that lawyers undergo, which overlaps significantly with real estate law and practices. However, California attorneys still must take and pass the real estate license exam.
For those not exempted by a legal career, the educational requirement is more than just a bureaucratic hoop to jump through. It is designed to equip you with a foundation to navigate the complexities of real estate transactions. These courses cover various topics, from property rights and contracts to finance and ethics, ensuring that you are well-prepared to serve your clients effectively.
Preparing for the California real estate exam is a rigorous process that demands a comprehensive understanding of various subjects. Our real estate exam prep guide offers a valuable resource for those studying for the exam, providing structured guidance and strategies to tackle the exam confidently. The guide includes practice questions, outlines of key topics, and test-taking tips to enhance your chances of passing on your first attempt.
Passing the California real estate exam is a notable achievement, but it's just the beginning of your journey. A Guide to Your First 30 Days as a Real Estate Agent outlines essential steps for newly licensed agents, from joining a brokerage to developing a marketing plan and building your client base. This critical period can set the tone for your career, emphasizing the importance of a strong start.
Once licensed, continuous learning and adaptation are key to longevity and success in the real estate profession. California requires real estate agents to complete continuing education courses to renew their licenses. This requirement ensures that agents stay updated on the latest laws, regulations, and market trends, reinforcing the value of lifelong learning in this dynamic field.
In addition to formal education and licensing requirements, building a successful real estate career involves mastering practical skills and leveraging personal networks. Referrals 101: How to Ask Your Friends and Family for Referrals highlights the significance of referrals in generating business. Cultivating a solid referral network can be instrumental in establishing and growing your real estate practice, underscoring the industry's relational nature.
Understanding the financial aspects of real estate, such as understanding off-the-top fees as a Realtor is also crucial. This knowledge helps agents manage their finances effectively, from navigating commission structures to budgeting for business expenses. Financial understanding is essential for maximizing earnings and ensuring the sustainability of your real estate career.
While it may seem appealing to bypass educational requirements and jump straight into taking the California real estate exam, the state mandates these courses for good reason. They provide a solid foundation of knowledge and skills essential for success in the real estate industry. For lawyers, exemptions offer a streamlined path to licensure, yet the principles of thorough preparation and continuous learning apply universally across the profession. By embracing these educational opportunities and leveraging resources like exam prep guides and practical advice for new agents, aspiring real estate professionals in California can set themselves up for a rewarding and prosperous career.
TLDR: For the most part, classes are required. Lawyers in California are exempt from the classes, but nobody is exempt from the licensing exam.
Love,
Kartik
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How Fast Can I Get My Real Estate License in California?
After being in real estate education for over 20 years, I can confirm that embarking on a career in real estate in California is an exciting
How Fast Can I Get My Real Estate License in California?
After being in real estate education for over 20 years, I can confirm that embarking on a career in real estate in California is an exciting journey that opens up a world of opportunities. The first step towards this venture is obtaining your real estate license. This process involves meeting specific requirements, each with its timeline. In this article, I’ll break down these requirements, the time it typically takes to complete each one, and the overall process to give you a clear picture of how quickly you can start your new career in real estate.
What are the Licensing Requirements?
To qualify for a real estate license in California, candidates must complete a handful of key steps:
Education: Aspiring real estate agents must complete 135 hours of Pre-Licensing education. This includes three courses: Real Estate Principles, Real Estate Practice, and one elective course with courses approved by the Department of Real Estate in California. [This can be finished in as fast as 54 calendar days]
Examination and License Application: After completing the educational requirements, you must apply to take the California real estate license exam. You can apply for the exam and license simultaneously, but it’s important to bear in mind that this step can’t be completed without first completing the pre-license courses. [This processing typically runs 6-8 weeks.]
Background Check: A fingerprinting process through Livescan is required for a background check. These fingerprints should be completed before applying for the real estate exam but after completing the three pre-license courses.
State Examination: Pass the California real estate license exam and apply for your license. Just as a heads up, the real estate license exam is given in a computerized format.
How Soon Can I Do Each One?
Education: The 135 hours of Pre-Licensing education can be completed at your own pace through ADHI Schools We have online courses for flexibility, so you can potentially complete this step in as little as 54 days. However, you have up to one year to complete the program. We want to give you more time, but the DRE in California says that all courses must be completed within one year of enrollment.
Exam and License Application: Once you complete the three open-book exams on our website, the next step is to apply for the state exam. You can apply online through a California Department of Real Estate eLicensing system. Processing times for the application to take the state exam can vary, but planning is critical. Currently, the processing time is typically between 6-8 weeks. This period can vary, so checking the DRE website for the most current timeframes is advisable.
Background Check: The fingerprinting process can be completed relatively quickly, often within a week, but scheduling might vary based on location and availability.
Where Do I Take My Real Estate License Test?
The California real estate license exam is administered at several DRE locations throughout the state. Candidates can choose the most convenient location when scheduling their exam. The DRE website lists the locations and provides addresses and contact information for planning your exam day.
The five locations where exams can be taken are Fresno, Oakland, Sacramento, San Diego, and La Palma. (La Palma is considered the "Los Angeles area" location for the state exam.)
To summarize, completing the pre-license courses can take up to 2 months, followed by an additional 1.5 to 2 months for the state to process the application. This means the entire process will take approximately 3.5 to 4 months in total.
Obtaining your real estate license in California requires dedication and planning. By understanding the steps involved and the time each takes, you can efficiently navigate the journey toward becoming a licensed real estate agent.
Remember, the time it takes to get licensed varies based on individual circumstances. Still, with a clear plan and a commitment to your goal, you can achieve your real estate aspirations in California. ADHI Schools would love to be a part of your journey!
TLDR: Ideally the whole process should take around 4 months if you hustle!
Love,
Kartik
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A well-crafted listing description is critical when you want a listing to get attention. It's more than just words on a page—it's the key to catching the eye of potential buyers and standing out in a
A well-crafted listing description is critical when you want a listing to get attention. It's more than just words on a page—it's the key to catching the eye of potential buyers and standing out in a competitive market.
By weaving together the correct details, emotions, and visual imagery, a creative listing description can attract attention and create a lasting impression, setting your property apart from the rest.
Start with a Captivating Opener
The first step in crafting a great listing description begins with the first sentence of your description. In real estate, where countless listings vie for attention, an opener that grabs attention is not just important—it's crucial. This is your chance to make a compelling first impression to ensure potential buyers pause and click through instead of scrolling past.
A powerful opener acts like a magnet, drawing in your target audience with the promise of something exceptional. It should be concise yet evocative, offering a glimpse into the lifestyle that the property enables. Whether it's the promise of serene suburban living, the allure of luxury urban convenience, or the charm of rustic countryside serenity, your headline should capture the essence of the property in a way that resonates with your intended buyers.
Incorporating keywords that highlight unique selling points—such as "panoramic views," "fully renovated," or "walkable to downtown"—can also enhance visibility in search results, making your listing easier to find among the sea of options. Remember, the goal is not only to inform but to entice and intrigue potential buyers, compelling them to delve deeper into what your listing offers.
If you want to learn more, after you read this article, check out Marketing Magnet: Attract Buyers & Close Deals with Next-Level Real Estate Strategies. Here, you'll find a treasure trove of tips and tactics that go beyond the basics, ensuring your listings attract attention and close deals.
Highlight Unique Features
The essence of a standout listing description lies in the ability to spotlight unique features of the property—those distinctive attributes that elevate it from merely a house to a potential home in the eyes of the buyer. Identifying and emphasizing these features requires an understanding of the property and an insight into what today's buyers seek.
Whether it's an expansive backyard perfect for summer barbeques, a gourmet kitchen that beckons the family chef, or a home office space tailor-made for the remote worker, highlighting these unique selling points is pivotal in connecting with potential buyers.
When identifying what to highlight, consider the elements that make the property special. Is it the architectural style, the eco-friendly upgrades, the proximity to coveted amenities, or the breathtaking views? These features should be brought to the forefront of your description, painted in a light that informs, entices, and excites the reader. The goal is to paint a picture in the buyer's mind where they can envision themselves enjoying these unique aspects of the property.
Moreover, it's not just about stating these features; it's about presenting them in a way that showcases their value. A bland statement like "attached garage" becomes more impactful when framed as "never worry about parking or weather with your own spacious, two-car attached garage."
Use Descriptive Language
The power of a listing lies not just in the details it conveys but in how it conveys them. Using vivid and descriptive language is akin to painting a picture for the buyer, one that transcends mere physical dimensions and taps into emotions and imagination. This approach transforms a simple listing into a compelling narrative that invites potential buyers to visualize a property and a future home filled with life and memories.
To achieve this, focus on sensory details and the emotions they evoke. Instead of merely stating "large windows," describe how the morning light pours into the room, creating a warm, inviting glow that illuminates the space. Rather than listing a "renovated kitchen," paint a picture of the space where culinary dreams come to life, with state-of-the-art appliances and ample counter space that invites family gatherings and gourmet explorations.
Language that evokes the sense of touch, sight, sound, and even smell can significantly enhance a property's allure. Mention the soft rustle of leaves in the private backyard oasis, the stunning views that capture the city skyline or serene landscapes, or the cozy fireplace where one can imagine curling up with a good book on chilly evenings.
Remember, the goal is to make potential buyers feel like they are walking through the home, experiencing its charm and envisioning their lives unfolding within its walls. By using descriptive language effectively, you not only showcase the property's best features but also create an emotional connection, making the listing memorable and compelling. This strategy helps attract attention and convert it into action, as buyers are more likely to pursue a property that sparks their imagination and feels like a dream home comes to life.
Create an Emotional Connection
A fundamental truth lies at the heart of every property transaction: real estate is as much about emotions and connections as it is about land and buildings. Writing descriptions that resonate emotionally with potential buyers is not just a strategy; it's an art that can significantly influence decision-making. To create an emotional connection, it's essential to weave narratives that speak not just to the mind but to the heart.
One effective strategy is to envision the lifestyle that the property enables. Rather than simply listing features, frame them in a context that suggests a story or a dream come true. For example, a backyard isn't just an outdoor space; it's a haven for summer gatherings, a future canvas for a garden enthusiast, or a serene retreat for quiet afternoons. This approach helps potential buyers envision their lives and cherished moments within the space, making the connection more personal and profound.
Incorporating elements of storytelling can also deepen this connection. Begin by setting the scene with the property's most enchanting qualities. Then, invite the reader on a journey through the home, highlighting how each space contributes to the overarching narrative of a fulfilled, joyful life. Use emotive language to describe how the property feels—peaceful, refreshing, warm, or welcoming—helping buyers see and feel the home's essence.
Understanding the target audience and tailoring the description to align with their aspirations and desires is also beneficial. A family might be drawn to a neighborhood's safety and community feel, while young professionals might value convenience and modern amenities. Aligning the property's attributes with the buyer's aspirations amplifies the emotional impact, making the listing more compelling.
Remember, at its core, Real Estate Is About People, Personalities, and Emotions. By placing people and their emotional responses at the center of your listing descriptions, you forge a more profound connection that transcends the physical aspects of the property. This emotional resonance distinguishes the listing in a crowded market and moves potential buyers closer to envisioning the property as their future home.
Be Honest and Transparent
Honesty is not just a policy—it's the foundation for lasting relationships and trust. For listing descriptions, honesty and transparency are crucial in attracting potential buyers and fostering a sense of reliability and integrity. This approach not only enhances the immediate appeal of a property but also safeguards the agent's reputation and mitigates potential issues down the line.
The importance of honesty in listing descriptions cannot be overstated. Overpromising or embellishing features may initially capture attention, but it can lead to disappointment and distrust when potential buyers view the property in person. This discrepancy between expectation and reality can sour the buying experience, damaging trust and potentially derailing transactions.
Transparency about the property's condition, features, and potential limitations conveys respect for the buyer's ability to make informed decisions. It demonstrates that the agent values integrity over making a quick sale, building a foundation of trust essential for successful, long-term relationships in the real estate industry. This approach also aligns with the expectations of today's buyers, who are more informed and discerning than ever before.
Moreover, honest descriptions help pre-qualify buyers, attracting those genuinely interested in what the property offers. This can lead to a more efficient selling process, as potential buyers are better matched to the property from the outset.
Use High-Quality Photos and Virtual Tours
In an era when the first impression of a property often happens online, integrating high-quality photos and virtual tours with your listing description is not just an enhancement—it's a necessity. These visual elements play a critical role in capturing the essence of the property and significantly augment its appeal to potential buyers.
Photos must be professional, well-lit, and thoughtfully composed to showcase the property in its best light, drawing buyers in and encouraging them to explore further.
Virtual tours offer an immersive experience beyond traditional photography, allowing potential buyers to navigate the property at their own pace. This technology enables viewers to understand the layout and flow of the home, giving them a sense of being there in person. Virtual tours have become increasingly important, offering buyers a convenient and comprehensive way to connect with a property, mainly when physical viewings are limited.
High-quality photos and virtual tours complement the descriptive language of your listing, creating a more complete and engaging portrayal of the property. This synergy between visual and textual elements enhances the listing's appeal and helps potential buyers form a deeper emotional connection with the home. They can envision their lives unfolding within its walls, a powerful motivator in home buying.
Embracing these visual tools is part of a broader digital strategy in real estate marketing, a theme explored in Real Estate Marketing Gets Real with Digital: Your Guide to the New Frontier. This resource delves into the evolving landscape of real estate marketing, highlighting the importance of leveraging digital technologies to connect with today's tech-savvy buyers. By understanding and applying these principles, real estate professionals can craft listings that stand out and resonate deeply with potential buyers, paving the way for successful transactions in the digital age.
Crafting a compelling listing description is an art form that requires attention to detail, creativity, and a deep understanding of what today's buyers are seeking. Throughout this blog, I've explored essential strategies that elevate your property listings from the ordinary to the extraordinary, ensuring they capture attention and stand out in a competitive market.
Applying these tips lets you transform your listings into captivating narratives that inform and inspire potential buyers. Remember, your goal is not just to sell a property but to tell a story that resonates with buyers, inviting them to imagine a future in the home you're presenting.
I encourage you to embrace these strategies, refining and adapting them to match your
unique listings and target audience. Doing so will make your listings stand out and create a more meaningful and impactful connection with potential buyers, paving the way for successful sales and satisfied clients.
Let these insights guide you as you craft your following listing. With creativity, honesty, and a keen eye for detail, you have the power to showcase properties in their best light, captivating the hearts and minds of buyers in today's real estate market.
Love,
Kartik
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The California Department of Real Estate is the state's authoritative body responsible for administrating and regulating real estate laws and overseeing the licensing of real estate professionals, including
The California Department of Real Estate is the state's authoritative body responsible for administrating and regulating real estate laws and overseeing the licensing of real estate professionals, including salespersons and brokers, within California. Established to safeguard public interests in real estate transactions, the DRE ensures that the real estate industry operates with integrity, transparency, and compliance with state laws.
The Real Estate Commissioner is the head of the DRE and oversees the Department. The Commissioner gets their job by being appointed by the Governor of California.
What qualifies someone to be the Real Estate Commissioner?
Section 10052 of the Business and Professions Code states that the commissioner shall have been a real estate broker for five years actively engaged in business as such in California or shall possess related experience associated with real estate activity in California for five years within the last ten years.
Who is the Real Estate Commissioner today?
On January 3, 2024, Chika Sunquist officially took the helm as the Commissioner of the California Department of Real Estate (DRE), following her appointment by Governor Gavin Newsom on November 28, 2023. Her journey with the DRE commenced in 2006 when she embarked on her career as a deputy commissioner within the Sacramento Enforcement Office. In this role, she dedicated herself to probing complaints lodged against both licensed and unlicensed individuals, alongside conducting thorough background checks on those applying for licenses.
Her career trajectory within the DRE saw a significant transition in 2008 when she moved to the Mortgage Loan Activities unit. In 2015, she was promoted to supervising special investigator for the same unit.
Since 2020, Sunquist has been Assistant Commissioner of Enforcement at the DRE. Her responsibilities there involved overseeing management and operational facets of the Enforcement division.
Before her tenure at the DRE, Sunquist garnered practical experience in the field, having engaged in residential real estate sales. To this day, she maintains her broker license. Her educational background is impressive, with a Bachelor of Science in Languages and Linguistics from Georgetown University, complemented by an Associate of Arts in Administration of Justice from Sacramento City College.
What Does the Real Estate Commissioner do?
The California Real Estate Commissioner is critical in overseeing the California Department of Real Estate. The Commissioner's duties are specifically tailored to ensure the integrity, transparency, and efficiency of the real estate market in the state, protecting consumers and ensuring that real estate professionals adhere to the legal and ethical standards set forth by California law. Some of these duties are:
Enforcement of Real Estate Law: The Commissioner oversees the enforcement of California real estate laws. This involves investigating complaints against real estate licensees, taking disciplinary actions against those who violate the law, and ensuring compliance with state and federal regulations affecting the real estate industry.
Licensing and Certification: The Commissioner is responsible for licensing real estate brokers and salespersons in California. This includes overseeing the examination process for new licensees, renewing licenses, and ensuring that licensees meet the required educational standards.
Education and Professional Standards: Setting and maintaining educational standards for real estate professionals is crucial. The Commissioner approves real estate education courses offered by real estate schools in California, ensures the ongoing professional development of licensees, and sets criteria for real estate pre-licensing and continuing education through the legislative process.
Consumer Protection: A significant aspect of the Commissioner’s role is to protect consumers involved in real estate transactions. This includes providing resources and information to help consumers make informed decisions, addressing and resolving consumer complaints, and ensuring that the real estate industry operates fairly and transparently.
Regulatory Oversight: The Commissioner oversees the regulation of real estate practice and transactions, including managing escrow companies, mortgage brokers, and other entities involved in real estate transactions in California.
Industry Liaison: Acting as a liaison between the real estate industry and the public, the Commissioner engages in outreach and communication efforts to educate consumers and professionals about their rights and responsibilities under California real estate law.
In carrying out these duties, the California Real Estate Commissioner ensures that the state's real estate industry operates in a manner that is ethical, lawful, and conducive to the economic well-being of California residents while also fostering professional integrity and competence among real estate practitioners.
Love,
Kartik
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Pass Rates For Real Estate Exam Explored
The path to becoming a real estate professional in California is often perceived as a straightforward journey. However, the reality is quite different. The
Pass Rates For Real Estate Exam Explored
The path to becoming a real estate professional in California is often perceived as a straightforward journey. However, the reality is quite different. The California real estate exam a critical step in this journey, poses a significant challenge to many aspirants. The statistics for September 2023 are a telling example of this challenge, reflecting a trend that remains consistent regardless of the month. These numbers have been pretty consistent throughout the years.
Qualifying to Take the Exam: The First Hurdle
In order to take the real estate license exam in California, a candidate must successfully complete three college level courses. These courses are “Real Estate Principles” “Real Estate Practice” and one elective course. Once certificates of completion are obtained for each of these three required courses, the candidate may then sit for the state license exam.
If a real estate broker license is desired, the candidate must complete the above three courses as well as five additional college level courses.
In addition to the education requirement, broker license candidates must also demonstrate a level of experience generally fulfilled by two years of full-time real estate sales experience or a degree with a major in Real Estate. (Most people qualify for this by the two-year experience method).
Scheduling vs. Taking the Exam: The Second Hurdle
Once the prerequisites are completed, the next step is to schedule and take the real estate license exam.
A surprising phenomenon in the California real estate exam process is the discrepancy between the number of individuals who schedule their exams and those who actually sit for them. In September 2023, for instance, while 384 brokers scheduled their exams, only 319 actually took the test. Similarly, out of 5013 salespersons who planned to take the exam, only 4179 followed through and actually took the test. That’s almost 1,000 people who scheduled their salesperson exam but never took the test!
This gap suggests a range of factors - from last-minute jitters to personal circumstances - that prevent candidates from even attempting the exam.
Passing the Exam: A Steeper Challenge
For those who do take the exam, success is not guaranteed. The failure rate is a stark reminder of the exam's difficulty and the level of preparation required.
A recent examination of the pass rates might be super surprising. 319 people took the broker exam in a recent month and only 150 of those passed.
The salesperson exam isn’t much better. In the same month, 4179 people took the sales license exam and only 1922 of those passed.
Unpacking the Low Pass Rates of California's Real Estate Exams: A Deeper Insight
The real estate license exams in California for September 2023 have yielded intriguing results, with notably low pass rates that might raise eyebrows among novices and experts alike. These outcomes are reflective of the stringent standards and complexities inherent in the real estate sector. Let's delve into the factors that contribute to such challenging scenarios.
Exam Difficulty: A Comprehensive Hurdle
The California real estate exams are renowned for their rigor. They encompass a broad spectrum of topics, from intricate laws and regulations to real estate principles, practices, but relatively little math This extensive range demands a level of understanding, often proving to be a formidable challenge for many examinees. The depth and breadth of these subjects require not only memorization but also a level of knowledge and the ability to apply concepts in varied scenarios.
Preparation Level: The Key to Success
A significant factor influencing these pass rates is the level of preparation among candidates. Often, examinees may find themselves inadequately prepared, possibly due to limited study time, a lack of understanding of the exam's structure, or even a simple underestimation of the exam's difficulty. Such unpreparedness can lead to gaps in knowledge and skills, hindering their ability to successfully navigate the exam.
Navigating Test Anxiety and Test-Taking Skills
Moreover, possessing the required knowledge is only part of the equation. Many candidates grapple with test anxiety or lack effective test-taking strategies, which are crucial for success in such high-stakes exams. This psychological factor can significantly impede performance, as it affects concentration, memory, and overall composure during the test. Developing strategies to manage anxiety and enhance test-taking skills is essential for transforming knowledge into successful exam results.
The pass rates for California's real estate license exams are indicative of a demanding professional standard and a call to action for aspiring real estate agents. They underscore the necessity for thorough, well-rounded preparation and the development of robust test-taking abilities. For those embarking on this journey, understanding and addressing these factors can pave the way to success in this challenging yet rewarding field.
If you need help passing the real estate license exam, visit www.crashcourseonline.com for the most up-to-date and comprehensive test prep available.
Love,
Kartik
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How Many Times Can You Take The California Real Estate Exam?
Starting your career in real estate and getting your real estate license in California is an exciting journey. Still, it often begins with
How Many Times Can You Take The California Real Estate Exam?
Starting your career in real estate and getting your real estate license in California is an exciting journey. Still, it often begins with a common question from some nervous new students:
How many times can I retake the California real estate exam if I don’t pass on my first try?
Understanding the process for retaking the exam is crucial for aspiring real estate professionals. In this article, I will guide you through the key points you need to know.
Understanding the Retake Policy:
The California Department of Real Estate (DRE) sets clear guidelines for retaking the real estate exam. Here’s what you need to know:
Wait for Your Results:
Before making any plans to retake the exam, wait until you receive your initial test results. It’s important not to submit a new application or fee or attempt to secure a new exam date before getting your results. Doing so can lead to your exam record being flagged and your results being withheld. Additionally, rescheduling before receiving your exam results can lead to changes, delays, or cancellations in any new dates obtained.
Applying to Retake the Exam:
If you do not pass the exam, you can reapply using the eLicensing online system for quicker processing.
No Limit Within Two Years:
There’s no limit on the number of times you can take the examination within the two years following the date of your original application. This offers ample opportunity for candidates to prepare and reattempt the exam.
Beyond Two Years:
You must submit a new application if you wish to retake the exam after two years. Additionally, you’ll have to requalify by meeting all statutory requirements and pay the appropriate fee.
Tips for Success:
Study and Prepare:
Utilize study materials, take practice exams, and consider enrolling in our real estate crash course.
Understand Your Weaknesses:
If you didn’t pass the exam on your first try, focus on the areas where you need improvement. If you don’t pass the real estate exam, your exam notice will show how you scored in each section. You can use this to plan your studies.
Stay Informed:
Keep up with any changes in real estate laws and practices in California.
While retaking the California real estate exam might seem daunting, the DRE’s policies are designed to give candidates multiple opportunities to succeed. Remember, persistence and preparation are key. Our school is committed to providing the resources and support you need to achieve your real estate career goals.
TLDR: You have unlimited retake attempts during the two year period.
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What does the California DRE do?
At the regulatory heart of California’s bustling real estate industry is the Department of Real Estate, an entity many have heard of, but few understand the extent
What does the California DRE do?
At the regulatory heart of California’s bustling real estate industry is the Department of Real Estate, an entity many have heard of, but few understand the extent of its influence.
The DRE isn't just another bureaucratic agency; it's the backbone of California's real estate market. Whether you're an aspiring agent studying for the real estate exam, a seasoned broker, a curious homeowner, or just someone fascinated by the intricacies of real estate, knowing at least something about the DRE is crucial. The DRE sets rules, enforces them, and tries to ensure real estate transactions are fair, proper disclosure is made, and parties are protected.
More specifically, what does the DRE do, and who oversees it? I wanted to shed light on some of these questions, and offer insights into the governance and oversight of the DRE and its significant impact on California's real estate sector. So, let's understand why the Department of Real Estate is such a key player in shaping the real estate landscape of California.
Organizational Framework of the California DRE
Let's peek behind the curtain to see who leads the California Department of Real Estate. At the top of this structure sits the California Real Estate Commissioner. The Commissioner is appointed by none other than the Governor of California. The fact that the governor appoints the Commissioner is a testament to the significance of the role.
The Commissioner's role is not just a title; the title comes with large responsibilities spanning the licensing of real estate agents and brokers to regulating real estate schools the Commissioner’s hands are full, ensuring the industry runs smoothly and ethically. But they're not doing it alone. A dedicated team of professionals supports the Commissioner and work to uphold the integrity of California's real estate market.
However, the DRE doesn't operate in isolation. It's part of a larger framework under the California Business, Consumer Services, and Housing Agency.
This connection underscores the DRE's role in real estate and broader aspects of business and consumer affairs. Through this agency, the state government plays a pivotal role in shaping policies and regulations that the DRE implements. It's a collaborative effort that ensures the real estate market aligns with the state's economic and consumer protection objectives.
In essence, the governance structure of the DRE is a blend of strategic leadership, state oversight, and collaborative governance. It's designed to both administer and innovate and adapt in the fast-paced world of California real estate.
Role of the Commissioner
So, who is the California Department of Real Estate Commissioner, and what exactly do they do? This pivotal role is filled by an individual appointed by the Governor of California, a decision that, as discussed, speaks volumes about the position's significance. The Commissioner is not just a figurehead; they are the driving force behind the DRE's vision, policies, and actions.
California’s Business and Professions Code stipulates that the Commissioner must have either five years of active engagement as a real estate broker in California. Alternatively, they could possess other real estate related experience in the state for five years within the last decade.
The commissioner's salary is determined as per the Government Code, and they are entitled to actual and necessary expenses incurred in the performance of their duties.
Once appointed, they step into a world where their decisions impact millions of Californians – from those buying their first homes to those building vast real estate empires - and the real estate licensees selling them.
Now, let's talk about the day-to-day responsibilities of the Commissioner. They oversee the licensing of real estate professionals, ensuring that only qualified and ethical individuals can practice in the state. But their job continues. The Commissioner also plays a crucial role in enforcing real estate law, including disciplining those who violate regulations and protecting the public from fraudulent practices.
In short, the California Department of Real Estate Commissioner is a guardian of the state's real estate integrity. They're a leader and protector of the public's interest in one of California's most dynamic economic sectors. Understanding their role gives us a clearer picture of how the California real estate market is shaped and regulated and how vital this role is in maintaining the health and vibrancy of this industry.
The DRE's Connection with Other State Agencies
Navigating the complex waters of real estate requires more than a solitary voyage; this is where the California Department of Real Estate (DRE) truly shines. The DRE is not an island, rather it is part of a network of other state agencies and governmental bodies.
One of the critical connections is with the California Business, Consumer Services, and Housing Agency. Think of this agency as a big umbrella under which the DRE collaborates with other departments to align real estate practices with broader state business and consumer protection policies. This partnership ensures that real estate regulations maintain market order, protect consumers, and support healthy business practices.
But the collaboration continues. The DRE also works closely with legislative bodies to help shape real estate laws. This involves providing expert insights and data to lawmakers, ensuring that any new legislation is grounded in real-world experience and knowledge. It's a two-way street, with the DRE playing a critical role in influencing and implementing policy.
Another significant aspect of the DRE's collaborative efforts is its relationship with law enforcement and judicial bodies. When it comes to upholding real estate law, particularly in cases of fraud or unethical practices, the DRE often joins forces with these entities. This collaboration ensures that enforcement is swift, effective, and just, maintaining the integrity of the state's real estate market.
Impact on Real Estate Professionals
When we think about the California Department of Real Estate (DRE), it's not just about rules and regulations; it's about the profound impact it has on the lifeblood of the real estate industry: the agents, brokers, and real estate schools. The DRE's governance touches every corner of the industry, shaping careers, businesses, and the overall market health.
The DRE is akin to a guiding star for real estate agents and brokers. It sets the standards for obtaining and maintaining a real estate license in California. Understanding the steps to get a real estate license is essential for anyone aspiring to enter the industry. The process includes outlining the educational requirements, conducting licensing examinations, and ensuring ongoing compliance with state laws.
In parallel, many wonder about the necessity of a college education for becoming a Realtor in California. This question is particularly relevant given the varied educational backgrounds of successful real estate professionals in the state.
The DRE's regulations are designed to uphold professionalism and ethical standards in the industry, boosting public trust and confidence in real estate professionals. Real estate schools are significantly influenced by the DRE's governance, with the DRE establishing the curriculum and standards for pre-licensing and continuing education. Schools must adhere to these standards to ensure their courses meet the quality and relevance required for future real estate professionals.
Furthermore, the DRE provides numerous resources and tools for real estate professionals. From informative publications to online services , the DRE ensures that agents, brokers, and real estate educators have access to the latest information and support they need to succeed and stay compliant with state regulations.
In summary, the DRE's governance has a ripple effect across California's entire real estate industry. It shapes how real estate professionals are educated, licensed, and regulated, playing a pivotal role in maintaining a fair, ethical, and thriving real estate market. For anyone involved in California's real estate sector, understanding the influence of the DRE is critical to navigating the market's challenges and opportunities.
Public Involvement and Transparency
The California Department of Real Estate (DRE) isn't just a regulatory body operating behind closed doors; it's a public-focused organization that thrives on transparency and community involvement. Understanding how the public can engage with the DRE and the transparency measures in place offers a glimpse into the department's commitment to serving and protecting Californians.
One of the most significant ways the public interacts with the DRE is through its website. Here, consumers can easily find information about buying or selling property, from licensed real estate professionals' records to educational resources. This online presence is not just informational; it's a tool for ensuring that the DRE's activities and decisions are open and transparent to everyone.
Transparency extends to the DRE's disciplinary actions as well. The department publicly makes disciplinary records and actions against real estate professionals. This transparency helps consumers make informed decisions when choosing real estate agents or brokers and is a deterrent against industry malpractice.
This openness is further enhanced by providing resources for public empowerment, such as detailed information on how to file a complaint with the California Department of Real Estate, ensuring that everyone has the tools to maintain the integrity of the market. This process is straightforward and integral to the DRE's enforcement role, ensuring that any misconduct is investigated and addressed. It's a vital part of the DRE's mission to protect consumers and uphold the integrity of the real estate market.
In sum, the California Department of Real Estate is a dynamic force, constantly evolving to meet the challenges of a rapidly changing real estate landscape. A thorough understanding of the DRE's role is invaluable for anyone venturing into buying, selling, or facilitating real estate transactions in California. It's an organization that doesn't just oversee real estate; it shapes its very future, ensuring that California remains a place where real estate dreams can thrive and prosper while protecting consumers along the way.
Love,
Kartik
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What are the Pros and Cons of Becoming a Real Estate Agent?
Imagine a career where each day brings a new adventure, your income mirrors your ambitions, and you have the power to shape your destiny.
What are the Pros and Cons of Becoming a Real Estate Agent?
Imagine a career where each day brings a new adventure, your income mirrors your ambitions, and you have the power to shape your destiny. This is the world of real estate — a profession that's not just a job but a lifestyle. Real estate offers an exciting and rewarding path for those drawn to a career that combines flexibility, potential, and personal fulfillment. However, like any dynamic career, it comes with its challenges.
At our real estate school we are regularly counseling students on the benefits of obtaining a real estate license As such, I wanted to write an article exploring the multifaceted nature of a real estate career, examining the advantages and hurdles to give you a clear perspective on what it truly means to pass the real estate exam and become a real estate agent. Whether you're seeking a change, chasing a dream, or contemplating your next career move, understanding the pros and cons of real estate is an essential step toward making an informed decision.
Pros of Becoming a Real Estate Agent:
Unlimited income potential:
Forget the paycheck treadmill: Ditch the predictable, the capped, the "just enough" mentality. In real estate, you're the CEO of your career and the captain of your financial ship. Every transaction is a voyage, every negotiation a thrilling adventure, every closed deal a treasure chest overflowing with rewards.
A single high-value deal can catapult you to financial heights you never dreamed of. Imagine exceeding expectations, not just meeting them. Imagine exceeding your wildest goals, shattering personal records, and rewriting your definition of "possible."
Remember, the only limit in real estate is the one you set for yourself. So, grab your ambition, unleash your hustle, and get ready to conquer the world, one deal at a time. The open sky awaits!
Flexible Schedule:
Say goodbye to the clock punch and hello to a workday woven into the fabric of your life. Becoming a real estate agent isn't just about houses; it's about reclaiming your time and crafting a schedule that dances to your tune. Imagine this: No more rigid 8-to-5s cramping your dreams. No more morning commutes stealing precious moments with loved ones. As a real estate agent, your calendar becomes a blank canvas, ready to be splashed with vibrant hues of work, family, and personal pursuits. Early bird or night owl? Introvert or social butterfly? The answer doesn't matter here. You schedule the open houses around your yoga class, the client meetings around your kid's soccer game, and the paperwork blitz around your quiet writing hour. This is your symphony, and you get to conduct the tempo.
Need a midday break for a spontaneous hike? Go for it! The market doesn't close with the lunch bell. Just schedule that afternoon showing around your newfound sense of rejuvenation. Your well-being isn't an afterthought; it's fuel for your hustle. Flexibility doesn't just mean freedom, it means opportunity. Imagine catching a weekday morning showing for a client before their work starts, securing the deal before anyone knows the property is available. Or you are closing a late-night negotiation over cocktails, sealing the deal with a flourish while others are tucked in their beds.
This isn't just about escaping the cubicle: It's about embracing a life where work flows seamlessly with your passions, where every day feels like a dance between ambition and fulfillment. You're not just selling houses; you're selling control over your precious time and the freedom to design a life that truly resonates with your soul. Remember, in real estate, time is yours to bend, mold, and sculpt into the masterpiece of your life. What will you create?
Career Satisfaction:
Imagine this: unlocking the door to a family's first home, their eyes sparkling with excitement as they step onto the freshly cut lawn. Picture yourself handing keys to a young couple, their faces radiating gratitude after months of searching. Feel the warmth of a retiree's smile as they hand you the keys to their longtime home, ready for their next adventure. These aren't just transactions; they're life-changing moments.
If you decide to focus on residential real estate you're not just selling houses; you're orchestrating dreamscapes, crafting havens of happiness, and weaving the threads of hope into the very fabric of your community. The gratitude you receive isn't just a pat on the back; it's fuel for your soul. Every satisfied client is a testament to your impact, a living reminder of the difference you make in their lives. It's a validation that your hustle, expertise, and dedication matter. But it goes beyond the tangible. You become a trusted confidante, a shoulder to lean on, a cheerleader for their aspirations.
You witness the most vulnerable moments – the nervous excitement of first-time buyers, the bittersweet nostalgia of downsizing seniors, the quiet anxieties of those facing life transitions. In these moments, you're more than an agent; you're a human touchpoint. You offer empathy, understanding, and a reassuring hand to guide them through the emotional rollercoaster of buying or selling a home. You become a part of their story, a thread in the tapestry of their lives. This isn't just a career, it's a privilege.
Variety and Excitement:
For those of us in real estate, each day is a blank canvas, ready to be splattered with vibrant hues of new experiences, unexpected challenges, and the thrill of the unknown. Imagine this: One morning you're touring a sprawling mansion with a celebrity client, discussing million-dollar deals and marble countertops. The next, you're knee-deep in negotiations with a young couple, helping them navigate the labyrinth of first-time homeownership. By lunchtime, you're meeting an appraiser on one of your listings.
No two clients are the same, no two properties are identical. You'll encounter quirky retirees looking for a cozy retirement haven, savvy investors hunting for profitable flips, and growing families yearning for their perfect suburban nest. Every interaction is a mini-mystery, a puzzle to be solved, a story waiting to unfold. The market is a living, breathing entity, pulsing with change and unexpected turns. Every economic update, every shifting trend, every neighborhood hot spot creates a new wave of excitement, a new challenge to conquer.
Networking Opportunities:
Forget business cards, think handshake highways! Becoming a real estate agent isn't only about keys and contracts, it's about unlocking a vast network that can catapult your career and expand your horizons. Imagine a web of opportunity woven from every conversation, every client you meet. Your daily life becomes a networking event in disguise. Open houses are cocktail parties where you mingle with potential clients, lenders, and fellow agents. Every neighborhood walk becomes a chance to connect with homeowners, business owners, and community leaders. Your social media becomes a vibrant marketplace of professional interactions and referrals. But it's not just about numbers, it's about relationships. You become the trusted advisor, the one who knows a guy (or gal) for everything. Think of yourself as a spider at the center of a bustling web.
This network isn't just for business, it's for life. You'll find mentors who guide your path, friends who share your hustle, and collaborators who fuel your creativity. So, step out of your comfort zone and into the bustling marketplace of possibilities. Shake hands, share stories, offer help, and watch your network become your launchpad. Remember, in real estate, connections aren't just built; they're cultivated, cherished, and leveraged to unlock a world of success beyond your wildest dreams. Who will you connect with today?
Personal Growth:
Forget the gym, embrace the real estate hustle! This isn't just a career; it's a training ground for personal growth where you'll sculpt yourself into a more robust and resilient version of yourself. Imagine this: Every client interaction is a language lesson, honing your communication skills from a whisper to a roar. You'll learn to negotiate like a ninja, read people like open books, and navigate complex situations with the grace of a seasoned diplomat. Challenges won't break you, they'll build you. Every hiccup in a deal, every tough negotiation, every unexpected hurdle becomes a stepping stone, teaching you resilience, resourcefulness, and the art of thinking on your feet. You'll learn to trust your instincts, embrace your unique approach, and become the best version of yourself, brick by brick.
As a new real estate agent, think of yourself as a diamond in the rough, waiting to be polished. Real estate is the polishing cloth, the pressure, the heat that brings out your inner sparkle. You'll emerge not just a successful agent but a confident individual, a skilled communicator, a fearless problem-solver, and a leader in your own right. This isn't just a career, it's a personal odyssey. It's about pushing your boundaries, conquering your fears, and discovering the depths of your potential. So, roll up your sleeves, embrace the challenges, and get ready to be amazed by the person you'll become in the vibrant world of real estate. Remember, growth isn't found in comfort zones, it's found in the heat of the hustle. What will you discover about yourself today?
Community Impact:
Imagine this: You're the key that unlocks the door to a young family's first home, the foundation on which they'll build their memories. You're the guide who shepherds retirees into their perfect downsized haven, a cozy nest for their golden years. You're the matchmaker who connects vibrant businesses with the ideal location, injecting life and prosperity into the local tapestry.
You might also become the local professional who spearheads the annual charity bake sale and organizes the neighborhood clean-up day. Your success fuels your desire to give back, see your community thrive, and leave a legacy beyond commission checks.
So, step into the role of community champion. Embrace the opportunity to leave your mark, not just on a balance sheet, but on the very soul of your neighborhood. Make a difference: one client, block, and smile at a time. Remember, in real estate, you're not just building houses; you're building a legacy of community. What will yours be?
Cons of Becoming a Real Estate Agent:
Income Inconsistency: The fluctuating nature of the real estate market means that income can be inconsistent. This variability requires agents to be financially savvy and prepared for periods of lower earnings.
Competitive Market: The real estate industry is highly competitive, requiring agents to work hard to differentiate themselves and build a thriving client base.
Extended Hours and Stress: Success in real estate often means working outside traditional hours, including evenings and weekends. The job can also be stressful, dealing with various client demands and market fluctuations.
A career in real estate offers a unique blend of challenges and rewards. It's a profession that demands dedication, hard work, and a willingness to navigate its complexities. Real estate can provide a fulfilling and lucrative career path for passionate and committed people. When entering this field, prospective agents should consider their personal goals, strengths, and lifestyle preferences. Despite its challenges, real estate offers a rewarding journey with professional and personal growth opportunities for the right individual.
Love,
Kartik
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Navigating Common Complaints Against Real Estate Agents: Understanding Client Concerns
The real estate industry is dynamic and multifaceted, with real estate agents guiding the complex process of buying
Navigating Common Complaints Against Real Estate Agents: Understanding Client Concerns
The real estate industry is dynamic and multifaceted, with real estate agents guiding the complex process of buying or selling properties. However, like any profession, real estate is not immune to challenges, and clients may occasionally file complaints against a real estate licensee. I wanted to explore some of the most common complaints against real estate professionals and offer insights into mitigating these issues.
This topic is especially important for our readership, primarily composed of individuals seeking the top real estate license schools or those currently preparing for the real estate license exam aiming to start their careers on a strong foundation.
Reason #1
Misrepresentation
A frequent complaint can involve misrepresentation. Clients may contend that a real estate agent provided inaccurate information about a property, failed to disclose pertinent details, or offered misleading descriptions. Maintaining transparency and ensuring accurate property information is crucial to fostering trust with clients.
The Case of the Hidden Sinkhole
Imagine a young couple, Sarah and Michael, excited about buying their first home. They find a charming two-story colonial in a desirable neighborhood, listed by a seasoned real estate agent named Tom. Tom assures them the house is in perfect condition, highlighting its spacious backyard and updated kitchen. Sarah and Michael are smitten and quickly make an offer.
After closing and moving in, Sarah and Michael discover a significant depression in the backyard, covered by hastily laid mulch. Upon further inspection, they find a sinkhole giant enough to swallow a small car. Panicked, they call Tom, who expresses surprise and claims he was unaware of the sinkhole. However, Sarah and Michael recall Tom mentioning plans for a pool in the backyard during the initial showing. They suspect Tom deliberately downplayed the sinkhole to make the sale.
Reason #2
Breach of Fiduciary Duty: Upholding Client Interests
Real estate agents owe a fiduciary duty to their clients, requiring them to act in the client's best interest. Complaints may arise when clients perceive a breach of this duty, such as self-dealing, conflicts of interest, or actions that do not prioritize the client's well-being. Real estate agents must consistently demonstrate an unwavering commitment to their client's interests to avoid such complaints.
Lisa, a real estate agent, convinces her elderly client, Mr. Jones, to sell his spacious condo for below-market value. With her cousin, Lisa secretly bought the condo at a discounted price and immediately flipped it for a significant profit.
Here's why this is a blatant breach:
Exploiting Vulnerability: Mr. Jones, being elderly, might be more susceptible to manipulation or unaware of the actual market value of his apartment. Lisa taking advantage of his vulnerability to secure a personal gain is textbook exploitation.
Undervaluing the Client's Asset: Selling the apartment below market value directly harms Mr. Jones' financial interests. Lisa benefits by buying it cheaper but deprives Mr. Jones of the money he could have received and harms him through her non-disclosure.
Hidden Motive: Lisa's hidden personal motive to buy the apartment for herself directly conflicts with her duty to act in Mr. Jones' best interest.
Insider Information: As Mr. Jones' agent, Lisa likely had access to information about the apartment's potential value and any other offers. Using this information to benefit herself while Mr. Jones suffers a financial loss is a clear breach of trust.
Reason #3
Failure to Disclose Material Facts: The Importance of Transparency
Failure to disclose material facts can lead to client dissatisfaction and complaints. Real estate agents must inform clients of any information that could significantly impact their decision-making process, including property defects, legal issues, or neighborhood concerns. Maintaining transparency throughout the transaction is essential.
The Leaky Roof on a Sunny Day
Imagine it:
A charming, sun-drenched bungalow sits in a picturesque neighborhood, listed by real estate agent Ray "Rainbow" Sunshine. Ray paints a vibrant picture of the home's potential, highlighting its spacious living areas, manicured lawn, and "fresh, bright atmosphere." He conveniently glosses over any mention of the roof.
The Thompson family, captivated by the home's cheerful energy and Ray's sunny disposition, make an offer without a second thought. Visions of backyard barbeques and lazy afternoons on the porch fill their minds.
The day their moving truck arrives, the storm clouds gather. With the first raindrop, the illusion shatters. Water, not sunshine, pours into the living room, staining the freshly painted walls and soaking the plush carpets. Panic sets in as the Thompsons scramble to salvage their belongings.
The "fresh" smell Ray mentioned masked a leaky roof, a notorious issue in the neighborhood, well-known to everyone including Ray.
Consequences of Omission:
The Thompsons face significant financial burdens. Roof repairs, damaged furniture replacements, and potential mold remediation create many unexpected expenses.
Ray's "Rainbow" reputation goes dark. The Thompsons might sue for misrepresentation, leading to legal fees and reputational damage for Ray.
Reason #4
Communication Woes: Bridging the Gap
Poor communication is a common source of discontent among clients. Complaints may stem from real estate agents who need to keep clients informed, respond promptly to inquiries, or provide updates on the progress of transactions. In this context, it's not just about maintaining communication with current clients; effective communication is also crucial in prospecting for new clients. Engaging potential clients with clear, informative, and timely communication can set the foundation for strong future relationships. Clear, open, and timely communication is vital to building and maintaining trust throughout the real estate process, whether it's with long-standing clients or those you are prospecting as new opportunities.
The Ghosting real estate agent
Imagine this:
Sarah, a young professional, entrusts Emily, a seemingly enthusiastic real estate agent, with finding her dream apartment. Sarah envisions Emily as a partner in this exciting quest, keeping her informed and supported through every step.
Initially, Emily shines. She schedules viewings efficiently, answers Sarah's questions promptly, and offers valuable insights. Sarah feels confident and optimistic about finding the perfect place.But then, communication fades. Emily's replies become delayed, often with vague excuses. Follow-up questions need to be answered. Updates on new listings disappear. Phone calls go straight to voicemail.
Days turn into weeks, and Sarah feels abandoned. The excitement morphs into frustration and anxiety. Is Emily working on finding her an apartment? Has she moved on to other clients? Sarah feels disconnected, unsure of how to proceed.
One day, out of the blue, Emily resurfaces with a potential apartment. She apologizes for the communication lapse, citing a personal emergency, but the trust is already broken. Sarah, unsure of Emily's commitment, hesitates to move forward.
Consequences of Communication Breakdown:
Client dissatisfaction and distrust: Sarah feels neglected and unimportant, damaging her confidence in the real estate agent and the process.
Missed opportunities: Delayed communication might cause Sarah to lose out on promising apartments or valuable negotiation leverage.
Time wasted and stress-induced: The lack of updates and follow-through creates uncertainty and anxiety for Sarah, impacting her daily life.
Reason #5
Negligence or Incompetence
Complaints related to negligence or incompetence can arise when clients believe their real estate agent made critical errors that resulted in financial losses or failed to demonstrate the necessary competence for adequate representation. Real estate agents must strive for excellence, staying informed about industry trends, regulations, and best practices.
Scenario: Overlooking Critical Property Disclosures
Situation:
John and Sarah, a young couple looking to buy their first home, enlisted the services of a real estate agent named Mark. Excited about a particular property, they relied on Mark's expertise for a smooth transaction. However, Mark, not staying current with industry regulations and best practices, failed to notice that the seller had not disclosed the property's history completely. Specifically, the property had a history of severe water damage and mold issues, which were not immediately apparent during the initial inspections.
Resulting Issues:
A few months after moving in, John and Sarah started experiencing significant mold and structural integrity issues caused by previous water damage. This resulted in substantial financial strain due to the unexpected repair costs. They were distressed and felt betrayed, as these issues should have been disclosed before the purchase.
Complaints of Negligence and Incompetence:
John and Sarah filed a complaint against Mark, alleging negligence and incompetence. They believed that Mark's failure to ensure full disclosure from the seller and his lack of due diligence in investigating the property's history directly led to their financial and emotional distress.
The Need for Excellence:
This situation underscores the critical importance of real estate agents continually striving for excellence. Staying informed about industry trends, regulations, and best practices, such as thorough property inspections and ensuring complete disclosures, is about compliance and protecting clients from potential future hardships. Real estate agents like Mark must understand that they facilitate transactions and serve as knowledgeable advocates for their clients, ensuring all necessary information is transparent and accessible.
While complaints against real estate agents are a reality, proactive measures can significantly reduce their occurrence. Real estate agents who prioritize transparency, clear communication, ethical practices, and continuous education are better positioned to navigate the intricacies of the real estate industry and build lasting, positive relationships with their clients. By addressing common concerns head-on, real estate professionals can uphold the integrity of their profession and contribute to a more trustworthy and robust real estate marketplace.
Mitigating Complaints:
Education and Training: real estate agents can invest in ongoing education and Training to stay abreast of industry developments and enhance their skills.
Clear Communication: Establishing clear lines of communication with clients and keeping them informed at every stage of the transaction helps prevent misunderstandings.
Ethical Practices: Upholding ethical standards and maintaining honesty in all dealings can foster positive client relationships.
Thorough Due Diligence: Conducting thorough due diligence on properties and ensuring accurate representation can minimize the risk of misrepresentation complaints.
Adherence to Regulations: real estate agents should be well-versed in local real estate regulations and ensure compliance with all legal requirements.
While complaints against real estate agents do exist, understanding the common pitfalls and actively mitigating them can lead to a more trusting and successful experience for all parties involved.
By prioritizing the five key areas – transparency, communication, ethical conduct, due diligence, and regulatory compliance – real estate agents can build a foundation of trust with their clients. Regular education and training ensure they stay informed and competent, enabling them to offer exceptional service and avoid costly missteps.
By embracing these principles and continuously striving for excellence, real estate professionals can contribute to a more trustworthy and robust marketplace, where clients feel confident, informed, and well-represented in every transaction. Remember, building trust and exceeding expectations are the true markers of success in the dynamic and ever-evolving world of real estate.
Love,
Kartik
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Finding Your Dream Home: The Joy and the Jolt
You've done it. After countless open houses, endless online listings, and what felt like an eternal waiting game, you finally found your dream home. The
Finding Your Dream Home: The Joy and the Jolt
You've done it. After countless open houses, endless online listings, and what felt like an eternal waiting game, you finally found your dream home. The excitement was palpable as your offer was accepted, the contract signed, and the future seemed to paint itself in bright, hopeful colors.
But then, a twist in the tale: the appraisal comes in, and it's lower than your purchase price. This news jolts you, shaking your excitement. It's a scenario many homebuyers fear, yet few are prepared for. It's not just about numbers; it's about your dreams, hopes, and vision for your future.
The Safety Net: Understanding the Appraisal Contingency
In these moments of uncertainty, your appraisal contingency becomes more than just a clause in a contract; it's a lifeline. This contingency is a crucial aspect of the home-buying process, designed to protect you, as the buyer, from overpaying.
But what exactly is an appraisal contingency? In simple terms, it's a condition in your home buying contract stating the purchase is contingent on the property being appraised at or above the agreed-upon sale price. If the appraisal falls short, this clause gives you the power to renegotiate or even walk away from the deal without penalty - more on that later.
More Than Just Money: The Psychological Impact
Beyond its financial safety, an appraisal contingency is also about peace of mind. It's a buffer against the unforeseen, a guard against the unpredictable nature of real estate valuations. When the appraisal comes in low, it's easy to feel overwhelmed and unsure. This clause serves as a reminder that you have options and are not locked into a potentially unfavorable situation.
Navigating the complexities of a low appraisal can be challenging, but understanding the role and power of your appraisal contingency is the first step.
As we delve deeper into this guide, we'll explore how to handle the gap between appraised value and offer price, examine your options under the appraisal contingency, and equip you with the knowledge to make the best decision for your future.
Dealing with the Gap: Understanding and Managing the Discrepancy
The Dilemma of Differing Values
When faced with a lower-than-expected appraisal, you encounter a fundamental dilemma: the gap between the appraised value and your offer price. This discrepancy isn't just a set of numbers but a potential challenge to your home-buying journey.
Appraised Value vs. Offer Price
The appraised value of a property is an expert's opinion of its worth, whereas the offer price is what you're willing to pay for it. These two figures ideally should align closely, but when they don't, it's crucial to understand what each represents. The appraised value is grounded in thoroughly analyzing the property and market conditions. At the same time, the offer price can sometimes reflect more subjective factors like personal desire or market competition.
Common Reasons for a Low Appraisal
Understanding why appraisals come in low can help you navigate this situation more clearly. Here are some common reasons:
Market Fluctuations: Real estate markets are dynamic, and rapid changes can lead to disparities between current market conditions and recent sales data used by appraisers.
Property Condition: If the appraiser notes issues with the property that you, the home inspector, or the seller might have missed, it can affect the appraisal value.
Comparable Sales (Comps): Appraisers generally use recent sales of similar properties in the area (comps) to determine value. If there are few comps or if they sold at lower prices, it can impact your appraised value.
Inaccurate Listing Information: Sometimes, discrepancies in square footage, room count, or amenities between the listing information and the actual property can lead to a lower appraisal.
Navigating the Appraisal Report with Your Agent
There needs to be more than just knowing the appraised value; understanding why it is key. This is where reviewing the appraisal report with your real estate agent becomes invaluable. Your agent can help interpret the report, point out areas that might be disputed, and provide insight into the appraiser's reasoning. This knowledge is crucial for your next steps, whether challenging the appraisal, renegotiating the deal, or even deciding to walk away.
Your Options with an Appraisal Contingency
When faced with a low appraisal, your appraisal contingency clause becomes a critical tool, offering you several paths to consider. Each option carries its own set of considerations and potential outcomes.
Option 1:
Walking Away: This option offers a clean break. Assuming you still have your appraisal contingency intact, you reclaim your earnest money deposit and walk away from the deal, free to explore other opportunities. Consider this path if the gap between the offer and the appraised value is significant, exceeding your budget, or if the appraisal highlights major concerns. While finding another suitable home in a competitive market might take time, the financial and emotional security gained can be invaluable.
The Benefits of Opting Out
Financial Protection: Assuming that your appraisal contingency is still in play, walking away allows you to reclaim your earnest money deposit, safeguarding your finances.
Avoiding Overpayment: You avoid overpaying for a property, which could have long-term financial implications.
Opportunity to Reassess: This situation allows you to reassess your options and find a better fit.
Considering the Drawbacks
Market Challenges: In a competitive market, finding another suitable property might take time and effort.
Emotional Impact: Letting go of a home you've become attached to can be emotionally challenging.
Option 2:
Paying the Difference: This option demands serious financial consideration. If the gap is manageable and aligns with your long-term budget, it can still lead to securing your dream home. However, be meticulous in your calculations. Factor in additional costs like closing fees, potential repairs identified in the appraisal, and the impact on your future financial stability. Consulting your financial advisor is crucial to ensure this decision is manageable for your resources later.
Financial Implications
Immediate Costs: Paying the difference (the amount between the contract price and the appraised amount) means more upfront cash, which can strain your budget.
Long-Term Considerations: This decision could impact your property equity.
Making a Responsible Decision
Financial Planning: Carefully consider your financial situation and future implications.
Seeking Advice: Consulting with trusted advisors can provide clarity.
Option 3:
Renegotiating: This option leverages your appraisal contingency as a negotiation tool. Armed with the appraiser's report, you can present a compelling case to the seller highlighting the discrepancy between the offer and the property's actual market value. Be prepared to compromise – offering alternative solutions like a lower price, closing date adjustments, or repair credits in exchange for a price concession. Remember, a win-win outcome benefits both parties and increases the chances of reaching an agreement.
The Power of Negotiation
Leveraging the Report: Use the appraisal report findings to negotiate a fairer price with the seller.
Finding Compromise: Aim for a win-win situation where both parties feel satisfied with the outcome.
Strategy and Compromise
Presenting Your Case: Be clear and factual when presenting your case based on the appraisal report.
Flexibility and Creativity: Consider other aspects of the deal where you can compromise, such as closing dates or repair credits.
Ultimately, the best decision is the one that aligns with your unique circumstances and risk tolerance. Consider these factors:
Financial Situation: Can you comfortably absorb the difference in price or additional costs?
Market Conditions: Is the market hot or cooling? Is finding another suitable property feasible?
Emotional Attachment: How attached are you to this specific property? Is it worth compromising for?
Alternative Options: Have you explored other properties that suit your budget and needs?
Timeframe: Your appraisal contingency period sets a deadline for making a decision. Utilize it effectively to gather information and weigh your options.
Remember, your real estate agent and advisors are valuable allies in this process. Feel free to use their expertise and experience to analyze your options and make the most informed decision. With a clear head, careful consideration, and the power of your appraisal contingency, you can navigate this unexpected turn and confidently choose the path that leads to your ideal home.
Negotiation Tactics with Your Appraisal Contingency in Play
With a low appraisal comes the opportunity to flex your negotiation muscles, and your appraisal contingency is your secret weapon. Here are some tips to wield it effectively:
1. Know Your Numbers: Thoroughly understand the appraised value, its reasons, and how much you're willing to budge. Present factual evidence from the appraisal report to support your arguments.
2. Be Assertive, Not Aggressive: Approach the seller confidently but maintain a respectful tone. Remember, your goal is to reach a mutually beneficial agreement, not to burn bridges.
3. Focus on Solutions, Not Demands: Instead of simply demanding a lower price, offer alternative solutions like extending the closing date, taking on some repairs identified in the appraisal, or contributing a closing cost credit.
4. Be Prepared to Walk Away: While compromise is key, know your bottom line and walk away if the seller isn't willing to meet your needs. Your appraisal contingency empowers you to do so without penalty.
5. Leverage Your Agent's Expertise: Your real estate agent can act as a mediator, facilitating communication and helping you reach a fair deal. Feel free to rely on their experience and negotiation skills.
6. Consider Professional Appraisers: If you have doubts about the original appraisal, you can hire a second appraiser for a different perspective. However, weigh the cost of a second appraisal against the potential benefits of its findings.
7. Keep Emotions in Check: While feeling attached to the property is natural, don't let emotions cloud your judgment. Stick to your budget and financial goals, and decide based on logic and data.
8. Use Time to Your Advantage: Your appraisal contingency gives you a timeframe to gather information, negotiate, and make a well-informed decision. Don't feel pressured to rush into anything.
9. Document Everything: Keep clear records of all communication with the seller and your agent, including any proposed settlements or agreements. This protects you in case any disputes arise later.
Remember, successful negotiation is a balancing act. By presenting a solid case, remaining flexible, and strategically leveraging your appraisal contingency, you can turn a low appraisal into an opportunity to negotiate the right deal.
Embracing the Crossroads
A low appraisal can feel like a roadblock, throwing a wrench into your dream home journey. But remember, it's not a dead end; it's a crossroads. With your trusty appraisal contingency by your side, you have the power to navigate this unexpected turn and choose the path that leads to your ideal future.
Whether you walk away with your deposit intact, bridge the gap and secure your dream home, or negotiate a win-win with the seller, remember that this decision is about more than just bricks and mortar. It's about your finances, emotional well-being, and long-term goals.
This unexpected curve in the road might lead you to a better destination than you imagined. Another property awaits, perfectly aligning with your needs and budget, with an appraisal that sings your praises. Or, after careful consideration, you decide that this house, with its quirks and charms, is worth the extra effort.
So take a deep breath, trust your instincts, and embrace the crossroads. While filled with twists and turns, the journey to your dream home can be enriching when you chart your course.
Love,
Kartik
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What is a real estate appraisal?
In real estate, an appraisal is a cornerstone. A real estate appraisal is a professional assessment of a property's market value conducted by a licensed real estate
What is a real estate appraisal?
In real estate, an appraisal is a cornerstone. A real estate appraisal is a professional assessment of a property's market value conducted by a licensed real estate appraiser This report is important to a variety of stakeholders in various situations, whether you're buying, selling, refinancing, or managing real estate investments.
For buyers, an appraisal offers a clear picture of whether the property is worth the investment. While the listing agent typically recommends a list price, sellers also can gain insights into setting a competitive and realistic price based on location, size, and condition. Most commonly, lenders use these appraisals to determine the viability and value of a property as collateral for loans.
Real estate appraisals provide a snapshot of a property's worth in the current market, offering a critical data point that influences decision-making in the dynamic real estate landscape.
Whether you are preparing for the real estate license exam a first-time homebuyer, a seasoned investor, or a curious reader, understanding the nuances of real estate appraisals is an invaluable part of navigating the property market successfully.
What is a Real Estate Appraisal?
Real estate appraisals, a fundamental subject taught in real estate school, play a pivotal role in the dynamics of property transactions. They influence the decisions of buyers, sellers, and lenders in distinct ways by providing an objective basis for decision-making. This ensures that all parties are well-informed about the actual value of the property in question.
Key components of a real estate appraisal include several critical elements:
Property Inspection: The appraiser conducts a thorough examination of the property, assessing its condition, size, location, and unique features. This physical inspection is a significant part of the appraisal process.
Market Analysis: The appraiser analyzes current market trends, including comparable sales data of similar properties in the area. This comparison helps evaluate how the subject property stacks up against others in the same market.
Documentation and Reporting: The appraiser compiles the data collected during the inspection and analysis into a detailed appraisal report. This report outlines the appraiser's findings and provides a final estimation of the property's value.
Professional Expertise and Standards: Appraisals are conducted by licensed professionals who adhere to standardized methods and ethical practices. Their expertise in property valuation ensures that the appraisal is reliable and compliant with industry standards.
A real estate appraisal is a comprehensive, pivotal real estate market evaluation. It provides a clear, professional assessment of a property's value, taking into account various factors like location, property size and market conditions.
For anyone involved in a real estate transaction, understanding the intricacies of the appraisal process is key to ensuring fair and informed decisions.
Who Typically Hires the Appraiser?
Lenders are who commonly engage appraisers in real estate transactions, particularly for mortgages, to assess the risk associated with the loan. This process ensures that the amount of money lent aligns with the property's actual market value. The appraisal, conducted by an independent professional, objectively evaluates the property's worth. This is crucial for the lender to determine the loan-to-value ratio, a critical factor in loan approval and risk management. Essentially, the appraisal safeguards the lender, ensuring they do not extend more credit than the property is worth, thus protecting their financial interests.
Imagine you want to buy a house that's listed for sale at $300,000. To purchase this house, you approach a bank for a mortgage. The bank, before lending you the money, wants to make sure that the house is really worth $300,000. So, the bank hires an independent appraiser to evaluate the house's value.
The appraiser looks at the house, considering factors like location, size, condition, and compares it to similar houses that have recently sold in the area. Suppose the appraiser determines that the house is indeed worth $300,000. The bank then feels confident to proceed with the loan, knowing that if you fail to pay the mortgage, they can sell the house and recover their money, as the house's value matches the loan amount.
However, if the appraiser finds that the house is only worth $250,000, the bank faces a higher risk. If they lend you $300,000 but you later default on the mortgage, the bank might not be able to recoup the full loan amount by selling the house. In such cases, the bank might offer a smaller loan or ask for a higher down payment to reduce their risk. This shows how appraisals protect lenders from loaning more money than a property is worth.
The Appraisal Process Explained
Understanding the step-by-step process and some basic real estate terms can significantly demystify what goes into determining a property's value. This insight is crucial whether you're a buyer assessing a potential investment, a seller setting a price, or a lender evaluating loan risk. Central to this process is the role of a licensed real estate appraiser whose expertise and impartial assessment are vital for an accurate and fair appraisal.
Engagement of a Licensed Appraiser: The process begins when a licensed appraiser is hired, typically by the lender or sometimes by the buyer or seller. The appraiser must be a professional with the credentials and knowledge of local market trends to ensure a reliable appraisal.
Collection of Preliminary Data: The appraiser starts by gathering basic information about the property, such as its location, size, and unique features. This initial data forms the foundation of the appraisal process.
Physical Inspection of the Property: The appraiser conducts an on-site visit to inspect the property thoroughly. This includes examining the interior and exterior, noting the property's condition, size, layout, and any improvements or unique features. This step is crucial in assessing the property's current state and its impact on value.
Market Research and Analysis: The appraiser then delves into market research, analyzing current real estate market trends and comparable sales data. This involves studying recent sales of similar properties in the area to help determine a fair market value for the subject property.
Preparation of the Appraisal Report: After the inspection and research, the appraiser compiles their findings into a detailed appraisal report. This report includes an analysis of the property and the market and the appraiser's final estimate of the property's value.
Review and Finalization: The completed report is then reviewed for accuracy and compliance with industry standards. Once finalized, it is submitted to the client thereby providing a professional, unbiased property valuation.
The appraisal process is a blend of professional evaluation, market analysis, and reporting. It is a critical component in the real estate industry, providing assurance and clarity to all parties involved in a property transaction.
Factors Affecting Property Value in an Appraisal
In real estate appraisal, understanding the factors influencing property valuation is critical. A real estate appraiser considers numerous aspects during the home appraisal process, each significant in determining the outcome. Let's delve into some of these crucial factors:
Location: Often touted as the most critical factor in property valuation, the location of a property significantly impacts its appraised value. This includes the neighborhood's desirability, proximity to amenities like schools, parks, and shopping centers, as well as the overall safety and accessibility of the area.
Property Size and Layout: The size of the property, including the square footage of the living space and the size of the land, is a primary consideration. Additionally, the layout and functional utility of the space can also affect its value. A well-designed layout that maximizes usability can enhance a property's appeal and value.
Condition and Age of the Property: The current state of the property is a vital component in the appraisal. This includes the home's age, its structure's condition, and any wear and tear. Properties that are well-maintained or recently renovated typically fetch higher appraisals.
Market Trends: Real estate market trends significantly influence property valuation. The appraiser considers the housing market's current state, including supply and demand dynamics, interest rates, and economic factors that could influence property values.
Market Analysis: A real estate appraiser conducts a Market Analysis, comparing the subject property with similar properties recently sold in the area. This comparison helps in gauging the competitive market value of the property.
Additional Features and Improvements: Unique features such as a swimming pool, a large garden, high-quality finishes, or energy-efficient appliances can add to a property's value. The appraiser assesses these additional features and considers how they contribute to the property's overall appeal and functionality.
Zoning and Future Development: The zoning regulations and potential for future development in the area can also impact a property's appraisal. For instance, a property in a zone with potential for commercial development may be valued differently than one in a strictly residential area.
A professional real estate appraiser meticulously evaluates each of these factors during the home appraisal process. Their assessment provides an objective estimate of the property's fair market value, reflecting its true worth in the current real estate market context. This comprehensive analysis ensures that all stakeholders in a real estate transaction have a clear and accurate understanding of the property's value, guiding informed decision-making and fair negotiations.
The Role of Appraisals in Real Estate Transactions
Real estate appraisals play a pivotal role in the dynamics of property transactions, influencing the decisions of buyers, sellers, and lenders in distinct ways. These appraisals provide an objective basis for decision-making, ensuring that all parties are informed about the actual value of the property in question.
For Buyers: Making Informed Purchase Decisions
Risk Mitigation: A professional property valuation helps buyers understand the actual worth of a property, reducing the risk of overpaying.
Negotiation Leverage: An appraisal can be a powerful negotiation tool, particularly if it reveals that the property's market value is lower than the asking price.
Investment Validation: For those purchasing property as an investment, an appraisal confirms whether the investment is sound based on current market trends and property potential.
For Sellers: Setting Realistic Selling Prices
Market-Driven Pricing: Sellers can benefit from appraisals by gaining insights into how to price their property competitively.
Justification for Price: A higher-than-expected appraisal gives sellers the evidence to justify their asking price or even adjust it upwards in a strong market.
Quick Sale Facilitation: Reasonably priced properties, backed by appraisals can attract serious buyers, potentially speeding up the sale process.
For Lenders: Determining Loan Values
Loan-to-Value Ratio: Lenders use the appraised value to determine the loan-to-value ratio, a critical factor in loan approval decisions.
Risk Management: By ensuring the property is worth the loan amount, lenders mitigate the risk of loaning more than the property's actual value.
Regulatory Compliance: Appraisals are often required for lenders to remain compliant with regulatory standards, ensuring that they are not issuing loans that exceed the value of the collateral.
As the real estate market continues to evolve, the role of a well prepared appraisal remains steadfast, offering clarity and confidence to all parties in a real estate transaction. Whether you are stepping into the market as a buyer, seller, or lender, understanding the value and implications of a professional real estate appraisal is crucial. It is not just a formality but a critical step in ensuring that the investment in real estate is sound, well-informed, and aligned with market realities. In essence, real estate appraisals are not just about assigning value to a property but about building trust and transparency in one of life's most significant financial decisions.
Love,
Kartik
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The DRE's significance is underlined by its historical foundation, marking the enactment of the nation's first real estate license law in 1917. The establishment of the first real estate license law in
The DRE's significance is underlined by its historical foundation, marking the enactment of the nation's first real estate license law in 1917. The establishment of the first real estate license law in 1917 by the DRE was indeed a landmark event in the United States. This was a pivotal move because it signified the first step toward formal regulation in the real estate industry, which involves high-value transactions and constitutes a significant portion of the economy.
Before this point, the real estate industry lacked standardized practices, potentially leading to fraudulent activities, misinformation, and inconsistencies that could harm consumers and destabilize the property market. The introduction of licensing laws brought a level of oversight, accountability, and professionalism that needed to be included. It meant that practitioners must adhere to professional standards, ensuring they had a requisite level of knowledge.
Furthermore, this historical foundation is not just about regulating individuals involved in the buying and selling real estate; it also sets a precedent for real estate law and regulation nationwide. This action back in 1917 underscores the DRE's long-standing role as a pioneer in shaping the landscape of the real estate industry. This fact might surprise those unfamiliar with the historical depth of formal real estate regulation in the United States.
This landmark regulation set the stage for the department's reputation as a nationwide influencer, standardizing practices in real estate and ensuring that buying and selling properties is conducted under at least some oversight.
The DRE serves a critical role within the realm of property transactions. As real estate is one of the most significant sectors in the financial market, the DRE is fundamental in ensuring the legitimacy, fairness, and legality of real estate transactions. These transactions, complex and multilayered, require stringent regulation for the protection of all parties involved, ultimately safeguarding the dynamics of buying, selling, and managing real estate.
At its core, the DRE is committed to safeguarding and promoting public interests. This is achieved through various methods, including the rigorous process of licensure that ensures only qualified individuals can hold a real estate license and regulatory practices that maintain legal and ethical standards in the industry. Furthermore, through educational programs and enforcement actions, the DRE works to uphold integrity and protect consumer rights and investments.
The DRE can also advocate for consumers, ensuring that industry practices adhere to legal and ethical standards. Advancing its role as a protector, the DRE embraces technology for service enhancement, ensuring secure information handling and improved accessibility, aiding consumers in making informed decisions. The department is a leader in adapting to evolving real estate landscapes, providing consumer protection, and promoting outreach programs that educate and empower public decision-making.
Funded primarily through the revenue obtained from licenses and permits, the DRE boasts a comprehensive operational structure with a significant geographical presence. This system allows it to effectively monitor real estate transactions and enforce regulatory compliance, ensuring the integrity of the real estate market.
The Real Estate Commissioner an appointed position, carries substantial responsibility and authority in enforcing the Real Estate and Subdivided Lands Laws. This role is pivotal in upholding consumer protection, exercising impartial judgment, and ensuring that every real estate transaction adheres to established legal and ethical standards.
The DRE is dedicated to protecting public interest and enhancing consumer awareness, consistently working to elevate industry standards and ethics. This dual focus ensures that consumers receive fair treatment and that professionals within real estate maintain the highest level of integrity and competence.
Today, obtaining a real estate license ensures only qualified individuals engage in the practice. It involves meeting specific educational criteria, passing the real estate exam and complying with established standards of practice and experience. The DRE also mandates regular license renewal and continuing education, ensuring that real estate professionals are current with evolving industry trends and regulations.
The DRE is firmly committed to enforcing legal standards and conducting thorough investigations based on public complaints. Violations of regulatory compliance have significant consequences, underlining the department's dedication to maintaining ethical practice and consumer trust in the real estate market.
The Consumer Recovery Account is another vital DRE feature, providing financial protection to consumers who have incurred losses in real estate transactions due to a licensee's unethical or illegal actions. This provision underscores the DRE's commitment to maintaining fairness and trust within the real estate sector.
Subdivision laws protect property buyers, ensuring they receive accurate, transparent information before purchasing subdivided lands. Compliance requirements for subdividers and the role of public reports are fundamental in this process, safeguarding buyer interests and investments.
In overseeing mortgage loan activities, the DRE ensures that real estate licensees comply with legal standards, further protecting consumer interests. This oversight extends to certain mortgage brokers, emphasizing the DRE's comprehensive approach to regulation and compliance within real estate transactions.
Through its various publications, including the Real Estate Bulletin and other educational resources, the DRE informs stakeholders about regulatory changes, trends, and important information affecting the real estate market. These resources further demonstrate the department's commitment to transparency and education in real estate practices.
The Department of Real Estate plays a critical role in regulating the real estate industry, providing mechanisms for public protection, and ensuring ethical practices in real estate transactions. Through its ongoing commitment to service, education, and transparency, the DRE continues to uphold its mission, adapting to the needs of consumers, professionals, and stakeholders in the ever-changing real estate landscape.
In its century-long journey since pioneering the nation's first real estate license law, the Department of Real Estate (DRE) has emerged as an indispensable guardian of ethical integrity, legal compliance, and consumer protection in the property market. By meticulously regulating licensure—underscored by the necessity of the real estate exam—and steadfastly enforcing standards, the DRE fortifies public trust and fairness in complex property transactions. This commitment extends from the vigilant oversight of market practices by the Real Estate Commissioner to the security offered by initiatives like the Consumer Recovery Account. Furthermore, the DRE harnesses technology and comprehensive educational outreach, ensuring transparency, informed decision-making, and responsiveness to the evolving dynamics of real estate. Ultimately, the department serves as a guiding entity, providing direction to all stakeholders through its consistent focus on service, accountability, and safeguarding interests in the fluctuating environment of real estate transactions.
Love,
Kartik
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Selling real estate is as much about understanding the buyer as knowing the property. One must delve into the buyer's psychology to excel in sales negotiation. No matter how good your marketing may be,
Selling real estate is as much about understanding the buyer as knowing the property. One must delve into the buyer's psychology to excel in sales negotiation. No matter how good your marketing may be, the best real estate agents can recognize the buyer's motivations, anticipate and understand the objections they might raise, and master persuasive communication techniques. By doing so, real estate professionals can tailor their approach to align with the buyer's mindset and needs.
Sell the dream, not just the house.
Innovative real estate marketing is about selling a lifestyle, a dream, not just the square footage. It's about crafting compelling narratives that resonate with the buyer's deepest aspirations. More than just being a real estate agent who knows square footage and property values is required. To truly excel, you need to be a mind reader. Unmasking the desires and anxieties of your buyers is the key to unlocking lucrative deals.
Dive into their heads:
Why are they buying? Is it a starter home for a growing family, a retirement haven, or a strategic investment? Knowing their motivations is like holding a treasure map to their deepest needs.
What scares them? Is it tight finances, a bad neighborhood, or hidden repairs? Anticipating and addressing their objections builds trust and shows you're genuinely invested in their well-being.
Speak their language, not yours. Ditch the technical jargon and master persuasive communication. Paint a vivid picture of their future in that house, highlighting how it solves their problems and fulfills their dreams.
Remember, it's not about you; it's about them. By tailoring your approach to their unique mindset, you become more than a salesperson – a trusted advisor, a confidante, someone who guides them towards their real estate happily ever after.
In short, Become a master of buyer psychology and watch your sales soar!
Active Listening and Empathy: The Foundation of Rapport
Building rapport is essential in real estate negotiations. This starts with active listening and empathy. By actively listening, agents can uncover their clients' hidden needs and desires, which might not be immediately apparent. Empathy allows agents to connect with buyers personally, fostering trust and understanding. This trust is crucial for establishing a positive negotiation environment where both parties feel heard and valued.
Mastering the Art of Rapport in Real Estate Negotiations
Building rapport isn't just a feel-good tactic in real estate negotiations – it's a power move. It's like having a secret decoder ring for your client's hidden needs and desires. Here's how to turn active listening and empathy into negotiation superpowers:
1. Go beyond surface-level listening: Actively engage, ask open-ended questions, and truly hear what's beneath the words. Is the buyer hesitant about the commute? Maybe it's not just time, but the thought of leaving their aging parents behind. Uncover those deeper concerns, and you'll strike gold.
2. Become a chameleon of empathy: Mirror their emotions, use validating phrases like "I understand," and show genuine interest in their perspective. When they feel seen and heard, trust blossoms, opening the door to productive negotiation.
3. Anticipate and address anxieties: Don't wait for objections to erupt. Preemptively acknowledge their concerns, like financing worries or neighborhood jitters. By showcasing your understanding, you build confidence and demonstrate your role as their advocate.
4. Speak their language, not yours: Ditch the real estate jargon and technical terms. Translate features into benefits, paint a picture of their future in that home, and focus on how it solves their problems and fulfills their dreams.
5. Remember, it's a two-way street: Share relevant details about yourself, build a personal connection, and show you're not just a robot in a suit. A touch of humanness goes a long way in fostering trust and rapport.
By mastering these tactics, you become more than an agent – a trusted advisor, a confidante, and a champion for your real estate dreams. When negotiations hit a snag, your unwavering empathy and understanding will be your secret weapon, paving the way to a win-win solution for everyone.
So, ditch the transactional approach and embrace the power of rapport. You'll close more deals, build lasting relationships, and leave your clients feeling heard, valued, and ready to sing your praises from the rooftops.
Preparing for Negotiation: Knowledge is Power
A successful negotiation in real estate is often the result of thorough preparation. This includes researching the property's value, understanding current market trends, and identifying potential concessions that could be made. By being well-prepared, agents can articulate a compelling value proposition that highlights how the features and benefits of a property align with the buyer's desires and needs.
Preparation: The Secret Weapon of Real Estate Negotiation Ninjas Imagine entering a negotiation with an arsenal of facts, figures, and insights, ready to dismantle any counterpoint like a ninja dissecting tofu.That's the power of preparation in real estate negotiations.
Here's how to transform from a negotiator to a negotiation domineer:
1. Become a data alchemist: Research the property inside and out! Comparable sales, local zoning regulations, and inspection reports – turn them into gold by understanding their implications for value and potential concessions.
2. Channel your inner economist: Master current market trends! Interest rates, inventory levels, buyer demographics – knowing the landscape lets you anticipate your opponent's moves and craft winning strategies.
3. Think like a poker player: Identify your "chips" – potential concessions like closing cost credits, appliance upgrades, or extended warranties. Know what you can offer without jeopardizing your client's best interests.
4. Forge the ultimate weapon: The Value Proposition: This isn't just about square footage and granite countertops. It's about how the property solves the buyer's problems and fulfills their dreams. Translate features into benefits, paint a picture of their future in that home, and showcase how it ticks all their boxes.
5. Practice makes perfect: Role-play potential scenarios with colleagues or mentors. Hone your articulation, anticipate objections, and refine your responses. Confidence breeds success, and preparation fuels confidence.
Remember, thorough preparation is like kryptonite to buyer hesitation. When you walk into that negotiation armed with knowledge, flexibility, and a compelling value proposition, you're no longer just an agent – a trusted advisor, a champion for their needs, and a master of the deal.
So, sharpen your research skills, study the market, and practice your pitch. With the proper preparation, you'll close deals and leave buyers feeling like they just won the real estate lottery.
Reaching Mutually Beneficial Agreements
The ultimate goal of any negotiation is to reach an agreement that benefits both parties. This involves closing the deal with clear terms, proper documentation, and a plan for post-sale follow-up. Ensuring all parties are satisfied with the outcome is essential for building long-term relationships and a strong reputation in the real estate market.
From Handshake to Happy Ever After Securing Win-Win Real Estate Deals
Negotiation isn't just about crossing the finish line – crafting a path to mutual satisfaction that lasts beyond the closing bell. Here's how to secure a win-win deal that cultivates loyal clients and builds a stellar reputation:
1. Seal the deal with clarity and care: Don't let excitement overshadow precision. Draft clear and concise contracts, address all contingencies, and ensure every detail is crystal clear. A solid foundation of paperwork prevents future headaches for everyone.
2. Documentation is your dance partner: Every promise, concession, and agreement needs to tango with the official documents. Thorough paperwork protects both parties and fosters trust, ensuring your happy ending isn't just a hopeful dream.
3. Don't disappear after the confetti falls: Follow-up is the secret sauce of client satisfaction. Check-in, answer questions, and offer support during closing and beyond. Showing you care even after the sale fosters loyalty and turns fleeting clients into raving fans.
4. Remember, it's about relationships, not just transactions: Treat your clients as partners, not just paychecks. Celebrate their success, build genuine connections, and go the extra mile. Happy clients become loyal advocates, praising you and fueling your future success.
5. Win-win is the ultimate trophy: By ensuring both parties feel heard, valued, and satisfied, you build a reputation for fairness and expertise. Word-of-mouth marketing beats any billboard, and happy clients attract even happier clients.
Remember, a successful negotiation isn't just about closing the deal – crafting a symphony of mutual satisfaction. By prioritizing clarity, documentation, follow-up, and lasting relationships, you transform yourself from a mere agent into a trusted advisor, a confidante, and a builder of real estate dreams. So, shake hands with confidence, knowing that you've secured a deal and laid the foundation for long-term success and a thriving reputation.
Mastering the Art of Real Estate Alchemy
Selling a house isn't just about matching square footage to shoe size. It's about transforming dreams into brick and mortar, anxieties into confidence, and negotiations into win-win symphonies. By mastering the art of real estate alchemy, you wield potent elements - buyer psychology, rapport, and preparation - to forge deals that shimmer with mutual satisfaction.
Remember, you're not just an agent; you're a:
Mind reader: Unearthing motivations, anticipating objections, and speaking the language of dreams.
Rapport alchemist: Building trust through active listening, empathy, and shared humanity.
Negotiation ninja: Armed with data, market trends, and a value proposition sharper than a shuriken.
Win-win architect: Crafting agreements that leave both parties singing from the rooftops (figuratively).
So, go forth and conquer the world of real estate, not with a briefcase but with a treasure map to your buyers' hearts and minds. Remember, the greatest deals are forged not just in steel and concrete but in the crucible of understanding, trust, and mutual dreams.
Embrace the art of real estate alchemy, and make it happen!
Love,
Kartik
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Forget dusty signs and crowded open houses. The real estate game has gone digital, and it's time to grab your smartphone and join the revolution. Why? The Internet has opened up a whole new world of marketing
Forget dusty signs and crowded open houses. The real estate game has gone digital, and it's time to grab your smartphone and join the revolution. Why? The Internet has opened up a whole new world of marketing possibilities for real estate agents, and it's packed with tools to reach more buyers, build deeper connections, and close more deals.
You likely encountered some of this information during your real estate education or stumbled upon these concepts while planning your steps after passing your real estate exam.
Digital lets you:
Target buyers with laser precision: No more shouting into the void. Digital lets you tailor your message to specific demographics, whether young urbanites or growing families. Think Instagram for trendy lofts and Facebook groups for suburban dream homes.
Turn viewers into buyers: Ditch the one-way street of traditional ads. With social media, blogs, and interactive websites, you can chat, answer questions, and guide buyers through the process, building trust and turning leads into gold.
Know exactly what works (and what doesn't): No more guessing games. Digital marketing gives you real-time data on how people respond to your efforts. See which posts get the most clicks and which listings generate buzz, and adjust your strategy accordingly.
But how do you navigate this digital Wild West?
Build your online HQ: Your website is your digital home base. Make it mobile-friendly, showcase your listings with stunning visuals, and offer valuable content like local guides and market insights. Become the neighborhood expert they can trust.
Master the social media jungle: Facebook, Instagram, YouTube – each platform offers a unique path to connect. Share stunning photos, host live Q&A sessions, and join relevant communities. Remember, authenticity is key – let your personality shine through!
Email like a pro: This trusty tool isn't dead yet. Use it to nurture leads, send targeted offers, and stay top-of-mind. Offer valuable content like downloadable guides or exclusive reports in exchange for email addresses.
But wait, there's more!
Get tech-savvy: Virtual reality tours let buyers virtually walk through homes, while 3D imaging brings floor plans to life. Chatbots answer questions 24/7, and AI personalizes the online experience. Embrace these tools to stand out from the crowd.
Of course, it's not all sunshine and rainbows:
Competition is fierce: Stand out with creative thinking and unwavering dedication. Build trust, prioritize transparency, and respect data privacy regulations. Your reputation is your digital gold.
The game keeps changing: Stay curious, embrace new trends, and invest in learning new skills. The digital landscape is constantly evolving, so adapt or get left behind.
The bottom line? Digital marketing in real estate is the new frontier, and it's time to stake your claim. Ditch the dusty playbook, grab your smartphone, and get ready to unlock unprecedented opportunities. The future is digital, and the keys to success are just a click away. So, what are you waiting for? Go digital and go big!
I hope it is becoming clear that the shift to digital is not just a trend but a fundamental change in how leads in real estate are procured and cultivated. The digital world offers vast opportunities, but navigating it requires strategy, creativity, and a willingness to embrace change.
Expanding Your Digital Reach
Engaging Content Creation: Content is king in the digital world. To captivate your audience, create blog posts, videos, and infographics that showcase properties and provide valuable information about the real estate market, home improvement tips, and neighborhood highlights. This content positions you as a knowledgeable and reliable source in the industry.
Leveraging SEO: Search Engine Optimization (SEO) is crucial for increasing your online visibility. Use relevant keywords, optimize your website's speed and user experience, and create quality content regularly. This ensures that your website ranks higher in search engine results when potential buyers or sellers search for real estate services online.
Utilizing Paid Advertising: Invest in paid digital advertising such as Google AdWords and targeted social media ads. These tools allow you to reach potential clients actively searching for real estate services. By targeting specific keywords and demographics, you can ensure your ads are seen by those most likely interested in your offerings.
Strengthening Client Relationships
Personalized Communication: Digital tools enable customized communication at scale. Utilize CRM (Customer Relationship Management) systems to track client interactions and preferences. This allows you to tailor your communication, making clients feel valued and understood.
Follow-Up Strategies: The digital realm makes follow-ups more effective. Automated email sequences, retargeting ads, and personalized messages can keep you in touch with potential clients without being intrusive. These strategies ensure that you remain at the forefront of their minds when they are ready to decide.
Gathering Client Feedback: Use digital surveys and feedback tools to understand your client's needs better. This information can guide your marketing strategies and improve your services, increasing client satisfaction and referrals.
The Challenges of Digital Marketing in Real Estate
Navigating Data Privacy: In the digital age, data privacy is paramount. Ensure that your marketing practices comply with regulations and be transparent about collecting and using data, and provide options for clients to control their information.
Dealing with Information Overload: The sheer volume of digital information can overwhelm leads and clients. Develop a strategy to filter and prioritize information, focusing on what is most relevant and beneficial to your target audience.
Maintaining a Consistent Brand Image: In the digital world, your brand image must be consistent across all platforms. From your website to social media profiles, ensure your brand message, values, and aesthetics are coherent and reflect your professional identity.
Embracing the Future of Real Estate Marketing
Digital marketing in real estate is not just about adopting new technologies; it's about transforming how you connect and communicate with clients. It's an opportunity to redefine your business, differentiate yourself in a crowded market, and build lasting relationships. The future of real estate is digital, and by embracing this new frontier with open arms, you can unlock a world of opportunities.
Remember, the digital journey in real estate is continuous. Keep exploring, innovating, and adapting to stay ahead in this dynamic landscape. The digital revolution in real estate is here to stay, and by embracing it, you're not just following a trend - you're paving the way for a successful, tech-savvy future in the industry.
Love,
Kartik
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Exploring the Prospects of Online Real Estate Classes: A Guide to Earning Your License from Home
If you've ever wondered, "Can you take real estate classes online?" you're not alone. We get calls like
Exploring the Prospects of Online Real Estate Classes: A Guide to Earning Your License from Home
If you've ever wondered, "Can you take real estate classes online?" you're not alone. We get calls like this each and every day in our office. Online real estate courses provide a distinct edge regarding flexibility, accessibility, and convenience. Unlike traditional classroom-based courses, online learning enables you to study at your own pace and schedule, making it an ideal option for those juggling multiple responsibilities—no more commuting or adjusting your schedule around fixed class times. With online courses, the classroom is wherever you want, be it your home, office, or coffee shop. Moreover, many online platforms like ADHI Schools provide interactive tools and resources, ensuring that you grasp complex real estate concepts effectively.
Anyway - if you are wondering if you can take online real estate classes - The simple answer is yes, you absolutely can. With the advent of online education, it is now more convenient than ever to study and qualify for your real estate license without hyperlink to leaving the comfort of your home.
The Appeal of Online Real Estate Classes
Online real estate classes are a great way to enter the industry. They offer a convenient and flexible alternative to traditional classroom learning, allowing aspiring real estate professionals to learn at their own pace and from the comfort of their own home.
At ADHI Schools self-study students can take classes on their schedule, meaning they don't have to quit their day job or adjust their lifestyles to accommodate a rigid class schedule. This is a significant advantage over traditional methods, where you must attend physical classes at specific times.
Affordable Options
It's a common misconception that online classes may be expensive or cost-prohibitive. ADHI Schools seeks to democratize access to education, making it easier for individuals from all walks of life to pursue their dreams of becoming real estate agents or just getting their real estate license as a personal goal.
Online Real Estate Licensing Courses
For those seeking an online class for a real estate license, ADHI Schools has a unique curriculum and teaching style. These classes typically cover all necessary material to pass your state's licensing exam, including property laws, real estate practices, and property management principles.
Getting Your Real Estate License Online
Getting a real estate license may seem daunting, but it's straightforward and ADHI Schools is here to help. We have designed our course to guide you step-by-step through the licensing process.
You can take your real estate licensing exam after completing your online classes and passing the course exams through the ADHI Schools portal. Once you pass the state licensing exam, you will receive your real estate license and officially become a real estate agent.
Quality Online Real Estate Education
When you opt for an online real estate agent course with ADHI Schools you are ensuring you're getting a quality education. When choosing an online real estate license course, you should look for accredited institutions that offer comprehensive courses, expert-led training, and strong student support services like ADHI Schools.
Regardless of the course provider you choose, online classes for real estate licenses should come with resources like interactive quizzes, video content, and other learning aids to enhance your understanding of the material.
The Importance of Choosing the Right Program
To successfully acquire your online real estate agent license, finding the right program is crucial. Make sure to thoroughly research your options before making a decision. The right program should not only be affordable but also cater to your learning style, provide comprehensive resources, and have a track record of helping students pass their licensing exams.
"Can you take real estate classes online?" can be confidently answered with a "Yes." The online platform has made it easier for aspiring real estate agents to earn their licenses and start their journey in the industry. With many options ranging from general courses to specialized classes and from affordable choices to more comprehensive programs, there's something for everyone. Choosing the right course is a personal decision that requires careful consideration. But with the proper research and a clear understanding of your career goals, you can find online real estate classes that perfectly fit you.
As always, feel free to reach out to us at www.adhischools.com or call us at 888-768-5285.
Love,
Kartik
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Real Estate Marketing and Sales Techniques
Forget "For Sale" signs and generic listings. In today's competitive real estate market, success hinges on mastering two crucial skills: effective marketing
Real Estate Marketing and Sales Techniques
Forget "For Sale" signs and generic listings. In today's competitive real estate market, success hinges on mastering two crucial skills: effective marketing along with sales skills.
These aren't just buzzwords. They're the power couple that transforms ordinary real estate agents into skilled salespeople able to attract the right buyers, and ultimately close more transactions.
This article is your no-nonsense guide to unlocking that potential. We'll cut through the fluff and dive into practical strategies you can implement right away, from crafting magnetic marketing campaigns to understanding your client's deepest desires and navigating the intricacies of negotiation.
Get ready to ditch the dusty real estate playbook and embrace the future of real estate success. By the end of this journey, you'll be equipped to turn leads into loyal clients, close deals with confidence, and solidify your position as a market leader.
Understanding Your Market
Identifying Your Target Demographic: Homebuyers, Sellers, Investors
To excel in real estate marketing, knowing who you're marketing to is crucial. This includes understanding the needs, preferences, and behavior patterns of homebuyers, sellers, and investors.
Homebuyers often prioritize location, price, and the potential for a property to feel like home. Tailoring your marketing to highlight these aspects can be more effective in attracting this group.
Sellers, on the other hand, are typically focused on maximizing their return on investment and the speed of the sale. Therefore, marketing strategies emphasizing your ability to sell properties quickly and at a reasonable price will resonate with them.
Investors look for properties that promise a good return through rental income or capital appreciation. Your marketing should showcase your expertise in identifying properties with high investment potential.
Analyzing Local Real Estate Trends and Market Needs
Staying updated with local real estate trends is imperative. This includes monitoring changes in property values, understanding the factors driving the local market, and being aware of new developments. Analyzing these trends helps to create marketing campaigns that are relevant and timely. It's also essential to understand the specific needs of your local market.
As an example, imagine you're a real estate agent in a city experiencing a tech boom. Your local market analysis reveals a surge in demand for affordable housing options near tech hubs. Micro-units, previously niche apartments, are suddenly trending.
Armed with this knowledge, you craft a targeted marketing campaign showcasing local micro-units alongside their proximity to trendy cafes, co-working spaces, and public transport. You highlight their space-saving features and emphasize their appeal to young professionals seeking urban convenience.
This local focus not only resonates with potential buyers but also positions you as the expert on this emerging market segment. The result? You're inundated with inquiries, closing deals with ease, and leaving behind your competitors who remained oblivious to the micro-unit wave.
The Importance of Local Knowledge in Real Estate Marketing
Local knowledge is a powerful tool in real estate marketing. Being well-informed about the community, from schools and amenities to local events and future urban planning, adds immense value to your service. Clients often look for agents with deep insights into the local area, as this knowledge helps them make informed decisions.
Demonstrating your local expertise in your marketing materials can set you apart from competitors and establish you as the go-to expert in your area.
Remember that understanding your market is about more than just knowing the properties; it's about connecting with your audience, staying ahead of market trends, and leveraging your local knowledge to meet the specific needs of homebuyers, sellers, and investors. This approach helps in crafting more effective marketing strategies and building lasting relationships with your clients.
Dominating the Digital Domain
Forget "location, location, location." Today's market is all about "visibility, visibility, visibility." And the virtual world is your new prime real estate. This section lays bare the digital tools you need to turn online browsers into eager buyers.
1. Crafting Your Online Hub: Your website is your digital headquarters, the first impression that sets the tone for your entire brand. Ditch the cookie-cutter templates and inject personality. Showcase stunning visuals, highlight your expertise, and make it easy for buyers to navigate from "dreaming" to "dialing" and “clicking”.
2. SEO Secrets Revealed: The magic of SEO? Climbing the ranks of search engine results ensures your listings are the first feast for hungry buyers' eyes. Master keywords, optimize content, and build local authority to become the neighborhood's online kingpin.
3. Social Savvy: Facebook, Instagram, LinkedIn – each platform a stage for your unique brand story. Craft engaging content, showcase properties with drool-worthy visuals, and foster genuine connections. Remember, it's not just about selling; it's about building trust and becoming the go-to source for real estate.
4. Email Alchemy: Don't underestimate the power of the inbox. Targeted email campaigns can nurture leads, educate buyers, and keep you top-of-mind. Offer valuable insights, exclusive listings, and sneak peeks into stunning spaces sprinkled with a dash of personality.
Mastering these digital tactics will transform your online presence from a dusty storefront into a vibrant marketplace buzzing with engaged buyers. Remember, in the digital realm, consistency is key. So, post regularly, engage with your audience, and watch those leads roll in like virtual foot traffic.
Traditional Marketing Techniques
The Role of Print Media: Flyers, Brochures, and Direct Mail
Traditional print media remains a valuable tool in real estate marketing in the digital age. Flyers, brochures and real estate postcards can be incredibly effective for open houses or as leave-behinds during meetings with potential clients. These materials should be professionally designed and include high-quality images and detailed information about the properties.
Don’t be afraid to use these physical marketing pieces to target specific neighborhoods or demographics, keeping your brand top-of-mind for potential clients.
Hosting Open Houses and Real Estate Events
Open houses are a classic but powerful marketing technique. They provide a firsthand look at the property and an opportunity to interact directly with potential buyers. To enhance these events, consider staging the home to showcase its potential, providing detailed property information, and even offering small tokens or refreshments to visitors.
Additionally, hosting or participating in real estate events like community fairs or expos can increase your visibility and allow you to connect with a broader audience.
Networking and Building Partnerships Within the Community
Building a solid network is critical in the real estate business. This includes forming relationships with other real estate professionals, such as agents, brokers, and local business owners. Attending community events, joining local business groups, and actively participating in community projects can help establish your presence in the area. Building partnerships with local businesses can also be beneficial.
Picture this: Sarah, a rising real estate agent, actively participates in her local chamber of commerce. Through regular coffee mornings and networking events, she forms genuine friendships with mortgage lenders, home inspectors, and interior designers. She even joins the community beautification project, planting trees and sprucing up parks with fellow business owners.
These seemingly casual interactions pay off big time. Sarah becomes the go-to agent for mortgage referrals from the lender she bonded with over coffee. The home inspector recommends her to clients seeking a trustworthy advocate. And when a local magazine needs an expert voice on up-and-coming neighborhoods, guess who gets the call?
Sarah, the community-connected powerhouse.
The Power of Word-of-Mouth and Referrals in Real Estate
Word-of-mouth remains one of the most effective marketing tools. Satisfied clients are likely to recommend your services to friends and family. To encourage referrals and maintain strong relationships with past clients through regular follow-ups or sending personalized notes on special occasions. Remember, a strong reputation in the community is invaluable and often leads to new business opportunities.
Traditional marketing techniques in real estate are about creating tangible connections and fostering relationships. Whether through high-quality print materials, engaging open houses, robust community networking, or leveraging the power of referrals, these strategies can complement your digital efforts and help solidify your brand in the real estate market.
Future-Proofing Your Success
Imagine yourself cruising down a winding real estate market road, confident in your skills, only to encounter a sharp, tech-induced U-turn. This section equips you with the night vision to navigate the ever-evolving landscape and stay ahead of the curve.
1. Trendspotting Prowess: Real estate marketing is a living, breathing beast, constantly morphing with new tools and strategies. Become a trend whisperer! Read industry blogs, attend conferences, and network with fellow agents to learn the next big thing. Virtual tours yesterday, AI-powered valuations tomorrow – stay at the forefront, and your buyers will thank you (and reward you) for it.
2. Lifelong Learner: Knowledge is not power; it's the gasoline that fuels your real estate engine. Invest in continuous learning – take online courses, attend workshops, and devour industry publications. Hone your negotiation skills, master video marketing, and delve into financial analysis. The more you know, the more adaptable and valuable you become.
3. Market Chameleon: Remember that U-turn I mentioned? That's market shifts for you. The key is not to panic and screech to a halt. Instead, be like a chameleon, blending seamlessly with changing tides. Understand how economic fluctuations and buyer preferences impact your business and adjust your strategies accordingly. It may be time to pivot to a different niche, refine your target audience, or offer new services. Agility is your friend in this game.
By embracing these tips, you'll transform from a passive observer to an active architect of your success. Remember, the future of real estate belongs to those who dare to anticipate, learn, and adapt. So, buckle up, put your foot on the pedal of continuous improvement, and enjoy the breathtaking view from the winner's lane.
To claim your rightful place as a market leader, embrace the role of a lifelong learner:
Devour industry insights.
Experiment with cutting-edge tools.
Hone your skills like a sculptor chiseling a masterpiece.
Become a trend whisperer:
Listen to the murmurs of innovation.
Sniff out the next big thing.
Adapt your strategies with chameleon-like agility.
Virtual tours and drone photography today, AI-powered valuations tomorrow – stay ahead of the curve, and your clients will reap the rewards.
Finally, remember that relationships are your currency in the grand game of real estate.
Connect with your community, build bridges with fellow professionals, and nurture trust with every client. Referrals become your treasure map, leading you to new opportunities and solidifying your reputation as the go-to guide in the property world.
This isn't just about selling houses but crafting a legacy. It's about becoming the trusted confidante, the market maestro who unlocks the doors to dream homes and financial freedom. Go forth, armed with the knowledge in this guide, and paint your masterpiece on the canvas of the real estate landscape. The future is yours to build, one perfectly marketed listing at a time.
And remember, the key to success isn't locked in a dusty filing cabinet. It's held in your hands right now.
Love,
Kartik
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Are you gearing up to carve out your niche in the competitive world of California real estate? Before you start showcasing homes and closing deals, there's one crucial hurdle to cross: the California Real
Are you gearing up to carve out your niche in the competitive world of California real estate? Before you start showcasing homes and closing deals, there's one crucial hurdle to cross: the California Real Estate License Exam Now, you might wonder, "Is the examination digital, or do I have to tackle it the old-fashioned way, with paper and pencil?" Let's dive into the evolution of the exam process, transitioning from paper to computer, and what that change means for aspiring real estate moguls like you.
The Evolution of the California Real Estate Exam
Years ago, the California Real Estate Exam was a paper-based test format many of us remember from school. Picture it: a room full of anxious individuals, the sound of pages turning, and the scratching of pencils against paper. This method, while traditional, presented various logistical issues, like scheduling constraints, potential for error in grading, and delays in scoring of the real estate exam.
However, as technology advanced, so did the examination methods. Over ten years ago (2011), the state recognized the need for a more streamlined, efficient process through computer-based testing (CBT). Today, the California Real Estate Exam is administered electronically, a transformation that has modernized the examination process. This change means quicker results, enhanced security, easier accommodations for those who need them, and a more flexible exam schedule.
But what does taking the exam on a computer entail for you? Let's unpack that.
Real Estate Exam Locations: Know Before You Go
The California Department of Real Estate (DRE) offers several convenient locations to take your computerized exam. These sites are strategically located to cover the widest possible area, ensuring candidates can find a testing center without traveling extreme distances.
Testing locations are in Fresno, Sacramento, La Palma (Los Angeles area location), San Diego, and Oakland.
What's important is selecting a location that suits your needs. Consider factors such as distance, ease of travel, and availability of dates. You'll want to register for your exam beforehand using eLicensing eLicensing and remember that slots fill up quickly, especially in busy seasons.
A pro tip? Be flexible with your dates, and monitor any slot openings due to cancellations.
Mastering the Digital Arena: Requirements to Pass the Real Estate License Exam
Switching to a computerized format doesn't change the essence of the exam; it's the medium, not the content, that's different. You will still be tested on your knowledge of real estate laws, principles, and practices. The exam consists of multiple-choice questions, requiring a keen understanding of various topics and the ability to apply that knowledge in scenario-based questions.
So, how do you conquer this digital giant? Preparation is key. Invest in up-to-date study materials take practice exams, and consider enrolling in reputablereal estate exam prep courses Since the exam is on the computer, try simulating the test environment by taking online practice tests. This approach will familiarize you with the content and digital format, reducing any test-day jitters related to navigating the computer interface.
Now, let's talk scores. To pass, you need to correct a specific number of questions, reflecting a thorough understanding of the material. The DRE doesn’t require perfection but demands a passing score. After submitting your test, one of the beauties of computer testing is that you won't have to wait weeks to receive your score. Instead, you'll know soon whether you've cleared the hurdle or need to jump again.
License Type
Broker
Salesperson
Number of questions
200
150
Number of exam
4 hours
3 hours
Passing score
75%
70%
Test Day Essentials: Remember the Parking!
You've studied and are ready to excel in the digital test-taking environment, but your test-day preparations continue beyond there. Picture this nightmare: You arrive at the testing center and are already nervous. Your heart sinks as you realize there's no parking, or worse, you need to have a permit you didn't know about. Now you're racing against the clock, with the added pressure of finding parking.
To avoid this added stress, plan your visit. Check out the testing location, noting the parking situation, whether you need to pay, where you can park, or if you need a permit. Some test centers may need more parking, especially during busy times. Others might share a parking lot with other businesses, and specific restrictions may apply. Check with the DRE for parking information or scope the location before your exam.
Knowing the parking logistics will spare you unnecessary test-day tension. Consider doing a trial run, especially if you are unfamiliar with the area. Knowing exactly where you're going will provide peace of mind, letting you focus on what's truly important: passing that exam.
Embracing the Future of Real Estate Examinations
Ultimately, the shift from paper to computer for the California Real Estate License Exam reflects our broader societal shift towards digitalization. It's about efficiency, security, and accessibility. For test-takers, computer-based testing represents convenience and quicker results, allowing you to embark on your real estate career sooner.
Remember, while the testing method has changed, the key to success remains unchanged. So, embrace the change, plan your test day down to the parking details, and you'll navigate this digital challenge like a pro, setting the stage for many successful transactions in your promising real estate career.
TLDR: Exams are given at DRE testing centers electronically.
Love
Kartik
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Oh, the allure of the real estate world! It's like a giant magnet for folks with big dreams of ditching the 9-to-5, being their own boss, and really taking control of their money. And why not, right? The
Oh, the allure of the real estate world! It's like a giant magnet for folks with big dreams of ditching the 9-to-5, being their own boss, and really taking control of their money. And why not, right? The beauty of diving into real estate is that you are the captain of your own ship. Your business grows as much as you hustle, and who doesn't love the sound of that?
Here's a little inside scoop: there's this magic number that everyone pencils at the top of their dream board - a cool $100,000. Cracking six figures isn't just about brimming bank accounts (although that's a sweet perk). It's more like a golden ticket that gets your foot in the door and your name on the leaderboard. It's a confidence booster, a sign you're playing in the big leagues, and can give you the confidence to climb even higher. So, for anyone breaking into the biz, crossing off that $100K target isn't just a flashy ambition; it's the first major pit stop on a thrilling ride to the top!
This number also strikes a balance between ambition and attainability. New agents, while enthusiastic, are aware of the realities of starting in real estate: the unpredictability of the market, the initial period where commissions might be sparse, and the competitive nature of the industry. Setting a goal too high might lead to early burnout from chasing unattainable targets, while too low a goal might not provide enough motivation. $100,000 is an accepted “middle ground” that provides a realistic target while offering enough challenge for motivation without being discouragingly unattainable.
But this requires a game plan.
And let's be real: a goal without a plan is just a wish. Without a target, how will you measure how far you've come? Or know what’s hot and what’s not? You need it to backtrack, tweak your strategies, and keep yourself honest. It’s your own personal reality check, stopping you from floating off into space.
So once you've aced your real estate exam your education truly begins. Now, instead of theory, you're analyzing the local real estate market in the real world.
So, what does the blueprint for achieving this goal entail?
To start, understanding the average sales price of homes in your market is a fundamental data point, as it correlates to potential commissions.
Suppose the median sales price in your area is $850,000. This will be your guiding figure, keeping in mind that actual property prices will be around this point.
The standard commission for real estate transactions hovers between 2-3% of the property's selling price. Using the average sales price gleaned from your market research, a 2.5% commission on an $850,000 property equates to $21,250.
So to reach your $100,000 goal you will need to close escrow on around five properties. However, remember that some deals will inevitably fall through due to various factors outside of your control.
Working with your broker or manager, you might come to realize that in order to close five transactions, you might need to open escrow on eight to ultimately close the five deals required to meet your income target.
Keep in mind that brokerage commission splits are a reality that will affect your take-home pay. If your brokerage claims a 30% share of your commission, your net earnings from each deal decrease, demanding another adjustment in your sales strategy to meet income objectives.
Develop a business plan that accounts for your brokerage's commission structure, the average property price in your area, and the realities of deal attrition. Regularly assess your progress and adjust your strategies as you learn more about market dynamics. The first step in doing this is to devise a schedule you need to open the eight escrows needed to achieve your income goal.
Remember there are only two ways to make more money in real estate:
Increase your average sales price
Close more deals
Whichever of these you choose, there are three crucial skills that new agents should develop to hit this lucrative target.
Prospect/Market
Lead Follow Up
Make Presentations
Prospecting and Marketing
Prospecting, the active process of searching for potential customers or buyers, is crucial in real estate sales. This proactive approach involves identifying individuals or entities in the market to purchase, sell, or invest in property. It is often what sets successful real estate professionals apart from their peers. In an industry where opportunities and competition coexist intensely, prospecting acts as a lifeline, ensuring a consistent flow of business opportunities and helping professionals keep their pipeline of potential sales active. Without effective prospecting, a real estate agent's business becomes highly susceptible to the peaks and troughs of market conditions, impacting sustainability and growth.
Moreover, prospecting allows real estate agents to establish and maintain relationships with a network of potential clients, which is essential in an industry driven by trust and personal connections. Agents build a reputation and a sense of authority among potential and future clients through regular communication initiated by prospecting efforts, such as calls, meetings, or community engagements. This continuous cycle of outreach and relationship management often leads to referrals, repeat business, and a robust client base, fostering long-term success. Prospecting is not just about seeking immediate opportunities; it's about nurturing an ecosystem of future opportunities, creating a solid foundation for a resilient and thriving real estate business.
Lead Follow Up
Securing a lead is just the beginning; following up is where the real work lies. The real estate industry thrives on relationships and trust, aspects developed through consistent communication. New agents should establish a systematic approach to lead follow-up, ensuring potential clients stay caught up.
This strategy might include personalized emails, regular check-in calls, or informative newsletters. A CRM (Customer Relationship Management) system can be invaluable here, helping manage your contacts and set follow-up reminders. Responding promptly and thoughtfully to inquiries is crucial, showing potential clients your commitment and setting the stage for successful transactions.
Remember - the money is in the lead follow up
Improving Your Presentation Skills
An often under-emphasized real estate license education skill is the ability to present effectively. Whether you're pitching to a prospective client, showcasing a property, or negotiating deals, your presentation skills are constantly under the spotlight.
New agents should invest time in improving these skills — practicing property showings, role-playing negotiation scenarios, or even taking a public speaking course. A compelling presentation can sway decisions in your favor and is often the key to converting leads into sales. As you gain confidence, you'll also build a reputation for professionalism and competence, factors clients seriously consider when choosing an agent.
Earning $100,000 a year in real estate is not a feat achieved by sitting back and waiting for opportunities to knock. It results from proactive effort in prospecting, meticulousness in lead follow-up, and continual refinement of presentation skills. These activities and the foundational benefits of getting a real estate license create a pathway to reach and exceed your income goals.
Embrace these tasks with the understanding that real estate isn't just about selling properties; it's about forging relationships, providing top-notch service, and asserting your value in a competitive marketplace. Each satisfied client, successful deal, and learned lesson propels you closer to that six-figure milestone.
If you are interested in learning more about getting your real estate license, reach out at www.adhischools.com or call us at 888-768-5285.
Love,
Kartik
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The holiday season might not seem ideal for your client to sell a home (or for you to take a listing, for that matter), but there are numerous advantages to listing a property during this festive time
The holiday season might not seem ideal for your client to sell a home (or for you to take a listing, for that matter), but there are numerous advantages to listing a property during this festive time of year. While this isn't a specific topic in real estate school nor discussed on the California real estate exam, I'd like to give you several convincing reasons why doing business during the holiday season is a wise decision. For some real estate agents, December can be a “slower month,” but it doesn’t have to be. Plenty of listings and sales can be had if you don’t “check out” of the business mentally.
One other thing to keep in mind, as a real estate professional, there is a 30-60 day lag on income compared to activity. This means that if you don’t sell anything in December, it will reflect poorly on your income from January through March. Similarly, if you struggle financially in December, this is a consequence of your activities in September and October.
Serious Buyers and Higher-Quality Showings Happen Over the Holidays
To start, people searching for homes during the holiday season are typically serious buyers with a specific need to purchase a property and likely quickly. You should have higher-quality showings and more motivated buyers interested in your listing. Logically, a buyer not genuinely interested in buying a property is unlikely to spend time touring various homes during the holidays with a buyer's agent. Therefore, when you put a house on the market during the holiday season, you can have a higher degree of confidence that potential buyers viewing your property are genuinely serious about making a purchase.
Less Competition and Higher Sale Prices
Less competition from other sellers typically means a higher sale price for your listing. Because inventory levels tend to be slightly lower during the holiday season, serious buyers have fewer houses to choose from, which means less competition for your listing. This can translate into a higher sale price, as your home will stand out among the limited options available.
Homes Show Better with Holiday Decorations
Houses also show better when decorated for the holidays. By working with your seller to tastefully adorn your listing, you can create an emotional connection with potential buyers, who will more easily envision themselves celebrating future holidays in your space. This might also mean you’ll have some passionate buyers willing to pay your price. Don’t be afraid to tug on the heartstrings of buyers walking through your open house around the holiday time - bake aromatic cookies in the oven or light that special holiday candle. Love does enter through the nose, after all!
Buyers Have More Time to House Hunt
Remember that there are other reasons why selling real estate during the holidays is better than any other time of the year. During the holiday season, many buyers have additional time off work, allowing them more opportunities to search for their perfect home, which could increase the number of showings your listing gets.
It's often easier for a buyer to sneak out of work during the holidays to go see your listing than at other busier times of the year.
Tax Advantages for Buyers
Also, some buyers need to purchase before the end of the year for tax reasons, making them more motivated to close on a property quickly. The reason is that buying a property before the end of the year can allow buyers to claim certain tax deductions in the current tax year. For example, mortgage interest, property taxes, and points paid on a mortgage may all be deductible expenses. Buyers can maximize these deductions and reduce their overall tax liability by closing on a property before the year-end.
Of course - tell your buyers to consult with their tax advisors to be sure.
Possible Tax Credits for First-Time Homebuyers
Tax Credits: Some jurisdictions offer tax credits to first-time homebuyers or buyers who purchase energy-efficient properties. Closing on a property before the end of the year may allow buyers to claim these credits in their current tax return, which may result in a lower tax bill or a larger refund.
Capture the Relocating Employee Market
January is a popular month for employees starting new jobs. Transferees often can't wait until spring to buy, so listing during the holiday season ensures your home is available to this motivated market segment.
Still Maintain Control Over Showings
While your home is on the market during the holiday season, you can still restrict showings during specific days to maintain your family's privacy and enjoy the festivities. Communicate with your real estate agent about your preferred showing schedule, and they can work with potential buyers to accommodate your needs while ensuring maximum exposure for your property.
Maximize Buying Power in Spring
Selling your home during the holiday season can position you as a non-contingent buyer in the spring when more houses are available at potentially lower prices. This strategy may allow your client to sell high and buy low, maximizing their buying power.
Faster Closing Process
Since the holiday season is typically a slower period for real estate transactions, lenders and other professionals involved in the closing process may have more availability. This can lead to a smoother and faster closing process, allowing your client to move into their new home sooner.
Enhanced Online Visibility
With the growing importance of online listings and virtual tours, especially during the holiday season, homes listed during this period can benefit from enhanced online visibility. Buyers are more likely to search for properties online during the holidays. A well-presented listing with professional photos and virtual tours can make a strong impression on potential buyers.
Taking a listing during the holiday season may seem unconventional, but the numerous benefits – including serious buyers, less competition, tax advantages, and more – make it an attractive option. You may have already completed our real estate school and passed the California real estate exam, now you need to be well-equipped to navigate the holiday market and achieve the best possible outcome for your seller.
So, instead of waiting for the spring season, consider taking advantage of these compelling reasons to list your client's home during the holiday season and make it a win-win situation for everyone involved.
PS - Keep working through the holidays! Your February self will thank you for it!
As always, if you are interested in taking real estate classes, visit www.adhischools.com
Love,
Kartik
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Top 5 Mistakes New Real Estate Agents Make After Getting Licensed (And How to Avoid Them)
Starting a career in real estate is exciting and has many opportunities. However, like any job, it has
Top 5 Mistakes New Real Estate Agents Make After Getting Licensed (And How to Avoid Them)
Starting a career in real estate is exciting and has many opportunities. However, like any job, it has its challenges. New agents might initially find it complicated, even after completing real estate school and getting their licenses. While getting a license is an important step, it's just the beginning. Challenges arise when handling property sales, building client relationships, and understanding market changes. I wanted to write an article to highlight common mistakes made by new agents and give advice on how to avoid them for a more rewarding real estate career.
Mistake 1: Not Building a Marketing Strategy
One of the most common pitfalls for newer real estate agents is the belief that clientele will magically gravitate toward them with little proactive outreach. This misconception can be detrimental to an agent's budding career. Today's real estate market is saturated, and standing out requires more than obtaining a license and setting up a desk in an office. Successful agents understand that a consistent and well-thought-out marketing strategy is at the heart of their business.
A robust marketing strategy is a combination of both online and offline efforts. In the digital age, online methods such as social media campaigns, targeted ads, email newsletters, and a professional website are indispensable. These tools increase an agent's visibility and help build credibility and trust among potential clients. On the other hand, offline methods like networking events, open houses, and local advertising play a vital role in community engagement and personal brand building. Together, these strategies form a comprehensive approach to reaching and attracting clients. For a new real estate agent, investing time and resources into a marketing strategy from the outset can make all the difference between a thriving career and one that never quite takes off.
Mistake 2: Neglecting Continuous Learning
Starting a real estate career usually begins with training, like what ADHI Schools offers. We prepare students for the licensing exam and give our students a basic understanding of the industry. But this initial knowledge is just the beginning. The real estate world constantly changes—new market trends, shifting property values, and updated regulations exist. So, while the foundation from schools like ADHI is important, agents shouldn't stop there.
To succeed, agents must keep learning. Regular training, workshops, and staying updated on the market are crucial. This continuous education helps agents stay ahead and better serve their clients. Simply put, the most successful agents know their learning never stops, even after formal schooling.
Mistake 3: Undervaluing Networking
The Power of Networking in the Real Estate Industry
For many newer real estate agents, passing the real estate exam marks a significant milestone in their budding careers. It's an achievement that opens the door to the vast world of property sales, acquisitions, and negotiations. However, a crucial aspect that can sometimes be overlooked in the initial stages is the immense value of networking.
While acing the real estate exam is a testament to one's foundational knowledge, the journey ahead requires more than just theoretical understanding; it demands connections, collaborations, and mentorships.
Failing to build a robust professional network can leave agents isolated in an industry where relationships often drive success. Engaging with local real estate groups, for instance, not only offers insights into regional market trends but also provides opportunities for collaborations and referrals. Likewise, attending industry events can introduce agents to seasoned professionals, potential clients, and even future mentors. These interactions often lead to partnerships, joint ventures, and other collaborative efforts that can bolster an agent's market presence and portfolio.
Furthermore, seeking mentorships can be a game-changer. A mentor can provide guidance, share experiences, and offer valuable advice on navigating the industry's complexities. They can be instrumental in avoiding common pitfalls and capitalizing on hidden opportunities.
So while passing the real estate exam is essential to establishing oneself in the industry,
the relationships built afterward often dictate the trajectory of success. Undervaluing networking can be a significant oversight, but with proactive effort, newer agents can weave a network that supports and propels their career forward.
Mistake 4: Not Setting Clear Goals and Milestones
In the bustling world of real estate, momentum and direction are paramount. One of the pitfalls that newer agents can sometimes fall into is navigating the industry without clear goals and milestones. Just as a ship without a compass can drift aimlessly, a real estate agent without set objectives may find themselves working hard but not necessarily smart. A lack of direction can significantly hamper growth, leading to missed opportunities and inefficient use of time and resources.
Setting both short-term and long-term goals is essential for charting a clear path forward. Short-term goals offer immediate targets, ensuring agents remain focused and motivated in their daily endeavors. These can range from acquiring a set number of new clients in a month to closing specific property deals. On the other hand, long-term goals provide a broader vision, guiding agents towards larger aspirations like becoming a top agent in their region or expanding into luxury or other high-end markets.
Other examples of short-term goals can be to tour several homes for sale in your target area each week to understand pricing and features. Another example might be to familiarize yourself with local market trends, neighborhood specifics, and school zones by a certain date.
Long-term goals as a real estate agent include achieving a specific income or commission amount by the end of 12 months or becoming one of the top agents in your office or area based on sales volume or closed deals. Other areas of long term growth might be to grow your team by hiring an assistant, a buyer's agent, or other supporting roles.
However, setting goals is only half the battle. Regular reviews are vital to assess progress and ensure alignment with these objectives. The real estate market is dynamic, and strategies that work today might need tweaking tomorrow. Agents can adjust their strategies by periodically evaluating their progress, ensuring they remain on the path to success.
In essence, while the real estate landscape offers vast opportunities, the agents with clear goals and the diligence to review and adapt find themselves at the forefront of success.
Mistake 5: Poor Time Management
The Pitfalls of Mismanaging Time in Real Estate
In the bustling world of real estate, time is of the essence. New agents are quickly introduced to a whirlwind of tasks, from back-to-back client meetings to endless property showings and the necessary (albeit boring) set of administrative duties. With effective time management, they can avoid drowning in these responsibilities, missing golden opportunities, and feeling unnecessary stress. Moreover, the work-life balance—vital for mental well-being and long-term productivity—crumbles when business tasks consume every waking moment.
The key to taming the time management beast is leveraging the right tools. Thankfully, today's technology offers many solutions tailored for real estate professionals. Whether it's an online calendar that nudges with timely reminders or a comprehensive CRM system that optimizes client interactions, there's a tool for every need. By incorporating these into their daily routines, agents can ensure they're not just busy, but productive. A structured schedule also earmarks moments for relaxation and personal time—because a burnt-out agent benefits no one.
The unpredictability of real estate demands discipline in time management. For new agents, knowing these challenges and being ready for them can lead to real success in the long run. Everyone makes mistakes, but being prepared and knowing how to handle common problems can help a lot. If new agents focus on good marketing, keep learning, build strong connections, set clear goals, and manage their time well, they can avoid many common mistakes.
Love,
Kartik
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Scheduling for Real Estate Agents: A Must-Have for Success
Being self-employed in the real estate industry presents unique challenges, especially when maintaining a consistent schedule. This is true
Scheduling for Real Estate Agents: A Must-Have for Success
Being self-employed in the real estate industry presents unique challenges, especially when maintaining a consistent schedule. This is true for both newcomers fresh from our real estate license school as well as seasoned agents. A well-organized timetable is essential. It ensures efficient time management, helps prioritize tasks, and ultimately aids in achieving career goals. Scheduling can also help achieve work-life balance, avoid burnout, and encourage balance.
Despite the benefits, scheduling can be challenging for real estate agents for a number of reasons:
The unpredictable nature of the job: Real estate agents often have to deal with unexpected events, such as last-minute client requests or property viewings. This can make it difficult to stick to a schedule.
Client-centric demands: Real estate agents need to be flexible and accommodating to their clients' needs. This may mean having to adjust their schedule on a regular basis.
The absence of a 9-to-5 structure: Real estate agents (especially in the residential sector) do not have fixed working hours, which can make it difficult to establish and maintain a routine.
With all this said, I wanted to suggest a sample schedule for the real estate professional to consider that is sustainable and ensures productivity. I’ve explained more about each of these below the schedule itself.
7.30am -10.00am Prospecting
10.30am – 12.00pm Lead Follow Up
1.30pm – 3.00pm Administrative Time
3.30pm – 4.30pm Preview Property/Market Analysis (MLS/CoStar Time)
5.00pm – 7.00pm Appointments or go home
Prospecting
Prospecting and lead generation are key tactics real estate agents use to get new clients. Lead generation is about attracting people by providing useful content online, like property listings, and using ads on social media, while also using traditional methods like direct mail real estate campaigns and open houses. On the other hand, prospecting is more active and involves agents directly reaching out to people, like making cold calls or asking previous clients for referrals. It's important for agents to effectively use both strategies: drawing people in with lead generation and then actively engaging with them through lead follow up to guide them through the buying or selling process in the competitive world of real estate.
Lead Follow-Up
In real estate, quickly and helpfully responding to potential customers, or "lead follow-up," is super important. This isn’t just being polite; it’s about showing you're reliable and trustworthy in a world where people are making big money decisions. Even in real estate school, there’s a big focus on this, teaching students that prompt and informative responses are key to turning interested people into actual clients. This has become especially crucial in our digital age, where potential clients can easily find another agent online if they don’t get quick answers. Therefore, learning about online communication and using tools to manage customer relationships is vital. In a nutshell, the careful and timely follow-up with leads often makes the difference in landing a deal in the real estate business.
Studying the Market
In real estate, knowledge about the market and continuous learning is vital. Market analysis involves studying current conditions and future possibilities in your local market, including pricing trends, demand, economic factors, and comparing similar properties. Like a doctor needs to stay updated with medical research, real estate agents must regularly analyze the market to provide accurate advice and spot trends or opportunities. Continuous learning, from seminars to online real estate courses, helps agents understand the many factors affecting the market. Agents must schedule time for these activities to stay informed, provide insightful advice, and gain a competitive edge in the fast-moving real estate world.
Preview property
Previewing properties is a crucial step for real estate agents, involving personally inspecting a property before showing it to potential buyers. This practice helps agents to know the property's features and any issues, enhancing client trust by providing accurate information and using their time wisely with suitable properties. For listing agents, previewing property also helps identify selling points and guide marketing strategies. This activity also assists in managing risks by identifying potential issues, facilitates professional development by keeping agents updated on trends, and ensures time efficiency by focusing on relevant properties.
Previewing property is invaluable for newer real estate agents as it offers firsthand experience and insights into the housing market. By personally visiting and inspecting properties, new agents become familiar with diverse property features, current market trends, and potential selling points, enabling them to answer client queries confidently.
This hands-on approach not only boosts their knowledge and credibility but also aids in building trust with potential clients, ensuring they offer relevant and informed property choices to match their clients' needs.
Showing properties and making presentations or go home
In the active world of real estate, two essential activities are showing properties and making presentations, both pivotal in aiding the transaction process.
Showing Properties: Real estate agents should allocate specific times in their calendars to show properties to qualified buyers. By having these slots pre-booked, agents can effectively structure their day and ensure they also have dedicated time for other essential tasks related to their real estate business.
Making Presentations: In real estate, listing presentations are crucial. Aiming to fit as many of these into your week as possible is beneficial. If you aren't engaged in showing a property or delivering a buyer or listing presentation, it's a sign you've concluded your essential tasks for the day. Adhering to a diligent schedule means you've put in solid work, and while heading home is an option, always remember that maximizing client interaction is always beneficial for success.
Scheduling Implications
Given the significance of these activities, real estate agents must make them central in their schedules:
Prioritization: Dedicating specific time slots for property showings and presentations ensures that agents remain undistracted during these crucial moments, providing undivided attention to clients.
Preparation: Scheduled times allow agents to prepare effectively — be it researching the nuances of a property, tailoring a presentation to a specific audience, or gathering additional resources to support their narrative.
Efficiency: Structured schedules optimize an agent’s time, ensuring a balance between personal client interactions and back-end research and administrative tasks.
By prioritizing property showings and crafting compelling presentations, agents bridge this gap. And in making deliberate time for these activities in their schedules, they amplify their efficacy, ensuring that every client interaction is informed, personalized, and impactful.
Don’t forget to incorporate regular intervals for short breaks that can ensure consistent productivity levels throughout the day.
Set Boundaries: Agents need to demarcate clear boundaries between work and personal time, ensuring neither encroaches upon the other.
Flexibility: While structure is vital, agents should allow spontaneous breaks or personal time, especially during taxing days.
Holistic Approach: Emphasizing the need for breaks and personal time signifies an agent's understanding of success as a holistic concept, encompassing both professional achievements and personal well-being.
While the hustle and bustle of real estate are inescapable, the importance of personal well-being remains paramount. By integrating breaks and personal time into their schedules, real estate agents do not merely enhance their productivity but also enrich their overall quality of life. After all, in a profession built upon relationships and personal connections, an agent's well-being is not just a personal asset but a professional one as well.
Love,
Kartik
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I recently received the below email, and I'm guessing that many of our newer real estate agents ask this question as they start their careers. I told this person I would write an article about the
I recently received the below email, and I'm guessing that many of our newer real estate agents ask this question as they start their careers. I told this person I would write an article about the topic, so here are the email and the response below.
I hope this helps!
Subject: Prospecting vs. Lead Generation?
Hi Kartik:
I trust this email finds you well.
I just got back from a sales seminar with Mike Ferry, and there was a lot of talk about the importance of "prospecting." I get that prospecting is essential to the job of a real estate agent. However, I'm also watching a lot of YouTube videos, and there is a lot of reference to "lead generation."
Are "lead generation" and "prospecting" the same thing? I’m confused by the two.
Thanks again for everything!
Prospecting:
Prospecting is like treasure hunting! Imagine you have a map and know there's a hidden treasure (potential clients) somewhere out there. Prospecting involves actively seeking out these treasures instead of waiting for them to find you.
Actively Seeking: Real estate agents might initiate contact by making phone calls, sending emails, or even knocking on doors. They're reaching out to people interested in buying or selling a property. This could also include sending messages on social media to prospects.
Direct Interaction: There's often direct communication between the agent and the potential client. The agent might converse, understand their needs, and offer solutions.
Lead Generation:
On the other hand, lead generation is like setting up a net to catch butterflies (potential clients). Instead of hunting them down, you create enticing environments (marketing strategies) that naturally draw them toward your business.
Attracting Attention: Real estate agents might use advertising, social media campaigns, or online content to create awareness about their services. This could be through informative blog posts about the housing market or ads about properties they sell.
Capture Interest: Once people show interest, perhaps by liking a post, signing up for a newsletter, responding to a mail piece or visiting a website and filling out a form, they become 'leads.' These people have shown some level of interest in the services offered.
Contrasting the Two:
Active vs. Passive: Prospecting is more active and direct, while lead generation is more passive, trying to lure leads in.
Personal vs. General: Prospecting often involves personal communication, whereas lead generation might not necessarily involve direct interactions.
In a nutshell:
Prospecting: Actively and directly reaching out to potential clients.
Lead Generation: Creating strategies to make potential clients come to you.
Lead generation could also be known in the business world by the generic term "marketing."
So which one is more important? Prospecting or marketing and lead generation?
Determining which is more important, prospecting or lead generation, is difficult. Both play essential, yet different, roles in the success of a new real estate agent.
Measuring the success of broad marketing as opposed to prospecting can be challenging as both have different goals and metrics. Prospecting and direct sales can be measured by the number of contacts to the number of appointments to the number of deals closed, while marketing might be evaluated based on brand awareness, lead generation, and long-term engagement.
They both also have varied timelines. Prospecting can often bring immediate results, while marketing and lead generation can take longer to bear fruit. This makes it challenging to weigh the immediate value of one against the other.
They are both essential components to the success of the real estate agent. Together, they create a balanced approach to reaching customers and securing success beyond just passing the real estate exam.
Lead Generation: The Essential Strategy Creator
Broad Reach: Marketing is a real estate agent's eyes and ears, reaching broader audiences and creating a presence in an area. It generates widespread awareness through advertising, social media, content creation, and more.
Long-term Impact: Marketing strategies typically aim for lasting impressions and sustained market presence, establishing a real estate agent as trustworthy and top-of-mind when a consumer is ready to purchase.
Brand Building: Marketing is vital for building a real estate agent's image and reputation, creating narratives that resonate with consumers on a broader level, affecting their perception and long-term loyalty.
Prospecting: The Crucial Deal Closer
Immediate Results: Prospecting and direct sales are the engines that propel a real estate agent forward, directly driving commissions through immediate conversions. It's about closing deals and getting results now!
Personal Connections: Real estate agents who interact directly with potential clients and understand their immediate needs and objections can tailor their approach, making it more personal and effective.
Revenue Assurance: With target quotas and direct influence on purchases, sales ensure that the real estate agent maintains a steady cash flow, securing financial stability.
Both strategies are crucial in the real estate world. Agents might use prospecting to build immediate connections and lead generation to ensure a steady flow of potential clients. They're different tactics but work toward the same goal: finding people who need the services offered and converting them into clients.
Does that help clarify things? Both processes are about finding new business, but they go about it differently!
Love,
Kartik
PS: If you are interested in getting your real estate license, reach out to us at www.adhischools.com or call 888-768-5285.
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Navigating the Landscape of Trust: Interpersonal Skills in Real Estate
Interpersonal Skills: The Essential Ingredient for Real Estate Success
As a real estate expert, I am often asked what the most
Navigating the Landscape of Trust: Interpersonal Skills in Real Estate
Interpersonal Skills: The Essential Ingredient for Real Estate Success
As a real estate expert, I am often asked what the most important quality is that a new agent needs to succeed. Without a doubt “interpersonal skills” is at or near the top of that list.
Interpersonal skills are the ability to communicate and interact with others effectively. These skills are essential for success in any profession, but they are especially important in real estate. Real estate agents need to be able to build relationships with clients, understand their needs, and negotiate on their behalf.
Here are a few of the most important interpersonal skills for real estate agents:
Communication: Agents need to communicate effectively with their clients verbally and in writing. They need to be able to explain what are sometimes complex concepts clearly and concisely. They also need to be able to listen attentively to their client's concerns.
Empathy: Agents need to be able to put themselves in their client’s shoes and understand their perspectives. This helps them understand their client's needs better and provide the best possible service.
Negotiation: Agents need to be able to negotiate effectively on behalf of their clients. This involves being able to understand both sides of the talk, to develop persuasive arguments, and to compromise when necessary.
Problem-solving: Agents need to be able to solve problems that arise during the buying or selling process. This requires creativity, flexibility, and a willingness to go the extra mile.
Real estate agents with strong interpersonal skills are more likely to build long-term client relationships. These relationships are essential for repeat business and referrals.
Building rapport with clients is not just a strategy but a way to create opportunities for growth for both the agent and the client. Understanding their needs and preferences is not just about following a checklist but actually finding solutions that meet their goals and budget. Through this process, the real estate agent becomes a trusted advisor, helping clients navigate the complex real estate market with empathy, foresight, and dedication.
Effective communication is essential for real estate agents to build trust, establish credibility, and close deals. It allows agents to understand their client's wants and to keep them informed and engaged throughout the buying or selling process.
Open Dialogue
Building rapport with clients is one of the most important aspects of effective communication. This means creating a safe and supportive environment where clients feel comfortable expressing their concerns and expectations. Agents can do this by being friendly, approachable, and empathetic. They should also listen attentively to their clients and ask clarifying questions. When clients feel comfortable communicating with their agent, they are more likely to be open and honest about their requirements. This allows the agent to understand the client better and to provide them with the best possible service.
Feedback Loop
Another important aspect of effective communication is creating a feedback loop with clients. This means keeping clients informed about every step of the process and getting their feedback regularly. This allows the agent to ensure the client is pleased with the process and to make adjustments as needed.
Agents can create this feedback loop by communicating with their clients regularly via phone, email, or text. They should also schedule regular in-person meetings to discuss the client's progress and answer any questions. In our real estate license school program, we often talk about the importance of regular check-ins with the client to ensure that communication is done with regularity and is predictable. This is essential for building trust, establishing credibility, and closing deals. You don’t have to wait to pass the real estate exam to start practicing these skills.
Here are some additional tips for effective communication in real estate:
Be clear and concise in your communications. Avoid using jargon or technical terms that your clients may not understand.
Be respectful and professional in all of your interactions with clients.
Be responsive to your client’s concerns.
Be honest and transparent in your dealings with clients.
Follow up with your clients regularly.
Long-Term Relationships
Building long-term relationships with clients is essential for real estate agents. Satisfied clients are more likely to return for future transactions and to refer their friends, family, and colleagues.
Repeat Business
When clients have a good rapport with their agents, they are more likely to trust and feel comfortable working with them again. This can lead to repeat business, as clients return to their agent when they are ready to buy or sell another property.
Referrals
Clients with a positive experience with their agent are likely to refer them to their friends, family, and colleagues. This is one of the most valuable sources of new business for real estate agents.
There are several things that real estate agents can do to build long-term relationships with their clients. Here are a few tips:
Provide excellent customer service. This means being responsive, helpful, and going the extra mile for your clients.
Keep your clients informed. Please regularly communicate with your clients throughout the buying or selling process and update them on your progress.
Be honest and transparent. Be truthful with your clients about the market conditions and their chances of success.
Be a good listener. Take the time to listen to your client's concerns and show them that you understand.
Stay in touch. Keep in touch with your clients after the transaction is closed. Send them holiday cards, birthday cards, or market updates.
By following these tips, real estate agents can build strong relationships with their clients that will last years.
Here are some additional benefits of building long-term relationships with clients:
Increased income: Long-term clients are more likely to purchase or sell multiple properties with you over time, which can lead to increased income.
Reduced marketing costs: Referrals from satisfied clients are one of the most cost-effective ways to generate new leads.
Improved reputation: A positive reputation is essential for success in real estate. When you have a long track record of satisfied clients, other potential clients are more likely to trust you and want to work with you.
Investing in your client relationships can build a successful and sustainable real estate business.
The role of a real estate agent extends beyond merely facilitating the purchase or sale of a piece of real estate. It involves building and nurturing solid relationships with clients. The bedrock of a successful real estate career lies in understanding and aligning with the client's preferences, and goals. This fosters trust and respect and can pave the way for repeat business and valuable referrals.
Effective communication forms the cornerstone of this relationship-building process. By maintaining an open dialogue and a continuous feedback loop, agents can ensure that clients are informed and engaged throughout the buying or selling journey. Furthermore, this approach enables agents to adapt and respond effectively to the client's evolving needs and preferences. Additionally, cultivating long-term relationships should be at the forefront of an agent's strategy. This involves providing excellent customer service, staying transparent in dealings, and keeping in touch even after completing transactions. In doing so, agents can build a positive reputation and a stable, successful career in the real estate sector.
By honing these interpersonal skills, real estate agents can set themselves up for a fulfilling and prosperous career marked by satisfied clients and a strong network of referrals.
Love,
Kartik
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The Changing Landscape of the Real Estate Industry
The world is now at our fingertips, and the real estate industry is no exception. Buyers can browse properties from the comfort of their own homes,
The Changing Landscape of the Real Estate Industry
The world is now at our fingertips, and the real estate industry is no exception. Buyers can browse properties from the comfort of their own homes, and agents can reach a global audience for their listings. This connectivity has created new opportunities for both buyers and sellers, and has also made the real estate market more competitive. The real estate industry is constantly changing, and it is important for agents and consumers alike to stay ahead of the curve. New technologies are emerging all the time, and agents who are able to embrace these technologies will be well-positioned to succeed in the future. In short, the real estate industry is in a new era, and it is an exciting time to be involved. The digital revolution has transformed the industry, and there are new opportunities for everyone.
Online listings, virtual tours, and digital marketing strategies have become the new norm, altering how real estate transactions are conducted and the expectations of both buyers and sellers.
Take a step back to the 1980s and early 1990s when the Multiple Listing Service materialized in hefty "phone book" styled catalogs. These pages showcased properties through single black-and-white photographs accompanied by brief, often vague descriptions that barely scratched the surface of what each home had to offer.
Today, dozens of full-color and high-resolution photos accompany each listing, with a lengthy description of each property that anyone with an internet connection can read. High-definition video tours abound with interactive components, allowing buyers to experience the property without leaving their homes.
Information is now readily accessible, effortless to obtain, and available everywhere.
How Has The Real Estate Licensing Process Changed Over The Years?
As of the date of this writing, the requirements to get a real estate license are three required statutory courses. These courses are Real Estate Principles, Real Estate Practice, and one elective course the candidate can choose from a list. Then the candidate will have to prepare for and pass the real estate exam.
However, these requirements have changed over time. Before October 1, 2007, only the Real Estate Principles course was a required to obtain a real estate license. Once completed, the candidate could get their real estate license, albeit a "conditional" one. Then, within 18 months, the new licensee could complete two other statutorily required courses and remove the "conditional" aspect of the real estate license.
The Department of Real Estate is again changing the real estate licensing requirements effective January 1, 2024. Applicants for a real estate license on or after that date must complete Real Estate Principles, Real Estate Practice with an "implicit bias" component, and one elective course. As the population becomes more diverse, real estate agents need to be able to understand and address the unique needs of all clients. The licensing process can play a role in preparing agents to be more inclusive and culturally competent.
Ultimately, the aim is to ensure that new agents are prepared to provide their clients with the highest level of service and professionalism. As the industry evolves, the licensing process will continue to adapt to meet the market's changing needs and protect consumers.
This change shows that the real estate licensing process adapts over time, hoping that new agents are knowledgeable, fair, and understanding when dealing with different kinds of people. These ongoing changes in the real estate licensing process show the industry's dedication to preparing new agents for the modern challenges of the real estate market.
The Future for Homebuyers
Home Buyers
In today's digital age, home buyers find themselves in a more empowered position than ever before when it comes to navigating the real estate market. Here's how:
Better Informed
Gone are the days when buyers had to rely solely on agents to get information about properties. Now, a wealth of information is just a click away. Various online platforms provide detailed information about the properties on the market, including asking prices, floor plans, amenities, and neighborhood statistics. The consequence is a breed of well-informed buyers who can make decisions based on data available at their fingertips, leading to more satisfying and confident purchases.
Convenience
The surge in digital platforms has notably streamlined hunting for a new home. Potential buyers can virtually tour numerous properties from the comfort of their homes at any time that suits them. This saves a significant amount of time and makes it easier to compare different options without the pressure of travel and appointments. Additionally, online tools like mortgage calculators and neighborhood insights assist buyers in making informed decisions quickly. The result is a smoother, more pleasant home-buying process where prospects can easily shortlist their preferred properties before visiting in person, making the entire journey less cumbersome and more aligned with individual preferences and needs.
Through these advancements, the real estate industry has reshaped the home buying process into a more buyer-friendly experience, bridging gaps and fostering a more transparent and efficient transaction environment.
The Future For Home Sellers
Home Sellers
Home sellers stand to gain immensely as the real estate industry embraces the digital revolution. From expansive outreach to enhancing the visual allure of listings, here's how the modernization of the industry is benefiting home sellers:
Wider Reach
In the era preceding the Internet, sellers largely depended on local agents and word-of-mouth to find potential buyers. But now, digital platforms have obliterated geographical barriers, offering an opportunity for listings to be viewed by a national, even global audience. Websites, apps, and social media platforms have become powerful tools in a seller's arsenal, enabling them to reach a vastly expanded pool of potential buyers. This increases the likelihood of finding the right buyer more quickly and fosters a competitive environment, driving the property price upward. Through online listings and virtual tours, sellers can ensure their property is visible to a much larger audience, enhancing their chances of a successful sale.
Visual Appeal
The ability to showcase properties through high-resolution images and videos has revolutionized the real estate listing process. Sellers can now work with professionals to create visually stunning virtual tours, aerial views captured by drones, and 3D home tours, allowing prospective buyers to explore every nook and cranny of a property without leaving their homes. This enhanced visual presentation attracts more viewers and enables the property to be presented in its best light, highlighting its strengths and downplaying its weaknesses. Consequently, a listing becomes more appealing and stands out in the crowded marketplace, potentially attracting more inquiries and visits and resulting in a quicker sale at a better price.
Digital tools have given sellers powerful ways to showcase their homes to a wider and more diverse audience, making the selling process more efficient and profitable.
Overall, I am optimistic about the future of the real estate industry and the licensing process. The changes we see are necessary to ensure that the industry remains competitive and that consumers are protected.
As Robin Sharma has said “Change is hard at first, messy in the middle and gorgeous at the end.” The real estate industry is no exception.
Love,
Kartik
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Since its inception, Redfin has carved a unique niche in the hyper-competitive real estate landscape. Unlike its contemporaries—Keller Williams, Coldwell Banker, Compass, and others—Redfin bucked traditional
Since its inception, Redfin has carved a unique niche in the hyper-competitive real estate landscape. Unlike its contemporaries—Keller Williams, Coldwell Banker, Compass, and others—Redfin bucked traditional industry norms by offering its agents a salaried position. This model, a significant departure from the commission-based income structures prevalent in real estate brokerages, was one of Redfin's signature moves, ensuring a steady income for its agents and ostensibly fostering a client-first service where agents might feel less pressure to close deals merely for the sake of their earnings.
However, on January 1, Redfin is introducing a new commission-based program called Redfin Max, initially to be rolled out in Los Angeles and San Francisco. Despite the market slowdown due to rising mortgage rates, Redfin is not presenting this shift as a cost-cutting measure but as strategic planning for growth.
The thought is that this change, aimed primarily at attracting and retaining high-performing agents, can earn up to a 75% commission split without incurring business expenses, a significant shift from their fixed salary system. This new strategy is particularly appealing to agents who have recently passed their real estate test and are looking for lucrative commission structures, a route often taught as advantageous in real estate school.
The initiative responds to feedback from agents who want more earning potential, especially those with substantial client bases who could bring in more business. Despite this change, Redfin agents will remain full-time employees with benefits, maintaining their W2 status, which is rare in an industry where many agents work as independent contractors.
Jason Aleem, Redfin's vice president of real estate operations, sees this move as a way to compete for top talent, noting that salary limitations previously deterred some leading agents. The change aims to attract new agents, particularly those fresh from real estate school and eager to pass the real estate exam, and increase the earnings of current top performers, potentially pushing their compensation to $1 million. This approach aligns with the company's view that rewarding high performers will increase profitability.
The company anticipates positive outcomes from this change, though it's also a departure from its traditional model, signaling a new era for its operations and compensation structure. If successful in California, Redfin might consider expanding this model, prioritizing its growth and market share aspirations.
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Navigating the complexities of real estate and passing the real estate exam often requires a way to remember concepts, and acronyms can help. I wanted to write an article to share a few acronyms to
Navigating the complexities of real estate and passing the real estate exam often requires a way to remember concepts, and acronyms can help. I wanted to write an article to share a few acronyms to aid real estate license examinees to understand and recall critical concepts for the exam. I wanted to review terms like the "bundle of rights", factors determining property value, criteria to determine whether or not something is a fixture, the specifics of joint tenancy, the fiduciary responsibilities of agents, and the government's powers concerning property to help you pass the real estate exam.
Each one of these acronyms, from TEEUP to PETE, offers a snapshot of a broader principle. By familiarizing yourself with these, you'll better grasp concepts and be prepared for the California real estate exam. Let's break down these acronyms and highlight their significance in real estate.
Bundle of Rights
The "bundle of rights" is a foundational concept in real estate that refers to the rights associated with property ownership. When someone owns a property, they don't just own the physical land and buildings; they possess legal rights that can be separated and individually sold, transferred, or leased. These rights encompass various ways an owner can use, enjoy, or dispose of the property.
TEEUP: This represents a buyer's bundle of rights, which are:
Transfer: Lawfully transferring ownership.
Encumber: Borrowing against the property.
Enjoy: Peaceful enjoyment without disturbances.
Use: The lawful use of the property.
Possess: Exclusive possession rights.
Factors That Influence Value
Understanding the underlying factors that drive property value is essential. These are commonly represented by the acronym 'DUST' and are intertwined and play a critical role in the valuation process.
DUST: The pillars of property value:
Demand: How many qualified buyers are interested in the property.
Utility: Its usefulness.
Scarcity: Availability in the market and how many other properties are competing with the property in question.
Transferability: Ease of changing ownership.
Determining Whether or Not Something Is a Fixture
In real estate, distinguishing between personal property and fixtures can often lead to intricate debates and discussions. The line between an item considered a movable personal possession and a permanent property fixture is not always clear. Think about kitchen appliances, pool equipment, or even home theater components. To demystify this gray area and provide clarity, professionals often rely on a set of criteria aptly summarized by the acronym 'MARIA.' Let's unpack each of these criteria to understand better what makes an item a fixture in real estate.
MARIA: Criteria to determine if an item is a fixture:
Method of Attachment - The degree of permanence is based on the means of attachment.
Adaptability - Can the item be used elsewhere.
Relationship of parties - Between buyer and seller, the law tends to favor the buyer.
Intention during attachment - Was the intent of the owner to make the item a permanent part of the structure?
Agreement between parties - What did the purchase contract say about the item?
Unities to a Joint Tenancy Holding
Real estate ownership can be complex, especially when multiple parties are involved. Joint tenancy, a common form of co-ownership, allows multiple individuals to hold a shared interest in a property. However, specific conditions must be met for a joint tenancy to be established. These conditions ensure that each tenant's rights are protected and clearly defined. Summarized by the acronym 'TTIP,' these factors are crucial in defining and understanding the nuances of joint tenancy. Let's delve into each of these factors for a clearer perspective.
TTIP: Factors determining joint tenancy:
Time: Acquiring at the same time - All joint tenants must take title to the property at the same time.
Title: Acquiring via the same document - All joint tenants names must be listed on the same deed.
Interest: Equal stake in the property - All joint tenants must own an equal share of the property, regardless of capital contribution.
Possession: Equal possession rights - All joint tenants have the right to touch, use and occupy the entire property and cannot be physically divided.
Fiduciary Duties
Agents play a pivotal role in guiding, assisting, and representing clients. Yet, with this role comes a set of profound responsibilities. An agent's commitment isn't just about facilitating transactions - it’s anchored in a deep-rooted sense of trust and duty to their clients. These obligations, often termed fiduciary responsibilities, are essential in preserving the integrity of the agent-client relationship. Represented by the acronym 'OLDCAR,' these duties underscore the essence of being a trusted real estate professional. Let's explore each of these responsibilities in detail.
OLD CAR - Agent's fiduciary responsibilities:
Obedience - The agent must obey the lawful instructions of the principal.
Loyalty - The agent must be loyal to the client.
Disclosure - The agent must disclose all known material facts to the client.
Confidentiality - The agent must keep the client data confidential.
Accounting - The agent must account for the client funds.
Reasonable care/diligence - The agent must use reasonable care when dealing with the client.
Government Power Over Property
While property ownership bestows certain rights and privileges upon individuals, it's essential to recognize that these rights exist within a framework governed by higher authorities. Every government maintains inherent powers over properties within its jurisdiction, ensuring societal order, public interest, and the equitable use of land. Summarized by the acronym 'PETE,' these powers reflect the delicate balance between individual rights and the collective good. This section will delve into the government's four primary powers over property and their implications for owners.
PETE: The government's powers over property:
Police Power: Regulating for the health, safety and general welfare of the public.
Eminent Domain: Acquiring property for public use.
Taxation: Levying property taxes.
Escheat: Claiming property when an owner dies intestate (without a will).
TLDR
In a Nutshell: Acronyms are invaluable tools when studying for the California real estate exam aiding in efficiently recalling vital concepts. Commit these to memory to ensure a successful exam outcome. Remember, these aren't just random letters; they encapsulate essential real estate principles. Best of luck with your studies and the exam!
Love,
Kartik
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Navigating the journey to a rewarding real estate career can be fraught with questions and uncertainties, particularly for those with a past marked by a felony or other problems on their background. As
Navigating the journey to a rewarding real estate career can be fraught with questions and uncertainties, particularly for those with a past marked by a felony or other problems on their background. As an aspiring real estate agent, you may be wrestling with a question that keeps you up at night: "C
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In real estate school, you learn that contracts are the backbone of all real estate deals. But there's more to contracts than meets the eye, especially when they go sideways. In this article, we'll demystify
In real estate school, you learn that contracts are the backbone of all real estate deals. But there's more to contracts than meets the eye, especially when they go sideways. In this article, we'll demystify the difference between two confusing terms: 'void' and 'voidable' as it relates to contracts.
Contracts 101
A contract is a promise that the law will enforce. It comprises a few parts: an offer, acceptance of the offer, and something valuable being exchanged by capable parties.
Void Contracts in Real Estate
A void contract is a promise that the law won't enforce. Imagine a person who isn't the actual owner of a property trying to sell a property they don't own. If someone tries to sell a house they don't own, that's likely an example of a void contract. In these cases, the law assumes that the contract never existed.
Another example of a void contract would be a contract to sell someone illegal drugs. The legality of the contract is a fundamental requirement for it to be valid. This means an agreement has to be for something legal. If it's not, the law won't recognize or enforce it
Therefore a contract to sell illegal drugs is void because selling illicit drugs is against the law. Since it's illegal, a contract to sell illegal drugs doesn't fulfill the requirement of legality.
In other words, you can't have a contract to do something illegal. That's why a contract like this is void - it's invalid from the start. So, if someone made a contract to sell illegal drugs and broke that contract, the other person couldn't take them to court. The court would say that the contract was void. The contract couldn't be enforced because it was to do something illegal.
Voidable Contracts in Real Estate
A voidable contract, on the other hand, is a contract that could work, but one person involved has the choice not to follow through with it. In these situations, the contract could become voidable.
A voidable contract is different from a void contract - It's a valid contract, but one party can agree or say no. Only one party is truly bound to the contract. The other party, who isn't bound, can say they don't want the contract anymore, and at that point, it becomes void or non-existent.
There are several reasons a contract might be voidable. These can include someone being forced or tricked into the contract, not understanding what they're agreeing to because of mental issues, being drunk, or lying about something important. Contracts made by minors (people under 18) are usually voidable, but they can only say no to the contract while they're still a minor and for a short time after they become an adult.
If a contract is made without the true agreement of one of the parties, it's considered a voidable contract. The law says a voidable contract can be enforced if one or more parties want it but not if the other parties don't want it to be. A voidable contract can become valid if the party who was wronged doesn't say they want to cancel it within a reasonable time.
Key Differences Between Void and Voidable Contracts
Although 'void' and 'voidable' may sound similar, they are distinct regarding contracts. Here's a breakdown of the major differences between them:
Validity: Void contracts are invalid from the outset. They lack legal standing from the moment they're created because they're based on an illegal act or lack a critical element necessary for a contract to be legally binding. On the other hand, voidable contracts are initially valid and legally enforceable. However, they may become void if the party having the right decides to nullify or reject the contract.
Option to Cancel: Void contracts do not offer the option to affirm or reject the contract. They are null from the start. In contrast, voidable contracts give one party the option to either continue or reject the contract, thereby making it void.
Enforcement: Void contracts cannot be enforced by any party or law because they are fundamentally flawed. But voidable contracts can be enforced, especially if the party with the right to reject the contract decides not to do so and proceeds with the agreement.
Participation: In a void contract, the parties involved can only be legally obligated to fulfill the terms if the contract is valid. All parties may be obliged to fulfill the contract terms for voidable contracts until the aggrieved party decides to reject the contract.
Examples of void contracts include contracts for illegal activities or contracts with impossible terms. Voidable contracts, however, often involve situations where one party was coerced, under undue influence, or somehow tricked into entering the contract.
Understanding these differences is crucial when dealing with real estate contracts. Carefully examining all terms and conditions can save you from unknowingly entering into void or voidable contracts, thus avoiding potential legal disputes or financial losses. Always consult a legal professional if you need clarification on a contract's terms or legality.
One other way to look at void and voidable
When you hear "void" about contracts, it means it's "nonexistent." It's like a rule that never counted from the start because it breaks some important laws or needs to include something required to make it a real contract.
Then there's "voidable," which suggests it could be void but not yet. The contract can still work, but there's a choice. One person in the contract can say it's void or let it stay as it is.
A void or "nonexistent" contract doesn't give any choices - it's just void. But a voidable or "potentially void" contract lets one person decide if it becomes void. That should help you tell the difference between the two.
Understanding the difference between void and voidable contracts is vital in real estate. It's as crucial as knowing when to when to walk away from a listing or the importance of a home inspection. Always remember to get professional help and check all contracts carefully.
As your online real estate school, we're here to help you understand these complex topics. We'd love to hear from you if you have any questions and remember, if you need more clarification, always ask a professional for help.
Love,
Kartik
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So, you're thinking about dipping your toes into the waters of real estate. You may be considering becoming a real estate investor or searching for a flexible job with boundless opportunities. Either
So, you're thinking about dipping your toes into the waters of real estate. You may be considering becoming a real estate investor or searching for a flexible job with boundless opportunities. Either way, acquiring a real estate license could be the key to unlocking a fulfilling and profitable career. The advantages of getting your real estate license are abundant, from setting your own schedule and boosting your earnings to enjoying a dynamic work environment and helping families find their dream homes. Join us as we explore why getting a real estate license is a smart move for your career. Get ready to discover a profession that provides flexibility, financial freedom, and the chance to impact people's lives.
Unparalleled Flexibility and Control Over Your Schedule
Imagine having the freedom to tailor your work schedule to suit your lifestyle. Whether you're an early bird, a night owl, or someone who needs the middle of the day free, having a real estate license allows for that flexibility. With the nature of the job revolving around when clients are available, you'll sometimes find yourself working evenings and weekends. However, the silver lining is that the times when most others are at work can be your downtime.
Being a licensed real estate agent also means you can decide how much or how little you work—planning a vacation? No need to request time off. Do you have a family function? You can rearrange your schedule to accommodate. This control over your work hours is especially beneficial for those with social or other possible business commitments. The key is managing your time effectively, ensuring you are available to your clients when they need you while maintaining a balance with your personal life.
What's more, the flexibility extends beyond just your schedule. As a real estate agent, you can choose which markets and types of properties you want to focus on. Are you interested in luxury homes, commercial real estate or affordable housing? You have the freedom to specialize according to your interest. This flexibility and control over your work-life balance and professional growth are unparalleled benefits that few other professions offer.
Unlimited Income Potential
Another appealing aspect of a career in real estate is the potential to earn a significant income. As an agent, your income isn't restricted by an hourly or predetermined salary. Instead, your earnings are primarily commission-based. The more properties you sell or rent, the more money you can make.
Consider that the market you choose to operate in will determine the price range of homes you sell. It’s no secret that higher-priced homes result in larger commissions. Similarly, if you're working in a hot market, the quick turnover of properties could result in a steady and more predictable income stream. However, it's essential to note that your income might fluctuate and can be unpredictable, especially when starting. Moreover, successful real estate agents often develop a network of satisfied clients who provide referrals, contributing to a more robust business and, ultimately, increased income.
This income potential allows for significant upward mobility, unlike many other jobs where raises and promotions are dictated by others. But with dedication, hard work, and a well-planned strategy, the sky's the limit to your earning potential as a real estate agent. Indeed, the ability to dictate your income based on your effort and success is a significant benefit of getting a real estate license.
Networking Opportunities
Getting a real estate license also opens up a world of networking opportunities. In real estate, your network is one of your most valuable assets. It's not just about selling properties; it's about connecting with people from all walks of life.q
Every day, you'll interact with diverse individuals: clients, fellow agents, lenders, inspectors, appraisers, and others who play critical roles in the property buying and selling process. Each interaction is an opportunity to learn, grow, and forge valuable connections that can lead to more business opportunities.
Being part of a community of real estate professionals also means you can leverage your peers' collective knowledge and experiences. Many agents find immense value in sharing insights, discussing market trends, and learning from the successes and failures of others in the industry.
Attending industry events, participating in local business groups, or getting involved with real estate organizations can further expand your professional network. Such involvement enriches your knowledge and enhances your visibility and credibility within the community.
In real estate, it's often said that “your network is your net worth”. The more people you know, the more opportunities you'll have to succeed.
Diverse Daily Tasks
A real estate career can be a perfect fit for you if you prefer a job that isn't monotonous. Unlike many professions where you might find yourself tied to a desk doing the same tasks every day, real estate provides a refreshing change of pace with diverse daily activities.
As a real estate agent, your days are packed with a diverse range of tasks and activities. You could be touring homes with potential buyers, researching market trends, or drafting contracts. You may be networking at industry events, designing marketing strategies for your listings, or conducting open houses.
In real estate, you also get to wear different hats, becoming a negotiator, marketer, salesperson, and sometimes psychologist, all on the same day. This diversity keeps the job exciting and enables you to hone a wide array of skills. It pushes you to be adaptive, creative, and responsive to each client's unique needs.
Moreover, each new client or property brings a different challenge and learning opportunity. As you navigate these challenges, you'll develop problem-solving skills and gain knowledge to contribute to your long-term success in the field.
Real estate can offer an enriching and dynamic career path if you're the type who thrives on variety and enjoys new experiences.
Opportunity to Help Others
Another rewarding aspect of becoming a real estate agent is the unique opportunity to impact people's lives positively. As a real estate professional, you're not just facilitating property transactions but guiding folks through one of their most significant life decisions — buying or selling a property.
This process, while exciting, can be filled with anxiety and stress for many clients. They're embarking on a journey filled with financial considerations, legal paperwork, and sometimes tough negotiations. As a real estate agent, you can leverage your knowledge and expertise to simplify this process, alleviating their concerns and ensuring a smooth journey.
Whether helping a young family find their perfect first home, assisting a retiree to downsize into a more manageable space, or guiding a seller to secure the best price for their property, you get to be part of these life-changing experiences. The smiles of new homeowners receiving their keys or the relief on a seller's face when the deal closes can bring tremendous job satisfaction.
In essence, a career in real estate gives you a chance to do more than work - it offers you a platform to serve, assist, and ultimately bring happiness to others through your professional expertise.
The Takeaway
Obtaining a real estate license opens the door to a career path filled with financial potential, flexibility, independence, diversity in tasks, and the unique chance to help others. You can mold your professional journey by breaking into the real estate industry.
While there's no denying the challenges that come with the territory — irregular hours, fluctuating income, and stiff competition, the rewards can far outweigh these hurdles. The satisfaction of helping people navigate the complex process of buying or selling a home, the thrill of sealing a deal, and the financial benefits make this career option worthwhile.
Getting a real estate license could be your stepping stone toward a fulfilling and prosperous career if you're considering a career shift or deciding what to do next. In the dynamic world of real estate, the sky is truly the limit.
And remember, just as every property holds unique potential, so does every real estate agent.
If I’ve convinced you to take the first step, call us at 8887685285 or visit www.adhischools.com.
Love,
Kartik
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In the ever-evolving world of real estate, the concept of For Sale By Owner (FSBO) has gained considerable attention from sellers trying to save on the commission. FSBO is a method of selling a property
In the ever-evolving world of real estate, the concept of For Sale By Owner (FSBO) has gained considerable attention from sellers trying to save on the commission. FSBO is a method of selling a property without the involvement of a real estate agent or broker. The seller assumes all responsibilities, from setting the right price to handling the paperwork and closing the sale. On the surface, it might seem appealing, mainly due to the potential for saving on fat commission fees that typically go to a real estate agent.
Every now and then, I will get a call in our office from someone who is interested in selling a property on their own without hiring an agent so I figured I should probably write an article about this. It's easy to get lured by the prospect of saving money. Still, it's equally critical to understand the challenges and potential drawbacks of this do-it-yourself approach to selling a property. My intention is not to discourage those considering FSBO but to provide a comprehensive understanding of what it entails, enabling sellers to make an informed decision.
Pricing Challenges
One of the significant challenges faced by those selling their home through the FSBO method is correctly pricing the property. This task usually falls within the expertise of a real estate professional who has obtained a real estate license through training, education and passing a real estate license examination.
Without this professional experience, accurately assessing the value of your home can become a complex process. Sellers need to consider various factors such as the location, size, and condition of the property, recent sales of comparable homes in the area, current market trends, and even the time of year. A real estate license gives professionals the know-how to consider and correctly weigh all these aspects.
Online websites like Zillow can be handy for getting a basic idea about how much homes are worth in your area. But it's better to depend on more than just them to determine your home's value. Zillow uses a Zestimate tool which tries to estimate your home's value using public information and other factors, but the Zestimate can't consider things like how good your home looks, any improvements you've made, or what's unique about your home. On the flip side, a licensed real estate professional knows all the ins and outs of selling homes. They'll come to your home, look it over carefully, consider what makes it unique, and consider what similar homes have recently sold for.
So, while Zillow can give you a rough guess of your home's value, a real estate professional can give you a much better, customized estimate. They should help you set a price that's just right for your home, which can be important when trying to sell.
If the home is underpriced, it could lead to a faster sale, but you risk losing out on potential profit. On the other hand, overpricing the property can deter potential buyers, leading to the property languishing on the market for an extended period. Both scenarios are far from ideal and could result in financial losses or unnecessary stress for the seller.
Accurately pricing a home for sale is a complex process that can significantly impact the sale's success. With the experience and training that comes with obtaining a real estate license, this task can be easier for FSBO sellers.
Time Considerations
The FSBO approach also demands a substantial time commitment from sellers. Not only must the seller price the property properly, but they must also handle all aspects involved in marketing the home. This includes scheduling and conducting viewings, answering inquiries, and actively communicating with potential buyers. Typically managed by a real estate agent, these responsibilities can quickly become overwhelming for the uninitiated.
Legalities and Negotiation
Last but definitely not least, FSBO sellers must handle all the paperwork and legal aspects of a property sale. This requires a deep understanding of real estate laws, contracts, and negotiation skills. The risk of making a mistake or oversight can be high; correcting these can take considerable time and effort.
Deciding to sell your house yourself also can limit the number of people who even know about your house being for sale. The main reason for this is that FSBO listings generally don't appear on the Multiple Listing Services (MLS). The Multiple Listing Service (MLS) is an important tool that can only be accessed by those who have passed the real estate test and are members of an Association of Realtors. Also, negotiating a deal can be hard without the help of an experienced real estate agent. If you're an owner representing yourself in the sale, staying objective during negotiations can take a lot of work. Real estate agents have honed their negotiation skills over many deals, which is a big plus they bring to the table.
Embarking on the FSBO route involves tackling negotiations without the advantage of professional experience. This aspect can be daunting, particularly if the buyer is represented by a seasoned real estate agent. These professionals have the skills and expertise acquired from handling numerous transactions, giving them an upper hand in the negotiation process.
In addition to this, there are emotional factors that often come into play during negotiations. Sellers may have a sentimental attachment to their homes, which can cloud judgment and lead to unrealistic expectations. This emotional investment can also make it challenging to respond objectively to criticism about the property or to negotiate effectively on price and terms.
Another often-overlooked aspect of selling a property FSBO are the legal complexities involved. This process requires understanding local and national real estate laws, regulations, and required disclosures. Without this expertise, sellers can find themselves in non-compliance, leading to penalties or delayed transactions.
The risk of legal disputes is significantly heightened in FSBO sales. Mistakes or omissions in the paperwork, or unintentional non-disclosure of specific property details, could lead to lawsuits after the transaction is completed. These issues can be costly, time-consuming, and stressful to resolve.
FSBO sellers also face potential financial losses due to these legal pitfalls. Costs associated with lawsuits, penalties for non-compliance, or needing to hire a legal professional for assistance can quickly add up.
Consider Getting Your Real Estate License
Another option is getting your real estate license if you're adamant about saving money on real estate commissions. This provides you with the necessary expertise to navigate your home sale and offers an understanding of the market, negotiation skills, and a grasp of the legal aspects of real estate transactions - at least at a high level. You’ll still need to put your license with a broker in order to do an act that requires a license but it’s at least a start.
Whether you sell FSBO, hire a real estate professional, or obtain your real estate license and represent yourself, it's crucial to understand what each path entails. We encourage all potential sellers to seek professional advice to ensure they make an informed decision that best suits their needs and circumstances.
While the FSBO route may initially seem more cost-effective, it requires a significant investment of time and energy that should not be underestimated.
As always, if you are considering getting your real estate license, even to sell just your own home, visit www.adhischools.com or call us at 888-768-5285.
Love,
Kartik
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In real estate, few situations can be as challenging as facing foreclosure. Foreclosure happens when someone borrows money and uses their property as a guarantee but then stops making payments. The lender,
In real estate, few situations can be as challenging as facing foreclosure. Foreclosure happens when someone borrows money and uses their property as a guarantee but then stops making payments. The lender, who gave the money, tries to get their money back by selling the borrower's property.
In the context of homeownership, this means the possibility of losing one's home.
Understanding the California foreclosure process is not just crucial for those living in the Golden State, but also for students in real estate license school who are preparing to assist clients facing foreclosure or those interested in purchasing foreclosed properties. I wanted to write an article to delve into California's non-judicial (common) and judicial (super-rare) foreclosure processes, offering insights into what homeowners and real estate agents can anticipate during each step.
While this article can’t possibly cover every edge case or scenario, it serves as a starting point to help you learn about these concepts. This applies whether you're trying to avoid foreclosure, thinking about buying a foreclosed property or guiding a client through this challenging time.
Legal Framework for Foreclosure in California
Understanding the foreclosure process in California necessitates a look into its legal framework. The state's foreclosure proceedings are primarily governed by the California Civil Code 2924, which outlines the procedures lenders must follow when borrowers default on their mortgage payments.
The California foreclosure process falls into two categories: non-judicial and judicial foreclosures. Non-judicial foreclosures (as the name implies) occur outside of court, the most common type in California. The lender can initiate this process if the promissory note and deed of trust include a "power of sale" clause, permitting them to sell the property to recoup the outstanding loan balance following a default.
On the other hand, judicial foreclosures, though less common, involve a court proceeding. In this case, the lender files a lawsuit against the borrower to recover the unpaid mortgage balance. Understanding these two types of foreclosure processes is not only crucial for managing foreclosure situations effectively, but it also forms a critical part of the real estate exam that aspiring professionals must pass. In the following sections, I will delve into each process separately, providing a step-by-step overview of what homeowners and real estate professionals can expect.
III. Non-Judicial Foreclosure Process
Non-judicial foreclosure is the most common type of foreclosure in California, and it doesn't involve court action. This process is usually used when a power of sale clause exists in a mortgage or deed of trust. Here's a brief overview of the steps involved:
Notice of Default: If a borrower fails to make payments for a certain period, the lender may record a Notice of Default at the County Recorder's Office. The borrower is then sent a copy within ten days, initiating the non-judicial foreclosure process.
Notice of Trustee's Sale: If the borrower does not pay the default amount or negotiate a resolution within about three months, a Notice of Trustee's Sale is recorded. The borrower has 21 days before the home can be sold.
Trustee's Sale: If the borrower still hasn't remedied the default, the property is auctioned to the highest bidder, who must pay in cash.
Eviction: If the property is sold, the new owner obtains the right of possession and can begin eviction proceedings if the borrower does not vacate voluntarily.
Remember, the non-judicial foreclosure process has no right of redemption following the trustee’s sale and the sale is final.
IV. Judicial Foreclosure Process
While less common in California, a judicial foreclosure process comes into play when a mortgage does not include a 'power of sale' clause. It involves court proceedings and provides the borrower with a statutory right of redemption. Here are the main steps:
Filing of Lawsuit: The lender initiates the judicial foreclosure process by filing a lawsuit against the borrower in a California court. The borrower is served with a summons and complaint, and they have the opportunity to respond.
Court Judgment: If the borrower does not respond or loses the case, the court issues a judgment in favor of the lender, including the total amount owed and permission for the lender to sell the property.
Sale of the Property: The property is then sold at a public auction. The highest bidder takes ownership, often needing to pay in cash on the spot.
Right of Redemption: In a judicial foreclosure, the borrower has a statutory right of redemption, allowing them to reclaim their property within a certain period post-sale by paying the total sale price plus additional costs.
Eviction: If the property is sold and the previous owner does not exercise their right of redemption, the new owner can start eviction proceedings to remove the former owner from the property.
Understanding the judicial foreclosure process helps homeowners and real estate professionals to navigate these complex proceedings better.
V. Foreclosure Timeline in California
In California, the foreclosure timeline can vary greatly depending on whether it's a non-judicial or judicial foreclosure. I’m going to break down each process to provide an estimated timeline.
Non-Judicial Foreclosure Timeline: The non-judicial foreclosure process can take approximately 120 days. It begins with a Notice of Default, recorded after a borrower defaults on their mortgage payment. The borrower has roughly three months (90 days) to pay the overdue amount. If the borrower cannot rectify the situation within these 90 days, the lender will record a Notice of Trustee's Sale. The property can be auctioned 21 days after the Notice of Trustee's Sale is recorded. However, remember that many lenders delay the process, and it could take several months to a year or longer from the initial default.
Judicial Foreclosure Timeline: A judicial foreclosure is typically much longer than a non-judicial foreclosure, often taking more than a year. The process begins with the lender filing a lawsuit, and the timeline then depends on court schedules and the length of time it takes to serve the borrower. If the court rules in favor of the lender, the property is sold at a public auction. Following the sale, the borrower has a right of redemption that may last one year, during which they can pay the total amount owed to reclaim their property.
Factors Affecting the Foreclosure Timeline: Several factors can lengthen the foreclosure timeline, including:
Legal Challenges: If a borrower contests the foreclosure, the process can be delayed significantly, particularly in the case of a judicial foreclosure.
Lender's Discretion: Lenders often have a backlog of foreclosures and might wait to immediately file a Notice of Default after a borrower misses several payments.
Loan Modification or Short Sale: If the borrower works with the lender to modify the loan or sell the property via a short sale, the lender may delay the foreclosure process.
Understanding the typical timelines and potential delays can assist homeowners and real estate professionals to navigate and plan accordingly during a foreclosure.
VI. Borrower's Rights and Protections
In California, borrowers have several rights and protections when facing foreclosure. Importantly, they have the right to be notified appropriately at every step of the foreclosure process, ensuring ample time to react or challenge the process. Additionally, they can attend and participate in the foreclosure sale. If a judicial foreclosure process is followed, borrowers have a statutory 'right of redemption,' allowing them to reclaim their property after the foreclosure sale.
Facing foreclosure is a challenging ordeal, but there are alternatives to explore:
Loan Modifications: Borrowers can negotiate with their lender to modify their loan terms, possibly reducing the monthly payments to a more manageable amount.
Short Sales: If the home's market value is less than the outstanding mortgage balance, borrowers can work with the lender to sell the house at a price lower than the balance due and forgive the remaining debt.
Deeds in lieu of foreclosure: As a last resort, borrowers can voluntarily transfer property ownership to the lender to satisfy the loan and avoid foreclosure.
Exercising these rights and options can help homeowners navigate the tricky waters of foreclosure, potentially avoiding it altogether. Knowledge is power; knowing your rights and options can make a significant difference when dealing with a possible foreclosure.
VII. Impact of Foreclosure
A foreclosure can have long-lasting impacts on a homeowner's financial situation and the community. For the homeowner, foreclosure negatively affects their credit score, making it more challenging to secure loans in the future. The foreclosure remains on the credit report for seven years and could lower the score by 85 to 160 points, according to Equifax. Furthermore, the ability to purchase a new home is affected; generally, a borrower must wait a while after a foreclosure to qualify for a new conventional mortgage.
The impacts extend beyond individual homeowners to the community and real estate market. Foreclosures can lead to decreased property values in the surrounding area, mainly if multiple foreclosures exist in the same neighborhood. The property often sits vacant for a time, potentially leading to neglect and disrepair. These circumstances can destabilize communities and reduce the area's appeal to potential buyers.
While the impacts of foreclosure are severe, awareness of these consequences can motivate homeowners to seek help early in the foreclosure process and explore options to avoid it.
Navigating the choppy waters of foreclosure can be overwhelming, but having a comprehensive understanding of the process can make the journey more manageable. I’ve discussed the California foreclosure process, explaining both non-judicial and judicial foreclosures and highlighting the vital legal framework in California that guides these processes. You also know about the typical timelines and potential delays and the rights and protections available to borrowers, including alternatives such as loan modifications, short sales, and deeds in lieu of foreclosure.
Remember, foreclosure can significantly impact a homeowner's credit, future homeownership opportunities, and the broader community and real estate market. Thus, it's essential to explore all options to mitigate these impacts.
Facing foreclosure is a complex process filled with legal intricacies, and every situation is unique. That's why seeking professional advice is essential when dealing with a potential foreclosure. Real estate professionals, credit counselors, and legal advisors can provide invaluable assistance, helping homeowners understand their options and make informed decisions.
Foreclosure is a challenging road, but with knowledge and the right support, homeowners can navigate this process more confidently, potentially finding alternatives to alleviate the situation.
As always, if you are interested in getting your real estate license, visit www.adhischools.com or call us at 888-768-5285.
Love,
Kartik
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The Tough Reality: Unveiling the 12 Reasons Why Real Estate Agents Quit and Fail in the Industry
So you're thinking about the real estate business, huh? It sounds pretty cool, right? You get to make
The Tough Reality: Unveiling the 12 Reasons Why Real Estate Agents Quit and Fail in the Industry
So you're thinking about the real estate business, huh? It sounds pretty cool, right? You get to make good money, choose when you want to work, and help people find their dream homes. But wait a minute! Did you know a lot of new real estate agents quit within just a few years? Yep, it's true. Even though it looks pretty exciting, a lot of folks find it tough to stick around. So let's dive into twelve reasons why so many people decide to hang up their real estate agent hat early.
I want to be clear about one thing - I’m not in the business of telling people why they can’t make it in real estate. I really wanted to write this article as a word of caution to ensure that our students have the greatest chance of success once they get out into the field.
Reason 1:
Most folks think that to be a successful real estate agent, all you need is to pass the real estate exam and get a license. Easy-peasy, right? Well, not so fast. The real world of real estate is like a huge puzzle. Without spending enough time learning all the pieces and how they fit together, things can get pretty confusing. And because of that, many agents find themselves saying, "This is too tough!" and decide to quit early.
For a newbie real estate agent, closing a deal may seem as simple as showing a house, finding a buyer who loves it, and then handing over the keys. But the truth is, it's more complicated than that.
First, they have to understand the local real estate market: what types of homes are selling, what prices are reasonable, and who the potential buyers are.
Then, they have to learn about home inspections and appraisals. They need to understand what problems might come up during an inspection, how to negotiate repairs, and how an appraisal can affect the selling price.
And lastly, they have to manage the closing process. This includes understanding all the legal documents involved, coordinating between lenders and other agents, and ensuring all the necessary steps are completed on time.
If a new real estate agent doesn't take the time to learn each of these pieces and how they fit together, they can easily become overwhelmed. This could lead to mistakes, missed opportunities, and ultimately, failure.
Reason 2:
Expecting Too Much: Sometimes, real estate school makes everything seem a lot easier than it really is. But being a successful real estate agent is hard work - not unlike studying for a tough test or training for a big game. It needs grit, lots of work, and a ton of patience. If new agents think they're going to close a bunch of deals super quick and it doesn't happen, they can get really disappointed and might decide to quit.
Reason 3:
Money Matters: Now let's talk about money. Because real estate agents earn commissions (that means we get paid when we sell a house), we need to plan our money carefully and control our costs. Think about expenses like licensing fees, the cost of advertising, and even just paying for everyday stuff like food, housing and utilities until you’re selling enough houses to make steady money. If you don't plan well, it’s possible to run out of cash before your career really gets started.
Reason 4:
Inadequate Marketing Skills: We live in an era where digital marketing is king. Thus, a real estate agent's ability to effectively market their listings and personal brand is crucial to their success. Agents who need help to adapt to digital trends or establish a substantial online presence might find themselves unable to stay afloat in this competitive arena.
Reason 5:
Mentorship Importance: Having a mentor when starting in real estate can help. This is because they can show you how to handle the complexities of our business. Mentors provide guidance, share valuable insights and experiences, and help navigate the industry's complexities. With a mentor, individuals might take advantage of learning opportunities and make avoidable mistakes. Additionally, mentors often challenge their mentees, pushing them to strive for more, which aids in career advancement. Career progression might be slower and more challenging without such support and stimulation.
A good mentor is going to stop newbies from making beginner mistakes, lessen their stress, and make them feel more confident.
Reason 6:
Poor Time Management: Despite the seemingly flexible work hours, the real estate industry demands exceptional time management skills. Promptly responding to clients, effectively coordinating open houses, diligently managing paperwork - all these tasks are integral to an agent's role. Failure to efficiently manage these responsibilities can result in missed opportunities and potential career failure.
Reason 7:
Not Building a Client Base: Just as a solid foundation is important in the construction of a building, having a strong client network is vital for a real estate agent. Even during real estate license school, agents learn the importance of effective networking and creating good relationships with clients. Those who struggle with these skills often need help getting clients. This can lead to fewer deals, not enough income, and could eventually lead them to give up on their real estate career.
Reason 8:
Over-reliance on Brokerage: While your brokerage can and should provide valuable resources and initial support, relying only on them can impede an agent's growth. Real estate agents must realize that their triumph hinges mainly on their initiative, independent decision-making abilities, and capacity to cultivate relationships and close deals.
Reason 9:
Inability to Handle Rejection: Rejection is integral to the real estate business. Deals will fall apart, and potential buyers will turn down offers. Agents incapable of handling rejection may quickly lose morale, leading them to reconsider their career choice.
Rejections and deals falling through are part of the process, but remember that these setbacks do not define your capabilities or worth as a real estate agent. Here's a different perspective to help cheer you up:
Firstly, every successful real estate agent has gone through what you're going through right now. Each rejection is not a failure but rather a learning opportunity. It's all about gaining valuable experience to help you improve at your job.
Secondly, remember that rejection isn't personal. Clients have numerous reasons for rejecting offers or pulling out of deals, most of which have nothing to do with you. They might have financial issues, change their mind about moving, or find a different property that suits their needs better.
Thirdly, consider that each "no" you hear is one step closer to the next "yes." It's a numbers game. Every rejection brings you closer to a successful deal. Persistence is key in this industry.
Lastly, it's important to maintain a positive attitude and take care of your mental health. Take time to do things you enjoy and relax when you're not working. The real estate business can be stressful, so it's essential to have a good work-life balance.
Reason 10:
Lack of Continuing Education: The dynamic real estate market continually evolves, requiring agents to stay updated with current trends and regulations. Those who neglect continuing education risk lagging behind more informed competitors. This deficiency can lead to fewer closed deals and career failure.
Reason 11:
Ignoring Customer Service: An agent's reputation is crucial for success. Those who fail to prioritize customer service face a tarnished reputation, which can result in fewer referrals, a shrinking client base, and an exit from the industry.
Reason 12:
Poor Negotiation Skills: Being a real estate agent demands being an adept negotiator. Agents need to ensure the best possible deal for their clients. With refined negotiation skills, agents may be able to finalize deals effectively, leading to dissatisfied clients and a subsequent exit from the industry.
Real estate transactions can be complex and stressful, with many potential conflicts. Good negotiation skills can help manage and resolve these conflicts, keeping the process moving smoothly.
When clients see their agent successfully negotiating on their behalf, this will increase their satisfaction and trust in their agent, leading to more referrals and repeat business, which is crucial for an agent's success.
I hope it’s apparent that the journey to a successful career in real estate extends far beyond passing a real estate exam and obtaining a real estate license. It requires an intricate blend of hard work, lifelong learning, stellar customer service, and sharp business skills. By comprehending these potential pitfalls, novice agents can equip themselves better for the challenges that lie ahead, significantly improving their chances of success and ensuring they become more than just another number in the high attrition rate of the real estate industry.
As always, if you are interested in getting your real estate license visit www.adhischools.com or call us at 888-768-5285.
Love,
Kartik
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Entering the world of real estate can feel like learning a new language. As in any industry, real estate comes with its unique terminology, which can be daunting for those new to the field. But fear
Entering the world of real estate can feel like learning a new language. As in any industry, real estate comes with its unique terminology, which can be daunting for those new to the field. But fear not; mastering this language is not only possible but also a critical component of becoming a..
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Entering the world of real estate as a professional can be both exciting and daunting. The dynamic landscape offers numerous possibilities, but the thought of choosing a broker can be daunting. There
Entering the world of real estate as a professional can be both exciting and daunting. The dynamic landscape offers numerous possibilities, but the thought of choosing a broker can be daunting. There are so many choices out there ranging from a team structure, to an independent company or even a national franchise - there are no shortage of options.
When it comes to commission splits, the 100% commission model stands out for its distinct structure and potential benefits among the available options. This model promises an attractive deal: the agent takes home their entire commission, hence the name '100% commission'. But like any other model, there are pros and cons.
As many of our readers are either enrolled in real estate license school or considering enrolling in license school I wanted to explore the nuances of 100% commission brokerages and assess whether it's the right choice for new professionals aiming to make their mark in our great real estate business.
In theory, a 100% commission brokerage allows agents to keep all their commission from a transaction. In other words, when an agent working under this model closes a deal, they retain the entire commission, hence the term '100% commission'. It’s important to read the fine print before joining such a company, however as sometimes “100%” isn’t really “100%”. Although some brokers may brand their compensation plans “100%” they can involve a nominal flat fee per transaction or a monthly or annual fee that the agent pays the brokerage rather than a commission percentage.
This starkly contrasts the traditional brokerage model, where an agent's commission is split between the agent and the brokerage. In a traditional model, the split is often a fixed percentage. It may range from a 50/50 split to a 90/10 split, depending on the agent's experience level, the brokerage's policies, and market standards. In a traditional brokerage model, the agent could take home anywhere from 50% to 90% of the commission from a transaction.
A simple example can illustrate the difference. If an agent closes a deal that generates a gross commission income (GCI) of $20,000 in a 100% commission model, the agent could keep the entire $20,000 (minus any flat fees or other costs associated with the brokerage). However, in a traditional 70/30 split model, the agent might take home let’s say $14,000, with the remaining $6,000 going to the brokerage.
This might seem like a no-brainer for the agent, but like anything there are pros and cons for the real estate professional in an environment like this.
The Downside of 100% Commission Brokerages
While 100% commission brokerages have gained traction for their potential benefits, they're not without their pitfalls. It's crucial to weigh these cons against the pros when deciding whether this model is right for you. Here, we'll explore some potential downsides of working with a 100% commission brokerage.
1. Lack of Support
One common criticism of 100% commission brokerages is the perceived lack of support. In traditional brokerages, part of the commission split often goes toward administrative support, training, and office resources. These brokerages might provide agents with access to a physical office, marketing materials, continued education, and more. In contrast, 100% commission brokerages typically operate on a leaner model, and you might find yourself largely on your own.
2. Hidden Costs
While keeping 100% of your commission can sound appealing, it's crucial to remember that this figure might only account for some costs. Some 100% commission brokerages charge a transaction fee per sale or even recurring monthly or annual fees. You should also account for costs related to errors and omissions insurance, marketing materials, and other business-related expenses. Therefore, it's essential to factor these into your calculations when determining potential earnings.
3. Less Structured Environment
The increased autonomy that comes with a 100% commission brokerage can be a double-edged sword. For some, this independence is liberating; for others, a less structured environment might lead to reduced motivation and productivity. Some agents may need the structure and community of a traditional office setting to stay focused and motivated.
4. Not Ideal for Newer Agents
Although the flat-fee model can be attractive to new agents from a financial perspective, the lack of support and guidance can make it a challenging environment for those just starting out. New agents often benefit from mentorship, training, and hands-on support to help them navigate the industry's complexities after they pass the real estate exam. With these resources, newer agents may find it easier to succeed.
5. Misleading "100% Commission" Terminology
Finally, it's worth noting that the term "100% commission" can be somewhat misleading. As noted earlier, this model's various fees and costs mean that agents rarely take home the full 100% of their commission. Understanding this can help manage expectations and make a more informed decision about whether this model is the right fit.
While the 100% commission model can offer significant benefits, it's essential to consider its potential downsides. Whether you're a seasoned pro or a newcomer to the industry, understanding these cons will help you decide and choose a brokerage model that aligns with your career goals and working style.
The Upside of 100% Commission Brokerages
In the fast-evolving real estate landscape, alternative brokerage models have begun to challenge traditional business methods. Let's talk about the promising upside of this model, as it holds potential to revolutionize an agent's income and autonomy in their real estate journey.
1. Greater Income Potential
The most obvious advantage of the 100% commission model is the potential for higher income. Agents can maximize their earnings from every transaction by keeping the entire commission minus a nominal flat fee. This approach can be incredibly lucrative for high-performing agents who complete many transactions.
2. Predictability and Transparency
One of the often-overlooked benefits of the 100% commission model is its simplicity. With a fixed fee structure, agents know upfront what their expenses will be, making it easier to budget and plan for the future. This clear-cut approach provides a sense of predictability and transparency that can be comforting in an industry often characterized by uncertainty.
3. Flexibility and Control
100% commission brokerages give agents more autonomy and control over their business. This independence allows agents to be more innovative with their marketing strategies and business plans, adjusting as they see fit without additional brokerage interference. This flexibility can lead to more effective personal branding and, consequently, better business growth.
4. Competitive Service Offering
Lastly, the 100% commission model allows agents to offer their clients competitive pricing in a crowded marketplace, possibly attracting more clients and driving more business.
Is the 100% Commission Model Right for a Newer Real Estate Agent?
Navigating the world of real estate can be complex for a novice agent, fresh from our real estate school. For new real estate professionals, the 100% commission model might seem appealing on the surface, but it's essential to understand what this model entails and if it truly aligns with your needs and career goals.
As mentioned earlier, 100% commission brokerages offer the allure of significant earning potential, allowing agents to retain the majority, if not all, of their commission. This can be especially enticing for those who are just starting and are keen on maximizing their income.
However, the primary challenge for newer agents under this model is more support and mentorship. Traditional brokerages often provide comprehensive training and resources that are beneficial for agents building their skills after passing the real estate exam. These resources can include hands-on training, marketing assistance, and access to experienced agents who can provide guidance and advice. The absence of these support structures in many 100% commission brokerages can make the initial stages of a real estate career more challenging for newer agents.
Furthermore, while the potential to earn 100% commission can be attractive, new agents need to remember that various expenses, such as transaction fees, marketing costs, and insurance often offset this. These expenses can add up and put financial pressure on agents, particularly those who are still trying to establish themselves in the industry and secure consistent transactions.
There is also the aspect of self-discipline and motivation. The high level of autonomy in a 100% commission model requires a substantial amount of self-direction. With the structured environment provided by traditional brokerages, some new agents might be able to maintain their momentum, especially during challenging periods.
So while the 100% commission model can offer greater income potential, it comes with challenges that may prove difficult for newer agents to navigate. It's vital for new agents to consider these factors and seek out a mentor or network of experienced agents for guidance. As with any career decision, it's all about finding the right fit for your goals, working style, and needs.
Becoming a real estate professional is filled with many decisions, and choosing the right brokerage model is an important decision. It's critical to remember that there is no one-size-fits-all solution - each model has its own unique characteristics and considerations. The 100% commission model, with its allure of potentially higher earnings and autonomy, is no exception.
It offers numerous advantages, including greater income potential, predictable and transparent fee structures, and more control over one's business. These benefits can be particularly appealing for seasoned agents with a solid client base and comfortable navigating the industry independently. For them, this model can be a financially rewarding alternative to the traditional commission split model.
As discussed, this model also has its challenges. The often-overlooked costs and the absence of supportive resources can pose hurdles, particularly for newer agents just starting their journey after real estate school. The lack of structured environment poses a challenge to maintaining motivation and discipline, crucial components for success in this industry.
Moreover, the decision should not be based solely on financial considerations. Agents, particularly those new to the industry, should also consider the level of support, mentorship, and resources they may need as they build their skills and client base. In this aspect, the traditional brokerage model with its training programs and support structures can often be more suitable for newly minted agents aiming to make their mark in the industry.
Ultimately, whether the 100% commission model is the right fit will depend on the individual agent's career goals, personal work style, and needs. It's critical to weigh the potential income benefits against the need for support, training, and resources. Agents considering this model should fully understand what it entails, assess their own needs and abilities, and seek advice from experienced professionals in the industry.
This decision marks one of the many milestones in the exciting journey of becoming a real estate professional. Choose wisely, as the right brokerage can pave the way for a rewarding and successful career in real estate - or not.
As always, if you are considering taking real estate license courses with us, visit www.adhischools.com or call us at 888-768-5285.
Love,
Kartik
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The real estate industry plays a pivotal role in today's economy, driving the
growth and stability of communities all across California and the United States.
The real estate industry plays a pivotal role in today's economy, driving the
growth and stability of communities all across California and the United States.
The real estate industry is a big part of our e
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Introduction
A question I've been getting a lot lately: "Do you need a college degree to practice real estate?"
Whether you're exploring a new career path in the real estate industry or you're a high
Introduction
A question I've been getting a lot lately: "Do you need a college degree to practice real estate?"
Whether you're exploring a new career path in the real estate industry or you're a high school student contemplating your future, understanding the educational requirements to become a real estate professional is critical. The answer is more complex than you might think, as conditions and expectations can vary. I wanted to write an article to clarify these ambiguities, equipping you with the knowledge you need to navigate your real estate career path successfully.
Navigating the world of real estate presents a wealth of opportunities. Gaining insights into whether or not a college degree is crucial for success in this field could significantly influence your career trajectory and future endeavors. Stay tuned as I break down the historical and current educational prerequisites, the role a degree might play, and alternative pathways to success in real estate.
Historical Perspective
The real estate industry, like many others, has seen considerable evolution over the years, including its educational requirements. In the early 20th century, there were few formal prerequisites to becoming a real estate agent. Anyone with a knack for sales and a strong network could enter the industry. The profession needed to be regulated, and the concepts of licensing and formal education in real estate were virtually nonexistent back in the day.
However, as the industry grew and the transactions became more complex, it became apparent that a certain level of knowledge and professionalism was necessary to ensure fair and ethical dealings. The U.S.'s first real estate license law was established in California in 1917, primarily responding to fraudulent land sales.
In the years that followed, more states joined in, implementing their own licensing laws and progressively ramping up their educational demands. By the mid-20th century, it had become commonplace for states to mandate that aspiring real estate agents undertake courses covering a range of subjects, including real estate law, ethics, and practical applications.
The focus shifted towards formalizing the industry and improving its standards. However, it's essential to note that while the requirement for pre-licensing education and passing a state-specific licensing exam became common, obtaining a college degree was, and still is, generally not a prerequisite for practicing real estate in most jurisdictions.
In the 21st century, educational requirements have continued to evolve, with increased emphasis on continual learning, professional development, and ethical behavior. Today, real estate education focuses on transactional knowledge and a holistic understanding of the industry, including market analysis, property management, real estate financing, and more. This progression showcases our industry's commitment to ensuring that its professionals are well-equipped to serve the best interests of their clients.
Current Educational Requirements
The educational requirements to practice real estate in the United States differ from state to state. There is no such thing as a “national real estate license” that would allow the holder to practice in every state. However, one common thread across all states is that a college degree is not a requirement to obtain a real estate license. Instead, each state requires a specific number of pre-licensing education hours and completing a state licensing exam.
To give you a snapshot: In California, aspiring real estate salespersons need to complete 135 hours of pre-licensing education, while in Texas, the requirement stands at 180 hours. In In New York, only 77 hours of pre-licensing education are required. While each state sets specific pre-licensing education hours, it's essential to research your state's requirements to ensure you meet the criteria.
In terms of baseline education, in some states, you must have a high school diploma or a GED to be eligible to obtain a real estate license in some states (not California). This requirement underscores the industry's commitment to a basic level of literacy and numeracy skills needed to operate in the real estate world effectively.
Pre-licensing courses are a critical aspect of the real estate licensing process. These courses, often offered by real estate schools like ADHI Schools have offerings both online and in-person that cover a broad range of topics. They include property law, real estate financing, contracts, property management, real estate ethics, and more. These courses equip you with the necessary knowledge to navigate the complexities of real estate transactions and provide excellent service to your future clients.
After completing the required pre-licensing education hours, the next step is passing the real estate licensing exam. This exam tests your understanding of real estate laws, principles, and concepts. In some states, the exam consists of a national portion covering general real estate principles and practices and a state-specific portion that tests knowledge of your state's real estate laws. California only has a state specific requirement.
While the requirements may vary, the path to becoming a licensed real estate professional doesn't necessitate a college degree. Instead, it calls for a dedication to learning, understanding, and applying real estate-specific knowledge and skills.
The Role of a College Degree in Real Estate
While it's clear that a college degree is not required to obtain a real estate license, the question remains: Does a degree confer any advantages in the real estate industry? The answer largely depends on one's career goals, personal learning style, and the specific real estate area they wish to pursue.
A college degree, particularly in fields related to business, finance, law, or marketing, can offer a strong foundation for a career in real estate. Such a degree can provide an understanding of broader economic trends, marketing strategies, negotiation techniques, and legal principles that could benefit the industry. It also often helps develop soft skills, such as critical thinking, communication, and problem-solving, which are invaluable in interacting with clients and navigating complex transactions.
Going to college doesn't just offer textbook knowledge or job-specific skills, it can also provide essential tools for a career like real estate. The social skills and other "soft" abilities you gain during your time in college can be a significant advantage in becoming a successful realtor.
College exposes you to people from all walks of life, different cultures and mindsets. As a realtor, you'll work with a broad range of clients, and understanding diverse perspectives can help you connect with them more effectively, communicate clearly, and meet their needs.
Working on college group projects can also teach you about teamwork and problem-solving, two key skills in real estate. Whether it's negotiating a sale or resolving a buyer-seller conflict, these abilities will come in handy.
Internships, part-time jobs, or volunteering during college can help you become responsible and efficient in managing your time - crucial traits for a realtor juggling multiple properties, clients, and appointments.
Lastly, college helps you to navigate the 'real world' in a supportive environment before stepping into it full-time. So, a college degree isn't just a mark of your academic achievement; it's a sign that you have the social skills, understanding, and work ethic needed to thrive as a realtor.
For those considering roles beyond being a sales agent or broker - such as a real estate developer or a corporate real estate manager - having a college degree may be preferred or even required by some employers. A degree could be advantageous if you aim to work in high-end markets or with a demographic that values educational credentials.
However, many successful real estate professionals have built thriving careers without a college degree. These individuals often emphasize the importance of on-the-job experience, industry-specific education, networking, and sales skills, which they argue are as important, if not more so, than a formal college education. They note that real estate is a results-oriented business, where success is typically measured by your ability to close deals and satisfy clients rather than by your academic credentials.
So, whether you are a high school graduate, have a GED, or hold a Ph.D., remember that your success in real estate ultimately depends on your industry knowledge, dedication to serving your clients, and passion for the profession. Whether or not to pursue a college degree is a personal decision and should align with your career aspirations, learning style, and professional goals.
Alternatives to a College Degree
While a college degree can provide a broad base of knowledge and skills, there are other pathways to success in real estate. Many alternatives can provide specialized, industry-specific knowledge that can prove just as valuable, if not more so, in building a successful real estate career.
One prominent alternative are real estate schools often required to obtain a license in a given state. These specialized institutions offer pre-licensing courses and a variety of post-licensing education options designed to keep real estate professionals updated on the latest trends, laws, and strategies in the industry. Real estate schools can provide a direct route into the profession, allowing you to gain the specific knowledge and skills needed to pass your state's licensing exam and succeed.
Continuing education is another critical aspect of a real estate career. Whether attending seminars, taking additional courses, or subscribing to industry publications, continuous learning is key to staying competitive in this dynamic industry. Moreover, many states require real estate professionals to complete continuing education courses to renew their licenses. Mentorship and on-the-job experience are also invaluable. Working with a seasoned professional can offer insights beyond textbooks, providing practical knowledge about client relationships, negotiation tactics, and local market conditions.
Lastly, certifications and designations can enhance a real estate professional's credibility and expertise. Various organizations offer these credentials in residential and commercial property, property management, appraisals, and more. Some of the most recognized designations include the Certified Residential Specialist (CRS), the Certified Commercial Investment Member (CCIM), and (for those in the property management industry) the Certified Property Manager (CPM). These designations can distinguish you as a specialist in a particular real estate area, making you more attractive to clients and employers.
At the end of the day, the key attributes for success in real estate go beyond formal education. Critical thinking, effective communication, negotiation skills, a solid work ethic, and a constant desire to learn are vital. So whether or not you pursue a college degree, remember that your skill set, determination, and commitment to your clients and the profession will largely determine your success in real estate.
As we have explored throughout this blog, the role of a college degree in the real estate industry can be variable. While some real estate professionals leverage their college education to enhance their business and analytical skills, others have found equal success by pursuing alternate routes, such as attending real estate schools or relying heavily on on-the-job experience and mentorship.
So, does one need a college degree to succeed in real estate? While many of the soft skills learned in college will certainly be a benefit to the real estate licensee, it’s not a hard requirement. While a degree can certainly be beneficial, it's not a mandatory requirement in most states nor the sole determinant of success. Much of what makes a successful real estate professional boils down to characteristics that aren't necessarily taught in a classroom: persistence, interpersonal skills, integrity, market understanding, and a commitment to continuous learning.
In the end, if you're considering a career in real estate, it's essential to evaluate your goals, strengths, and resources. Whether your path includes a college degree or not, remember that education — in all its forms — is a lifelong journey. In real estate, as in any industry, the willingness to learn, adapt, and grow is the cornerstone of a successful career.
As always, if you are interested in obtaining your real estate license and building a career in real estate visit www.adhischools.com call us at 888-768-5285.
Love,
Kartik
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A foreclosed home is a property repossessed by a lender, typically a bank, due to the homeowner's inability to meet their mortgage obligations. When a borrower fails to make timely mortgage payments,
A foreclosed home is a property repossessed by a lender, typically a bank, due to the homeowner's inability to meet their mortgage obligations. When a borrower fails to make timely mortgage payments, the le
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Imagine a young couple finally stumbled upon a charming old Victorian house nestled at the end of a quiet cul-de-sac. Smitten by its ornate design and quaint charm, they quickly decided this was the home
Imagine a young couple finally stumbled upon a charming old Victorian house nestled at the end of a quiet cul-de-sac. Smitten by its ornate design and quaint charm, they quickly decided this was the home they wanted to start their new chapter in. As they navigated the escrow process, Sarah and Tom
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Whether you're a first-time homebuyer, a student at our real estate school, or a professional within the real estate industry, trust and transparency are critical factors in your interactions and transactions.
Whether you're a first-time homebuyer, a student at our real estate school, or a professional within the real estate industry, trust and transparency are critical factors in your interactions and transactions. An essential component of this transparency is the real estate license number. Every licensed real estate professional is issued a unique identifier: a license number. This number is not merely an administrative detail but a tool to uphold professionalism and instill confidence in the industry.
Looking up a real estate license number is an extra step in an already complex process. However, it's a task that carries significant importance. Firstly, it allows clients to verify the credentials of a real estate professional, ensuring that they are dealing with a licensed individual with the necessary training and competence. This can help protect clients from fraudulent practitioners or those who don't have the necessary credentials.
Additionally, for real estate professionals, verifying a license number can provide insight into a colleague's professional background and standing, such as any disciplinary actions taken against them. It fosters accountability within the profession and is an essential part of due diligence in transactions like referrals and collaborations.
In essence, checking a real estate license number is a straightforward measure that enhances trust and transparency. It's an essential step in ensuring the legitimacy of interactions in real estate. As we delve deeper into this topic, we will explore what a real estate license number is, how to look one up, and why this simple check can significantly impact your real estate journey.
Understanding What a Real Estate License Number Is
A real estate license number is a unique identifier, much like a badge of legitimacy, assigned to each real estate professional who has successfully passed their real estate exam and received licensing from their state's regulatory body. This distinct number serves as proof of a professional's eligibility to conduct real estate transactions within their respective state. This applies to various roles in the industry, whether one is a real estate broker, an agent, an appraiser, or any other certified professional in the field.
However, a real estate license number provides more than proof of licensure. It is a gateway to a wealth of information about the professional's background and track record. When you look up a real estate license number, you can typically find details such as:
The licensee's full name.
The licensee's professional standing (whether active, inactive, or retired licensee).
The license status (whether it's current, expired, suspended, or revoked).
Any disciplinary actions taken against the licensee by the regulatory body.
The dates of issue and expiration of the license.
The licensee's areas of specialty or additional certifications.
Details of the licensee's affiliated brokerage, if applicable.
It's important to note that the specific details accessible can vary between states, as each state's regulatory body may have different rules and regulations regarding the transparency of license information.
Understanding and using this information effectively can help you make informed decisions in your real estate transactions. Whether you're confirming an agent's credentials, considering hiring, or verifying the standing of a peer, understanding what a real estate license number is and the information it provides is a key step in confidently navigating the real estate landscape.
Situations When You Might Need to Lookup a Real Estate License Number
You should look up a real estate license number in several situations. Here are some common scenarios:
Hiring a Real Estate Agent or Broker: If you're a client preparing to embark on a real estate transaction, hiring a licensed professional to guide you is essential. Looking up their real estate license number allows you to verify their standing, check for any disciplinary actions, and ensure they can legally assist with your real estate needs. It provides a level of reassurance about the professional's qualifications and credibility.
Verifying a Professional's Credentials: In some instances, you may need to confirm the credentials of a real estate professional. For example, suppose you're another real estate agent considering a partnership or a client looking for specialist services. In that case, you should check whether the professional holds the necessary certifications or specialties.
Filing a Complaint: Unfortunately, there might be circumstances when you're unsatisfied with a real estate professional's service, suspect malpractice, or need to resolve a dispute. In these cases, you would need the real estate license number to file a formal complaint with the relevant state licensing board. The licensing board uses the number to identify the individual involved and investigate the matter appropriately.
Conducting Due Diligence: For professionals involved in complex transactions, such as real estate lawyers or investors, looking up a license number may be necessary in their due diligence process. This process can help verify the identities and credentials of all involved parties, ensuring compliance with legal requirements.
For Journalism or Research Purposes: Journalists, researchers, or anyone conducting a study on real estate markets might need to look up real estate license numbers to gather information for their projects. License information can provide valuable insights into market trends, regulatory compliance, or professional demographics.
Looking up a real estate license number can serve various purposes, all centered around ensuring credibility, accountability, and transparency within the real estate industry. It's a simple yet effective tool for safeguarding the interests of all parties involved in real estate transactions.
Step-by-Step Guide on How to Lookup a Real Estate License Number
Looking up a real estate license number is usually a straightforward process - far easier than finding out who owns a particular property. However, please note that the specifics might vary slightly from state to state due to differences in real estate regulations and the design of each state's real estate commission website. Here's a general guide on how to do this:
Identify the Relevant State Real Estate Commission Website: Each state has its own Real Estate Commission or similar regulatory body overseeing real estate professionals' licensing. You must visit the appropriate website for the state where the real estate professional is licensed. A simple Google search using the state's name and "Real Estate Commission" should help you find the right site.
Navigate to the 'License Lookup' Section: Once on the state's real estate commission website, look for the 'License Lookup,' 'Verify a License,' 'Licensee Search,' or a similarly named feature. This feature is typically easy to find and is often located in a prominent place on the website's homepage or under a 'Public Resources' or 'Consumer Tools' tab.
Enter the Necessary Information: In the license lookup section, you'll typically see fields where you can enter information about the licensee. This could be the person's name, the company's name, or the license number itself if you have it but want to verify its validity. Fill in as much information as you can to facilitate the search.
Conduct the Search: Once you've entered the required information, hit the 'Search' or 'Submit' button to start the search. The system will then scan its database for the relevant details.
Review the Results: The search should return a summary of the professional's license status, including their full name, license number, status (active, inactive, expired, or suspended), any specialty licenses, and possibly even any disciplinary actions taken against them.
This general process should help you look up a real estate license number. Remember that the importance of verifying the license number lies in ensuring the credibility of the real estate professional you are dealing with and maintaining transparency in all real estate transactions.
How to Lookup a Real Estate License Number by State
While the overall process of looking up a real estate license number is essentially the same across the United States, there are slight differences in how each state's regulatory commission's website operates. Here, we will provide an overview of how to search for a real estate license number in three of the most populous states: California, Texas, and Florida.
California
Visit the California Department of Real Estate's License lookup page.
Enter the individual or company's name, license ID, or the city they are located in.
Click the 'Find' button to view results, which include the license number, status, and expiration date.
Texas
Go to the Texas Real Estate Commission's License Holder Lookup page.
Enter the person or company's name or the license number if you verify it.
Click 'Search' to view results, displaying the license number, type, status, and any disciplinary actions taken.
Florida
Visit the Florida Department of Business and Professional Regulation's Licensee Search page.
Please enter the name, city of the individual, business, or license number.
Click 'Search' to display results, including the license number, status, and the licensee's address.
In each case, having the correct name or license number will make your search more accurate. Also, note that the information available may vary based on privacy laws in each state. Always cross-check and verify information obtained through these searches to maintain accurate and ethical business practices.
What to Do if There Are Issues or Discrepancies
In the world of real estate, credibility and trustworthiness are paramount. If you encounter any issues or discrepancies when looking up a real estate license number, it's essential to address these concerns promptly. Here's what you should do:
Reverify the Information: Mistakes happen, and they can be as simple as a typographical error. Double-check the details you've entered if a license number appears invalid or brings up unexpected results. Ensure there's no misspelling in the name or error in the license number.
Check with Other Sources: If you continue to encounter issues, try to verify the license number through different means. You could ask the real estate professional to provide more proof of their licensure or contact their brokerage.
Contact the Relevant Real Estate Commission: If discrepancies persist, contact your state's real estate commission or the licensing authority where the agent is supposed to be licensed. They can provide further assistance and confirm the license status. Make sure to provide all relevant details to help them expedite the process.
Report any Concerns: If your inquiry reveals a person practicing real estate without a valid license, it's essential to report this to the relevant authorities. Unlicensed practice is a serious offense and can harm unsuspecting clients and tarnish the reputation of the real estate industry.
Remember, every licensed real estate professional must operate transparently, and any reluctance to share license details should be a red flag. Taking these steps will protect you and contribute to maintaining the integrity of the real estate industry.
Navigating the real estate landscape requires understanding market trends and recognizing the importance of trust and transparency. One significant way of establishing this is by verifying real estate license numbers. This simple yet crucial step can play a pivotal role in building professional relationships based on trust, be it with your clients, colleagues, or other stakeholders in the industry.
Looking up a real estate license number is a protective measure, ensuring that you are dealing with a certified professional recognized by the governing real estate bodies. It assures the authenticity and credibility of the real estate professional you are engaging with, whether hiring an agent, verifying credentials, or filing a complaint.
Moreover, it plays a key role in maintaining the integrity and professionalism of the real estate industry. By being diligent and proactive in these verifications, we contribute to an industry standard where transparency is the norm, not the exception.
So whether you're a buyer, a seller, a real estate agent, or someone eyeing a career in real estate, remember that license verification is a small step that goes a long way in ensuring fair and honest real estate transactions. Keep the guide above handy, and make the most of the resources available to you, confirming your journey in the world of real estate is as smooth and secure as possible.
As always, if you are interested in taking real estate courses visit www.adhischools.com or call us at 888-768-5285.
Love,
Kartik
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The real estate industry offers a wide range of career opportunities. Many roles within our great industry will require you to get a real estate license and pass the real estate exam, but some still need
The real estate industry offers a wide range of career opportunities. Many roles within our great industry will require you to get a real estate license and pass the real estate exam, but some still need to
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There are lots of new things to learn when you are getting into real estate, and knowing about the mortgage markets is one of them. As a real estate student preparing for your exam, comprehending these
There are lots of new things to learn when you are getting into real estate, and knowing about the mortgage markets is one of them. As a real estate student preparing for your exam, comprehending these markets in depth is not just a requirement, but a stepping stone towards securing your real estate license.
This comprehension won't only serve you in passing the exam, but it will also equip you with the tools necessary to provide informed advice to future clients. After all, understanding the mechanisms of the mortgage markets will be key to your ability to guide your clients effectively through their journey toward homeownership.
So, what exactly are mortgage markets? Mortgage markets involve the process of lending, borrowing, buying, and selling mortgage loans. Essentially, they are the conduits that make home ownership possible. And to fully grasp their workings, it's important to understand that they're divided into two sectors – the primary and secondary mortgage markets.
This blog post is designed as a guide for real estate students to help differentiate between the primary and secondary mortgage markets. I want to cover the definitions, roles of parties market. With this knowledge, you'll be better equipped to navigate and succeed in your future real estate endeavors. So let's delve into the world of mortgage markets and enhance your journey towards becoming skilled real estate professionals.
Primary Mortgage Market: An Overview
The primary mortgage market is where it all begins for homebuyers. It's the marketplace where borrowers and mortgage originators come together to negotiate and agree on the terms of new mortgage loans. In simple terms, it's where you, as a potential homeowner, would obtain a loan to buy - or refinance - a property.
The key players in the primary mortgage market are borrowers and lenders. These banks (or mortgage companies) often provide the funds for borrowers to purchase their dream homes. They are responsible for setting the loan terms, including interest rates and repayment schedule, and verifying the borrower's creditworthiness and ability to repay the loan.
Obtaining a mortgage loan from the primary market is straightforward. A potential homeowner applies for a mortgage loan from a lender. The lender then scrutinizes the applicant's credit history, current income, employment status, and other factors before approving the loan. Once the loan is approved and the agreement is signed, the borrower begins to repay the loan, typically for 15 to 30 years.
Consider this scenario: John and Sarah, eager to buy their first home, approach their local bank for a mortgage loan. After reviewing their application and assessing their financial position, the bank approves their loan at a fixed interest rate for 30 years. This entire transaction is part of the primary mortgage market.
As real estate students, understanding the primary mortgage market's functioning is crucial. It provides the foundation of the mortgage industry and is the starting point of most real estate transactions.
Secondary Mortgage Market: An Overview
While the primary mortgage market involves the creation of new mortgage loans, the secondary mortgage market revolves around the buying and selling of existing mortgages and mortgage-backed securities. Home buyers do not directly participate in the secondary mortgage market as this is largely the domain of large financial institutions and investors.
Investors and financial institutions, like Fannie Mae and Freddie Mac, play a significant role in the secondary mortgage market. These government-sponsored entities buy existing mortgage loans from lenders, bundle them into mortgage-backed securities, and then sell them to investors. This process frees up the lender's resources, allowing them to issue more loans in the primary mortgage market.
For instance, let's revisit John and Sarah's story. After their bank granted them a mortgage, the bank could then sell it to a larger financial institution like Fannie Mae. Fannie Mae then pools John and Sarah's mortgage with hundreds of similar mortgages to create a mortgage-backed security, which is then sold to investors. This entire transaction takes place in the secondary mortgage market.
Why does this matter to real estate students? Understanding the secondary mortgage market is essential as it directly influences the primary mortgage market. It dictates mortgage rates and availability of loans and contributes significantly to the overall health of the real estate market. It’s a key component of the knowledge you'll need to obtain your real estate license.
Secondary Mortgage Market: An Overview and Its Significance
As discussed, while the primary mortgage market is initial loan creation, the secondary mortgage market is where existing mortgages and mortgage-backed securities (MBS) are bought and sold. It may seem abstract compared to the more direct borrower-lender interactions of the primary market. Still, its impact is far-reaching and fundamental to the functioning of the broader economy.
The secondary mortgage market's leading players are large financial institutions and investors, including government-sponsored entities like Fannie Mae and Freddie Mac. These entities buy existing mortgage loans from lenders, package them into MBS, and then sell these securities to investors on the open market. This cycle is an economic engine that keeps mortgage funds flowing – but how exactly does it work, and why is it so crucial?
Liquidity and the Recycling of Capital
In essence, the secondary mortgage market provides liquidity to the banking system. When lenders, such as banks, originate a loan in the primary market, that loan is an asset tied up in the property for the duration of the mortgage term, often 15 to 30 years. This represents a significant commitment of the lender's capital, limiting their ability to offer new loans.
Lenders can recycle their capital by selling these loans on the secondary market. The sale frees up their resources, allowing them to originate more loans. It's akin to a fresh injection of cash into the primary market. The more active the secondary market, the more liquidity lenders have, ultimately making mortgages more accessible to potential homeowners.
Why Investors Buy Mortgage-Backed Securities
But why would investors want to buy MBS? The answer lies in the appeal of these instruments as investment vehicles. Mortgage-backed securities are income-generating assets. The monthly mortgage payments made by borrowers (consisting of principal and interest) pass through to MBS investors as regular income, making them an attractive long-term investment.
Furthermore, MBS are often considered lower-risk assets. Real estate, a physical asset, backs them and often carries guarantees from government-sponsored entities against defaults on the underlying loans. This combination of regular income and lower risk makes MBS popular among many investors.
So you can see that the secondary mortgage market plays an essential role in maintaining liquidity in the banking system and ensuring the availability of mortgage loans. It's the lifeblood of the housing market, turning individual home loans into a cycle of capital that benefits lenders, investors, and homeowners alike. It's a foundational concept for any real estate professional to understand, as it influences mortgage availability and rates and the broader health and vibrancy of the real estate market.
Navigating the labyrinth of the real estate market can be challenging, especially for students preparing for their real estate license exam. Hoping this guide helps as we now understand that the primary mortgage market is where loans are originated, with lenders and borrowers negotiating the terms of new mortgage loans. In contrast, the secondary mortgage market involves the buying and selling existing loans by investors and financial institutions like Fannie Mae and Freddie Mac.
The key takeaway is the interdependence of these two markets. They influence each other significantly, dictating mortgage rates, the availability of loans, and, thus, the overall health of the real estate market.
Understanding these markets equips real estate students with the knowledge necessary for acing their real estate license exam and launching successful careers in real estate. It enables you to provide comprehensive advice to your future clients and better understand the factors influencing the market conditions.
We encourage you to continue exploring these concepts, digging deeper into how they function and their influence on the broader real estate market. Remember, every bit of knowledge gained now is a step towards becoming a proficient real estate professional, ready to make your mark in the dynamic world of real estate.
As always, if you are interested in getting your real estate license or building a career in real estate sales visit www.adhischools.com or call us at 888-768-5285.
Love,
Kartik
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The beginning of any career is crucial, but this is especially true for real estate agents. A
strong start sets the stage for long-term success, establishing
The beginning of any career is crucial, but this is especially true for real estate agents. A
strong start sets the stage for long-term success, establishing credibility and building
momentum.
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In the wake of escalating wildfire risks and a rapidly
changing environmental landscape, major property
insurers are taking steps that could drastically alter the
state of homeowner insurance in California.
In the wake of escalating wildfire risks and a rapidly
changing environmental landscape, major property
insurers are taking steps that could drastically alter the
state of homeowner insurance in California. Farmers
Insurance, a significant player in the state's insurance
market, has recentl
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In today's ever-evolving financial landscape, investors are often faced with the challenging decision of where to allocate their hard-earned money. Two popular investment avenues, real estate and the stock
In today's ever-evolving financial landscape, investors are often faced with the challenging decision of where to allocate their hard-earned money. Two popular investment avenues, real estate and the stock
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Starting a new career in real estate can be exciting and rewarding, but pursuing a real estate license while working a full-time job presents challenges.
Firstly, time management is a significant concern
Starting a new career in real estate can be exciting and rewarding, but pursuing a real estate license while working a full-time job presents challenges.
Firstly, time management is a significant concern when balancing work with studying for the real estate license exam. Allocating sufficient hours to study and attend classes or training sessions can be difficult amid work, family, and other personal commitments.
Secondly, maintaining focus and motivation can be challenging. After a long day at work, finding the energy and enthusiasm to study (before you get your license) and prospect and work with clients (after you get your license) can be tricky. Furthermore, managing multiple commitments can lead to mental and physical fatigue.
Thirdly, the financial aspects of pursuing a real estate license can be challenging. Obtaining a license involves upfront costs, such as course fees, exam fees, and study materials, which individuals may be hesitant to invest in while supporting themselves and their families through their current job.
Lastly, once working, networking and building a professional reputation in real estate can be difficult when your attention is divided between a full-time job and pursuing a license. Networking events and industry-related activities typically occur during regular working hours, making it hard for those with full-time jobs to attend and establish connections. Clients might want to meet or look at property during the hours of your “real job”.
Even though pursuing a real estate license while working full-time can be challenging due to time management concerns, maintaining focus and motivation, financial considerations, and difficulties associated with networking and establishing a professional reputation with dedication, discipline, and effective time management, aspiring real estate agents can successfully navigate the path to licensure and embark on their new careers.
Here are some tips to help you find the perfect balance between your job and your real estate aspirations:
Create a schedule and set goals
Time management is crucial when juggling a full-time job and pursuing a real estate license. Set aside dedicated time for studying and attending classes. Break down your goals into smaller, achievable tasks, and track your progress regularly.
Set a deadline to get your Real Estate Principles, Real Estate Practice, and Elective course certificates of completion so that you have a goal you’re working toward.
Set another long-term goal for when your license will be issued and another goal for when you will earn your first commission check.
Prioritize your time
When managing a full-time job and a real estate career, it's essential to prioritize your time. Identify and focus on completing the most critical tasks in both areas first. Remember to take breaks and give yourself time to recharge.
Choose a flexible real estate education program
A flexible real estate education program is essential when balancing work and studies like ADHI schools. Look for a program (like ours) that offers online courses, evening classes, or weekend sessions. These options will help you fit your real estate education around your full-time job.
In-person physical real estate classes can pose challenges and limitations for students balancing their education with a full-time job. Firstly, these classes often follow a fixed schedule, which might not align with the student's work hours or personal commitments. Limited flexibility makes it difficult for students to attend classes and consistently keep up with the coursework.
Additionally, commuting to and from physical classes can be time-consuming and costly, especially for those who live far away from the educational institution. This extra time spent traveling could be better utilized for studying or attending to personal responsibilities.
Moreover, physical classes typically have a rigid curriculum and pace, which may not cater to the diverse learning needs of students. Some individuals require more time to understand certain concepts, while others prefer to move faster. In a traditional classroom setting, it can be challenging for instructors to accommodate these different learning styles and needs.
Lastly, in-person classes can be more susceptible to disruptions, such as inclement weather or unforeseen events that might lead to class cancellations. This unpredictability can hinder the student's learning progress and overall experience.
In summary, in-person physical real estate classes can limit students trying to balance work and education due to their inflexible schedules, time-consuming commutes, rigid pace, and potential for disruptions. A flexible program that offers online or alternative class options is better suited for students who need to fit their real estate education around their full-time job.
Utilize your network
Networking is a powerful tool when pursuing a real estate career. Connect with other professionals in the industry and ask for advice. Learn from their experiences and apply their tips to your journey. You can start by reading about the experiences of successful real estate agents, such as those featured in "Things You Should Know Before Becoming A Real Estate Agent". This can shave time off your learning curve.
Stay organized
Staying organized is crucial for managing your time and responsibilities. Use digital tools like calendars, to-do lists, and project management apps to keep track of deadlines, meetings, and study sessions. Stay organized to avoid feeling overwhelmed.
Be patient and persistent
Pursuing a real estate license while working full-time can be challenging, but remaining patient and persistent is essential. Celebrate small achievements and remind yourself of your long-term goals. With dedication, you can achieve success in both your job and your real estate education.
Seek support
Don't hesitate to ask for support from friends, family, or coworkers. During your journey, they can provide encouragement, advice, and a listening ear. You can also join online forums or social media groups, such as those mentioned in "Tips For Real Estate Agents On Social Media", to connect with others in similar situations.
In conclusion, juggling a full-time job while pursuing a real estate license requires dedication, time management, and a robust support system. By following these tips and incorporating valuable resources like "7 Study Tips For Passing Your Real Estate Exam", you'll be well on your way to launching a successful career in real estate.
Love,
Kartik
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Unveiling the Math Aspect of the California Real Estate Exam: Is There a Lot of Math?
The California Real Estate Exam is a formidable stepping stone for all those seeking to wear the hat of a
Unveiling the Math Aspect of the California Real Estate Exam: Is There a Lot of Math?
The California Real Estate Exam is a formidable stepping stone for all those seeking to wear the hat of a licensed real estate professional in the Golden State. As part of their preparation, many potential test-takers ask, "Is there a lot of math on the California Real Estate Exam?" The question is an understandable one. Let's explore this question in detail, assessing the quantitative aspects and providing guidance on navigating this portion of the examination successfully.
The Math Component of the California Real Estate Exam
To put it in plain terms, yes, the California Real Estate Exam contains math - but very little. And the level of math involved may not be as extensive or intimidating as you might think. On average, there are only a small number of questions that focus on mathematical problems. These problems test your ability to perform real estate related calculations like computing real estate taxes, property values, commission rates, prorations, interest, mortgage payments, and depreciation.
The Good News: It's Not Rocket Science!
The type of math encountered on the California Real Estate Exam primarily involves basic arithmetic and some simple algebra, including the ability to work with fractions, decimals, and percentages. So, if you have been fretting over complicated equations, exhale a sigh of relief – calculus and advanced mathematics do not feature on this exam!
And there isn’t a lot of it on the state test.
Preparation is Key
Even though the math portion of the exam only makes up a very small fraction of the total questions, it's essential not to take it lightly. As with any other exam section, diligent preparation is key to success. Many resources are available, including textbooks, our real estate exam prep, and practice problems, specifically designed to help candidates understand and master the types of math questions they encounter.
A good starting point would be to familiarize yourself with real estate terminology and principles. Once you grasp these well, you can start working on the calculations. Solve many practice problems related to loan amortization, property valuation, real estate taxes, etc. Understand the formulas rather than just memorizing them. Knowing when and how to use them effectively will make all the difference on exam day.
Remember, speed and accuracy are crucial for these exams. While you need to work quickly, double-checking your answers is equally important to avoid careless mistakes.
Take a Crash Course
A candidate preparing for the real estate test would significantly benefit from taking a crash course prior to their exam. The real estate field encompasses many complex topics, including property laws, contract laws, real estate principles and practices, ethics, and market dynamics.
A crash course is an intensive, fast-paced program that condenses these vast subject matters into digestible chunks, ensuring the candidate comprehensively understands all the necessary information. Additionally, such a course often incorporates practice tests that mimic the actual exam's format and difficulty, providing the candidate with invaluable experience under realistic conditions. It also allows the candidate to pinpoint their strengths and weaknesses, allowing them to focus on areas that need improvement. Overall, a crash course fosters confidence, thoroughness, and strategic examination techniques, thereby improving the chances of success in the real estate exam.
To sum it up, while the California Real Estate Exam does include math problems, they are relatively straightforward and can be tackled efficiently with consistent practice and understanding. Don't let the fear of math deter you from your goal. Remember, every licensed real estate agent in California has passed this test. With the right mindset, diligent preparation, and extra help, you will, too. The pathway to success on the California Real Estate Exam may require you to crunch some numbers, but the rewards of a career in real estate are certainly worth it.
Math-related vocabulary for the state exam:
Benchmark : A reference point used in surveying, marked on a fixed, stable object. Its position and elevation are known and utilized in tidal observations, land surveys, and other geodetic operations.
Board Foot : A unit of measurement for lumber, signifying a volume equal to a one-foot cube of one inch thick wood. It's often used in the lumber industry to price and sell wood.
Decimal : Related to the base-10 system. It signifies a number or fraction expressed in the decimal system. In a decimal number, such as 125.67, the decimal point (.) separates the whole number (125) from the decimal fraction (67).
Denominator : The bottom number in a fraction, indicating the total number of equal parts that constitute the whole. For instance, in the fraction 3/5, '5' is the denominator, representing that the whole is divided into five parts.
Fraction : A mathematical expression representing the division of two numbers or quantities. It's also used to describe a portion or segment of a whole.
Front Foot : A real estate term, denoting a property's linear footage along the frontage (like a street or road). It can be used for pricing properties but needs to account for the property's depth.
Governmental Survey System/Rectangular Survey System : A land division system used in the US. It divides land into 24-square-mile quadrangles using north-south and east-west lines.
Latitude : The geographic coordinate representing the angular distance of a point north or south of the Earth's equator, measured in degrees along a meridian.
Lineal Foot : Another term for a 'foot' in measurement, mainly used to measure the length of items.
Longitude : The geographic coordinate that specifies the east-west position of a point on the Earth's surface. It's an angular measurement, usually expressed in degrees, minutes, and seconds.
Lowest Common Denominator : The smallest multiple that is exactly divisible by every denominator of a set of fractions. It is used to simplify the process of adding, subtracting, and comparing fractions.
Meridian : An imaginary line running from the North Pole to the South Pole on the Earth's surface. All locations along a given meridian share the same longitude.
Numerator : The top number in a fraction, indicating the number of parts of the whole that are considered. For example, in the fraction 3/5, '3' is the numerator.
Point of Beginning : The starting point in land surveying from which the boundaries of a parcel of land are described. This is most often associated with the “metes and bounds” method of land description.
Product : The result obtained from the multiplication of two or more numbers.
Range : In the U.S. public land surveying system, a 'range' refers to a vertical column of townships in a grid layout. It is six miles wide, running north to south, and is numbered based on its distance east or west from a specified meridian.
Rounding : A mathematical process to approximate a number to its nearest whole number, tens, hundreds, etc. It simplifies numbers while still maintaining a reasonable level of accuracy.
Running Foot : A measurement unit used in the lumber industry to measure the length of a piece of wood, irrespective of its width or thickness.
Square Foot : A unit of area measurement equal to a square with sides each one foot long.
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In the busy year of 2023, the real estate market is changing faster than ever before. New technologies, a diverse buyer pool, and the chance to work flexibly have made real estate a really appealing
In the busy year of 2023, the real estate market is changing faster than ever before. New technologies, a diverse buyer pool, and the chance to work flexibly have made real estate a really appealing career choice. But even with all these exciting changes, many of our potential students at our real estate license school are asking an important question: Is it still worth it to get a real estate license this year?
As we dive into the world of real estate, we'll look at the rewards you can get from earning a real estate license in today's market. So, if you're trying to decide whether a career in real estate is right for you in 2023, keep reading. We want to show you clearly why now might be the best time to start your career in this exciting field.
Join me as I delve into the current real estate market dynamics, the advantages of becoming a licensed professional, and how a real estate license could be your gateway to financial independence, career satisfaction, and endless opportunities.
The Current Real Estate Market
When we look around in 2023, we see that the real estate market is full of energy and opportunity and it's important to know that a lot of people still want to buy homes. This trend is driven by more and more millennials and Gen Zers trying to buy their first homes. They like things like smart homes, buildings that are good for the environment, and city living—these preferences are changing the way real estate looks.
At the same time, people want bigger homes because of changes in how we work. With more people working from home, there's a need for home offices. This has led to a comeback of suburban and rural real estate markets, with more city people wanting to live in greener areas and out of the concrete jungle.
We're also seeing a change in office spaces (your California real estate license lets you do commercial real estate too) in order to make them more flexible and turning traditional shopping areas into spaces for experiences. Plus, the growth of online shopping has led to a big need for warehouses and logistics hubs.
Moreover, real estate technology, or PropTech, has made significant strides. Virtual tours, AI-powered property recommendations, and blockchain in real estate transactions are no longer the future; they're the present and streamlining operations like never before.
Regarding growth, data from the National Association of REALTORS® suggests a positive trajectory. Despite the typical cyclical nature of real estate, the industry's fundamentals remain strong. There's a constant need for real estate professionals who can navigate this complex yet rewarding landscape, making it an appealing time to jump in and start a career in real estate. The real estate market has had an adaptive response to changes in the world and continues to open new avenues for growth and opportunities, making it an exciting time to be a part of this industry.
Advantages of Having a Real Estate License
While the current market trends certainly add an element of allure to the real estate profession, the advantages of obtaining a real estate license extend well beyond market circumstances. Here are a few compelling reasons to consider stepping into the world of real estate:
Earning Potential: The income of a real estate agent largely depends on their effort and skill, making it an attractive career choice for driven individuals. Unlike traditional 9-5 jobs with a fixed salary, real estate agents earn commissions on each transaction, meaning the potential for earnings can be substantial. In a thriving market, the chances to broker deals and make commissions increase significantly, thus augmenting earning potential.
Flexibility and Independence: One of the significant benefits of having a real estate license is its flexibility. Real estate agents can set their schedules, choosing when and where to work. This career can be especially appealing for those who value work-life balance and the ability to control their own time.
Diverse Opportunities: Holding a real estate license opens up many opportunities beyond buying and selling homes. Licensed individuals can explore property management, commercial real estate, development, and even real estate consulting. This diversity allows for exploration and specialization within different industry sectors, catering to various interests and talents.
Building Valuable Skills: A career in real estate is an opportunity for continuous learning and skill development. As a real estate agent, you'll develop valuable skills like negotiation, sales tactics, marketing strategies, and customer relationship management. These skills aid in career progression within the real estate sector and are transferable and highly valued in other industries.
Obtaining a real estate license offers potentially high earnings, greater flexibility, many career paths, and the chance to hone skills that will serve you throughout your career. It's not just about entering a profession; it's about opening the door to a career that can grow and evolve with you.
The Real Estate License Process in California
Venturing into the real estate profession begins with understanding the process of obtaining a real estate license. In California, there are specific steps potential agents need to take.
Step 1: Pre-License Education Before you can sit for the California real estate license examination, you must complete pre-license education. This includes 135 hours of real estate courses, covering essential topics like real estate principles, real estate practice, and one elective course from a set list. These courses prepare you for the breadth of knowledge needed in the industry, from property valuation to real estate law and everything in between.
Step 2: Exam Application After completing the education requirements, you must apply for the state licensing exam. The California Department of Real Estate (DRE) oversees this process, and you'll submit your application along with proof of completed education.
Step 3: State Examination Next is the state licensing exam, a comprehensive test that evaluates your understanding of important real estate concepts. This exam requires thorough preparation to pass and we highly recommend taking one of our real estate crash courses to help prepare you.
Step 4: License Application Once you pass the state exam, the final step is to submit a license application, undergo a background check, and fulfill other requirements set by the DRE.
Now, where does a real estate school like ADHI Schools come into play? Our school is instrumental in guiding you through pre-license education. We offer the necessary courses, provide resources for exam preparation, and assist in understanding the licensing process. The role of a good real estate school is to equip you with the knowledge, skills, and confidence to pass the state exam and kickstart your real estate career.
The time commitment to this process is a few months, but worth the investment when considering the potential returns. It may take several months to obtain your license between education, exam preparation, and the application process. However, this should be viewed as an investment in your future—a stepping stone to a rewarding career with high earning potential, flexibility, and a broad range of opportunities.
In the grand scheme, the time spent earning a real estate license is relatively short compared to the potential for long-term career growth and financial gains. By committing to obtaining your license now, you're setting the stage for future success in the vibrant world of California real estate.
Case Study
Ryan Rembert is a young real estate agent working out of the South Bay city of El Segundo. The way that Ryan got involved in our real estate classes is rather unique. Kartik was at a dinner appointment at the Shade Hotel in Manhattan Beach late in 2014 and Ryan was his waiter. Ryan and Kartik struck up a conversation and Ryan mentioned that he was interested in getting into the real estate business. A couple of weeks later, Ryan enrolled in the classes and the rest is history!
In this video, Ryan talks about his journey making whatever he could in tips over a given week to making $50,000 commission checks and dream surf trips to Indonesia and other parts of the world - all because of the great real estate business!
What is best about Ryan is how mature and grounded he is for his age. He has since transitioned from residential sales to multi-family apartment brokerage.
That’s one of the greatest things about real estate licensure in California. You can do commercial, residential, property management and more!
Enjoy his story!
Future Outlook
Looking ahead, the future of the real estate industry appears bright. Several factors suggest continued growth and ongoing demand for real estate professionals.
Much like any other industry, the real estate market is influenced by various economic and societal trends. In California, factors such as population growth, urbanization, and the evolution of the tech sector are expected to maintain a steady demand for housing and commercial real estate. This demand will inevitably drive the need for licensed real estate professionals who can effectively navigate the market.
In addition, as real estate continues to evolve in response to changes in consumer behavior and technological advancements, new opportunities are likely to emerge. The rise of digital real estate transactions, sustainable housing, and a shift towards more flexible working and living spaces all point to an industry that is growing and evolving.
Real estate professionals who can adapt to these changes, leverage technology, and understand consumer needs will be in high demand. Thus, having a real estate license won't just offer opportunities in the present but will provide a strong foundation for the future. Lastly, the nature of the real estate business is inherently local. No matter the broader economic conditions, professionals will always need to understand their local markets, provide personalized service to clients, and help them make informed decisions about their real estate transactions.
The future of the real estate industry looks promising, with ample opportunities for growth and evolution. Obtaining a real estate license in 2023 isn't just about seizing current opportunities; it's about preparing for a vibrant and rewarding career in the long term.
If you’re interested in learning more about obtaining a real estate license visit www.adhischools.com or call us at 888-768-5285.
Love,
Kartik
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Are you preparing to take the real estate license exam? Whether attending an online real estate school or studying alone, passing the exam is a significant step in your journey to becoming a licensed
Are you preparing to take the real estate license exam? Whether attending an online real estate school or studying alone, passing the exam is a significant step in your journey to becoming a licensed real estate agent. Here are the top 10 tips to help you succeed on your exam and launch your new career.
Tip 1: Choose the right study materials
The first step in preparing for the exam is selecting the best resources. An accredited online real estate school can provide the necessary curriculum and materials to help you succeed.
ADHI Schools’ materials are second to none in the real estate industry, and thousands of students have used our exam preparation software to take and pass the real estate license exam.
Tip 2: Develop a study schedule
Consistency is vital when preparing for the exam. Set aside a specific time each day to study and review the material.
A well-structured study schedule is critical for success when preparing for the real estate license exam. A consistent and organized study approach helps you retain information more effectively and ensures you cover all the necessary material before taking the exam.
Creating a study schedule is essential for a bunch of reasons. First, it helps you manage your time more efficiently, ensuring that you allocate sufficient hours to review and understand the material. By setting aside specific times each day to study, you establish a routine that becomes a habit, making it easier to stay on track and avoid procrastination. Furthermore, a study schedule allows you to break down the vast material into smaller, manageable segments, reducing the risk of becoming overwhelmed or burned out.
To create an effective study schedule, consider the following tips:
Assess your current commitments: Before developing a schedule, evaluate your daily obligations, such as work, family, and personal activities. This will help you determine how much time you can dedicate to studying daily.
Set specific study times: Allocate particular time slots for studying, ideally when you are most alert and focused. Consistency is key, so try to maintain the exact study times daily to establish a routine.
Break down the material: Divide the course content into smaller sections based on topics or chapters. This will make it easier to focus on specific areas and track your progress.
Prioritize your study topics: Identify areas where you may need more review or practice and allocate more time to those sections.
Set goals and deadlines: Establish clear objectives for each study session, such as completing several practice questions or reviewing a specific topic. Setting deadlines for covering particular sections can also help you stay on track and maintain a sense of urgency.
Allow for flexibility: While consistency is important, adaptability is also essential. Adjust your schedule if you need more time on a specific topic or encounter unforeseen interruptions.
Schedule regular breaks: Incorporate breaks into your study sessions to prevent burnout and maintain focus. Taking brief pauses can improve retention and productivity.
By implementing a consistent and well-structured study schedule, you'll be better equipped to retain the information, cover all the necessary material, and succeed on the real estate license exam. Dedication, discipline, and effective time management are crucial to success.
Tip 3: Take a bunch of practice exams
Practicing exams is crucial to preparing for the real estate license exam. These exams not only help you familiarize yourself with the test format but also allow you to gauge your progress, identify areas for improvement, and build confidence. In this blog post, we'll delve deeper into the importance of practice exams and provide tips on making the most of them in your study routine.
Benefits of Practice Exams:
Familiarity with exam format: Real estate licensing exams can vary by state, but they typically consist of multiple-choice questions that test your knowledge of real estate principles, practices, and laws. Taking practice exams helps you become more comfortable with the exam's question style, pacing, and format.
Assessing strengths and weaknesses: Practice exams enable you to identify the areas where you excel and those that require further study. You can spend more time reviewing and practicing those specific topics by pinpointing your weaknesses.
Building confidence: The more practice exams you take, the more confident you'll feel in answering questions accurately and efficiently. This confidence can help reduce anxiety and improve your performance on the actual exam.
Time management: Practice exams help you develop practical time management skills, ensuring you can complete all questions within the allotted time on the exam.
Tips for Taking Practice Exams:
Simulate test conditions: Try to recreate the environment of the actual exam when taking practice tests. Find a quiet, distraction-free space and time yourself according to the exam guidelines. This will help you become more comfortable with the testing conditions and improve your ability to focus.
Review your answers: After completing a practice exam, thoroughly review and analyze any incorrect responses. This will help you identify areas for improvement and prevent the same mistakes on the exam.
Use various resources: Take advantage of the numerous practice exam resources available, including those provided by your real estate school, online resources, and study guides. This will expose you to many questions and scenarios, better preparing you for the exam.
Track your progress: Record your practice exam scores to monitor your improvement. This will help you determine if your study methods are effective and motivate you to continue working towards your goal.
Please don't overdo it: While practice exams are valuable, it's important not to rely solely on them for exam preparation. Ensure you also allocate time to review course materials, study critical concepts, and attend review sessions or crash courses.
Incorporating practice exams into your study routine is essential for a successful real estate license exam outcome. By familiarizing yourself with the test format, assessing your strengths and weaknesses, and using these exams to guide your study plan, you'll be better prepared and more confident when taking the actual exam.
Tip 4: Take a good crash course before your exam
Participate in a real estate license crash course: These intensive courses can help you review essential concepts and provide tips for passing the exam.
Participating in a real estate license crash course is an effective strategy for passing the real estate exam. These focused review courses offer numerous benefits that help you consolidate your knowledge and refine your test-taking skills. A highly recommended crash course can be found at www.crashcourseonline.com.
Real estate crash courses provide:
• A comprehensive review of essential concepts.
• Expert guidance from experienced instructors.
• Time-efficient learning.
They also offer valuable test-taking strategies and networking opportunities with aspiring real estate professionals.
When choosing a crash course, consider its reputation, content, format, and cost. Look for a system with a strong track record, such as the one at www.crashcourseonline.com. Ensure the course covers all relevant topics included in your state's real estate exam and that the format aligns with your learning preferences and schedule. Lastly, compare the fees of various crash courses to find one that fits your budget.
In conclusion, enrolling in a real estate license crash course, like the one found at www.crashcourseonline.com, can be a game-changer in your exam preparation. These courses can significantly increase your chances of passing the real estate exam and kickstarting your career in the industry.
Tip 5: Stay updated on industry news
Staying updated on industry news is essential to preparing for the real estate license exam. While the exam may not directly test you on the latest news, keeping abreast of industry trends and developments has several benefits that contribute to your overall success as a real estate professional.
Firstly, staying informed about the real estate market helps you maintain a strong connection with the industry. This connection fosters a sense of motivation and enthusiasm, which can positively influence your attitude and drive when preparing for the exam. As you gain insights into the latest trends, you're more likely to be engaged and eager to learn, which can improve your study sessions' effectiveness.
Secondly, following industry news can also contribute to understanding broader real estate concepts, making it easier to grasp the principles and regulations tested in the exam. By observing the practical application of these concepts in real-world scenarios, you'll develop a more profound comprehension that can help you tackle exam questions with greater confidence.
Lastly, immersing yourself in the real estate industry news helps you build a solid foundation for your future career. As you enter the field, having an informed perspective on market trends and developments will enable you to serve your clients better and make well-informed decisions. By cultivating this habit early, you set the stage for continued growth and success as a real estate professional.
Tip 6: Understand state-specific requirements
Familiarize yourself with the licensing requirements specific to your state, such as how to get your California real estate license.
Remember that the real estate test doesn’t require that you ace the exam. The exam is qualifying in nature only, so don’t beat yourself up trying to score a 100%. Just score better than 70% on the sales exam or 75% on the broker exam and you’ll be good.
Since the test is qualifying in nature only, when you pass the exam your score isn’t even reported. :)
Tip 7: Manage test anxiety
Practice relaxation techniques, such as deep breathing and visualization, to help you stay calm and focused during the exam.
Managing test anxiety is essential for optimal real estate license exam performance. Stress can hinder your ability to focus, recall information, and think critically – all these skills for test success. Relaxation techniques like deep breathing and visualization can significantly reduce anxiety and help you maintain a calm, focused mindset during the exam.
Deep breathing exercises can lower your heart rate and stabilize your nervous system, while visualization techniques allow you to rehearse a successful exam experience, boosting your confidence mentally. By incorporating these relaxation strategies into your exam preparation, you improve your overall well-being and increase your chances of achieving a high real estate license exam score.
Tip 8: Belief in yourself
Stay confident in your abilities and trust that your hard work and preparation will pay off.
By following these tips and taking advantage of the resources available through an online real estate school and real estate license crash course, you can set yourself up for success on the exam.
In conclusion, passing the real estate license exam is a crucial milestone in your journey toward becoming a successful real estate professional. Utilizing these 7 tips outlined in this blog post will make you well-prepared to tackle the exam confidently. From choosing suitable study materials and developing a consistent study schedule to taking practice exams and managing test anxiety, these strategies will ensure you cover all necessary material and are ready for the challenges of the exam. Dedication, discipline, and effective time management are crucial to success. Embrace the journey, stay confident in your abilities, and soon you'll be ready to embark on an exciting and rewarding career in real estate.
Love,
Kartik
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What Is A Real Estate Exam Prep Course?
A prep course for the real estate exam is an essential tool for any aspiring real estate agent. These courses provide comprehensive learning materials and resources
What Is A Real Estate Exam Prep Course?
A prep course for the real estate exam is an essential tool for any aspiring real estate agent. These courses provide comprehensive learning materials and resources designed to prepare and ensure exam success. Often
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The oldest recorded tax records, around 8,000 years ago, were in the form of tablets found in the city-state of Lagash near modern-day Iraq.
This tax system
The oldest recorded tax records, around 8,000 years ago, were in the form of tablets found in the city-state of Lagash near modern-day Iraq.
This tax system was said to be based on a time-based rotating system to make tax collection more manageable befor
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Buying a house and obtaining a real estate loan can be confusing, especially if you're doing it for the first time. One important real estate finance term you should know about is a "subordination clause."
Buying a house and obtaining a real estate loan can be confusing, especially if you're doing it for the first time. One important real estate finance term you should know about is a "subordination clause." I wanted to write an article explaining this clause and why it matters. We'll also show you how attending a real estate school or taking a real estate crash course can help you learn more about this and other real estate topics.
How Are The Priority of Liens Generally Determined?
In real estate financing, lien priority refers to the order in which various lenders and creditors have a legal claim or right to the property as collateral in the event of a default by the borrower. The lien priority determines who gets paid first and how much they receive when the property is sold or foreclosed upon.
Generally, lien priority is determined by the date and time when the liens were recorded. Liens recorded earlier typically have higher priority than those recorded later.
Here's an example to illustrate how lien priority works:
Let's say John owns a property and takes out a mortgage loan with Bank A, which is recorded on January 1, 2021. Later that year, John took out a home equity line of credit (HELOC) with Bank B, which was recorded on October 1, 2021. Finally, in 2022, John defaults on both loans, and the property is sold at a foreclosure auction for $500,000.
In this case, Bank A's mortgage lien has priority over Bank B's HELOC lien because it was recorded earlier. Therefore, Bank A will receive its total outstanding balance of $400,000 from the foreclosure sale proceeds first, while Bank B will only receive the remaining $100,000 (if there is any left after paying off Bank A).
What is a Subordination Clause?
A subordination clause is part of a mortgage or loan agreement where what would otherwise be a senior lender agrees to stay in a subordinate position and allow a new loan to have priority over an existing one.
Why is a Subordination Clause Important?
If you have more than one loan on your house, like a first and a second mortgage, a subordination clause helps determine which loan gets paid back first if you can't pay. This is especially important if you want to refinance (get a new loan with better terms) or get a second mortgage.
How Does a Subordination Clause Affect Homeowners?
A subordination clause can make it harder to refinance your primary mortgage or get a second mortgage. If the lender for your second mortgage doesn't agree to a new subordination clause, you might not be able to refinance. Also, getting a second mortgage will have a higher interest rate and not as good loan terms since it will be in a lower priority position.
How to Learn More About Subordination Clauses and Real Estate
Understanding real estate can be challenging, but attending a real estate school online or taking a crash course can make it easier.
Subordination clauses in development deals - an example
Imagine a developer named Emily who sees an opportunity to build a new residential complex on vacant land. To acquire the land and finance the construction, she needed to secure two loans: one for the land purchase and another for the construction costs.
Emily approached Big Bank to obtain a loan for purchasing the land. Big Bank agreed to lend her the necessary funds and make a first mortgage on the property using the land as collateral. This meant that in case of a default, Big Bank would have the first claim on the property. Now, Emily also needed a construction loan to cover the costs of developing the residential complex. She went to another lender, Builder Finance, which agreed to lend her the construction funds. However, Builder Finance needed assurance that they would also have a claim on the property if Emily defaulted on her loan.
Emily, Big Bank, and Builder Finance agreed to a subordination clause in their contracts to resolve this issue. The subordination clause stated that although Builder Finance's lien on the property was recorded later, Builder’s Finance would have a first loan on the property, and Big Bank agreed to a subordination clause. This meant that if Emily defaulted on her loans, Builder’s Finance would have the first right to recover its funds from the property, and Big Bank would have the subsequent claim after Builder’s Finance was fully satisfied.
This arrangement allowed Emily to secure both the land and the construction loan she needed to complete her project.
Using a subordination clause, Emily and her lenders created a clear and fair hierarchy of claims on the property, facilitating the successful financing and development of her residential complex.
Are you studying for the real estate exam and need expert instruction related to complex topics? Visit www.crashcourseonline.com
Love,
Kartik
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In the complex and rapidly evolving world of real estate, having the correct information at the right time can make all the difference.
In our great real
In the complex and rapidly evolving world of real estate, having the correct information at the right time can make all the difference.
In our great real estate business, if you are involved in the real estate sector, your role might be that of an agent
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Sometimes, homeowners need money to fix their house, pay off debt, or handle emergencies. They can get this money through Home Equity Lines of Credit (HELOCs) or Home Equity Loans. Both options let homeowners
Sometimes, homeowners need money to fix their house, pay off debt, or handle emergencies. They can get this money through Home Equity Lines of Credit (HELOCs) or Home Equity Loans. Both options let homeowners borrow money based on their home's value, but they have different interest rates, ways to pay back, and flexibility. This blog will discuss the differences between HELOCs and Home Equity Loans, their pros and cons, and when to choose each one.
This information can benefit those preparing for their real estate exam or attending an online real estate school.
What is a Home Equity Loan?
A Home Equity Loan allows homeowners to borrow a set amount of money using their home's value and equity (as the name implies). They pay it back with the same interest rate and payment for up to 30 years. This loan can be used to fix the house, pay off debt or for other reasons. Home Equity Loans are great for homeowners who know how much money they need and want to make the same payment every month. Keep this in mind if you are seeking a California real estate license or attending a real estate crash course so you can have intelligent discussions with your clients.
Pros of a Home Equity Loan:
• Fixed interest rate and monthly payments.
• Receive the entire loan amount at once.
• Some lenders don't charge additional fees.
• Loan payments might be tax-deductible if used for home improvements.
Cons of a Home Equity Loan:
• You must know the exact amount of money needed.
• Need sufficient home equity to qualify for the loan (usually 15-20%).
• Risk of losing the home if payments are not made.
• If the home's value decreases, homeowners might owe more than the home is worth.
What is a Home Equity Line of Credit (HELOC)?
A Home Equity Line of Credit (HELOC) is similar to a credit card but tied to the equity in your house. You can use the money when needed and pay it back when possible. The amount of money you can borrow and the amount you have to pay back every month can change.
Pros of a HELOC:
• Only pay interest on the amount used.
• Can borrow and repay funds as needed.
• Some HELOCs allow converting to a fixed-rate payment.
• It can be used as an emergency fund.
Cons of a HELOC:
• Variable interest rates may lead to higher payments if rates increase.
• There might be annual fees or prepayment penalties.
• Risk of losing the home if the line of credit is not repaid.
Choosing Between a HELOC and a Home Equity Loan
When choosing between a HELOC and a Home Equity Loan, consider what you need the money for and how you want to pay it back. A Home Equity Loan is better if you know exactly how much money you need and want fixed payments that won't change. A HELOC is better if you want to access funds as needed and are okay with fluctuating payments. These concepts are crucial for students in online real estate schools or those preparing for their real estate exam.
History of HELOCs and Home Equity Loans
HELOCs and Home Equity Loans have been popular borrowing options since the 1980s. They became famous as the housing market grew and home values increased. Over time, lenders have adapted these products to serve borrowers' needs better, making them valuable topics for those pursuing a California real estate license or attending a real estate crash course.
Understanding Why People Take Out Home Equity Loans
Introduction
A home equity loan is a type of loan where homeowners borrow money using the value of their house as a guarantee. This loan can help people get the cash they need for various reasons, like paying for significant expenses or improving their house. In this article, we'll explain why people take out home equity loans and how they can be helpful in simple terms.
Home Improvements and Repairs
One of the main reasons people take out home equity loans is to pay for improvements or repairs to their house. When you make your house better, it usually becomes worth more money. Using a home equity loan to improve your home can be smart because it can help you increase your home's value in the long run.
Debt Consolidation
Sometimes, people have a lot of different debts, like credit card bills, car loans, or student loans. These debts can have high-interest rates, making it hard to pay them off. A home equity loan can help people use the money from the loan to pay off their other debts. This way, they only have one loan to repay, which usually has a lower interest rate than their other debts.
1. Lower Interest Rates: One of the primary reasons homeowners use a HELOC for debt consolidation is because it typically offers lower interest rates than other borrowing forms, such as credit cards or personal loans. By consolidating high-interest debts with a lower-interest HELOC, homeowners can save money on interest payments over time.
2. Tax Benefits: Sometimes, the interest paid on a HELOC may be tax-deductible if the funds are used for specific purposes, such as home improvements. This tax benefit can make using a HELOC for debt consolidation even more attractive for homeowners.
3. Simplified Payments: When homeowners consolidate multiple debts into a HELOC, they can simplify their monthly payments. Instead of managing and paying several monthly bills, they only have to make one payment towards the HELOC. This can make managing finances more manageable and less stressful.
4. Flexible Access to Funds: A HELOC is a revolving line of credit, meaning homeowners can borrow and repay funds as needed during the draw period. This flexibility can be helpful for debt consolidation, as homeowners can use the HELOC to pay off their debts and repay the HELOC at their own pace.
5. Longer Repayment Terms: HELOCs often have longer repayment terms than other credit forms. This can result in lower monthly payments, making it easier for homeowners to manage their debt and budget.
6. Potential for Improved Credit Score: By consolidating high-interest debt using a HELOC, homeowners can lower their credit utilization ratio, which is the amount of debt they have compared to their available credit. A lower credit utilization ratio can improve credit scores over time.
Paying For Education
Education can be expensive, whether it's for yourself or your kids. Some people use home equity loans to help pay for college or other types of schooling. This is a good option because the interest rates on home equity loans are lower than other loans or credit cards.
Emergency Expenses
Sometimes, unexpected things happen, like a medical emergency or job loss. When people need money quickly, a home equity loan can be helpful. Because the loan uses the house's value as a guarantee, banks are more likely to approve the loan quickly.
Funding a Business or Investment
Starting a business or investing can be an excellent way to make money. However, you usually need some money to get started. A home equity loan can help people get the cash they need to create a business or make an investment, and if the investment pays off, it can be a smart financial move.
Understanding the differences between HELOCs and Home Equity Loans can help homeowners make informed decisions about leveraging their home's equity. By considering the purpose of the funds, the amount needed, and their preferences for repayment and interest rates, homeowners can choose the option that best suits their needs.
Either way, homeowners should be cautious when considering home equity loans, as these loans use their house as collateral. If they fail to make timely payments, they risk losing their home to foreclosure. Additionally, taking on more debt can potentially lead to financial strain and negative consequences if the housing market declines, resulting in owing more than the home's current value. It is essential to carefully assess one's financial situation and consider all options before using home equity loans.
Love,
Kartik
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A question a have been getting regularly lately is “If interest rates are so high, why aren’t prices coming down?!” I get this question from students in our real estate license school as well as
A question a have been getting regularly lately is “If interest rates are so high, why aren’t prices coming down?!” I get this question from students in our real estate license school as well as from past and potential clients.
This is a totally understandable question to ask, especially given the fact that interest rates have more than doubled in the past few years. The real estate market is experiencing high mortgage rates and an unprecedented housing inventory shortage - the market seems to be at a stalemate. This isn’t just true in southern California where we operate a real estate school and provide real estate crash courses to prepare folks for the real estate exam - this story is true all across the United States. The reality is that most U.S. homeowners remain tethered to their current homes due to significantly lower mortgage rates locked in over previous years.
A recent analysis by Redfin revealed that nearly 92 percent of homeowners with mortgages have an interest rate below 6%, much lower than the current average mortgage rate of 6.71%. "Why would I want to sell my house when I have a really low 3% interest rate on my mortgage? If I buy a new house, I might end up with an interest rate that could be twice as high as my current one!” is the sentiment of many.
As a consequence, the lack of available homes for sale has led to the housing market entering a very odd place, as noted by Redfin's Deputy Chief Economist, Taylor Marr. The reluctance from homeowners to list their properties, fostered by the significantly higher current mortgage rates, is stagnating the market, making it difficult for buyers to find suitable properties. There just isn’t enough inventory.
A bit of bright news for the market is that the Federal Reserve in its most recent meeting opted against an 11th consecutive interest rate increase, which signaled a "hawkish pause" as it evaluates the impact of the previous rate hikes. However, the Fed indicated the likelihood of two more quarter percentage point increases by the end of the year, pushing the median expectation to a funds rate (not mortgage rate) of 5.6% by the end of 2023.
The pause in interest rate hikes is intended to allow the Fed to monitor the impacts of its policy moves as it battles uneven but optimistic signs of inflation being under control. The decision resulted from various factors, including solid labor market performance and, as previously mentioned, slowing inflation rates. The future outlook suggests the possibility of rate cuts beginning in 2024, with raised expectations for economic growth and an optimistic outlook on unemployment rates. The inflation projections were also adjusted, but the overall impacts of the policy adjustments are yet to be fully realized in the economy. It has been said that an economy as large as the United States’ is like turning an aircraft carrier. To move in another direction requires turning the wheel miles and miles ahead of time.
On a national level, regions where the inventory shortage is particularly acute include Hartford, Connecticut, and Buffalo, New York. Housing inventory hovers near record lows in these markets, where new construction is scarce. Hartford had just 1.4 months of housing supply in December, while in the past, a balanced housing market was considered to have between four and six months of supply.
"Months of housing supply" is a metric often used by real estate professionals to measure the balance between supply and demand in the housing market. It's calculated by taking the current inventory of homes for sale and dividing it by the current sales rate (the number of homes sold per month).
In this context, if Hartford has 1.4 months of housing supply, it means that at the current sales pace, all the homes currently listed for sale would be sold in approximately 1.4 months, assuming no new homes are listed.
On the other hand, a balanced housing market is typically said to have between four and six months of supply. This means that it would take four to six months to sell all the homes currently on the market at the current sales pace. If the months of supply are less than this (like 1.4 months in Hartford's case), it generally indicates a seller's market because demand is outpacing supply. If it's more, it could be a buyer's market because supply exceeds demand.
Therefore, Hartford's low 'months of housing supply' indicates a significant shortage of homes for sale compared to the number of interested buyers, leading to increased competition among buyers and potentially higher home prices. It’s the same story around much of the United States as low inventory continues to squeeze the housing markets all across the country. California is no exception.
In addition to high mortgage rates, other factors contributing to low inventory include older Americans opting to age in place, investors purchasing homes for renting purposes, and the lack of new construction. Buyers priced out of major markets are relocating to smaller cities, creating demand in areas traditionally not associated with a housing crunch. This leads to emotionally charged house-hunting experiences, buyers are left with few options and the prospect of waiting long periods to find their dream home.
Meanwhile, investor activity is also altering the market dynamics, with the proportion of single-family homes purchased by investors increasing from 15-16% each year from 2012 to 24% in 2021 Cities such as Austin, Nashville, and Dallas, which experienced bidding wars and price hikes in recent years due to low inventory, are now seeing a leveling off of prices due to increased available homes.
The U.S. housing market currently presents a bittersweet scenario. With homeowners holding on to their homes and the housing inventory at record lows, it's a challenging time for those looking to enter or navigate the market. As things stand, the market remains skewed, favoring neither buyer nor seller, and it's a situation that appears likely to stay the same in the immediate future.
It's essential to understand that such fluctuations and shifts present unique opportunities for those interested in the world of real estate. Yes, mortgage rates are high, and inventory is low, but this only increases the need for competent, understanding, and proactive real estate professionals who can navigate this challenging terrain. Obtaining a real estate license isn't just about selling homes; it's about understanding market dynamics, providing sound advice, and adapting to changing circumstances. This unique state of the market offers a wealth of learning experiences and the potential for lucrative returns. Moreover, as the market stabilizes and evolves, there will be a strong demand for qualified professionals to guide clients through their real estate journey.
Remember, every market condition brings its own advantages and opportunities – the key lies in being prepared and willing to leverage them effectively. So, don't be discouraged. Embrace the opportunity to learn, grow, and become a valuable player in the real estate industry.
Love,
Kartik
TLDR: The U.S. housing market is currently experiencing a unique state characterized by high mortgage rates and an unprecedented low inventory, leading to a market stalemate with homeowners reluctant to sell due to lower locked-in mortgage rates. However, the market's fluctuations are seen as opportunities for competent real estate professionals to navigate these challenges, understand market dynamics, and leverage changing circumstances to their advantage.
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When preparing for the California real estate license exam or attending a real estate crash course, understanding the concept of easements is essential. An easement is a legal right that grants one party
When preparing for the California real estate license exam or attending a real estate crash course, understanding the concept of easements is essential. An easement is a legal right that grants one party the use of another party's property for a specific purpose, generally for access. Because many of our readers are preparing for the real estate exam, this article will prove helpful.
I also wanted to dive into what an easement is, what a prescriptive easement entails, how it is formed, how it can be terminated, and the commonality of such easements in California.
What is an Easement?
In the world of real estate, an easement is a special permission that lets someone use another person's land for a specific reason. Even though the property owner still owns the land, the person with the easement has the legal right to use the land in a certain way. Some common examples of easements are when someone needs to go through a neighbor's property to get to their own when utility companies need access to put in and take care of things like power lines, and when people share a driveway.
There are several situations where easements might be necessary or valuable. For example, suppose a person's property is located behind another person's property, and there is no other way to access their property. In that case, they might need an easement to cross their neighbor's land. This is called a "right-of-way" easement and ensures that the person can come and go from their property without any issues.
Utility companies also rely on easements to install and maintain critical infrastructure, such as power, gas, or water pipes. These easements give the utility company the right to access a property owner's land to work on the necessary equipment, ensuring everyone can access essential services.
Another typical example of an easement is neighbors sharing a driveway or pathway. In these cases, both property owners agree to let each other use the driveway or pathway to access their properties. This type of easement, known as a "shared-use" easement, helps neighbors work together to use their land and resources best.
Easements play a crucial role in real estate by allowing people to use another person's property for specific purposes. They help resolve potential conflicts and ensure everyone's property rights are respected while still meeting the needs of all parties involved.
Prescriptive Easement: Definition and Formation
Simply put, a prescriptive easement is a special kind of permission to use someone else's land, even if they didn't say it's okay. It happens when a person uses the land in a way everyone can see, and they keep doing it for a certain amount of time without stopping. In California, this time is five years. If the person meets these rules, they can get the legal right to keep using the land, and that's called a prescriptive easement.
Example:
Imagine a person named Bob who uses a path through his neighbor's yard to get to a park. Bob's neighbor, Sally, doesn't know about it and never said it was okay. Bob has used this path daily for five years, and everyone in the neighborhood knows about it. After five years, Bob can ask for a prescriptive easement, which means he can legally keep using the path through Sally's yard.
For a prescriptive easement to be legally recognized in California, the following elements must be satisfied:
1. Open and notorious use: The use of the property must be visible and apparent to the owner.
2. Continuous use: The property must be used consistently without interruption for the required period.
3. Hostile use: The use must be against the owner's wishes and without their consent.
4. Exclusive use: The use must not be shared with the owner or others with no legal property rights.
Terminating a Prescriptive Easement
There are several ways a prescriptive easement can be terminated in California:
1. Abandonment: If the easement holder stops using it for a significant period, it may be considered abandoned, thus ending the easement. In California, this period of abandonment is five years.
2. Release: The easement holder can voluntarily relinquish their rights to the easement in writing.
3. Merger: If the easement holder acquires the property subject to the easement, the easement is terminated as the two properties merge.
4. Court action: A property owner may file a lawsuit to challenge the validity of the easement or seek a court order to terminate it.
How Common Are Prescriptive Easements in California?
Prescriptive easements are relatively common in California due to the state's high population density and the prevalence of real estate disputes. They often arise when property boundaries are unclear, or neighbors have informally used a shared driveway or pathway for many years. It is crucial for property owners and those studying for the real estate exam to be familiar with the concept of prescriptive easements and their implications.
A real-life example of such a case was Warsaw v. Chicago Metallic Ceilings, Inc., 35 Cal. 3d 564 (1984). In this case, the plaintiff, Warsaw, claimed a prescriptive easement over a portion of the defendant's (Chicago Metallic Ceilings, Inc.) property. The disputed area was a strip of land that Warsaw had been using to access their property for parking purposes. The plaintiff had used the land openly, notoriously, and continuously for more than five years without the defendant's permission.
The California Supreme Court ruled in favor of Warsaw, granting them a prescriptive easement over the disputed strip of land. This case illustrates the concept of a prescriptive easement in California. It provides an example of how the courts may rule in favor of a party that has satisfied the requirements for establishing a prescriptive easement.
Understanding easements and prescriptive easements is vital for anyone pursuing a real estate license or preparing for the real estate exam in California. Real estate professionals should be aware of the formation and termination of prescriptive easements and their prevalence in the state to navigate property disputes and effectively protect their clients' interests. By mastering this concept, real estate professionals will be well-equipped to handle complex situations that may arise in their careers.
If you need help passing the real estate exam, visit us at www.adhischools.com and check out our free resources.
Love,
Kartik
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In the fast-paced world of real estate, success largely depends on the expertise and guidance of professionals who help new agents build their careers. Understanding the differences between Brokers, Team
In the fast-paced world of real estate, success largely depends on the expertise and guidance of professionals who help new agents build their careers. Understanding the differences between Brokers, Team Leaders, Mentors, and Coaches is essential to making the most of these resources.
I wanted to write about this specifically for students that are just finishing out of our real estate license school and are interviewing with brokerages. If that is you, you are probably going to hear a lot about these terms as you talk to managers and brokers.
“We have a mentor program!”
“Our broker is always avaliable to help you!”
“You should get into real estate coaching!”
All of the above are pretty common things you’ll hear from leadership within a medium-to-large size real estate company. I want you to be prepared.
In this article, I wanted to explore the roles and responsibilities of these professionals, providing examples to help you determine the best support system for your growth.
Broker
A broker is a licensed real estate professional who is responsible for a real estate brokerage or agency. They are tasked with overseeing and guiding the business activities of their agents, ensuring compliance with relevant laws and regulations. Brokers are typically more experienced than agents and have met additional educational and licensing requirements. In California, in order to become a real estate broker, you have to have two years of real estate experience at a minimum. There are also 5 other classes you have to take beyond those you took to get your sales license. If you want to know how to become a broker, I recorded a video about this you can watch here.
Example: A new agent can turn to their broker for guidance on navigating the complexities of real estate transactions and for support in understanding and complying with industry regulations. If the salesperson breaks a real estate law, the broker could be liable.
Team Leader
A team leader is a real estate professional responsible for managing and supervising a team of agents within a brokerage - They may or may not also be the broker of record for the real estate office. They provide guidance, support, and motivation to their team members and are often responsible for training and coaching new agents. Team leaders often have strong communication and leadership skills, enabling them to manage team dynamics and foster a positive working environment effectively.
Sometimes, the team leader is also responsible for recruting new agents into the company which is why newer agents have often heard this term.
Example: A new agent may join a team led by an experienced team leader who will provide training, support, and resources to help them grow and develop as a successful real estate agent.
Mentor
A mentor is an experienced real estate professional who will offer guidance and support to a new agent often in exchange for a portion of their commission on a given real estate transaction. This relationship is built on trust and mutual respect, with the mentor sharing their knowledge, experience, and insights with the mentee. Mentorship can sometimes be informal, with mentors and mentees seeking each other out, or formalized through mentorship programs within brokerages or professional organizations.
Example: A new agent may seek a mentor to help them navigate the challenges of their first few transactions, providing advice on negotiation strategies, client relations, and best practices in the industry. In exchange the mentor and mentee agree on a 50/50 commission split on any deals they work on together.
Mentorship plays a crucial role in developing and progressing a successful career. The right mentor can provide guidance, support, and knowledge that can be transformative for a mentee's personal and professional growth. This article will explore the importance of mentorship at various career stages, highlighting how a mentor's influence can lead to lasting success.
Early Career: Building a Strong Foundation
In the early stages of a career, a mentor can provide invaluable guidance and support, helping mentees navigate the challenges of entering the workforce. They can offer insights into industry-specific best practices, share their experiences, and help mentees develop essential skills such as communication, problem-solving, and time management.
A mentor's influence at this stage can help mentees establish strong foundations, enabling them to approach their careers with confidence and a clear sense of direction.
Mid-Career: Navigating Transitions and Growth
As professionals progress, they may face new challenges and opportunities, such as transitioning to a new role, taking on increased responsibilities, or pursuing advanced education. During these transitional periods, the guidance of a mentor can be precious.
Mentors can provide perspective and advice on making these transitions, helping mentees to identify and leverage their strengths, develop new skills, and adapt to changing circumstances. This support can foster resilience and agility, essential traits for continued success in a dynamic professional landscape.
The Mentor-Mentee Relationship: A Two-Way Street
While the benefits of mentorship for the mentee are clear, it is essential to recognize that the relationship is often mutually beneficial. Mentors can also gain valuable insights from their mentees, fostering their growth and development - and in sharing commissions.
Moreover, serving as a mentor can be personally rewarding, as it provides the opportunity to make a meaningful impact on another individual's life and career and contribute to the development of future leaders in their industry.
Mentorship is essential to career growth and success, providing guidance, support, and knowledge at every stage of professional development. From building a strong foundation in the early stages of a career to navigating transitions and refining leadership skills, the influence of a mentor can have a lasting impact on an individual's personal and professional growth. Embracing mentorship as a vital tool for success, professionals can unlock their full potential and thrive in an ever-changing professional landscape.
Coach
A coach is a professional who focuses on real estate agents' personal and professional development. Coaches often have a background in real estate, but their primary focus is guiding agents to achieve their goals and reach their full potential. Coaches may provide one-on-one coaching sessions, group workshops, or online courses addressing business planning, marketing strategies, time management, and mindset development.
In the competitive world of real estate, professionals are constantly seeking ways to gain an edge and stand out from their peers. While a real estate license and education from a real estate school are essential prerequisites for entry into the industry, more than they may be required for long-term success.
This is where coaching comes in. Real estate coaching provides individuals with personalized guidance, support, and accountability to help them achieve their goals and overcome any obstacles they may face in their careers. Whether it's building a successful business, developing marketing strategies, or improving negotiating skills, a coach can provide the insights and tools needed to excel in the industry.
Real estate coaching can also be valuable for new agents needing more experience and confidence in navigating the industry's complexities. A coach can guide everything from building a client base to closing deals, helping new agents build a strong foundation for lasting success.
Moreover, coaching can help real estate professionals stay current with industry trends and best practices. As the industry evolves, adapting and innovating to remain competitive is essential. A coach can provide insights into emerging trends, technological advancements, and changes in consumer behavior, enabling professionals to stay ahead of the curve.
In conclusion, real estate coaching is a valuable tool for professionals seeking long-term success in the industry. It provides personalized guidance and support to help individuals achieve their goals, stay current with industry trends, and overcome any obstacles they may face. Whether you're a new agent just starting or a seasoned professional looking to take your career to the next level, coaching can provide the insights and tools needed to thrive in the ever-changing world of real estate.
Example: A new agent may hire a real estate coach to help them set and achieve their goals, create a business plan, and develop the skills necessary to excel in the industry.
Understanding the roles of Brokers, Team Leaders, Mentors, and Coaches is essential for new real estate agents seeking guidance and support in building their careers. Each of these professionals brings unique expertise and insights to the table, and the right combination of these resources can set new agents on the path to success. By recognizing the value of each role and leveraging their strengths, new agents can build strong foundations for lasting success in the real estate industry.
As always, your real estate journey begins with enrolling in the right real estate school. Visit www.adhischools.com or call us at 8887685285 for more information.
Love,
Kartik
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In today's fast-paced and competitive real estate market, agents must understand the wants and needs of their clients. A successful agent knows that meeting the expectations of home sellers can make all
In today's fast-paced and competitive real estate market, agents must understand the wants and needs of their clients. A successful agent knows that meeting the expectations of home sellers can make all the difference in securing a listing and closing a deal. As a result, agents must put their clients' priorities at the forefront of their business strategies. This article discusses the key factors that home sellers are looking for in an agent and how obtaining a real estate license from a reputable real estate license school can help you meet these expectations.
Assist in Competitive Pricing
Pricing a property accurately is critical in ensuring a quick sale and the best possible return on investment for the seller. Home sellers want an agent who can use their expertise and local market knowledge to determine the appropriate price point for their property. This involves analyzing comparable properties in the area, understanding current market trends, and accounting for any unique features or upgrades the home may have.
One of the most crucial aspects of a real estate agent's job is helping sellers determine the appropriate listing price for their property. This requires a deep understanding of the local market, comparable properties, and the unique features of the home in question. By guiding sellers toward a realistic and competitive listing price, agents can optimize the chances of a successful sale and maximize the seller's return on investment.
To begin, real estate agents, should conduct a comprehensive Comparative Market Analysis (CMA) to evaluate similar properties in the area that have recently sold, are currently on the market, or were withdrawn from the market without being sold. This analysis allows the agent to identify trends, gauge the competition, and determine the property's fair market value. By presenting this information to the seller, agents can help them understand how their home compares to others in the market and why a specific price range is recommended.
In addition to the CMA, agents should also consider the property's unique features, upgrades, and condition when recommending a listing price. Factors such as a recently renovated kitchen, a well-maintained garden, or energy-efficient upgrades can add value to a home and justify a higher asking price. Conversely, outdated appliances, necessary repairs, or an undesirable location may warrant a lower price. By discussing these factors with the seller, agents can help them grasp the impact of their property's specific characteristics on the listing price.
Completing a comprehensive real estate course online can help future agents develop the skills and knowledge needed to price properties accurately and communicate their findings effectively to sellers.
Market to Interested Buyers
Strategic marketing is essential in attracting the right buyers and generating interest in a property. Home sellers want an agent to showcase their property through various channels, including online listings, social media, and print advertising. A well-rounded marketing plan should include professional photography, engaging property descriptions, and targeted exposure to potential buyers.
A quality real estate license school will offer courses covering marketing strategies and techniques, enabling agents to promote their listings and generate interest from potential buyers effectively.
Determine Price-Boosting Improvements
Home sellers are often interested in making improvements that will increase their property's value. A knowledgeable agent can recommend high-ROI repair projects and renovations that will significantly impact the final sale price. Some examples of valuable improvements include:
Kitchen Remodel:
A minor kitchen remodel can yield a significant return on investment (ROI). According to the 2021 Cost vs. Value Report by Remodeling Magazine, homeowners can expect to recoup approximately 72% of the cost of a minor kitchen remodel. A minor kitchen remodel may include updating cabinet doors and drawer fronts, installing new countertops, and updating fixtures and hardware. The report also notes that an updated kitchen is one of the most important factors for homebuyers when considering a property.
Source: Remodeling Magazine - 2021 Cost vs. Value Report
Adding a Wood Deck:
Adding a wood deck to your home can increase its appeal to potential buyers and provide a good ROI. The 2021 Cost vs. Value Report states that homeowners can expect to recoup around 66% of the cost of a wood deck addition. A deck expands your home's living space and enhances its outdoor appeal, making it more attractive to potential buyers.
Source: Remodeling Magazine - 2021 Cost vs. Value Report
Updating the Entry Door:
Replacing your entry door with a new steel door can significantly improve your home's curb appeal and security while providing a high ROI. According to the 2021 Cost vs. Value Report, homeowners can expect to recoup about 65% of the steel entry door replacement cost. An attractive, secure front door can create a strong first impression on potential buyers and increase your home's overall value.
Source: Remodeling Magazine - 2021 Cost vs. Value Report
Remember that these projects' actual return on investment can vary depending on your specific location and market conditions. It's always a good idea to consult with a local real estate professional for tailored advice on the best improvements for your home.
Safeguard with Technology
In today's digital age, technology plays a significant role in protecting both agents and their clients during real estate transactions. Home sellers want an agent who can use cutting-edge technology to streamline the process and mitigate future risks, particularly regarding property disclosures. A complete or correct disclosure package can help avoid legal and financial troubles for sellers, even after closing the deal.
Reputable real estate license schools will offer courses that cover the use of technology in real estate transactions, ensuring that agents are well-versed in using digital tools to protect their clients and themselves.
Responsiveness and Advocacy
Home sellers expect their agent to be available and responsive to their needs. In the age of instant communication, clients want to know that their agent is just a phone call, text, or email away. Agents who are prompt and attentive to their client's needs can foster trust and build long-lasting relationships.
A quality real estate online course will emphasize the importance of effective communication and guide on maintaining client responsiveness.
Home sellers want an agent to advocate for their best interests throughout the transaction. This includes being honest about the property's value, representing only one party in a transaction, and disclosing potential conflicts of interest. Agents who prioritize their clients' needs and work diligently to secure the best possible outcome are more likely to earn repeat business and referrals.
Advocacy, in the context of real estate, refers to actively supporting, promoting, and defending the best interests of one's client while buying or selling a property. It involves providing expert advice, guidance, and representation to ensure the client's needs, preferences, and goals are met or exceeded in a transaction. Advocacy is a hallmark of real estate representation because it underscores the fundamental duties of a real estate agent and exemplifies their commitment to their client's success.
Here are a few reasons why advocacy is considered a hallmark of real estate representation:
1. Fiduciary responsibility: A real estate agent has a fiduciary duty to their client. This means that the agent must put the client's interests above their own and act with honesty, loyalty, and good faith. Advocacy is essential to fulfilling this fiduciary duty, as it demonstrates that the agent prioritizes their client's well-being in every aspect of the transaction.
2. Expertise and knowledge: A real estate agent's extensive knowledge of the market, property values, legal requirements, and negotiation strategies is critical to effectively advocating for their client. By leveraging this expertise, agents can provide valuable insights and advice to help their clients make informed decisions and achieve the best possible outcome in a transaction.
3. Negotiation skills: One of the most important aspects of advocacy in real estate is the ability to negotiate effectively on behalf of a client. A skilled negotiator can help secure favorable terms, such as a lower purchase or higher sale price, and ensure the client's interests are protected throughout the negotiation process.
4. Communication and problem-solving: Advocacy in real estate also involves maintaining open lines of communication with the client, as well as addressing any concerns, issues, or obstacles that may arise during the transaction. By actively listening to the client's needs and working diligently to find solutions, a real estate agent demonstrates their commitment to advocacy and exceptional client service.
5. Ethical conduct: A real estate agent's dedication to advocacy goes hand in hand with adhering to a strict code of ethics. This commitment to ethical behavior ensures that the agent will not only prioritize their client's interests but will also act fairly, honestly, and transparently throughout the process.
Advocacy is a cornerstone of real estate representation because it embodies the fundamental principles and responsibilities that agents must uphold to serve their clients effectively. Real estate agents can help clients navigate the complex world of property transactions by acting as a steadfast advocate, ensuring a successful and satisfying outcome.
In conclusion, understanding what home sellers genuinely want from their real estate agent is paramount in establishing a successful relationship and ensuring a positive outcome for both parties. By assisting with competitive pricing, strategic marketing, recommending price-boosting improvements, utilizing technology, and maintaining a strong sense of responsiveness and advocacy, agents can effectively meet the needs of their clients. Pursuing a real estate license from a reputable real estate license school and taking real estate courses online can equip agents with the skills and knowledge necessary to excel in these areas, ultimately leading to satisfied clients, successful transactions, and a thriving real estate career. By prioritizing the wants and needs of home sellers, agents can build long-lasting relationships, foster trust, and make a lasting impact on the lives of their clients.
As always, if you are interested in taking real estate license courses with our school, please reach out at www.adhischools.com or call us at 8887685285.
Love,
Kartik
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Homebuyers' expectations have evolved significantly in today's dynamic real estate market. Modern homebuyers are more informed and tech-savvy than ever, making it essential for real estate agents to adapt
Homebuyers' expectations have evolved significantly in today's dynamic real estate market. Modern homebuyers are more informed and tech-savvy than ever, making it essential for real estate agents to adapt and meet their clients' needs. This article delves into the top five qualities homebuyers seek in a real estate agent. It provides insights into how agents can develop these skills and become the trusted ally their client's desire. By understanding and prioritizing these characteristics, real estate agents can ensure a successful and satisfying experience for their clients, setting themselves apart from the competition and thriving in the ever-changing world of real estate. So, let's explore these key attributes and discover how agents can enhance their offerings and better serve the modern homebuyer.
Buyers want their agent to be available and responsive.
Homebuyers want an easily reachable agent and quick to respond to their questions and concerns. In today's fast-paced real estate market, clients appreciate agents who can provide real-time updates and accommodate their busy schedules. Enrolling in our real estate school can help agents improve their communication skills and client management techniques in courses like Real Estate Practice.
Availability and responsiveness are essential characteristics for a real estate agent working with buyers because they directly impact the client's experience and the agent's ability to secure the best possible deal for their client. In today's fast-paced and competitive real estate market, quick and effective communication is essential for a successful outcome. Here are several reasons why availability and responsiveness matter:
1. Timely Action: In a hot market, properties can sell quickly, and buyers must act quickly to secure their desired home. An available and responsive agent can quickly schedule showings, submit offers, and handle negotiations, increasing the chances of success for their clients.
2. Client Satisfaction: Clients appreciate an agent who is readily available to answer questions, provide updates, and address concerns. This level of attentiveness and support fosters trust and helps build a strong working relationship between the agent and the client.
3. Informed Decision-Making: The home-buying process can be complex; clients rely on their agent's expertise to guide them through it. A responsive agent ensures clients receive the information they need promptly, helping them make well-informed decisions.
4. Problem-Solving: Issues can arise during the home-buying process, and a responsive agent can quickly address and resolve these problems, minimizing stress and delays for the client.
5. Reputation and Referrals: Clients who have a positive experience working with an available and responsive agent are more likely to recommend them to friends and family, leading to future business opportunities.
Utimately availability and responsiveness are crucial for a real estate agent working with buyers, as they directly contribute to client satisfaction and successful transactions. By prioritizing these traits, agents can provide an exceptional experience for their clients and achieve better results in the competitive real estate market.
Buyers Want Their Agent to be Tech-Savvy
Homebuyers expect agents to be proficient with digital tools, including social media, websites, and apps, to streamline the home search process. By taking our online real estate classes, you will learn how to leverage technology effectively and provide a seamless experience for their clients.
In today's fast-paced digital world, the modern homebuyer expects a real estate agent who is tech-savvy and well-versed in using the latest tools to find properties and provide top-notch service. With the increasing reliance on technology and the internet for information, agents need to adapt and meet the needs of their clients effectively and efficiently.
A tech-savvy real estate agent understands the importance of having a robust online presence, utilizing social media platforms, and maintaining an up-to-date website with relevant content. These tools help attract potential clients and provide valuable resources for homebuyers in their search for the perfect property. In addition, a modern agent leverages cutting-edge property search tools, virtual tours, and mobile apps to streamline the home-hunting process for their clients.
Furthermore, today's homebuyers crave instant communication, and a tech-savvy agent knows how to deliver. Using text messaging, email, and other instant messaging platforms, modern agents can respond promptly to inquiries, provide real-time updates, and ensure their clients are always in the loop. This level of responsiveness builds trust, enhances client satisfaction, and fosters strong working relationships.
In essence, the modern homebuyer seeks a real estate agent who can harness the power of technology to make the home-buying process as seamless and stress-free as possible. By staying ahead of the curve and embracing technological advancements, agents can cater to contemporary clients' needs and set themselves apart from the competition, leading to a successful and thriving real estate business.
Buyers Want Their Agent To Have Local Knowledge
Homebuyers want an agent with in-depth knowledge of the area they are interested in. This expertise helps clients decide about neighborhoods, schools, and local amenities. Attending a real estate crash course can give agents valuable insights into local markets and trends, positioning them as trusted experts by passing the real estate exam.
A modern real estate agent with strong ties to the local community can offer homebuyers a unique advantage in their property search. By actively participating in community events, networking with local businesses, and staying informed about municipal developments, agents can stay ahead of changes that may impact property values or the desirability of specific neighborhoods. This local expertise allows agents to provide clients with a comprehensive understanding of the market and up-to-date information on potential investment opportunities and emerging trends. Engaging with the community enhances the agent's reputation as a knowledgeable resource. It demonstrates their genuine commitment to helping clients find the perfect home within the context of the larger community.
Buyers Want Their Agent To Have People Skills
A friendly, approachable demeanor is essential in fostering strong relationships with clients. Homebuyers want to feel comfortable discussing their needs and preferences with their agent. Developing excellent interpersonal skills through real estate education and practice can significantly enhance an agent's ability to connect with clients and understand their unique requirements.
In addition to being friendly and approachable, a modern real estate agent must possess high emotional intelligence. This involves understanding and managing their emotions and empathizing with their client's feelings and needs. Agents can better tailor their services and create a more personalized home-buying experience by being sensitive to clients' concerns and preferences. Furthermore, strong emotional intelligence can help agents calmly and professionally navigate challenging situations, such as tense negotiations or emotional setbacks. Cultivating emotional intelligence through real estate education and practice fosters trust and rapport with clients. It equips agents with the skills necessary to handle the various demands of the home-buying process with grace and competence.
Buyers Want A Partner, Not Just An Agent
More specifically, this entails guiding them from the initial property search to the closing day, ensuring the process is smooth and seamless. Clients highly value agents who prioritize their best interests, offering comprehensive support at every stage. By pursuing continuous education through real estate school and staying updated on industry trends, agents can position themselves as indispensable partners to their clients. This level of commitment enhances the client's experience and strengthens the relationship between the homebuyer and their real estate agent, leading to lasting trust and satisfaction.
By focusing on these characteristics, agents can build trust with their clients and deliver a satisfying home-buying experience. Developing these skills through real estate education is essential to becoming a successful agent in today's competitive market.
Love,
Kartik
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Introduction:
In the competitive world of real estate, securing a California real estate license through our online real estate school is just the beginning. Experienced professionals understand that
Introduction:
In the competitive world of real estate, securing a California real estate license through our online real estate school is just the beginning. Experienced professionals understand that passing the real estate exam is just the beginning – sometimes, it's in their best interest to walk away from a potential deal. Aspiring agents are often eager to take on any listing, assuming it's a stepping stone to success. In this article, I wanted to write about five instances when a real estate agent should consider declining a listing, illustrated by stories from industry professionals who have navigated the complexities of the California real estate market.
Unrealistic Seller Expectations
In the context of real estate sales and listings, unrealistic seller expectations refer to situations where a property owner has unreasonable or impractical assumptions about the value or marketability of their property. These expectations may include an inflated asking price, an overly optimistic timeline for selling, or a refusal to acknowledge necessary repairs or improvements.
These expectations can make it difficult for a real estate agent to market and sell a property effectively. Potential buyers may be deterred by the high asking price or unwilling to invest in a property that requires significant work. Additionally, these expectations can lead to frustration and strained relationships between the agent and the seller, as the agent struggles to meet the seller's demands or explain the realities of the market. In some cases, it may be in the agent's best interest to decline the listing and avoid the challenges associated with unrealistic seller expectations.
Zillow's Zestimates, an automated home valuation tool, can sometimes cause unrealistic seller expectations and difficulties for property owners during the sale of their home. While Zestimates can provide a general idea of a property's value, they are generated using algorithms that may not always account for unique characteristics, recent upgrades, or current market conditions. Consequently, sellers might overestimate their home's worth based on these potentially inaccurate valuations, leading to inflated asking prices that deter potential buyers. Additionally, when property owners discover the discrepancy between the Zestimate and the actual market value of their home, they may experience disappointment and frustration, complicating the selling process for both the seller and their real estate agent.
Example: A seller, Mr. Smith, insisted that his property was worth $500,000, despite comparable homes in the area selling for around $400,000. After extensive market research, Agent Amy realized that Mr. Smith's expectations were unrealistic and that selling the property at his desired price would be nearly impossible. Instead of taking on the listing and wasting time, energy, and resources, Amy politely declined and suggested that Mr. Smith reconsider his price expectations.
Poor Property Condition
In real estate sales and listings, poor property condition refers to a property with significant defects, damages, or maintenance issues, making it less appealing to potential buyers or requiring extensive repairs or renovations. After passing the real estate exam, agents need to be aware of issues like structural problems, damaged foundations or roofs, outdated or unsafe electrical or plumbing systems, signs of water damage, mold or pest infestations, and a general lack of upkeep that results in a worn or neglected appearance. Understanding these factors is crucial for agents navigating the competitive California real estate market. It helps them decide when to decline a listing that might not be in their best interest.
Obviously, a property in poor condition can negatively impact its marketability as buyers may be hesitant to invest in a home that requires considerable time, effort, and money to bring it up to standard. In some cases, a property in poor condition may need help attracting offers or selling at a significantly lower price than comparable properties in better shape. Real estate agents may only accept listings with good property conditions if the seller is willing to address the issues or adjust the asking price accordingly. The property may be challenging to sell, potentially harming the agent's reputation.
Example: Agent Bob was excited to list a beautiful Victorian home, only to discover that the property was riddled with structural issues, including a crumbling foundation and termite damage. The sellers were unwilling to make the necessary repairs or adjust the asking price to account for these issues. Recognizing that the property would be a hard sell and could damage his professional reputation, Bob decided to walk away from the listing.
Ethical or Legal Concerns
Ethical or Legal Concerns refer to situations where an agent may encounter moral dilemmas, potential violations of the law, or breaches of professional conduct related to the property or the parties involved in the transaction.
Example: Agent Carol was approached by a seller who seemed eager to offload their property as quickly as possible. After digging, Carol learned that the home had a history of illegal activity, and the seller attempted to sell the property without disclosing this information. Carol chose not to take on the listing to protect her integrity and avoid potential legal repercussions.
Uncooperative Sellers
Uncooperative sellers are property owners unwilling or unable to work collaboratively with their real estate agent to market and sell their property effectively. Uncooperative sellers can create a range of challenges for agents, making the sales process complicated, time-consuming, and frustrating. This lack of cooperation can manifest in various ways.
First, uncooperative sellers may refuse to promptly provide the necessary documentation, such as property records, disclosures, or financial statements. This can impede the agent's ability to market the property or negotiate with potential buyers accurately. Delayed or incomplete paperwork can prolong the sales process, leading to missed opportunities and diminishing the chances of securing a successful deal.
Second, uncooperative sellers might prefer to make recommended improvements or repairs to their property. Real estate agents often suggest updates or fixes enhance the property's marketability and increase its value. However, some sellers may be unwilling to invest the time or money required to make these changes, ultimately making it more difficult for the agent to attract buyers and negotiate favorable terms.
Another manifestation of uncooperativeness is the reluctance to accommodate property showings or open houses. These events are crucial for attracting potential buyers and allowing them to view the property in person. Uncooperative sellers may cancel showings at the last minute, impose unreasonable restrictions on viewing times, or be unprepared for scheduled events, all of which can deter interested buyers and hinder sales.
Example: Agent David was excited to list a stunning luxury property but quickly realized that the sellers needed help. They were unresponsive, refused to provide the necessary documentation, and regularly canceled scheduled showings. Recognizing that the sellers' lack of cooperation would make the sales process challenging and inefficient, David decided walking away from the listing was best.
Overwhelmed Schedule
An overwhelmed schedule refers to an agent taking on too many active listings, clients, or responsibilities, resulting in an inability to dedicate adequate time, attention, and resources to each individual client or property. This can lead to diminished quality of service, reduced client satisfaction, and ultimately, a negative impact on the agent's reputation and success.
An overwhelmed schedule might require an agent to turn down a new client for several reasons:
1. Maintaining the quality of service: Real estate agents are responsible for providing exceptional service to their clients, which includes thorough communication, effective marketing strategies, and diligent representation in negotiations. Taking on too many clients can spread an agent too thin, preventing them from delivering the high level of service that clients expect and deserve.
2. Prioritizing existing clients: An agent has a fiduciary duty to act in the best interests of their current clients, and adding more clients to an already packed schedule can jeopardize their ability to fulfill that obligation. By turning down a new client, an agent can focus on existing clients, ensuring they receive the attention and care necessary for successful transactions.
3. Time management and work-life balance: Juggling many clients and listings can lead to long hours, increased stress, and potential burnout. By recognizing their limits and turning down new clients when necessary, agents can maintain a healthier work-life balance and avoid becoming overwhelmed.
4. Protecting professional reputation: An agent's success often relies on their reputation for excellent service, effective communication, and successful sales. Overextending themselves with too many clients can lead to negative experiences, harming their reputation and future business prospects. Agents can safeguard their reputation and maintain a thriving business by carefully managing their workload and declining new clients when appropriate.
Example: Agent Emma had a thriving real estate business with several active listings. When a seller approached her to list a new property, she realized that taking on another listing would spread her too thin and compromise her ability to provide exceptional service to her existing clients. Emma made the tough decision to decline the listing, prioritizing her commitment to her current clients.
Conclusion:
Knowing when to walk away from a listing is crucial for real estate agents who want to maintain a successful and ethical practice. Whether it's due to unrealistic expectations, poor property conditions, moral or legal concerns, uncooperative sellers, or an overwhelmed schedule, agents should carefully consider each potential listing and prioritize their best interests and those of their clients. By recognizing the red flags and making intelligent decisions, real estate professionals can avoid wasting time and resources on listings that don't align with their values and business goals.
For more information about real estate license courses, please visit www.adhischools.com or call us at 888 768 5285.
Love,
Kartik
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Title vesting refers to the legal manner in which an individual or entity holds ownership rights to a piece of real property. It is a crucial aspect of property transactions, as it determines the rights,
Title vesting refers to the legal manner in which an individual or entity holds ownership rights to a piece of real property. It is a crucial aspect of property transactions, as it determines the rights, interests, and privileges of the property owners and how the ownership is transferred or inherited in the event of a sale, gift, or death. Understanding title vesting is essential for anyone involved in real estate transactions, as it impacts decision-making, estate planning, and dispute resolution, ultimately shaping the rights and obligations of all owners.
I’m sure you remember this if you took my real estate license course, but real estate agents should never give their clients advice on title vesting methods for several reasons:
Lack of expertise: Real estate agents are not licensed attorneys, and their expertise lies in facilitating property transactions, marketing, and negotiating deals. Title vesting involves complex legal concepts and ramifications that require a thorough understanding of property and estate law. Providing advice without the necessary legal knowledge can result in misinformation, potentially causing financial and legal issues for clients.
Legal liability: A real estate agent may inadvertently assume a legal duty of care to their clients by offering advice on title vesting methods. If the advice turns out to be incorrect or causes harm to the client, the agent may be liable for damages through a negligence or malpractice claim.
State licensing regulations: Most states have laws prohibiting real estate agents from engaging in activities reserved for licensed attorneys, such as providing legal advice on title vesting methods. Violating these regulations can result in disciplinary actions, including fines, suspension, or revocation of the agent's real estate license.
Client's best interest: Real estate agents have a fiduciary duty to act in their clients' best interests. By refraining from advising on title vesting methods, agents ensure that clients consult qualified legal professionals who can provide accurate, tailored advice that aligns with the clients' unique circumstances and objectives.
It’s important to remember that I’m writing this article to help folks trying to pass the real estate exam. This article also should not be viewed as tax or legal advice.
Real estate agents should avoid advising on title vesting methods to protect their clients' interests, maintain professional boundaries, comply with licensing regulations, and avoid legal liability. Instead, agents should recommend clients consult a qualified attorney to obtain accurate and appropriate guidance on title vesting matters.
Even though real estate agents can’t advise their clients on how to vest, aspiring real estate professionals preparing for the real estate license exam must have a solid understanding of various property ownership types, especially joint tenancy and tenancy in common. I wanted to compare the pros and cons of these co-ownership forms, highlighting their differences and significance in real estate law.
With the help of ADHI Schools’ online real estate classes and resources, candidates pursuing a California real estate license can enhance their knowledge of these key concepts but this article will serve as a good starting point even if you aren’t already enrolled.
Joint Tenancy
Joint tenancy is a popular title vesting method in real estate, allowing two or more individuals to own property with unique rights and protections. This section explores the concept of joint tenancy, its characteristics and provides an example of joint tenancy ownership to illustrate its practical application in real estate transactions.
Understanding Joint Tenancy
Joint tenancy is a form of co-ownership in which two or more individuals hold an undivided interest in a property. It is characterized by the presence of the "four unities": time, title, interest, and possession. To help you prepare for the real estate license exam, you can remember this by the acronym TTIP.
This means that all joint tenants acquire their interests in the property simultaneously (TIME), from the same deed or document (TITLE), with equal ownership shares (INTEREST), and have equal rights to possess and use the entire property (POSSESSION).
One key feature that sets joint tenancy apart from other forms of co-ownership is the "right of survivorship." When one joint tenant dies, their interest in the property automatically passes to the surviving joint tenants, typically bypassing probate and avoiding potential delays and costs associated with the probate process.
Example of Joint Tenancy Ownership
Consider a married couple, John and Jane, who decide to purchase a home together. They opt for joint tenancy as their title vesting method. As joint tenants, they each hold an undivided 50% interest in the property and have equal rights to use and occupy the entire home.
The right of survivorship plays a crucial role in their ownership arrangement. If John were to pass away unexpectedly, his interest in the property would automatically transfer to Jane, making her the home's sole owner. This transfer occurs outside of the probate process, providing Jane with immediate, uninterrupted access to the property.
As joint tenants, John and Jane must make unanimous decisions regarding the property's management, maintenance, and any potential sale. This consensus requirement helps ensure that both parties' interests are considered and respected.
Conclusion
Joint tenancy is a widely used title vesting method in real estate, offering unique benefits to co-owners, such as the right of survivorship and equal ownership interests. Understanding the concept of joint tenancy and its implications is essential for individuals considering this form of co-ownership, as it directly impacts their rights, obligations, and estate planning strategies. By examining the example of John and Jane's joint tenancy ownership, we can better understand this title vesting method's practical application and advantages in real-life scenarios.
Pros and Cons of Joint Tenancy
Pros:
1. Right of survivorship: Joint tenancy comes with the right of survivorship, meaning that when a joint tenant dies, their interest in the property passes automatically to the surviving tenants. This avoids probate, saving time and expenses. This could be a benefit to joint tenancy.
2. Equal ownership: All joint tenants hold equal ownership interests and possess the same rights, ensuring fairness among co-owners.
3. Simplified decision-making: As all joint tenants have equal rights and interests, decision-making related to the property's management and use is more straightforward.
Cons:
1. Limited control: Joint tenants cannot independently sell, transfer, or encumber their share of the property without affecting the entire ownership structure.
2. Potential disagreements: Equal ownership rights and interests may lead to disputes among joint tenants, as all decisions must be unanimous.
3. Inflexible ownership shares: Joint tenancy requires equal ownership shares, which might not suit all co-owners' preferences or financial situations.
Tenancy in Common
Tenancy in common is a prevalent title vesting method in real estate that enables two or more individuals to own property together while retaining separate and distinct interests. In this section of this article I wanted to delve into the concept of tenancy in common, its characteristics and provides an example of tenancy in common ownership to demonstrate its practical application in real estate transactions.
Understanding Tenancy in Common
Tenancy in common is a form of co-ownership in which two or more individuals hold separate and distinct interests in a property. Unlike joint tenancy, tenancy in common does not require the presence of the "four unities" – time, title, interest, and possession. This means that tenants in common may acquire their interests in the property at different times, through different documents, or in unequal shares. However, all tenants in common have equal rights to possess and use the entire property, regardless of their ownership shares.
A critical difference between tenancy in common and joint tenancy is the absence of the "right of survivorship" in a tenancy in common when a tenant in common dies, their interest in the property passes to their heirs or designated beneficiaries, as outlined in their will or state intestacy laws, rather than automatically transferring to the surviving co-owners.
Example of Tenancy in Common Ownership
Consider three friends, Alice, Bob, and Carol, who decide to invest in a vacation property together. They choose tenancy in common as their title vesting method due to its flexibility in ownership shares. Alice contributes 50% of the purchase price, while Bob and Carol each contribute 25%. While not required, their ownership interests in the property reflect their respective contributions:
Alice owns a 50% interest, while Bob and Carol each own a 25% interest.
Since there is no right of survivorship in a tenancy in common, if Alice were to pass away, her 50% interest in the property would not automatically transfer to Bob and Carol. Instead, her interest would pass to her designated beneficiaries or heirs according to her will or state laws covering the property of a deceased when they die with no will - also called intestate.
As tenants in common, Alice, Bob, and Carol must collaborate on property management, maintenance, and potential sales decisions. However, each tenant in common has the freedom to sell or transfer their interest in the property without the consent of the other co-owners.
Conclusion
Tenancy in common is a widely used title vesting method in real estate, offering unique benefits to co-owners, such as flexible ownership shares and the ability to transfer interests independently. Understanding the concept of tenancy in common and its implications is crucial for individuals considering this form of co-ownership, as it directly impacts their rights, obligations, and estate planning strategies. By examining the example of Alice, Bob, and Carol's tenancy in common ownership, we can better understand the practical application and advantages of this title vesting method in real-life scenarios.
Pros and Cons of Tenancy in Common
Pros:
1. Flexible ownership shares: Tenancy in common allows co-owners to hold unequal property shares, making it a more flexible option for parties with differing financial capacities or preferences.
2. Independent control: Tenants in common can more easily sell, transfer, or encumber their share of the property without the consent of other co-owners compared to a joint tenancy vesting.
3. Customizable estate planning: Tenancy in common enables co-owners to choose their property share's beneficiaries, offering greater freedom in estate planning.
Cons:
1. No right of survivorship: Tenancy in common lacks the right of survivorship, which means that a co-owner's share of the property passes through probate upon their death, potentially causing delays and expenses.
2. Complex decision-making: As tenants in common may hold unequal shares, decision-making related to property management and use can be more complicated, especially if there are disagreements among co-owners.
3. Potential partition risks: In case of disputes or a desire to sell, tenants in common may face the risk of court-ordered partition, which can lead to a forced sale or physical division of the property.
In preparation for the real estate license exam, it is essential to understand the pros and cons of joint tenancy and tenancy in common and their legal implications. Our real estate classes for obtaining a California real estate license can provide you with the necessary knowledge to navigate these critical co-ownership concepts on the real estate test confidently.
Love,
Kartik
TLDR: Title vesting determines the ownership rights and transfer of property in real estate transactions, and it's important to understand the different methods available. Real estate agents should avoid giving advice on title vesting due to lack of legal expertise, legal liability, state licensing regulations, and the clients' best interests. Two common co-ownership forms are joint tenancy and tenancy in common. Joint tenancy offers the right of survivorship, equal ownership, and simplified decision-making, but limited control and potential disagreements. Tenancy in common allows for flexible ownership shares, independent control, and customizable estate planning, but lacks the right of survivorship, has complex decision-making, and potential partition risks. It's important to understand the pros and cons of these methods and their legal implications for the real estate license exam
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I never imagined that I'd be writing an article on the entertainer Drake for our real estate school blog, yet here I am. I previously authored an article discussing the trend of individuals relocating
I never imagined that I'd be writing an article on the entertainer Drake for our real estate school blog, yet here I am. I previously authored an article discussing the trend of individuals relocating from California to other states, specifically during the COVID pandemic. However, the news of Drake reportedly putting his final US property on the market has piqued my interest.
First, for our real estate school students who are interested in breaking into luxury real estate, this is particularly appropriate as the same licenses that you would need to sell a small condo in southern California is the same license that allows you to sell a mansion like the one discussed in this article.
Canadian-born rapper Drake is reportedly saying goodbye to America as he lists his final US property, an $88 million Beverly Hills estate, for sale. The Grammy award-winning artist has allegedly decided to return to his hometown of Toronto, where he resides in a custom-built mansion. The Beverly Hills estate is a stunning Tuscan-style home boasting luxurious features and amenities, increasing appeal to what is certainly a narrow buyer pool.
The KAA Associates designed property Drake is selling has a celebrity ownership history, with British pop star Robbie Williams initially purchasing the property before Drake acquired it for $75 million in 2022. The sprawling estate is situated on a roughly 19.7-acre lot in the verdant hills of Benedict Canyon.
Public records indicate a structure size of 24,260 square feet featuring 10 bedrooms and 22 bathrooms, offering ample space for both living and entertaining. Its resort-style landscaping and incredible city, ocean, and mountain views create an atmosphere of luxury and relaxation.
According to sources, the property is stacked with lavish amenities, including a circular motor court with water fountains, a grand columned entryway, a double-height foyer, and a sweeping grand staircase. The living spaces feature two fireplaces, a library with built-in cabinets, a formal dining room, and a gourmet kitchen with a breakfast room.
Additional features include a professional screening room, wine cellar, gym, game room, hidden tennis court, and an 11-car garage. The estate also boasts a pool/guest house with a mosaic-tiled pool, an indoor-outdoor kitchen, and an orchard with mature olive trees and ancient oaks. The 11-car garage is appropriate as the musician is known to have a car collection consisting of a 2016 Ferrari LaFerrari, a 2010 Mercedes SLR McLaren, and even a coveted Bugatti Veyron, according to British GQ magazine.
Drake has recently sold off a string of US properties totaling $26 million. The sales include a trio of properties in the Hidden Hills neighborhood of Los Angeles, purchased by various buyers, including LA Rams quarterback Matthew Stafford and former US assistant attorney general Makan Delrahim.
In Toronto, Drake's custom-built 50,000-square-foot mansion serves as his primary residence. The property features an NBA-regulation size indoor basketball court and numerous other lavish amenities. The rapper's intention behind the home's design was to create a timeless, monumental structure that would stand firm for 100 years.
Drake's decision to sell his final US property and focus on his Canadian roots demonstrates his commitment to his hometown of Toronto. With no known plans to purchase any other properties in the United States in the near future, the rapper's luxurious Beverly Hills estate is now up for grabs, offering a rare opportunity for potential buyers to own a piece of celebrity real estate.
As always, if you are interested in a career in real estate, reach out to our school at www.adhischools.com or call us at 888-768-5285.
Love,
Kartik
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Getting your real estate license is the first step to becoming a successful agent. While many agents dream of selling luxury real estate and catering to an affluent clientele, it takes dedication, hard
Getting your real estate license is the first step to becoming a successful agent. While many agents dream of selling luxury real estate and catering to an affluent clientele, it takes dedication, hard work, and the right strategies to break into this competitive market. This article will guide you on your journey to becoming a luxury real estate professional, offering tips on gaining confidence, staying relevant, and thriving in the industry.
Step 1: Obtaining Your Real Estate License and Preparing for the Luxury Market
If you aim to work in California, you must familiarize yourself with the state's real estate license requirements California has specific regulations that govern real estate professionals, and understanding these rules will ensure you're well-prepared to succeed in the luxury market.
Applicants must be at least 18 years old and a legal resident of the United States. If you are an out-of-state candidate, the good news is that California residency is not a prerequisite.
Candidates must complete 135 hours of pre-license education from a California-approved real estate school like ADHI Schools. The coursework consists of three 45-hour courses: Real Estate Principles, Real Estate Practice, and an elective course.
Once the pre-license education is complete, candidates must submit their application for the exam and license with the required fees. The state exam costs $100, and a four-year license costs $350.
If you take and fail the real estate license exam, you can retake it by paying another $60 fee to the state. This is one of the many reasons you want to enroll with ADHI Schools to increase your chances of passing the first time!
Why ADHI Schools is the Premier Choice
ADHI Schools is considered the premier choice for obtaining a California real estate license based on several factors:
Comprehensive Curriculum: ADHI Schools offer a thorough and engaging curriculum covering all the required California real estate licensing courses. The courses are designed to prepare students for success in both the licensing exam and their real estate careers.
Flexible Learning Options: ADHI Schools provides various learning options, including online courses, physical textbooks, live classes, and hybrid programs, allowing students to choose the most convenient and suitable format for their needs.
Expert Instructors: The instructors at ADHI Schools are experienced professionals with in-depth knowledge of the real estate industry. They are dedicated to helping students understand complex concepts and prepare for the challenges of a real estate career. Our newest instructor has been teaching for over ten years.
Exam Preparation: ADHI Schools offers comprehensive material and resources to ensure students are well-prepared for the California real estate salesperson examination. This includes practice exams, study guides, and personalized support from instructors.
Student Support: The staff at ADHI Schools is committed to providing exceptional support and guidance throughout the licensing process. Students can rely on ADHI Schools for assistance and encouragement from enrollment to exam preparation and beyond.
ADHI Schools has established itself as the premier choice for aspiring real estate agents seeking a California real estate license by offering a comprehensive curriculum, flexible learning options, expert instructors, and outstanding support.
Step 2: Gaining Confidence in the Luxury Real Estate Markets
Now that you have your California real estate license, the next step is to enter the luxury real estate world.
If you want to break into the luxury market, it’s important to remember that the brokerage you work with matters. I know you might have an uncle or cousin who is a real estate broker, and they are offering you a “good split.” Still, the truth is that working with an established luxury brokerage provides you with invaluable access to a network of other experienced luxury agents and brokers. As a new agent, you can benefit greatly from the mentorship, guidance, and support of seasoned professionals who have navigated the unique challenges and opportunities within the luxury market. This can help you accelerate your learning curve, avoid common pitfalls, and develop the confidence and expertise necessary to thrive in the competitive luxury niche.
Second, a brokerage with a well-regarded luxury brand will often have an extensive client base and a steady flow of high-end listings. By joining such a company, you gain immediate credibility and exposure to potential clients and other industry professionals. This can help you build your reputation, establish trust, and attract the affluent clientele essential for success in luxury real estate.
Furthermore, a luxury-focused brokerage is more likely to invest in the specialized resources and tools necessary to excel in this niche market. This includes advanced marketing strategies, cutting-edge technology, and high-quality support services, which can enhance your ability to market and sell luxury properties effectively. By leveraging these resources, you can deliver a superior experience to your clients and set yourself apart from the competition.
Networking with luxury professionals
Networking with experienced luxury real estate agents and brokers can provide invaluable connections, insights, and mentorship opportunities. Attend industry events, conferences, and local gatherings to build relationships that can help you gain confidence and knowledge.
It’s also critical to stay informed about market trends. Keep updated with the latest luxury real estate trends, news, and developments. This will help you gain confidence in your understanding of the market and provide essential information that can benefit your clients and potential leads.
Learn From Top Producers
As a new Realtor aiming to break into the luxury real estate market, learning from top producers and observing their strategies is critical in accelerating your growth and success. Top producers have navigated the challenges of the luxury market and honed their skills, allowing them to achieve exceptional results consistently. By studying their approaches, you can glean valuable insights and adopt proven techniques to thrive in this competitive niche.
One key aspect of learning from top producers is understanding their marketing strategies. Luxury real estate demands a tailored approach that effectively showcases the properties' unique features and appeals to the discerning tastes of affluent clientele. Watch how successful agents utilize high-quality photography, videography, and virtual tours to present properties in their best light. Additionally, take note of their branding, storytelling, and targeted marketing efforts across various platforms, including social media, print advertising, and digital channels. By adopting and adapting these strategies, you can enhance your marketing campaigns and attract the attention of prospective luxury clients.
Another critical element to consider is the exceptional level of customer service that top producers provide. Luxury real estate clients often have high expectations, and successful agents are adept at meeting and exceeding those demands. Pay close attention to how top producers communicate, negotiate, and problem-solve and how they anticipate and address clients' needs.
Emulating their strong interpersonal skills and commitment to client satisfaction will help you build lasting relationships and a reputation for excellence in the luxury market.
Moreover, top producers are often well-versed in industry trends, market data, and luxury clients' specific needs and preferences. By staying informed and maintaining a deep understanding of the luxury market, you can position yourself as a knowledgeable resource and trusted advisor to your clients. Learn from successful agents by following their lead, consistently updating your knowledge, and staying ahead of market shifts and trends.
Step 3: Staying Relevant as a Luxury Real Estate Professional
To stay relevant as a luxury real estate agent, it’s important to remember that the real estate industry is constantly evolving, and staying ahead of the curve is crucial for success. Participate in online real estate classes, workshops, and seminars to keep your skills sharp and your knowledge current.
Don’t be beholden to the old ways of doing things. It’s often said, "What got you here won’t get you there.”
Embrace new technologies and tools that can streamline your workflow, improve your marketing efforts, and provide a better experience for your clients. From virtual property tours to advanced customer relationship management software, staying technologically savvy will help you remain relevant in the luxury market.
Finally, a strong personal brand is essential for standing out in the luxury real estate market. Invest in professional photography, create a polished website, and develop a consistent presence on social media to demonstrate your expertise and commitment to the luxury market.
Final word
Breaking into the luxury real estate market takes dedication, persistence, and a willingness to learn. By obtaining your real estate license, gaining confidence through networking and market knowledge, and staying relevant with continuous education and technology, you'll be well on your way to becoming a successful luxury real estate professional.
Your first step in starting a career in real estate begins with the right real estate school. Enroll online at www.adhischools.com or call us at 888 768 5285.
Love,
Kartik
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As a real estate license school in Rancho Cucamonga, California, we are vested in local developments and how they impact the surrounding community. Recently, IKEA's announcement of abandoning its initial
As a real estate license school in Rancho Cucamonga, California, we are vested in local developments and how they impact the surrounding community. Recently, IKEA's announcement of abandoning its initial plans to construct a colossal retail store in Ontario and opting for a distribution warehouse piqued my interest. Furthermore, the city's reaction to this planned shift carries significant implications and is worth observing closely. I wanted to write about this specifically because there are so many lessons here for the new real estate agent or the person studying for their real estate license exam. Among these lessons are exploring the role of cities in dictating land use, how the economy has changed post-pandemic, and how that has influenced this potential new location.
Public records reveal that in 2019, IKEA purchased at least five parcels just north of the 10 freeway in Ontario, encompassing around 25 acres of land. Reporting indicates that IKEA initially planned to build a 330,000-square-foot retail store on Inland Empire Boulevard, across from the Ontario International Airport. This was undoubtedly a massive decision for IKEA as the company only has around 50 stores in the entire United States and there is already a massive retail showroom in Covina - only about 15 miles west of the proposed new location. Reporting also suggests that due to the pandemic, the company pivoted its business model and wanted to build a distribution warehouse instead of a full retail location.
In the same reporting, the Daily Bulletin reports that this proposal to change the site from a retail showroom to a distribution center did not sit well with the city of Ontario. It appears that the city is going to block IKEA’s proposal according to additional reports.
Questions remain as to what IKEA will now do with the around 25 acres that they own and whether they will be able to come to some compromise with the city of Ontario.
From your Real Estate Principles course, you might remember that in urban planning, general and specific plans serve as two distinct yet related tools for guiding land use, development, and growth within a city or a county. Both plans help ensure that development occurs in a well-organized and sustainable manner, addressing various aspects of land use, zoning, transportation, housing, and environmental concerns.
General Plan
A general plan, or a comprehensive plan or master plan, is a comprehensive, long-range policy document that establishes the overall vision, goals, and objectives for a city or county's future growth and development. It provides a framework for land use, circulation, housing, conservation, open space, safety, noise, and other elements crucial to the community's well-being. The general plan guides decision-making regarding zoning, capital improvements, public services, and other land use matters.
The general plan consists of several elements, each addressing a specific community development aspect. These elements are usually interrelated and should be consistent with one another. State laws often dictate the minimum required elements for a general plan, but local governments may include additional elements as they see fit.
Specific Plan
On the other hand, a specific plan is a more detailed planning document that focuses on a smaller, well-defined area within the jurisdiction. It serves as a bridge between the general plan's broader policies and the actual development projects that will take place within the specific plan area.
Specific plans outline precise development standards, land use designations, zoning regulations, infrastructure requirements, and implementation measures for the targeted area. They are tailored to address the unique needs and characteristics of the area in question, ensuring that development occurs in accordance with the community's vision and the general plan's goals.
In summary, while the general plan provides a comprehensive, long-range vision for the entire city or county, the specific plan offers a more detailed and focused approach to land use and development within a particular area. Both types of plans work together to ensure that growth and development occur in a well-planned and sustainable manner, reflecting the needs and aspirations of the community.
The Post-Pandemic Economy and IKEA's Decision
The COVID-19 pandemic has significantly impacted the global economy, forcing businesses to adapt and change their strategies. One major shift has been the growth of e-commerce and the need for more efficient distribution channels. IKEA's decision to attempt to build a distribution warehouse instead of a traditional retail store is a clear reflection of this trend.
As a real estate license school, we must stay updated on such trends and share our insights with our students and community. The evolving economy post-pandemic, the impact on businesses like IKEA, and the importance of cities' role in land use are all valuable lessons for aspiring real estate professionals.
Ontario's IKEA distribution center dilemma is a prime example of how the post-pandemic economy, land use regulations, and city planning intersect in real estate. As a real estate school, we strive to provide relevant, timely, and informative content for our students and community.
Stay tuned to our ADHI Schools blog for more local developments and real estate news updates and if you are interested in getting your real estate license visit www.adhischools.com or call us at 888-768-5285.
Love,
Kartik
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For most people, purchasing a home is one of the most significant financial decisions an individual can make in their lifetime. Given the considerable investment involved, homebuyers need to ensure that
For most people, purchasing a home is one of the most significant financial decisions an individual can make in their lifetime. Given the considerable investment involved, homebuyers need to ensure that the property they are buying is structurally sound and free from potential problems. A critical step in achieving this is getting a home inspection before closing escrow. I wanted to write an article discussing a home inspection, why buyers should get home inspections, the typical costs associated with home inspections, and the process involved.
This is especially important reading for the licensee who just passed the real estate exam and completed real estate school because this topic isn’t really tested on the state licensing exam in California.
What is a Home Inspection?
A home inspection should be a comprehensive assessment of a property's physical structure, systems, and overall condition, carried out by a qualified professional - a home inspector. The primary goal of a home inspection is to identify any existing or potential issues that may affect the value, safety, or functionality of the home. The inspection typically includes visually examining the property's foundation, roof, plumbing, electrical systems, heating and cooling systems, insulation, ventilation, and other essential components. Upon completion, the home inspector provides the buyer with a detailed report outlining their findings and recommendations for any necessary repairs or improvements.
Who Licenses Home Inspectors in California?
Despite the lack of a licensing requirement for home inspectors in California, it is still highly advisable for buyers to seek a home inspection before purchasing a property. A home inspection performed by an experienced and reputable inspector offers invaluable insights into the condition of a house and helps buyers make informed decisions about the transaction.
The absence of a licensing requirement raises concerns about the quality and reliability of home inspections in the state. Licensing home inspectors would ensure minimum competence and knowledge, thereby providing greater protection to consumers. It would also help maintain industry standards and create a more level playing field for professionals. With a formal licensing process, home inspectors would be required to undergo training, demonstrate expertise, and adhere to ethical guidelines, ultimately resulting in better service and more reliable outcomes for home buyers - but that’s not the case as of the time of this writing. Home inspection companies aren’t required to be licensed in California.
By implementing a licensing system, the state would help ensure home inspectors are held accountable for their work, promoting transparency and giving buyers peace of mind.
Despite not needed to be licensed, home buyers should still obtain a home inspection before purchasing a property.
Why Buyers Should Get Home Inspections
1. Identifying Hidden Issues: A home inspection allows buyers to uncover potential problems that may not be immediately apparent during a casual walk-through or from the seller's disclosures. This could include structural damage, water damage, mold, or outdated electrical systems, which could be costly to repair or pose safety hazards.
2. Negotiating Power: A thorough home inspection gives buyers valuable information that they can use to negotiate the purchase price or request repairs from the seller before closing. If significant problems are discovered, the buyer may be able to either renegotiate the price or request that the seller address the issues.
3. Planning for Future Expenses: The home inspection report can help buyers plan for future maintenance or repair costs. By understanding the home's current condition and its systems, buyers can better budget for necessary expenses and avoid surprises.
4. Peace of Mind: A home inspection provides buyers with confidence and reassurance, knowing they have made a well-informed decision about their purchase. It reduces the likelihood of post-purchase regrets or discovering serious issues after moving in.
Risks of Not Obtaining a Home Inspection
Safety and Health Risks
Skipping a home inspection can lead to unexpected financial burdens down the road. If a significant problem is discovered after the close of escrow the buyer may have to cover the cost of repairs or replacements out of pocket. In some cases, these expenses can be substantial, causing financial strain and potentially forcing a buyer to take out loans or tap into their savings to cover the costs. Furthermore, if the property is sold in the future, unresolved issues can decrease the resale value, resulting in a lower return on investment.
Another critical aspect of a home inspection is ensuring the safety and health of the property's occupants. Inspectors (although unlicensed) should be trained to identify potential hazards, such as mold, asbestos, radon, and lead paint, which can pose serious health risks if not addressed. Skipping a home inspection can leave a buyer exposed to these dangers, potentially resulting in long-term health consequences and expensive remediation efforts.
Typical Costs of a Home Inspection
The cost of a home inspection varies depending on the property's size, age, and location. On average, home inspections in the United States range from $400 to over $1,000 with larger or older homes potentially costing more due to the additional time and complexity involved. It is essential to remember that while a home inspection may seem like an added expense, it is a small price compared to the potential costs of unforeseen repairs or disputes with the seller.
The Home Inspection Process
The home inspection process typically begins with the buyer hiring a home inspector. On the day of the inspection, the inspector will arrive at the property and conduct a thorough examination, which may take anywhere from two to four hours, depending on the size and complexity of the home. The buyer is often encouraged to accompany the inspector during the inspection, as it provides an opportunity to ask questions and better understand the home's condition. Once the inspection is complete, the inspector should compile a detailed report, including photographs and descriptions of any issues found. The buyer can then review the report and decide whether to request repairs, renegotiate the purchase price, or proceed with the purchase as-is.
The Home Inspection As A Negotiating Tool
One of the key benefits of a home inspection is the ability to use the information gathered to negotiate with the seller. If the inspection reveals issues that need to be addressed, buyers can request that the seller make the necessary repairs or provide a credit towards the cost of fixing the problems. With a home inspection, you can take advantage of the opportunity to negotiate a better deal, potentially leaving you to cover the costs of any issues discovered after the purchase to ensure that the property is the wonderful investment you and your client believe it to be.
Love,
Kartik
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As a real estate agent, prospecting is one of the most critical aspects of your job. It's the foundation of building a solid client base and ensuring a steady stream of business. One of the most effective
As a real estate agent, prospecting is one of the most critical aspects of your job. It's the foundation of building a solid client base and ensuring a steady stream of business. One of the most effective ways to maximize your prospecting efforts is to do it first thing in the morning, before you do anything else. In this blog post, I wanted to discuss the benefits of morning prospecting and how it can contribute to your success as a real estate agent, from getting started at a reputable California real estate school to acing the real estate exam and beyond.
Why Morning Prospecting is Essential for Real Estate Agents
Many successful individuals, including top-performing real estate agents, have established morning routines that help set the tone for a productive day. By incorporating prospecting into a consistent morning routine, agents can establish a strong habit that becomes an integral part of their daily success strategy. This consistency helps agents stay disciplined and focused on their goals, leading to increased productivity and success in their real estate careers.
Mornings are when most people feel refreshed and energized after a good night's sleep. This is the perfect time to channel that energy into prospecting, as it will allow you to approach potential clients with enthusiasm and a positive attitude. It’s no secret that after a good night's sleep, the body has had time to recover from the previous day's activities, repair tissues, and consolidate memories. This restoration process leaves people feeling refreshed and rejuvenated when they wake up in the morning - and ready to make those calls!
Also, don’t forget that cortisol levels are typically at their highest in the early morning, which helps increase alertness and energy levels. Cortisol, the "stress hormone," helps regulate the body's sleep-wake cycle. This rhythm is influenced by exposure to natural light and helps the body prepare for waking up in the morning by increasing body temperature, blood pressure, and hormone levels.
Also, in the morning, the mind is generally less cluttered with thoughts and distractions from the previous day. This clear mental state allows for improved focus and concentration, contributing to higher energy levels - you’ll sound better on the phone!
Not to mention that there are typically fewer distractions in the early hours of the day, making it an ideal time to focus on prospecting. With fewer emails, calls, and meetings to attend, you can dedicate your full attention to connecting with potential clients and setting up appointments.
Also people are generally more receptive in the morning. Many people are more open to having conversations and making decisions in the morning when their minds are fresh and not yet cluttered with the day's tasks. This receptiveness can lead to more productive discussions and a higher likelihood of securing appointments with potential clients.
Reaching Clients Before the Competition
By prospecting in the morning, real estate agents can get a head start on their competition. Many agents may not begin their workday until later, giving those who start early an advantage in connecting with potential clients first. This early-bird approach can help real estate agents stand out and make a lasting impression on prospects before their competitors even have the chance to reach them.
Getting Started: Enroll in a California Real Estate School
Before beginning your journey as a real estate agent, you must enroll in a reputable California real estate school, like ADHI Schools. This is the first step towards obtaining your real estate license, as the school will provide you with the necessary knowledge and skills to succeed in the industry and pass the real estate exam. Our high-quality real estate school will offer comprehensive courses, experienced instructors, and proven results, ensuring you are well-prepared for the challenges.
Passing the Real Estate Exam
After completing your real estate courses at a California real estate school, you must pass the real estate exam. This is a crucial milestone in your journey towards becoming a successful real estate agent, demonstrating your knowledge of real estate laws, vocabulary, and principles. By adequately preparing for the exam, you can boost your chances of success and set yourself up for a prosperous career in real estate.
Before you get too deep down the prospecting rabbit hole, your journey towards becoming a successful real estate agent begins with enrolling in a reputable California real estate school and passing the real estate exam. By investing in your education and honing your prospecting skills, you can build a thriving career in the real estate industry.
Love,
Kartik
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In recent years, California has experienced a significant boom in the real estate industry. With a thriving housing market and a diverse population, it is no surprise that many individuals are pursuing
In recent years, California has experienced a significant boom in the real estate industry. With a thriving housing market and a diverse population, it is no surprise that many individuals are pursuing careers as real estate agents in the Golden State. After over 20 years in the real estate business
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Los Angeles is currently grappling with a significant homelessness crisis, and city officials are searching for ways to address this pressing issue. One idea that went into effect recently is the so-called
Los Angeles is currently grappling with a significant homelessness crisis, and city officials are searching for ways to address this pressing issue. One idea that went into effect recently is the so-called “mansion tax”, a controversial policy that has generated considerable debate among residents. While some argue that the tax is necessary to alleviate the city's housing crisis, others contend that it unfairly punishes wealthy property owners and successful individuals. I wanted to write an article that delves into the complexities surrounding the mansion tax, exploring both the benefits of the tax in addressing homelessness and the concerns about its potential negative consequences.
Most of our real estate classes are now on Zoom and done virtually, but I taught at a couple of real estate schools on the Westside of Los Angeles for many years and several of our students wanted to break into luxury real estate and I’m curious to know what you think.
Understanding the Mansion Tax
On April 1, 2023, a so-called “mansion tax” was enacted in Los Angeles. The tax applies to property sales at or over $5,000,000, with an increased rate for sales of $10,000,000 and above.
The tax was approved by voters in November 2022 as a city-wide tax, implementing a 4% tax on properties that sell for $5 million or more and 5.5% on properties that sell for $10 million or more. The mansion tax aims to raise about $900 million yearly for affordable housing, homelessness programs, and other related initiatives. However, the tax has faced criticism from real estate brokers, developers, and property owners.
Arguments for the Mansion Tax
Proponents of the mansion tax argue that it is a much-needed source of revenue to address the affordable housing crisis and homelessness in Los Angeles. The tax is expected to generate millions of dollars earmarked for subsidized housing, housing acquisition and rehabilitation, rent assistance, and homelessness-related programs. Advocates say the tax will help bridge the gap between the rich and the poor and provide resources for those in need. A 2022 UCLA study found that the mansion tax's potential impacts on new construction would be minimal, suggesting that the tax will not significantly deter developers from building new properties in Los Angeles.
The mansion tax in Los Angeles, despite its drawbacks, offers several benefits that could potentially help address the city's homelessness problem:
1. Generating Revenue for Affordable Housing and Homelessness Programs: The mansion tax is estimated to raise about $900 million annually, which can be directed towards various initiatives focused on tackling the housing crisis and homelessness. This additional funding can support the construction and preservation of affordable housing units and provide rent assistance to those in need. It can also help fund comprehensive homelessness programs, such as emergency shelters, permanent supportive housing, mental health services, and job training programs, essential in addressing the root causes of homelessness.
2. Progressive Taxation: The mansion tax is a form of progressive taxation, as it targets high-end property sales and wealthier individuals who can afford to pay a higher tax rate. This approach can help reduce income inequality and bridge the gap between the rich and the poor. By imposing a higher tax on luxury properties, the city can allocate more resources to support vulnerable and low-income residents, often disproportionately affected by the housing crisis.
3. Encouraging Efficient Use of Land: The mansion tax might encourage more efficient land use in Los Angeles. Luxury properties often occupy large plots of land, and the mansion tax could motivate property owners to either downsize or sell their land to developers who might build more affordable housing units in its place. This could ultimately increase the overall housing supply, alleviating the pressure on the city's housing market and potentially reducing homelessness.
4. Increased Awareness and Involvement: Implementing the mansion tax has generated significant public debate, raising awareness of the homelessness crisis in Los Angeles. This increased attention could lead to greater involvement from residents, businesses, and other stakeholders in finding long-term solutions to the housing crisis. This collective effort could result in developing more effective policies, initiatives, and partnerships to address homelessness in the city.
5. Demonstrating Commitment to Social Responsibility: The mansion tax conveys that Los Angeles is committed to addressing its homelessness problem and working towards a more equitable city. By using tax revenue from luxury property sales to fund affordable housing and homelessness programs, the city demonstrates its dedication to social responsibility and the welfare of all its residents.
The mansion tax in Los Angeles presents several potential benefits that could help alleviate the city's homelessness problem. By generating additional revenue for affordable housing and homelessness programs, promoting progressive taxation, encouraging efficient land use, raising awareness, and demonstrating a commitment to social responsibility, the mansion tax might contribute to creating a more equitable city and ultimately reducing homelessness.
Arguments Against the Mansion Tax
Critics of the mansion tax argue that it may slow the number of new apartment complexes built in the city. The tax applies not only to mansions but also to apartment complexes, retail and industrial buildings, and other structures. Real estate brokers and developers, including those with real estate licenses from real estate school and those who have passed the California real estate exam, warn that the tax will disincentivize developers from building new housing.
Moreover, the tax has faced backlash from wealthy homeowners, including celebrities, who rushed to sell their properties before it went into effect. Some critics argue that the tax may depress property values and force sellers to cut prices to complete deals before the deadline. Additionally, opponents of the tax are concerned about the transparency of how the revenue will be spent, and they argue that the tax may dissuade people from moving to Los Angeles.
Higher Costs: Wealthy individuals considering purchasing a luxury property in Los Angeles might be deterred by the additional costs associated with the mansion tax. In comparison, other cities or states without such a tax might become more attractive for high-end property buyers, leading them to choose alternative locations for their investments. For example, a prospective buyer might opt for a luxury property in Miami, Florida, with no state income tax or mansion tax, making it a more financially appealing option.
Reduced Investment: Investors might also be less inclined to purchase properties in Los Angeles subject to the mansion tax, as it could potentially reduce the profit margin on their investments. This could result in a decline in the city's overall demand for luxury properties, further impacting the real estate market and potentially leading to reduced property values. Consequently, the city could experience a slowdown in real estate investments, which could negatively affect the local economy and limit available resources to address homelessness and other social issues.
Impact on Business and Talent Attraction: Businesses, particularly those in the entertainment and technology industries, often attract high-income employees and executives who might consider purchasing luxury properties. However, implementing the mansion tax could discourage some individuals from moving to Los Angeles. In turn, this could make it more difficult for the city to attract new businesses and retain existing ones and limit its ability to draw in top talent across various industries.
Celebrity Exodus: Los Angeles is known for being home to numerous celebrities who often own high-end properties. The mansion tax could potentially prompt some of these high-profile individuals to sell their properties and relocate to areas with lower taxes, as seen in the backlash from wealthy homeowners who rushed to sell their properties before the tax went into effect. This exodus could further contribute to the decline in property values and negatively impact the city's image, tourism, and the overall economy.
In conclusion, implementing Los Angeles' mansion tax has stirred a significant debate in the city's real estate market. Advocates argue the tax will generate much-needed revenue to address the city's affordable housing crisis and homelessness issues. However, opponents contend that the tax will dissuade property development, negatively impact non-luxury properties, and ultimately harm the real estate industry in Los Angeles. As real estate professionals with real estate licenses from real estate schools, and those studying for the California real estate exam, monitor the situation, the long-term implications of the mansion tax on the city's real estate market remain uncertain. Time will tell whether this tax proves to be an effective solution to Los Angeles' housing challenges or an obstacle to the city's real estate growth.
As always if you are interested in getting your real estate license, visit www.adhischools.com or click here for a real estate exam crash course. Or if you’re old school - call us at 888-768-5285.
Love,
Kartik
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Secrets to Success in the Real Estate Industry: How to Get a California Real Estate License and Thrive
Introduction: The real estate industry offers vast opportunities for professional growth and financial
Secrets to Success in the Real Estate Industry: How to Get a California Real Estate License and Thrive
Introduction: The real estate industry offers vast opportunities for professional growth and financial success. However, it can also present challenges for both newcomers and experienced agents. To help you navigate the world of real estate and achieve your goals, we have compiled top insider tips from successful professionals. These actionable steps will provide you with the tools needed to excel in this dynamic and competitive industry.
One of the first steps to success in the real estate industry is investing in continuous education. The field of real estate is constantly evolving, and staying ahead of the curve is essential. Enroll in a reputable reputable real estate school like ADHI Schools, attend seminars, and keep up-to-date with industry trends to maintain a competitive edge. Real estate is a heavily regulated industry, with laws and regulations pervading all aspects of the real estate transaction. Continuing education helps agents stay informed about the latest legal and regulatory changes, ensuring they remain compliant and avoid potential fines or legal issues. Attending courses, workshops, and seminars often provides opportunities to network with other professionals, fostering valuable connections that can lead to referrals and collaboration.
After obtaining your California real estate license developing a solid personal brand is crucial. Your personal brand is your unique selling proposition. Establish a clear, consistent image and message that sets you apart from competitors. Utilize social media, create engaging content, and maintain an up-to-date website. One of the hardest things about social media posting is maintaining consistency around your posts. Develop a content calendar to maintain a consistent presence across platforms to help with this. Identify your strengths and values, and create a cohesive brand that reflects them.
Mastering time management is another key to success in the real estate industry. Successful professionals know how to prioritize their tasks and manage their time effectively. Create a daily schedule, set goals, and break them down into achievable milestones. Use productivity tools, such as calendars and task management apps, to stay organized and focused on your priorities.
Embracing technology is essential in today's real estate landscape. Utilize digital tools to streamline processes, enhance client communication, and market your services more effectively. Research and adopt tools that will boost your efficiency, such as CRM systems, virtual tour software, and digital marketing platforms.
Building a solid network is invaluable in the real estate industry. Attend industry events, join local real estate organizations, and establish connections with other professionals, such as lenders and contractors. Set a goal to attend at least one networking event per month and follow up with new contacts right away. There is nothing better than meeting someone and realizing that they are responsive, educated and willing to help. Vendors and other potential partners recognize this and building a network will help advance your career.
Another thing to keep in mind is that most real estate leads aren’t going to want to buy or sell a property that very day. Most of the time, leads need to be nurtured and followed up with. Because of this, nurturing your leads is essential for success in the real estate world. Develop a system for tracking and following up with leads. Consistent communication will help you build relationships and convert leads into clients. Implement a CRM system to manage your leads and create personalized follow-up strategies.
Offering exceptional customer service is vital for agents with a California real estate license Your clients are your biggest advocates and their referrals are going to be a key lead source as you move forward in your career. Ensure their satisfaction by providing excellent communication, prompt follow-up, and personalized service. They are going to remember the service they received - don’t give them any reason to hesitate to refer you to friends or family.
Being adaptable is crucial in the constantly changing real estate industry. Stay open to new ideas, adapt to market fluctuations, and adjust your strategies as needed. Regularly review your business plan and adapt your strategy based on market trends and your performance. As an example, interest rates back in 2021 were under 3 percent for a 30-year fixed rate mortgage. About a year later these rates had more than doubled. Being adaptable and finding ways to market your services and put buyers and sellers together is a non-negotiable skill you’ll have to develop - even when rates spike so quickly.
In conclusion, the real estate industry offers immense potential for growth and success, but it also requires dedication, adaptability, and a commitment to continuous learning. By investing in education, developing a strong personal brand, mastering time management, embracing technology, building a robust network, offering exceptional customer service, nurturing leads, leveraging social media, and staying adaptable to market changes, you will be well-equipped to thrive in this dynamic and competitive field. Remember, your journey as a real estate professional is unique, and by applying these insider tips, you will be poised to achieve your goals and carve out your own path to success. So, take these actionable steps, and watch your real estate career soar to new heights.
Love,
Kartik
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Maybe you thought this day would never come! But it’s clear that your hard work and dedication have paid off and you’ve earned your first real estate commission!
You already passed the real estate
Maybe you thought this day would never come! But it’s clear that your hard work and dedication have paid off and you’ve earned your first real estate commission!
You already passed the real estate license exam, chosen an office to work for and now have your first commission in your hand!
Now the big question is - what to do with all that money?!
First piece of advice - please don’t go out and blow all of it at a casino in Vegas. Remember that the real estate sales business is a marathon and not a sprint. I know too many Realtors who got off to a great start but because of improper money management were unable to stay in the business.
I wanted to write this article because even if you are just considering getting your real estate license or researching how to pass the real estate exam at some point you’re probably going to think about all the money you can make in real estate and what you might do with it all!
Here are some options below:
Option 1:
Payoff any credit card or other high-interest debt you have.
Paying off a credit card can be a good idea for several reasons, including avoiding high interest charges: Credit cards typically charge high interest rates, which can add up quickly if you carry a balance. By paying off your credit card, you can avoid paying interest charges and save money over time.
Also, don’t forget that paying off credit card debt can improve your credit score. A good portion of your credit score is based on something known as your “credit utilization”. The more available credit you have the higher your credit score generally becomes.
Another intangible benefit to carrying less debt is your financial will be reduced. I think we all know that carrying debt can be stressful - especially credit card debt. In the process of paying off your credit cards you’ll reduce financial stress and improve your overall financial well-being.
Option 2:
Invest in additional education or real estate coaching.
Real estate coaching (be careful there’s a lot of scammers out there) is supposed to help develop new skills and refine existing ones. Critical know-how like sales, marketing, and negotiation learned through coaching can help agents become more effective in their roles and better serve their clients.
Another big benefit to a real estate coach is a heightened sense of accountability. A good real estate coach will help agents stay accountable for their actions and progress, which can be particularly helpful for those who aren’t on a team and work independently. Coaches can provide feedback, support, and guidance to help agents stay on track and achieve their goals.
Finally, real estate coaches can help with goal setting. A good coach will help agents set clear and achievable goals, as well as create action plans (and accountability as mentioned above) to reach those goals. This can help agents stay focused and motivated toward their progress.
A word of caution about real estate coaching, however. Be aware of long-term coaching contracts that are difficult or impossible to get out of.
Option 3:
Just good old-fashioned save it!
In an industry like real estate sales which can be up and down nothing beats having a large cash bankroll.
Saving money is a good idea for several reasons, including building an emergency fund. An emergency fund is important to cover unexpected expenses, such as medical bills or car repairs and can help you weather a storm in our business if you run up against a dry spell. Having cash reserves can help you avoid going into debt or relying on credit cards to cover these expenses.
Also, if you’ve taken one of my live lectures, you know that the real money in our business is not made through sales commissions but in the acquisition of real estate. Saving money can help you take advantage of investment opportunities when they arise like a great deal on a flip or other real estate you can acquire below market. Investing is a whole lot easier when you have the cash ready to deploy whenever opportunity strikes.
Option 4:
Invest in the stock market
If you are going to invest in the stock market it’s important to remember that stocks have risk and can (and do) go down on occasion. Don’t forget that when the economy enters a recession or experiences slow growth, companies may struggle to generate profits and investors may become pessimistic about the future, leading to a decline in stock prices.
Remember that in the 2008 financial crisis the stock market experienced a sharp decline as a result of the housing market collapse and a series of bank failures - Both the stock market and the real estate market really took it on the chin during these times.
More recently, in early 2020, the stock market experienced a significant decline as a result of the global COVID-19 pandemic and its impact on the economy.
The market rebounded after both of these crises but lots of investors experienced heartburn during these years.
With that being said, the stock market has historically provided long-term growth potential, with an average annual return of around 10% over the past century in a highly liquid investment - meaning that it is relatively easy to buy and sell stocks quickly and efficiently and convert the asset into cash.
Option 5:
Invest in real estate
It would not be right to omit the mention of investing in real estate if you are a real estate agent. Real estate is a sure path to wealth creation and can provide a number of potential benefits, including long-term appreciation, rental income, diversification, tax benefits, and a hedge against inflation.
What lots of real estate investors like about this asset class is that real estate investments provide a tangible asset that can be leveraged for financing, used for collateral, or sold if needed. Real estate investors like the fact that real estate can be felt, experienced and touched. Not to mention the tax benefits, such as depreciation deductions and the ability to defer capital gains taxes through a 1031 exchange.
Whatever you decide to do with your first real estate commission just remember to be responsible. In the real estate industry agents have to work for every deal - and the next one isn’t promised.
With that said - if you feel that you need to blow your first check in Vegas - be my guest but don’t say I didn’t warn you. :)
If you still need to take real estate classes visit us at ADHI Schools or call 888 768 5285.
Love,
Kartik
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The best real estate agents know that it is virtually impossible to become an expert on all real estate throughout the entire state. California (and basically every other state) is just too large to try
The best real estate agents know that it is virtually impossible to become an expert on all real estate throughout the entire state. California (and basically every other state) is just too large to try and get significant market share in an area that big.
While you had classes at a California specific real estate school your real estate practice should be far more focused. Just because your license allows you to sell real estate throughout the entire state, does this mean you should try to sell in San Diego, Oakland and Los Angeles all at the same time?
Instead of trying to conquer the entire state, successful agents try and build hyperlocal market share within a particular city, specific neighborhood or even on a specific street or building to establish market dominance.
How is this done and why is this important?
Building hyperlocal market share involves establishing a strong presence and reputation in a specific geographic area, with the goal of becoming the go-to real estate agent for a particular community or area. As I mentioned earlier, it’s easier to pick up market share in a small localized farm than throughout an entire city, county or state.
Some real estate agents might call this local marketing “farming”. As a Realtor, farming involves establishing a strong presence in a specific geographic area. By focusing your efforts on a specific niche, you can become an expert in the local market and build a strong client base over time by building hyperlocal market share.
Here are some strategies that will help you build this local market share:
Focus on a specific area: When a real estate agent has focus, it means that s/he has a clear understanding of priorities, objectives, and target customers, and is committed to pursuing them with a high degree of discipline and consistency. Choose a specific neighborhood or community and be disciplined enough to focus your marketing efforts on that area. Become an expert in the local market, and make sure you understand the unique features and selling points of each property and model in the community. Get so good at understanding the floorpans and nuances of the neighborhood that when an owner tells you they have the 3-bedroom model you can ask them if it’s the one with the laundry area upstairs or in the garage because you know the floor plans so well. When a Realtor has a strong local presence, they are seen as an expert in the local real estate market which establishes credibility with potential clients, as potential clients are more likely to trust and hire a Realtor who has a deep understanding of the local market and appears committed to the area.
Attend local events: Attend local events and community gatherings to network and get to know the people in the area. Consider sponsoring a neighborhood event or local sports team to increase your visibility. Attending local events can help the individual real estate agent connect with potential clients. When agents engage with residents at these local events, they are more likely to be viewed favorably and become a familiar face within the community.
Use social media: Use social media to showcase your knowledge of the local market and engage with potential clients. Share local news and events, and use local hashtags to make your content more discoverable. Local hashtags are hashtags that are specific to a particular geographic area or community. These hashtags are used to help categorize content and make it easier for users to discover posts related to a particular location or event. For example, if you are a Realtor in Los Angeles, you might use local hashtags such as #losangeles, #LA, or #LAlocal to help your posts appear in searches related to the local area. By using local hashtags, you can increase the visibility of your posts among people who are interested in or located in the same area. When using local hashtags, it's important to choose hashtags that are relevant to your business and audience. Avoid using hashtags that are too broad or generic, as this can make it harder for your posts to be discovered by people who are interested in your specific niche or industry. Additionally, be sure to include a mix of local and industry-specific hashtags to maximize your reach and connect with the right audience.
Send targeted mailings: Send targeted mailings to residents in the area, highlighting your expertise in the local market and offering your services. Targeted mailings can help establish credibility with potential clients. By providing information about the local real estate market and highlighting the realtor's expertise in the area, targeted mailings can help potential clients view the Realtor as a trusted resource and expert in the local market. There are real estate specific mailing services like Farming Cards that can assist with printing and mailing.
Partner with local businesses: Partner with local businesses and organizations to cross-promote your services. Consider offering a referral program to incentivize business owners to refer clients to you. Create joint marketing materials, such as brochures or flyers, that feature both you the Realtor and the other business. This can help both businesses reach a wider audience and establish themselves as a valuable resource in the community.
Offer community resources: Create community resources such as local market reports, school district information, and guides to local businesses and attractions. Share these resources on your website and social media, and use them to establish yourself as a trusted resource for the community. When potential clients see that a real estate agent is providing valuable resources and information about the local area, they may be more likely to choose that real estate agent over others who are not offering similar resources.
Provide exceptional service: Above all, provide exceptional service to your clients. Word-of-mouth referrals are key in building hyperlocal market share, and satisfied clients can be a powerful source of new business. Remember that when you play the hyperlocal game reputation and word of mouth spread quickly.
Remember that building hyperlocal market share takes time and effort, but by focusing on a specific area and establishing yourself as an expert in the local market, you can attract more clients and grow your business over time.
If you want more tips as a new real estate agent to grow your career, I would recommend reading our Guide To Starting Your Real Estate Business.
Love,
Kartik
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Even if you are just starting out in our real estate school or researching how to get your real estate license, you probably want to know what it takes to be successful in the real estate business.
Even if you are just starting out in our real estate school or researching how to get your real estate license, you probably want to know what it takes to be successful in the real estate business.
This leads to the question - what defines success as a Realtor?
Objectively, every business (even the individual real estate agent) needs KPIs - also known as Key Performance Indicators. KPIs are measurable values that businesses and organizations (and Realtors) use to track progress toward specific goals and objectives. They are typically used to assess performance over time and provide a way to measure success or failure in achieving specific targets.
KPIs can be used in a wide range of contexts and industries, from marketing and sales to finance and operations. They are often tied to specific business objectives, such as increasing sales revenue, improving customer satisfaction, or reducing costs. As a real estate agent, knowing what KPIs are and how to measure them can give you a way to look at your business outside of just dollars and cents.
These KPIs are particularly useful to a new agent because there will likely be a few months early in your career where you are getting your bearings and might not see any revenue - but you are still making progress.
In the broad world of business, examples of KPIs might include:
Sales revenue: This might be tracked on a monthly or quarterly basis to assess how well a company is meeting its revenue targets.
Customer satisfaction: This might be measured through surveys or other feedback mechanisms to assess how happy customers are with a company's products or services.
Website traffic: This might be measured using web analytics tools to track how many visitors a website is receiving over time.
Employee productivity: For bigger and more established businesses, this might be measured using metrics such as sales per employee, number of calls or emails answered, or projects completed on time.
By identifying and tracking KPIs, businesses gain insight into their performance and make data-driven decisions about how to improve their operations and achieve their goals. It is important to select the most relevant KPIs for each specific business or project and to ensure that they are tracked consistently over time.
So how does this relate to real estate agents?
KPIs for real estate agents are measurable values that can help agents track their performance and progress toward specific business objectives. Here are some examples of KPIs that real estate agents may use:
Number of listings: The number of listings an agent has at any given time can be a key indicator of their success in attracting new clients and building their business.
Time on market: This KPI measures the average amount of time it takes for an agent's listings to sell. Agents who are able to sell properties quickly may be viewed more favorably by clients.
Sales volume: This KPI measures the total dollar value of properties an agent has sold within a specific timeframe. This metric can be used to track an agent's overall business performance and success.
Conversion rate: This KPI measures the percentage of leads or inquiries an agent converts into actual clients. Agents with a high conversion rate may be more effective at closing deals and building long-term relationships with clients.
Customer satisfaction: This KPI measures how happy clients are with an agent's services. Agents who receive positive feedback from clients may be more likely to receive referrals and repeat business. In order to measure this you or your broker might need to send review forms out to past clients to gauge satisfaction.
So how does the individual real estate agent improve customer service and satisfaction?
One tip is to be responsive - one of the most important aspects of good customer service is responsiveness. Respond to client inquiries, calls, and emails promptly, and make sure you are available to answer their questions and address their concerns.
Don’t forget to listen actively - Good communication is key to providing excellent customer service. Listen actively to your clients' needs and preferences, and make sure you are clear in your communication with them. If they ask for a single story home with a pool, don’t show them 3-story townhomes with no pool.
Another tip is to brush up on your knowledge. As a real estate agent, it is important to be knowledgeable about the local real estate market, trends, and regulations. Clients rely on you to provide them with accurate and up-to-date information.
Its important to be professional and proactive: It is important to maintain a professional demeanor at all times when working with clients. Dress professionally, be on time for appointments, and treat clients with respect and courtesy.
Anticipate your clients' needs and take the initiative to provide them with relevant information and resources. Offer suggestions and advice based on your expertise and experience.
By focusing on these aspects of customer service, real estate agents can build trust and long-term relationships with their clients, which can ultimately lead to increased success and referrals.
Referral rate: The final KPI I wanted to write about measures the percentage of new clients an agent receives from referrals. Agents with a high referral rate may be viewed as more trustworthy by their clients.
Real estate agents can generate more referrals by building strong relationships with their clients, providing excellent service, and actively seeking out referrals. Here are some specific strategies for increasing referrals:
Focus on customer service: Providing exceptional customer service is key to generating referrals. This includes being responsive to clients' needs, providing accurate and helpful information, and maintaining a professional demeanor at all times.
Stay in touch: Keep in touch with past clients through regular communication, such as email newsletters or phone calls. This will help you stay top of mind and increase the likelihood that clients will refer you to others. Make sure to stay active on all the social media platforms so your past clients know you are still in business.
Ask for referrals: Don't be afraid to ask for referrals directly. Ask satisfied clients if they know of anyone else who might be in need of real estate services, and make it easy for them to provide referrals.
Build a network: Develop relationships with other professionals in related industries, such as mortgage brokers, home inspectors, and contractors. They may be able to refer clients to you, and you may be able to refer clients to them.
Provide valuable content: Offer valuable content, such as market reports, home buying or selling guides, or other resources that clients may find helpful. This can help build trust and loyalty, and increase the likelihood of referrals.
By focusing on these strategies and providing exceptional service, real estate agents can generate more referrals and build a thriving business.
By tracking these KPIs real estate agents can gain insight into their performance and make data-driven decisions to improve their operations and achieve their objectives.
Love,
Kartik
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Preparing for your real estate exam involves looking at a number of concepts that are likely to be on your exam. Financing is one such topic that is worth directing some of your time to. The DRE says
Preparing for your real estate exam involves looking at a number of concepts that are likely to be on your exam. Financing is one such topic that is worth directing some of your time to. The DRE says that 9 percent of the exam covers financing and a financing concept that is commonly tested is “amortization”.
Amortization of a loan refers to the process of paying off a debt with regular and fixed payments over a specified period of time. Each payment includes a portion allocated to both principal and interest.
Principal is the amount of each payment that actually goes to reducing the amount owed. Interest is the fee that is charged for borrowing the money.
The word "amortization" comes from an Old French word "amortir," which means "to kill" or "to deaden." This is rooted in medieval times and idea was that each payment would "kill off" a portion of the debt, reducing it gradually until it was fully paid off.
The modern financial meaning of the term, which refers to the gradual repayment of a loan through regular payments that include both principal and interest, evolved from this earlier usage.
Example: You borrow $800,000 to buy a house and pay off the loan over the 30 year term. At the end of the 30 years, the loan has been “fully amortized”.
In simple terms, amortization breaks the loan into smaller and more manageable payments over a set period. As an example, in the case of a car loan the time to “fully amortize” or “kill” the loan is typically 4-7 years. In the case of a home mortgage, the loan term is usually either 15 or 30 years.
Every loan has an amortization schedule which outlines the amount of the payment and shows the portion of each payment that goes towards paying off the principal and interest.
Because amortization “kills” the loan, each payment made during the amortization period reduces the outstanding balance of the loan by some amount. In the early part of the payment schedule, most of the payment goes towards interest, but as the loan progresses, more of the payment goes towards reducing the principal.
Over time, the amount of interest paid decreases, while the amount of principal paid increases. At the end of the loan term, the full amount borrowed is “amortized”, and the borrower owns the property outright.
Not all loans are full amortized. For example, there is another type of loan known as a straight note or interest-only loan. In this arrangement, the borrower makes interest-only payments and none of the payment goes to actually reduce the principal balance.
Straight notes may be used in certain situations, such as when a borrower expects to have a large amount of cash available at a future date to pay off the principal balance, or when a borrower needs lower monthly payments in order to afford the property.
However, straight notes can be risky for borrowers because they may result in higher overall interest costs, larger future payments, and potentially owing more on the loan than the value of the property. As a result, straight notes are generally less common than fully amortized loans in the mortgage industry.
So which loan is better?
Whether a fully amortized loan or a straight note is better depends on the specific circumstances of the borrower and their financial goals.
A key benefit to the fully amortized product is that it results in the loan being completely paid off at the end of the loan term. This type of loan provides predictability and stability in terms of payment amounts and a clear path toward paying off the debt.
As mentioned earlier, a straight note requires the borrower to pay only interest on the loan for a set period of time. This type of loan can result in lower monthly payments and may be beneficial for borrowers who need more flexibility in their monthly budget. However, because the principal balance is not being paid down during the interest-only period, the borrower will need to make larger payments or refinance the loan to pay off the principal at the end of the interest-only period.
In general, a fully amortized loan may be a better choice for borrowers who want to build equity in their property and pay off the debt over a set period of time, while a straight note may be a better choice for borrowers who need lower monthly payments in the short term but are willing to take on the risk of potentially higher payments in the future. Ultimately, borrowers should carefully consider their financial goals and the terms of each loan option before making a decision.
There is another type of even riskier loan product common before the financial crisis of 2008 is known as negative amortization. It’s called negative amortization because instead of the loan balance going down, in negative amortization the loan balance actually goes up.
The reason the balance rises in negative amortization is because the payments are not sufficient to cover the interest owed on the loan, resulting in the interest being added to the principal balance. This means that the borrower's loan balance actually increases over time rather than decreasing as it would with a fully amortized loan.
Negative amortization typically occurs with certain types of loans that have adjustable interest rates, such as option adjustable-rate mortgages (ARMs), or payment option loans. These loans offer a low initial payment, often resulting in a payment that is less than the interest that is accruing on the loan, causing the unpaid interest to be added to the loan balance.
Although the payment on a negative amortization loan is much lower compared to even a straight-note, this type of loan has several horrific consequences for borrowers, including increased interest costs over the life of the loan, larger payments in the future, and potentially owing more on the loan than the original amount borrowed. Therefore, borrowers should carefully consider the terms of their loan and ensure that they can afford the payment amount both currently and in the future.
Because of all these risks associated with the negative amortization product, when Arnold Schwarzenegger was governor, California passed legislation actually banning new negative amortization loans.
Federally the Truth in Lending Act (TILA) requires lenders to disclose the terms of a loan, including the payment schedule, interest rate, and total cost of the loan over its term. Additionally, the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 includes provisions that require lenders to evaluate a borrower's ability to repay the loan, which has led to tighter regulations on certain types of loans, including those with negative amortization.
If you are reading this article and want practice questions related to real estate finance to prepare you for your real estate exam, I’d recommend checking out our exam prep website for tons of practice questions and updated content.
At the end of the day, fully amortized loans can offer several benefits for borrowers, including:
Predictable payments: With a fully amortized loan, the borrower knows exactly how much they will need to pay each month and over the life of the loan. With an interest only loan, on the other hand, there may be a balloon payment at the end of the loan or a variable rate after some fixed period. Full amortized loans can make budgeting and financial planning easier and more predictable.
Reduced interest costs: By design, fully amortized loans are created so that the borrower pays off the loan balance over a set period of time. Because of this borrowers will typically pay less in interest costs over the life of the loan compared to other types of loans, such as interest-only or balloon loans.
Equity buildup: As time goes on and the borrower makes payments on a fully amortized loan, the loan balance gradually decreases, resulting in an increase in equity in the property. Combine this with expected appreciation of the home and equity can start to build quickly- no doubt an important factor for homeowners who plan to sell the property in the future or use it as collateral for another loan.
Lower financial risk: Fully amortized loans offer a lower level of financial risk for owners because the loan balance is gradually paid down over time, reducing the risk of owing more on the loan than the property is worth.
Potential tax benefits: In some cases, the interest paid on a fully amortized loan may be tax-deductible, which can result in additional savings for the borrower.
Overall, fully amortized loans offer borrowers a stable and predictable path towards paying off their debt, with lower overall interest costs and reduced financial risk. Much of the real estate industry (and society at large) learned their lesson in 2008 when borrowers got risky adjustable rate and interest only loans in the few years prior.
As always if you are interested in taking real estate classes with our school and for in-depth instruction to help you pass the real estate exam visit www.adhischools.com.
Love,
Kartik
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Real estate can be a challenging career for some, but whether it "hard" or not depends on a variety of factors, including your strengths, experience, market conditions, and overall dedication to the profession.
Real estate can be a challenging career for some, but whether it "hard" or not depends on a variety of factors, including your strengths, experience, market conditions, and overall dedication to the profession.
Remember that real estate sales is a highly competitive field, with many agents and brokers vying for clients and listings in the same market area.
Considering how much money a real estate agent can make, real estate has a very low barrier to entry. Think about other lucrative careers like becoming a doctor or lawyer - real estate sales has the potential to make just as much money but becoming a licensed real estate agent requires much less by way of time and money. Our real estate courses are as little as $199 and can be completed in 54 days. The result is that a lot of folks get licensed and end up competing for the same clients and listings.
This sense of competition is especially heightened in a limited inventory market. When the supply of homes for sale is limited there may be more agents and brokers than there are available listings, making it even more competitive to win new business.
Your journey in starting a real estate career will be much easier if you remember that market conditions can change rapidly. Because the real estate market is constantly evolving, changes in interest rates, economic conditions, and local regulations all affecting the demand for housing. Successful real estate professionals need to stay on top of these changes and adapt their strategies accordingly.
Another tip to ease the transition into the market is to remember that building a successful real estate career requires a significant amount of time and effort invested in networking, marketing, and prospecting.
Networking is a crucial part of building a successful career in real estate and I wanted to share some tips for effective networking in the industry:
Attend industry events: Conferences, trade shows, and networking events are great places to meet other real estate professionals and build relationships. Look for events that are relevant to your niche or market, and come prepared with business cards and a clear elevator pitch.
Join professional organizations: There are many industry associations and organizations that offer networking opportunities, as well as education and training programs. Consider joining groups such as the National Association of Realtors (NAR), the Women's Council of Realtors, or a local real estate investment club.
Participate in online communities: Social media platforms like LinkedIn and Facebook can be great tools for building professional relationships and staying connected with other real estate professionals. Look for groups or forums where you can share your expertise, ask questions, and connect with other industry insiders.
Collaborate with other agents: Consider partnering with other agents or brokers on transactions or marketing initiatives. This can help you expand your network and build relationships with other professionals who may refer business to you in the future.
Provide value: Finally, it's important to remember that networking is a two-way street. Offer your expertise, knowledge, and connections to others in the industry, and be generous with your time and resources. This will help you build a reputation as a valuable member of the real estate community and strengthen your professional relationships over time.
As you consider whether or not a career in real estate is right for you (and how difficult it may be) bear in mind that real estate is cyclical. It is cyclical because our industry is heavily influenced by the broader economic and financial cycles that affect the economy.
The real estate market is influenced by the overall health of the economy. When the economy is strong, people have more money to spend on housing, which can lead to increased demand for real estate. When the economy is weak, people may have less money to spend on housing, leading to lower demand.
Another thing to keep in mind is that interest rates play a significant role in real estate cycles. When interest rates are low, it can be easier for people to obtain financing and afford a home, resulting in increased demand. When interest rates are high, it can be more difficult for people to obtain financing, leading to lower demand. The couple of years of the pandemic were great for the real estate industry and a large part of this had to do with interest rates being so low during this period.
Another fundamental truth about the real estate market is that it is subject to the basic laws of supply and demand. When there is more demand for housing than there is supply, prices tend to rise. When there is more supply than there is demand, prices tend to fall.
These factors, and others, all contribute to the cyclical nature of real estate and can impact how “hard” the business is for you as you get started. As economic and financial conditions change over time, so do the patterns of supply and demand in the real estate market. Understanding these cycles is crucial for real estate professionals who want to stay ahead of the curve and succeed in the industry.
Another challenge that real estate agents face it that we often work irregular hours, including evenings and weekends in order to accommodate clients' schedules. Here are a few reasons why:
Client availability: Many real estate transactions take place outside of regular business hours, when clients are available to view properties, attend open houses, or meet with their agent. This means that agents may need to be available evenings and weekends to accommodate their client's needs.
Flexibility: Real estate agents often have some degree of flexibility in their schedules, which can be a big perk of the job. However, this flexibility may also mean that agents need to be available outside of regular business hours to meet with clients, attend inspections, or negotiate deals.
Competition: Real estate is a highly competitive industry, and agents who are available and responsive to their clients are often the most successful. This can mean working irregular hours in order to stay ahead of the competition.
Administrative tasks: In addition to client-facing work, real estate agents also have a variety of administrative tasks to manage, such as paperwork, marketing, and bookkeeping. These tasks can often be done outside of regular business hours, which may contribute to a more irregular work schedule.
All of the above being said, many people find real estate to be a rewarding and fulfilling career that allows them to help clients achieve their goals and build their own businesses. Success in real estate often requires a combination of knowledge, skill, hard work, and a passion for the industry.
As always, if you are interested in getting your real estate license our real estate school is here to help!
Love
Kartik
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Part of preparing for the real estate exam involves studying as much vocabulary as possible. One vocabulary word that is worth reviewing is the word “lien”. The purpose of this article is to go over
Part of preparing for the real estate exam involves studying as much vocabulary as possible. One vocabulary word that is worth reviewing is the word “lien”. The purpose of this article is to go over a few different examples of liens that are commonly tested on the real estate exam. You might have already read my article on encumbrances - if not that link is worth reading once you are done with this more specific article.
While reading this, bear in mind that liens are quite common and don’t always need to be viewed as scary or fatal to the title to real estate.
Simply put, a lien is a claim or legal right that a creditor has against a property to secure payment of an obligation or other debt by the property. If the debt is not paid, the creditor may have the right to sell the property through foreclosure.
Some liens can affect all property of a debtor. These are called “general” liens and are so called because they affect everything that a debtor might own. Examples of general liens might include judgements and income tax liens.
Other liens are known as “specific” and only affect one particular property. As an example, a mortgage lien is a specific lien because the lien only pertains to the property on which the loan is placed. Imagine you have two houses, one in Los Angeles and another in San Diego. If you refinance your house in San Diego and put a mortgage on it the lien only relates to the San Diego home and not the house in Los Angeles - hence mortgage liens are “specific”.
There are several other types of liens that can be placed on real estate and I’ve outlined some of the most common below. These are worth memorizing and understanding so you have context for the state exam. You might remember a lot of this from real estate school but this article is worth it as a refresher.
Property Tax Liens: As the name suggests, property tax liens are filed by the government to secure payment of delinquent property taxes. If the taxes are not paid, the government may have the right to foreclose on the property. The lien is typically recorded in the county where the property is located and becomes a part of the public record.
If a property tax lien is filed against a property, it may impact the ability of the owner to sell or refinance the property until the taxes are paid or the lien is removed. Again, in some states, the government may have the right to sell the property at a tax sale if the taxes remain unpaid for a specified period of time.
Income tax liens: Like property tax liens, income tax liens can have a significant impact on real estate. An income tax lien is a claim made by the government to secure payment of delinquent income taxes owed by an individual or a business. If an individual or a business fails to pay their income taxes, the government may place a lien on real property to secure payment of the taxes owed.
The income tax lien is recorded at the county in which the property is located and becomes part of the public record. The lien provides the government with a legal claim to the property and gives them the right to foreclose on the property if the taxes remain unpaid. The specific requirements for filing an income tax lien vary by state, so it is important for property owners to be aware of the laws in their jurisdiction.
Mechanics Liens: No - this lien doesn’t have anything to do with leaving your car too long at the mechanic. A mechanics lien is a claim by a contractor, subcontractor, or supplier to secure payment for work performed or materials supplied for the improvement of real property.
A mechanics lien provides a legal claim to the payment for work performed or materials supplied on a property and allows the contractor, subcontractor, or supplier to potentially foreclose on the property if the debt is not paid. The mechanics lien is typically filed with the local government and recorded in the county where the property is located.
In order for a mechanics lien to be valid, certain requirements must be met, such as proper notice to the property owner, the use of proper forms, and timely filing of the lien.
If a mechanics lien is filed against a property, it may impact the ability of the property owner to sell or refinance the property until the debt is paid or the lien is removed. It is important for property owners to monitor any liens that may be filed against their property and to take steps to resolve any liens in a timely manner.
Judgment Liens: A judgment lien is a claim by a creditor to secure payment of a debt that has been awarded in a court of law. This type of lien can be filed against a property if the debtor loses a lawsuit and is ordered to pay.
The judgment lien is typically filed with the local government and recorded in the county where the property is located.
Homeowner Association Liens: A homeowner association (HOA) lien is a claim by a homeowner association to secure payment of delinquent HOA fees or assessments owed to the association. If the fees or assessments are not paid, the homeowner association may have the right to foreclose on the property.
This type of lien is filed by a homeowner association to collect unpaid fees for common area maintenance, landscaping, security, and other services provided to homeowners in the association.
It is important for real estate owners to understand the liens that may be placed and to take steps to prevent or resolve any liens that may be filed against their property. This may involve paying any delinquent debts or taxes, negotiating with creditors, or consulting with a real estate attorney.
In conclusion, liens are a way for creditors to secure payment of a debt or obligation related to a property. Liens can have a significant impact on the ownership and value of a property and it is important for real estate owners to understand the liens that may be placed on their property and to take steps to prevent or resolve any liens that may be filed against their property.
As always - if you are interested in taking real estate classes with our school reach out at www.adhischools.com
Love,
Kartik
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1. Arrive early at the property
Most buyers are pretty excited about seeing a home in-person for the first time. Sure, they’ve probably seen more than a few pictures online but there’s nothing like
1. Arrive early at the property
Most buyers are pretty excited about seeing a home in-person for the first time. Sure, they’ve probably seen more than a few pictures online but there’s nothing like walking through a home and touching, feeling and smelling it. Taking those first steps into the house comes with hope and all the possibilities of what life might be like when they move in.
With that said, imagine you are a homebuyer and call up a real estate professional and set up an appointment to view the property.
Upon your arrival the the agent is nowhere to be found.
All sorts of red flags start firing off in your mind:
“Am I at the right address?”
“Did the Realtor get lost? Wait - how does a Realtor get lost? Aren’t they supposed to know the area?”
“If they can’t show up on time - maybe they aren’t so reliable after all!”
Basically, when you arrive late for an appointment you undermine your trustworthiness at both a conscious and subconscious level.
Showing up early demonstrates that you are able to manage your time and are able to meet basic deadlines.
Pro tip: Get there at least 15 minutes early so you can verify access and open the property up.
2. Dress the part and groom yourself properly
Dressing appropriately is one of the easiest ways to make a good first impression.
I want to emphasize the word “appropriately” in this sentence because it doesn’t always mean a three-piece suit with a Charvet tie. Your style and your outfit should blend your style with that of your client and even the properties you are going to show. Because details matter how you appear will affect your buyer’s perception of you and the service you provide.
If you are showing beach cottages in Manhattan Beach your outfit will likely be different than if you are showing office space to a group of architects in downtown Los Angeles.
Be smart about your style and understand that how you visually present yourself will affect how your client perceives you.
Getting out of a clean car as a Realtor doesn’t hurt either.
3. Come prepared
Pulling property profiles and running comps isn’t the most exciting part of the job of being a Realtor. But remember that showing up with data in hand is one of the best things you can do to demonstrate your preparedness.
Being able to explain to your buyer why the deal is good and showing them data and comps will increase your credibility make you more trustworthy as an agent. Preparation is key whether you are meeting with a buyer client or preparing for a listing presentation to a seller.
Inevitably there will be something that goes sideways while you are in escrow - the home inspection might show more work than the buyer is mentally prepared to do or an appraisal can come in low. The more of an expert you seem to your buyer the more likely they are to take your advice.
Being perceived as an expert isn’t something that just happens. It’s a series of experiences that your client has with you that will build trust. Preparation is a critical step in building that relationship.
4. Put your phone away and appear interested
If you aren’t sure- yes it is 100 percent rude to swipe through your phone instead of being fully present with your prospect. It feels weird that I have to remind folks of this, but I have seen this time and time again in personal and business settings.
Constantly being on your phone makes your client feel unvalued - and those feelings never make for a great start for a relationship.
I get it though - you’re worried about that other escrow that is falling apart or you want to check TMZ to see if Kim Kardashian really got married again, but resist the temptation.
If you must have your phone out, the least you can do is turn the ringer off and only look at it during natural breaks in conversation.
5. Offer a firm handshake
If we can agree that COVID is over we can get to the importance of a firm handshake the first time you meet a client. The truth is that a good handshake helps to set the tone of your confidence and maybe even how trustworthy you are.
A firm handshake coupled with a smile and solid eye contact (not in a creepy way) can impart a strong first impression with your buyer. This type of introduction can help your image and set a solid foundation.
A strong and warm handshake also can subconsciously show your willingness to compromise and reach a real win-win for you and your buyer.
6. Remember to smile
Like a magnet, we are drawn to people who smile. We are also polarized and repelled by people that have negative facial expressions like frowns and grimaces.
Of course, smiling is seen as attractive and even makes folks assume you embody more positive personality traits.
Smiling more often can also have an ancillary effect of making you look youthful because studies show that the muscles we use to smile lift the face thereby making a person appear younger. I’m not suggesting that smiling is a natural form of botox but I might not be too far off. Smiling helps you look younger and psychologically makes us all feel just a little bit better.
So if you want to look more confident, youthful and give off a positive vibe try smiling a little more consciously and little more often. It might help you win over that real estate client, make you seem more relatable and even more approachable. You might even find that you get a little further along in life.
In the end - smiling suggests success.
7. Ask questions to show you are interested
I have spoken to some real estate agents who say that they don’t feel comfortable asking too many questions of a new buyer because they don’t want to appear too pushy or nosy. Some agents I have spoken with say they don’t even ask about buyer financing on the first meeting.
While these probing questions might seem a little awkward we have to ask these questions just like a doctor would to properly diagnose a patient. In the real estate world questions about financing, buyer needs and wants and timelines are critical.
I know if you have taken our real estate school online you’ve learned about the importance of asking questions of your client to better understand their needs. We talk a lot about this in our Real Estate Practice course.
It is said that the best real estate agents and salespeople keep asking questions until there are no more answers. Also keep in mind that the more questions you ask, the more emotional intelligence you build and the deeper your relationship with your client becomes.
Final thoughts
While many of the above list might be considered common sense, they are all important reminders to be present and focus on the needs of your client.
As always if you are looking to get your real estate license, we would love to talk to you! Call us at 888-768-5285!
TLDR:
1. Arrive early at the property.
2. Dress the part and groom yourself properly.
3. Come prepared.
4. Put your phone away and appear interested.
5. Offer a firm handshake.
6. Remember to smile!
7. Ask questions to show that you are interested.
Love,
Kartik
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Some of our readers might be in a position where they are looking to build a real estate team or even start their own brokerage. Clearly if you are looking to grow your team, you have transcended simple
Some of our readers might be in a position where they are looking to build a real estate team or even start their own brokerage. Clearly if you are looking to grow your team, you have transcended simple searches like trying to find find the right real estate school and you are looking to be a more intentional leader.
Having trained tens of thousands of new real estate professionals I have a pretty good handle on what new agents want and how to put together a recruiting plan. I put together a list of value propositions that team leaders, managers and brokers should consider to help in their recruiting effort.
Requirement 1: Structured training schedule
The importance of a structured training calendar for new recruits is difficult to overstate. It’s no secret that new real estate sales professionals have a deep desire to be trained properly. Without a written training program candidates don’t have the confidence that they are really going to get the training that they are so desperately in search of.
Beyond the pre-license real estate school curriculum, any good post-license training program should cover two broad aspects of the business.
First - Training on sales and marketing focused on helping the new agent understand how to acquire leads and ultimately close them. Your new hires want to know how to brand themselves to their friends, family and the local marketplace will help ensure their success.
Second - Training on contracts, new laws and procedures governing the day-to-day aspects of the business are also key to getting your new agents the skills they need to go out and compete in a highly competitive real estate market.
In our pre-license real estate course, we recommend that all our students ask potential brokers for a copy of the written training calendar the broker has. We advise them that if the broker does not have a written training calendar with scheduled topics and times the training program probably doesn't exist.
Think back to when you first started your real estate career. If someone simply handed you a desk and a phone and said “go to work” you would naturally feel frustrated and lost and probably eventually quit the business.
A major reason why the majority of newer agents don't end up making it past their first two years is because they get involved with brokers who don’t take training their agents seriously.
Requirement 2: Agent marketing plan and lead generation strategies
You should know that many new agents are going to rely on their broker for a marketing roadmap. Whether you as the broker decide to actually subsidize this marketing is entirely up to you but know that your agent is going to look to you for guidance.
Offering ideas for social media like video topic suggestions or even access to a camera and some lights within your brokerage will scream “value” for new agents. A marketing set-up like this can also help you attract mid-level and experienced realtors to your firm.
Too many real estate agents these days either don't know how to market themselves or are using very generic ideas found all over the Internet. Originality is important.
Showing your new agents that you have ideas for them to market themselves is a real value add.
Requirement 3: Leads + accountability
Few things will entice new agents to come work with your team like the promise of qualified leads. Some brokers and teams pay for Internet leads and others do a lot of direct mail and exploit other marketing channels to attempt to secure leads into the company. These leads can then be distributed to members of the team.
New agents wonder if they can perform well in this business and also strategize around how they're going to do it.
Common questions like “Am I going to be able to get leads?” “Am I going to be able to close those leads?” “How long will it take until I get my first paycheck?” wear on the mind of the new agent.
Some of this apprehension can be alleviated by providing leads to the new real estate licensee. The decision of how many leads you give the sales staff and your budget is a very personal decision - but I can promise you that providing qualified leads to your new sales staff is a very powerful recruiting tool.
Requirement 4: Transaction coordination
There are two schools of thought regarding the use of a transaction coordinator.
Thought #1: Real estate agents should handle all the paperwork on their own
Thought #2: Real estate agents should always delegate out the paperwork to a transaction coordinator.
I recorded a YouTube video about this very topic.
In my opinion, a new real estate agent should handle the paperwork with the supervision of their broker or manager for the first couple of deals, and then slowly start to wean off to a transaction coordinator as they grow more mature in their career. But the new licensee has to be able to at least understand the documentation, know where things go and be able to run a file on their own if needed.
With all that said, transaction coordination is a perk that many real estate offices offer. Being able to tell a new agent that they have support during an escrow is a recruitment plus.
New agents are often intimidated by the volume of documents involved in a typical real estate transaction and a good TC is a nice backstop.
Requirement #5: Available management
As a leader, it’s important to be aware that you must strike a delicate balance between your desire to recruit new agents to your brokerage with your bandwidth to be able to answer their questions and provide needed guidance. Rest assured, there will be an agent of yours that will call you or one of your senior managers on a Friday night at 7 PM because a buyer wants to write an offer and they have a question. Are you or a member of your management team going to be available to take this call?
The truth of the matter is, real estate can be a “nights and evenings” type of business and undoubtedly newer agents are going to have questions. Clients want to see homes on weekends and after working hours and consequently your agents are going to be there to assist them. The big question for you is whether or not you are going to be there as a manager or leader to help them in the event they have a problem?
In terms of retention, if you start missing a bunch of these late night or weekend calls or are non-responsive, it's likely that your agents may end up leaving you for the promise of more available management.
While this might be less than ideal it is the harsh reality of the residential real estate business.
Hope that these strategies will help spark some ideas in your own mind about what it takes to recruit and retain a sales team.
As always, if you are interested in taking real estate license courses or have a new member of your team that needs to get licensed call us at 888 768 5285.
Love,
Kartik
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Get ready for a little bit of basic math as we define the GRM in real estate investing and compare it to the capitalization rate.
Both the GRM and capitalization rate (also known as the “cap
Get ready for a little bit of basic math as we define the GRM in real estate investing and compare it to the capitalization rate.
Both the GRM and capitalization rate (also known as the “cap rate”) are important metrics for investors to consider when looking at an investment property.
If you are interested in real estate investing this will be a good read for you. I’m guessing that most readers who are interested in getting their real estate license have at least toyed around with the idea of investing in real estate.
The gross rent multiplier represents the relationship between the gross income that a property produces and its potential purchase price or value. It is a simple back-of-the-envelope way to represent the multiple of the gross income relative to the property’s purchase price - the GRM is not a measurement of time (more on that later).
As a general rule, the higher the GRM the more pricey the property is relative to the income. The lower the GRM the more of a “value” investment the property might be. Investors looking for the most “bang-for-their-buck” might seek out properties with lower GRMs as the multiple of gross income to the amount invested is lower.
Examples of the GRM
As an extreme example, consider the property below.
Purchase price = $100,000
Gross yearly income = $100,000
In the above case, the GRM would be 1x. The purchase price of this property equals the gross rent collected. This is an impossible and extreme example but it illustrates just how good of a deal this would be if it were true. Imagine a property that rents for $100,000 per year (or about $8,333 per month) that you could buy for only $100,000. This would be such a good deal that you would have to get in line and fight hundreds of other investors for it.
More likely, is that if a property rents for $100,000 per year that it would cost something like $2,000,000 or 20x the gross rent collected.
Again, lower gross rent multipliers can generally represent better value purchases for investors and higher gross rent multipliers mean that the investor is paying more for every dollar of rent collected.
More Realistic Examples of GRM
Property 1:
Purchase price $2,500,000
Gross annual income of $50,000
$2,500,000 / $50,000 = The purchase price is 50x the gross rent collected.
Property 2:
Purchase price $1,750,000
Gross annual income of $75,000
$1,750,000 / $75,000 = The purchase price is 23.3x the gross rent collected.
Drawbacks to the GRM
There are some drawbacks to using the gross rent multiplier method as the only way to value property. Because only the gross rent is considered expenses are not factored into this equation. This is a key distinction between the gross rent multiplier compared to the capitalization rate of a property.
Unlike the GRM, the cap rate does consider expenses like property taxes, insurance, maintenance and management to name a few to calculate net operating income. The GRM merely looks at the total rent collected relative to the gross income of the property.
Investors may look at both the gross rent multiplier and the capitalization rate to determine whether or not a property is a good investment and compare it with other properties the investor might be considering.
However, rarely will an investor only consider the GRM.
What is the difference between the GRM and cap rate?
The Gross Rent Multiplier and the capitalization rate are two wildly different methods of valuing an investment property.
As I mentioned above, the GRM is a very simple way to find out how many times the gross rent collected will equal the value. The capitalization rate on the other hand is a way for an investor to determine the annual rate of return.
Formulaically, the capitalization rate is calculated by taking the net operating income that the property produces and dividing it into the purchase price.
If you are interested in learning more about the cap rate check out the first in a 3 part series here:
As a matter of practice, most investors will give more credence to the capitalization rate as opposed to the GRM.
Why the GRM isn’t a measure of the number of years it will take to pay off the property
There are several problems with assuming that the GRM is the number of years it will take to recoup your investment. The first fallacy with considering GRM as a measurement of time is that it does not take into account expenses. If a property produces $50,000 per year in gross rent, the GRM does consider property taxes, insurance, maintenance, management nor does it include any debt service that the investor might be paying to secure the investment.
The second issue with considering GRM as a measurement of time is that rent typically increases as time progresses. The gross rent multiplier only considers the current rent not any future rent increases.
For the above two reasons, it is inaccurate to assume that the GRM is some measurement of the “number of years” it would take to recoup your investment because it doesn't include expenses, nor does it include any future increases in rent. Both of these affect the amount of time it will take to get your investment back.
Does a buyer want a high GRM or a low GRM?
Generally, as a buyer, a low GRM is preferred. Lower GRMs generally represent better deals for buyers because the ratio of the gross income to the purchase price is lower.
Higher GRMs generally mean that the buyer of an investment property is paying more for every dollar in income that the property produces.
Closing thoughts
While not perfect, the gross rent multiplier is still a common method that investors used to analyze a particular property. Keep in mind that this is not the ground truth golden method, because expenses are not considered.
If you are considering signing up for real estate school we would love to have you!
Love,
Kartik
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As some of our readers have moved beyond obtaining their real estate license and passing the real estate exam, I wanted to have some content that is a little more advanced for the reader.
After you
As some of our readers have moved beyond obtaining their real estate license and passing the real estate exam, I wanted to have some content that is a little more advanced for the reader.
After you complete real estate school, you’ll end up working at a brokerage and are likely going to become a member of a local Multiple Listing Service and a member of an Association of Realtors.
As you might already know, the MLS is the Multiple Listing Service and is a database of properties for sale and also contains history of homes that were for sale and those that have sold. It’s really an invaluable tool.
Generally, most MLS systems require that any status updates to a property be reported within two business days of the status change and will result in a status violation if not changed in a timely way.
Broadly, there are two types of MLS statuses:
1. On-market
2. OFF-market
On market statuses are used on properties that the seller is actively soliciting offers on.
The off market status represents those houses that either have sold or those that the seller is not actively trying to obtain offers on.
I have written the statuses below and have used abbreviations of the statuses also. For example, the “Coming Soon” status is abbreviated by a “C” and the “Active” status is abbreviated with an “A”.
On Market Statuses
COMING SOON (C) This status would be used by a real estate professional when they have a valid listing contract on a property and there isn’t an offer accepted as yet. For this status to be used, the listing firm must have specific instructions signed by the seller to submit the listing as “Coming Soon” and not “Active” - there’s a difference.
While under this status, the agent is permitted to market and advertise the property and must include language that the property is “Coming Soon” and must include the date the property’s status will become “Active”. A key point to remember with the “Coming Soon” status is that the property must not be available for showings while the status is such.
The fact that the property is not allowed to be shown to prospective buyers while in “Coming Soon” is a big deal. There may be agents - or buyers - that see the property online and want to see it in person to get a jump start on the market. This is not permitted while it is listed as “coming soon”.
ACTIVE (A) The Active status is much less complicated than the “Coming Soon” one. The “Active” status is used when a property is On-Market and when the agent has a valid listing contract signed by the seller and no offer has been accepted as yet.
ACTIVE UNDER CONTRACT (U) Like the simple “Active” status, “Active Under Contract” is also technically an On-Market status even though the property has an accepted offer on it.
This status is used when the seller has already accepted an offer but wants the property to remain as an on-market status to collect back-up offers.
This might be a prudent status if the sale is subject to court or other third party approval as those third party approvals can sometimes be hairy and take more time than the current buyer is willing to wait.
It's important to keep in mind that even though the property is still active under contract, the seller generally does not have a right to cancel an existing escrow if they get a higher offer later making this not truly an “on-the-market” scenario.
Off-Market Statuses
HOLD (H) Unlike Coming Soon, Active or Active Under Contract, the “Hold” status is an Off-Market status. The agent would tag the property this way when a valid listing contract is in effect but due to myriad reasons the seller doesn’t want any showings. Perhaps this is due to repairs being made to the property or even an illness of an occupant and the seller might not want to show the home on a temporary basis.
WITHDRAWN STATUS (W) If the listing agent on a home is going to use a “Withdrawn” status the agent is indicating that the property is moving to an Off-Market status.
If this contract is going to be used, the property will no longer be marketed through the MLS - despite the fact that a valid listing contract exists.
In other words, the listing is being withdrawn from the MLS but no necessarily withdrawn from the market as a whole. Beware - there is potential to incur a duplicate listing violation if the seller relists with another listing agent and a Withdrawn status is still in effect.
PENDING (P) This status is also an “off-market” one. The listing agent can switch the status to Pending once an offer has been accepted.
The main difference between Active Under Contract and Pending is that when the listing is “Pending” the Seller is no longer soliciting offers through the MLS whereas while “Active Under Contact” the seller continues to solicit offers.
CANCELED (K) Canceled is a unique status as only Brokers and Office Managers have the permission to change a listing’s status to Canceled. The reason for this is that the listing contract is taken in the name of the broker and not the individual agent and as such no individual salesperson has the unilateral ability to cancel a listing.
This is an off-market status once changed to Canceled.
It’s important to note that using Withdrawn instead of Canceled will result in a status violation if tagged incorrectly.
CLOSED (S) Congratulations! If you are switching the status of your listing to “Closed” it means that your transaction has successfully completed and title has transferred from the seller to the buyer. This status is an Off-Market one and a property should be tagged as such after escrow has closed.
If you had a lease listing this could also be used after a property has been successfully leased.
EXPIRED (X) Like the “CLOSED” status, the “Expired” status is an Off-Market status and should be used when the time period of the listing has lapsed and the listing contract has, as such, expired. Most of the MLS platforms will automatically set the status to “Expired” once the time period has elapsed. At the time of the listing being input, the agent is required to specify the Date of Expiration so the system knows when to change the status to “Expired”. If the property sells before the expiration date and the agent has changed the status to “CLOSED” the MLS will not trigger an EXPIRED status after CLOSED.
Closing thoughts:
Choosing the right real estate brokerage to work for should ensure that you are trained up properly and that there are no surprises when it comes to what these MLS statuses actually mean. Some of the above are obvious, but the intricacies of when to use each one can sometimes be confusing.
Hope this helps!
As always, if you are interested in signing up for real estate school reach out to us at 888 768 5285!
Love,
Kartik
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Many of our readers are just starting their journey into the world of real estate and they want to start a real estate business from scratch. Most of them want to understand the steps of the journey they
Many of our readers are just starting their journey into the world of real estate and they want to start a real estate business from scratch. Most of them want to understand the steps of the journey they are about to embark on and see a path to success laid out for them.
Step 1: Enroll in real estate classes
The first step in your real estate journey is to enroll in a California state approved real estate school and complete three required courses. The courses required to sit for the real estate exam are:
Real Estate Principles
Real Estate Practice +
Elective course
While we offer a selection of elective courses, my recommendation is to choose Legal Aspects of Real Estate because it contains the most relevant information to prepare you for your California real estate exam. Additionally, if you wish to obtain your brokers license at some point,Legal Aspects of Real Estate is a required course so completing this course will serve these two purposes.
As far as options to complete the program go, we have two packages that can get this done for you. One is a package wherein a licensed instructor will walk you through all the material and the other is a self-study option where you read the material on your own.
My recommendation would be to choose the instructor-led Zoom calls mostly because there is so much material to digest and having a professional to ask questions of will make the experience easier and provide more of a roadmap for you.
Step 2: Pass the real estate exam and obtain a real estate license
Once you have enrolled and completed the three required courses the next step is to take and pass the state licensing exam in California. The best way to get ready for this exam is with our famous crash course software. Our crash course offers hundreds of videos explaining each answer choice and why the answer is correct and the others are wrong.
The sales license exam is given over 3 hours and it consists of 150 multiple-choice questions. Passing score is a 70% or better.
Pro tip: Don’t worry about getting 100% on this exam. The state doesn’t even release your score when you pass. The exam is strictly qualifying in nature and as long as you score at least a 70% you’ll be good to go.
Obtaining a real estate license also requires that you clear a criminal background check. This is done through a process called Live Scan. This Live Scan is required even if you’ve gone through this process in the past for another license or purpose. For example, we have many students who are also notary publics or have other professional licenses and certifications that required that they be fingerprinted in the past. This doesn’t matter - you’ll have to go through the fingerprinting again.
Step 3: Choose a real estate broker to work for
If your aspiration is just to get a real estate license, you don't necessarily have to put that license with a broker. However, if you want to work and represent buyers and sellers, the real estate law requires that you find a broker to work for and hang your license with.
As you make the decision about where to work keep in mind that there are many things that determine whether you are working at the right firm.
Learn more about how to pick a broker here:
To a newer agent, the most important thing in deciding where to work should be the training program available and the culture around the office. For example, if your goal is to make a lot of money and help lots of clients, you'll want to make sure that you are in an environment where the broker encourages teamwork, camaraderie and a culture of training.
Step 4: Start working on your sales skills
One of the most underrated aspects of starting as a new real estate sales professional is the fact that people forget that the nature of this job is sales. The successful real estate agent will employ marketing strategies to get their name out there, be able to set an appointment and ultimately close for the contract.
Whether dealing with buyers or sellers there are objections that your client will inevitably throw at you. For example, buyers might want to wait until interest rates come down or prices cool off. Sellers will want to understand what your marketing plan is and may even ask you to cut your commission. Your ability to handle these objections with empathy and professionalism is key to your success.
The best real estate sales professionals continuously practice their skills, role-play, and work on their sales abilities each and every day.
Step 5: Solidify Your Marketing Plan
With over 400,000 real estate licensees in California it's important to be able to be found and recognized as an area expert. The only way to do this is through proper marketing as marketing is the lifeblood of any business. It’s no different when it comes to you as an individual real estate professional.
As a newer agent, the big question is, how are you going to be found? Joining a team can help in this effort because teams generally allocate marketing dollars to lead generation and they pass out these leads to members on their team.
It’s important to bear in mind that these leads come at a cost, however. Commission splits are often lower on a team, because not only do you have to pay the brokerage but you'll also have to pay a split to your team in return for generating those leads for you. Being able to ride the coattails of your team should mean that you don’t have to figure out your own marketing plan.
Whether or not you end up joining a team, I would still suggest doing community and sponsorship events, a lot of direct mail, and maybe even some good old fashioned doorknocking. Consider sponsoring the local chili cook off or the Little League team to get in front of residents in the community.
Remember that sales and marketing go hand-in-hand. Marketing will help you bring in the leads, while sales skills will help you close the leads that you do generate.
Don’t neglect social media. It’s important to be active on Instagram and Facebook and maybe even start your own YouTube channel. Social media is a great way for members of the community to get to know you and gives you the chance to show that you're an active local real estate professional.
Step 6: Continue to grow your career
I understand that reading that you should “grow your career” sounds cliche and I’m aware that this saying means different things to different people. In the context of being a real estate agent, growth could involve branching out into other aspects of real estate like property management or commercial real estate.
The concept of growing your career also involves attending continuous training on sales skills, marketing, social media strategies, or even technical training like new laws that affect the real estate community or updates to the purchase agreement.
Your goal should be to avoid stagnation and always continue to grow and learn. Real estate is an ever-changing industry and technological tools have changed the way the properties are purchased.
Given the fact that our clients are trusting us with what is likely their largest asset, we have a duty to make sure that we are learning all we can and that we are the best real estate agent possible.
I'm hoping the six steps I’ve outlined will help understand the arc of starting and growing a lucrative career in real estate. It can be an extremely rewarding career and I’m looking forward to helping you get started or continue to grow it.
If you are interested in learning more about starting a real estate career, call us at 888 768 5285 or send us a message on Instagram
Love,
Kartik
TLDR:
Here are the six steps to starting and growing your real estate career.
1. Enroll in real estate classes
2. Pass the real estate exam and obtain a real estate license
3. Choose a real estate broker to work for
4. Start working on your sales skills
5. Solidify your marketing plan
6. Continue to grow your career
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As a real estate professional, it’s hard to overstate the importance of having a competent loan officer on your team. Since most real estate purchases involve financing, the person quarterbacking the
As a real estate professional, it’s hard to overstate the importance of having a competent loan officer on your team. Since most real estate purchases involve financing, the person quarterbacking the buyer’s loan can make or break the purchase of the property - and ultimately affect whether or not you get your commission.
Remember - real estate agents don’t get paid for opening escrows, the only thing that matters is closing them.
As a student in our real estate license course, assembling a great team consisting of a reliable escrow officer, title representative and a mortgage professional might seem completely disconnected from your pre license studies or real estate crash course but it’s an important thing to consider nonetheless. This way, once you do obtain your real estate license you can hit the ground running.
So who do you choose as your go-to lender? I made a quick list of some of the things you’ll want to consider for as you choose a lender for your team:
Reliable Pre-approvals
In short, if a lender is going to write up a pre-approval letter for your buyer it’s important to be sure that the transaction is actually going to close. While there are no absolute guarantees, you and your buyer should at least have some confidence that the transaction is actually going to happen with no foreseeable problems regarding the loan.
Lots of lenders today will issue a “DU” approval as well. “DU” stands for
Desktop Underwriter with Fannie Mae Desktop Underwriter is an automated system for mortgage underwriting that determines if a loan meets approval requirements. Lots of listing agents will also want to see an “approved eligible” printout from DU to ensure that the buyer is well qualified.
As a real estate agent you need to have trust in your lender that their pre-approval letter carries weight. At the end of the day, if that pre-approval letter doesn’t translate into an actual funding it will leave the real estate agent and the buyer with a big problem on their hands as the buyer may end up losing their deposit and the real estate agent won’t get paid.
In the end a pre-approval that doesn’t blow up in your face is a bare minimum you should expect from a lender.
On-Time Closings
There’s nothing worse than a closing that is continuously delayed. It puts the buyer and the seller in precarious positions, forcing them to rearrange schedules, potentially delaying start dates at jobs, and generally giving all parties in the deal heartburn.
To be clear, on occasion there will be delays that are beyond the lender’s control. Perhaps the buyer’s employer is lagging on delivering a Verification of Employment. Maybe the IRS has delays related to a tax transcript. But either way, a lender that has the ability to foresee potential problems related to the loan early on and takes action based on these possible roadblocks is worth their weight in gold.
A Wide Variety of Loan Products
While it’s unfair to expect a lender to be an expert in all loan types, a lender should have the ability to do more than a home loan for a borrower with a 800 FICO score and twenty percent down.
It’s not unreasonable to expect a good lender to have a wide variety of loan offerings -- conventional loans, programs for first time home buyers, FHA loans, VA loans and more. A lender that has these basic arrows in their quiver will allow the Realtor to get more comfortable with the lender and solidify them as the go-to for new clients.
The Ability to Problem Solve
Most loans have some hair on them. Maybe a borrower has a gap in their employment history. Perhaps there is one 30 day late payment showing up on the credit report from 18 months ago that is bringing down their credit score. Either way, most real estate loans aren’t perfect and they require some level of critical thinking in order to close them on time and with minimal hassle.
Finding a loan originator that knows how to deal with small -and sometimes large - problems is helpful.
Superior Customer Service
Excellent customer service makes dealing with a lender less stressful. What defines good customer service? In the lending and real estate world, this means answering your phone and responding to email, communicating often and keeping tabs on the cadence of the loan. Whether the agent or borrower needs the answer to a simple question or requires serious assistance with a major issue, the lender should have customer service resources available. If the lender isn’t immediately available, the lender should make it clear who should be contacted in their absence.
Transparency
Above all else, borrowers today value integrity and transparency. Lenders who change terms at the last minute or mislead homebuyers are not to be trusted. Most real estate agents seek out lenders with proven histories of doing right by clients and respecting the financial burdens of those about to make the biggest purchases of their lives.
When a real estate agent recommends a lender to a buyer they are, in essence, vouching for them and there can be reputational risks to the agent if the lender doesn’t perform. Pairing motivated buyers with reliable lenders is an important job of a buyer’s agent. The right partnership will result in a smooth transaction that becomes a win for all parties.
Love,
Kartik
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Starting a career in real estate and obtaining your real estate license opens up a new world of opportunity to you. There are so many different career paths that can be taken one you get your real estate
Starting a career in real estate and obtaining your real estate license opens up a new world of opportunity to you. There are so many different career paths that can be taken one you get your real estate license.
While it’s true that most of our students start their career selling houses, commercial real estate (CRE) is also an option for you in California. There are similarities between both areas of practice as they involve helping clients buy, sell and lease property so the desired outcome is the same. The high level difference is that the clients to whom you provide services are simply looking at a different class of property.
A common misconception is that the commercial side of the business is somehow more complicated than residential but in many ways the opposite is true. Commercial files can be thinner because there are many forms and documents that are required in residential real estate that don’t exist in the commercial world.
In any case, if commercial is an area of specialization you find appealing, here are some things to consider and things you’ll need to do:
1. Obtain a real estate license
Every real estate agent, regardless of whether they plan to work in residential or commercial real estate, must meet specific criteria and pass an exam. Individual states set their own criteria, so be sure to research your state’s process. Generally speaking, you must meet eligibility requirements, take approved pre-licensing real estate classes, and pass the real estate exam to obtain a license.
2. Find a firm specializing in CRE
After you choose a real estate school and receive your real estate salesperson license in California, you’ll have to place your license under a broker. Once you select a broker, the firm will dictate the type of real estate you can practice. If you want to pursue work in the CRE market you will have to find a broker that has the bandwidth and resources to conduct commercial sales and leasing. This is where it can get a little sticky because most residential firms don’t offer the tools needed to do commercial real estate and most commercial firms don’t offer the residential tools to sell a house.
3. Get trained up in commercial real estate
Finding someone to mentor and train you to practice commercial real estate is not as easy as finding a residential mentor. Part of why this is true is that there are far more residential real estate agents than there are commercial ones and residential firms are typically more eager to hire than commercial ones.
There are large commercial companies like CB Richard Ellis and Jones Lang LaSalle that might hire you with the right resume and connections, or you can explore working at a more boutique local shop in your area. The key thing here is to find solid training and a mentorship program that will allow you to start your commercial real estate career properly.
4. Identify an area of specialty
Many residential real estate agents specialize in certain types of homes, such as retirement communities, townhouses, luxury homes, or another niche. The commercial real estate industry tends to be even more specialized than this. The commercial real estate world tends to be broken down into five pillars:
Retail - Shopping centers
Industrial - Warehouse type uses
Office - Larger or single tenant office spaces
Raw land - Developer specialization
Apartments/multi family sales - 5 or more apartment units
While there can be some cross-over between these two functions there is still a high level of specialization.
5. Create a marketing strategy
Not unlike residential real estate, you need to have marketing and branding strategies in your toolbox. In addition to the types of properties you want to specialize in, your plan should include factors such as how to target clients, budgets, unique selling points, and strategies to client outreach.
These branding and marketing initiatives can include real estate postcard mailing, really cool property photos, or a social media strategy.
6. Explore other career possibilities
One of the benefits of working in the commercial real estate field is the ability to expand your practice. Besides an area of specialization, there are opportunities to participate in arranging financing for a property, performing property management, or (as mentioned above) negotiating tenant leases.
Just how wide of a net you can cast is going to be dependent on your brokerage and the services that they offer. If your brokerage doesn’t have a trust account and accounting systems created, you won’t be able to legally conduct property management so you’ll want to explain your aspirations to your broker and see if they have a system to support your endeavors.
A final thought
Because sales prices are generally higher on commercial properties than residential ones commercial agents often find they can earn larger commissions, which can equate to higher annual earnings. Many agents who specialize in this area find it to be a lucrative, exciting, and rewarding experience. It's important to know, success doesn't come overnight, it takes effort and experience. The large commercial deal sizes can have a negative impact on the commissioned real estate agent, however. If your entire earnings for the year are dependent on one large deal that ends up falling apart this can put you in a precarious position.
Nevertheless, if commercial real estate sounds appealing to you, you need to start with our real estate license course. Register today so we can help you prepare for a lucrative career in the commercial market.
Love,
Kartik
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As a current or former student in our real estate license school you might remember my lecture from Real Estate Practice on listing presentations. I’ve placed a link to the YouTube video here if you
As a current or former student in our real estate license school you might remember my lecture from Real Estate Practice on listing presentations. I’ve placed a link to the YouTube video here if you need a refresher or haven’t seen it yet.
While this video isn’t intended to be a real estate crash course it’s still helpful to watch as you strategize around building your seller-focused real estate business. While buyer clients are important, a scaleable real estate business is built around controlling listing inventory and that means working with sellers.
In order to obtain listings, you must become proficient at generating seller leads and making killer presentations. The high-level goal is to demonstrate you are the best Realtor for the job of selling their home.
Because of the competitive nature of the market you’ll need to have a solid listing presentation. Sellers have options when it comes to listing their home as the number of real estate agents in an area far exceeds the inventory at any given time.
I’ve put together some tips as you work with and negotiate with a potential seller.
1. Introduce yourself
Every meeting starts with an introduction. Keep in mind first impressions matter—so be sure to get this part right—and remember to smile. Be prepared to share your credentials, previous successes, and any other pertinent information demonstrating why you’re the right person to list their home.
2. Know the property
Before you arrive, make sure you’ve researched everything possible about the property and dig beyond surface-level information like bedroom and bathroom count. If you haven’t done your homework, it’ll be obvious to the seller. Make sure that your Comparative Market Analysis (CMA) is detailed, up- to-date and visually appealing.
3. Walk through the selling process
Share a clear timeline with the seller so they know what to expect. Much of this timeline will depend upon the current state of the market, so be prepared to explain any circumstances that will impact the time it’ll take from listing to contract and from contract to close.
It’s also important to also explain to the seller that buyers will generally have the right to conduct an inspection on the home while it’s in escrow. This could cause the buyer to ask for repairs or even ask for a monetary credit as a result of the inspection.
Going through several possible scenarios with the seller will help minimize surprises during the listing.
4. Explain pricing strategy
The main thing that prevents a listing from selling is an inappropriate price. Proper pricing can overcome nearly everything. Does the property have an inferior location? Price it properly. Is there an odd smell or is the home in desperate need of landscaping? Fix the price.
The professional real estate agent should have relevant comps pulled, bearing in mind the condition of the subject property, condition and location of comps, and have the communication skills to convey this information to the seller.
Be prepared and ready to explain the recommended price to the seller. It’s not uncommon for the owner to believe that their home is worth more money than your data suggests, especially in the world of Zillow. I recorded a YouTube video about this here if you need a refresher.
5. Explain pre-listing steps
As a sales technique, speak to the seller during the presentation as though you already have the listing. Educate them on what will be occurring after they sign. Assume that they are going to be listing with you.
It’s important that the seller know that the property won’t hit the market the instant you leave the presentation as there are many things that still have to happen. Photography must be arranged, marketing collateral needs to be created and copy must be written, as examples.
Giving the sellers a heads up about the process will go a long way in establishing rapport, trust and an understanding of the cadence of the process.
6. Explain marketing strategy
If your marketing strategy consists of placing the property on the MLS with one iPhone photo - this isn’t going to be enough.
Since real estate commissions easily run $10,000+ on most homes in California, it’s important to explain to the seller what the plan to sell their home is and why our commissions are as they are.
A well thought out marketing plan will help justify your fee and aid the seller in understanding where their money goes.
Include any syndication, local marketing, and online publicizing—share techniques you use that make their home stand out in a competitive marketplace.
7. Remember to listen
You want to build a relationship of trust with clients. Talk to them about why they’re selling their home and ask what their future plans are understanding their needs will help you better serve them.
Also remember to include all family members in the discussion. Often times a real estate professional might only speak to one spouse, falsely believing that they are the decision maker when the decision to list might be one made jointly by both owners.
God gave us two ears and one mouth-remember to use them run that ratio.
8. Dress for success
Non-verbal cues like body language, grooming and how we dress can say a lot more than verbal communication can. There is little doubt that in a post-COVID world the business climate has moved away from suits, ties and pantyhose in favor of a more relaxed attire.
Depending on your market, how you dress might vary, but generally, business casual is probably appropriate.
One last tip: While the world is a bit more casual it’s better to be overdressed than underdressed so choose your wardrobe carefully.
9. Leverage the power of reviews
If you (or your company) have testimonials or online reviews from previous clients, bring them to the listing presentation.
People are more inclined to trust others who have experienced success with their agents.
These nine tips should help you put your best foot forward when making listing presentations.
It all starts with the right real estate school so choose wisely. I’d love to help you get started in our great business. Call me at 888 768 5285 and I or a member of my team can get you started.
Love,
Kartik
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In today’s day and age if you don’t have a presence on social media you almost aren’t in business. Both current and potential customers want to feel connected to the brands and individuals they do
In today’s day and age if you don’t have a presence on social media you almost aren’t in business. Both current and potential customers want to feel connected to the brands and individuals they do business with - what better way to foster community than social media?
Promoting positive engagement is a must for a successful social media marketing strategy as a Realtor. Here are a few best practices to bear in mind:
Do’s of Social Media Posting
1. Try to combine posts and content across multiple platforms
Because of the sheer volume of social media posts, you will get lost in the noise of these platforms if you aren’t aggressive in your approach. Post often and recycle your posts across many social media platforms. You don’t need to be selective with the social media platforms you join - the goal is to be omnipresent.
Because busy real estate agents can’t always come up with content daily, consider scheduling a “content day” to write, film and edit a bunch of posts all at one time to be released over the next week or so.
A recent study done by the National Association of Realtors (NAR) found that 97% of Realtors chose Facebook as their preferred network. Facebook was followed by LinkedIn (59%), and Instagram (39%). Roughly one-third choose Twitter.
The lesson really is that content can be recycled and reposted over many platforms to get the widest reach possible.
I understand that your focus now is probably passing the real estate exam but planning out your content strategy while you are in real estate school is a good way to spend your time while also prepping for your exam.
2. Be active
There have been many studies about when and how often you should be putting content out there. Consider posting daily on at least one platform but be careful to not overly focus on self-promotion. Make sure that your content is relatable, and [as a Realtor] concentrate on being part of the online community on which you are posting.
Share posts, make comments, ask thoughtful questions, and give shoutouts to connections. Bottom line, be consistent in terms of activity and be responsive to others.
3. Use visibility strategies
When posting or sharing others' posts, be sure to use visibility strategies to gain traction. Good methods include using keywords with hashtags and tagging others in your network to give them call-outs.
Don’ts of real estate social media posting
Just one blunder can soil your professional standing, but a series of bad practices can really hurt your reputation if not careful. Here are the top don’ts when it comes to social media marketing for real estate agents.
1. Don't be overly promotional
This is #1 on the list of things NOT to do. Don’t try to oversell on your page, but use social media to share interesting news, customer interests, how-to’s, or relatable and interesting aspects of your personal life. By using your page strictly as a personal listing mechanism, people will disconnect from you or scroll through your posts without even looking. Always follow the 80/20 rule when using social media.
2. Use your own photos
Photos are a critical aspect of promoting properties. Ideally, you want to use your own photos to highlight listings you promote. (20% of your posts!) If using others' photos, be sure to first ask permission first and then publicly give credit to the photo’s owner.
3. Don’t post nonsense just to “post”
The trick to social media marketing success is balance. You need to find the “Goldilocks” level of posting. In other words, don’t post so frequently it becomes “noise”, or worse, social media’s version of unsolicited robocalls. Then again, you don’t want to post so infrequently that you become irrelevant. Focus on timely, thoughtful, and interesting posts, spread out. Determine what your audience likes and deliver it.
Savvy real estate agents know how to skillfully use social media to gain the trust of potential clients and maintain strong relationships with existing ones. Focus on good social media practices, avoid bad ones, and you’ll create a standout online presence.
Love,
Kartik
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As you prepare for your real estate exam you’ll no doubt take at least one of our crash courses. These lectures and online tools can be done in the comfort of your own home and are based on individual
As you prepare for your real estate exam you’ll no doubt take at least one of our crash courses. These lectures and online tools can be done in the comfort of your own home and are based on individual self-study.
But what if you aren’t quite ready for a real estate crash course yet? What if you still need to complete Real Estate Principles, Real Estate Practice and the elective course in real estate school?
While we offer an amazing self-study program to help you finish the required courses there are some students who don’t do well left to their own devices. Does this sound like you?
What if you wanted a professional instructor who walked you through the course material, but didn’t need to drive to a physical location? A plus with gas prices being $7 a gallon.
To bridge the gap between total self-study and a physical real estate school we offer an amazing Zoom-based option.
I made a list of seven benefits of this program to prepare and qualify for the California real estate exam.
1. Eliminate procrastination
By coming to our scheduled Zoom calls, you’ll be less inclined to put off studying the material to qualify for the exam. When working independently, it’s easy to procrastinate, but when you make a commitment to meet with our study group you’ll be more motivated to press on and prepare so you’re ready to cover the material with other group members.
2. You’ll Probably Learn Faster
Members of study groups like those on our Zoom calls tend to learn faster than individuals who work independently. With any type of learning, it’s common to get stuck on a concept and have difficulty getting over the proverbial learning hump. With fellow students and an instructor to talk out concepts with, it can clarify some of the drier material.
3. Fill in Gaps in Notes
While you might prepare for class by watching some of the videos on our YouTube channel questions might arise as you watch the videos or read the textbooks.
Bring you questions to class and the instructor will answer them and encourage you to deep-dive into the course material. You can read the book on your own first, knowing that if you do have a question you’ll be able to ask it to the instructor and bounce ideas off other students in the process.
As a result, fewer gaps exist, when it’s time to take the real estate exam you’ll be better prepared.
4. Sharpen Your Study Skills
Everyone has their own techniques they use to study. However, working with a diverse group of other hopeful real estate agents empowers you to sharpen your own study skills. You’ll be able to learn from the strengths of others and maybe even share your own with them.
5. Break Up Monotony of Studying Alone
Studying alone is very monotonous and it could lead to feelings of isolation, frustration, and loneliness. On the other hand, working with a group pursuing the same goals not only adds socialization, it gives you something to look forward to nearly daily. Check out our schedule of Zoom classes here! <hyperlink to https://www.adhischools.com/schedule >
6. Hone Your People Skills
Working as a real estate agent means you’ll need to hone your people skills if you don’t already possess them. Success in our industry is based on your ability to work with other people. In study groups, you’ll encounter a variety of personalities and this will strengthen your ability to communicate with different people - a must in real estate!
7. Get a Jump on Networking
In a sense, a study group can be your first step into developing your professional network. In any industry, it’s not what you know, but who you know. Often, those on our Zoom calls have built a sense of camaraderie – the perfect seed to grow a professional network. Remember, not only can you connect with members of your group, but they can introduce you and vice versa to other people. Knowing you have friends in real estate upon passing your exam is a great feeling - It’s never too soon to build a professional network!
In order to pass California’s licensing exam you’ll need to gain a full understanding of the topics and concepts used in everyday real estate business. Joining our Zoom calls can put you on a solid path.
If you are interested in getting a free guest pass to check out one of our Zoom study sessions, click here and pick a day and time that works for you. I look forward to seeing you on an upcoming real estate Zoom call!
Love,
Kartik
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Imagine you have completed all the required classes at our real estate school and now you are in the process of studying for your real estate exam. You’re probably taking our real estate crash course
Imagine you have completed all the required classes at our real estate school and now you are in the process of studying for your real estate exam. You’re probably taking our real estate crash course and are focused on prepping for the test.
You can probably tell from our hundreds of 5 star reviews that we know a thing or two about getting students to pass their real estate exam Still, I wanted to write a quick blog outlining a few things that can actually make it harder to pass your test so you know what not to do.
I’ve read some other articles from folks that incorrectly say that the real estate test is purposely and unnecessarily difficult. This isn’t really the case. If you understand the concepts and study you should have no problem passing.
I’ve read some other articles from folks that incorrectly say that the real estate test is purposely and unnecessarily difficult. This isn’t really the case. If you understand the concepts and study you should have no problem passing.
Consider the below list as you do:
Bad Prep Materials or a Bad Exam Prep Program
Call me a little biased, but I think that our real estate crash course is the best way to study for the real estate test out there. There are alternative products in the marketplace that aren’t California specific or that are written by people who have never even taken the real estate exam.
Obviously, the purpose of real estate exam prep material is to increase comprehension of the subject matter. Understanding that most people are on their mobile devices the majority of the time, our team developed an app for Android and iOS devices that is second to none. If you don’t have this yet, get it!
In the end, prep materials that do not play to your strengths decrease your chances of passing the real estate exam.
2. Too Much Study Time on What’s Not Important
One of the common mistakes real estate examinees make is focusing on items not likely to be on the exam. What too often occurs is that folks can get bogged down in the minutia and lose focus on critical concepts and facts. Some call this not “seeing the forest through the trees.”
I cringe when students send me articles about how to study for the “math portion” of the real estate test or 50 questions on the history of California. The truth is that there is very little actual arithmetic on the real estate test so spending 15 hours studying how to calculate capitalization rates isn’t going to do much good when there are other topics that appear far more frequently on the exam.
The good news about our crash course system is that questions are weighted in the same ratio that the actual real estate exam is. Our system is organized in a fashion that emphasizes primary concepts and focuses your study time in ways that actually matter.
The point is that investing too much of your limited time in minutia might not be a good decision.
3. Procrastination
Procrastinators of the World Unite! Tomorrow.”
People from all walks of life come up with seemingly good reasons to put off studying. These rank among the common reasons people procrastinate.
Feeling Overwhelmed
Lack of Urgency
Lack of Discipline
Don’t Like to Study
Can’t Choose a Starting Point
Giving in to these and other inclinations puts potential real estate professionals behind the knowledge curve. The sooner you crack open the materials and begin learning at a deeper level, the better your chances of passing the test.
I would recommend doing all the questions in the training mode of our real estate crash course at least twice before attempting a mock exam. Focusing on our training mode will expose you to all the questions in our system and eliminate any false confidence from a high score on a random mock exam.
4. Failing to Follow a Study Plan
Possessing an actionable study guide and plan cures some of the reasons to procrastinate. Of course, potential real estate professionals will need to leverage a study plan in a timely and orderly fashion. Common missteps involve jumping around and prioritizing topics you feel comfortable studying. Such practices are more a lack of discipline than an attempt to gain high-level knowledge.
It’s essential to use a study plan designed to build one concept on another. Like many other industries and disciplines, real estate knowledge tasks people with possessing a broad understanding of how things intersect. Rifling through study materials and jumping ahead typically results in fragmented ideas that don’t translate to sound professional skills.
Remember to set aside plenty of time before the test to ensure that you don’t feel overwhelmed - This leads me to my final point.
5. Test Anxiety and Last Minute Cramming
When I was in high school and college, I would love the adrenaline rush of studying for an exam at the absolute last minute and leaving with a good score. While exhilarating, it’s important to realize that the real estate exam should not be approached in this manner. There is far too much material to only study the night before. A study schedule at least two weeks before the test will help you stay focused and ensure you have ample time to review and understand the material.
It’s totally normal to feel a little on edge before the exam starts. Issues such as self-doubt or fear of failure can derail efforts to pass the real estate exam. The good news is that test anxiety does not have to stop you from beginning a new career.
TLDR:
Learn to Study Effectively
Establish a Study Routine
Practice Relaxation Strategies
Exercise, Eat Well, Hydrate, and Get Restful Sleep
Reach out to our office at 888 768 5285 or shoot us a message if you’re having a hard time passing the test.
Love
Kartik
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One of my early real estate sales managers passed away a few years ago. When I think back on our interactions, one thing that stands out is his advice that an agent isn’t going to make money sitting
One of my early real estate sales managers passed away a few years ago. When I think back on our interactions, one thing that stands out is his advice that an agent isn’t going to make money sitting in the office behind a desk. You’ve got to get out there, pound the pavement and understand the local market.
Previewing property is something that should be a non-negotiable for a real estate professional, especially a newer licensee. Even if you are just starting in our real estate license course you can still play around on websites like realtor.com or other IDX sites to sort of “arm chair” quarterback and see what’s going on in the market.
Once you get your real estate license you’ll want to start physically entering as many properties as possible so you can keep a pulse on what’s happening in the marketplace. By the way, this shouldn’t seem like too much of a chore as most people that take our real estate classes have at least some interest in viewing homes and property for sale. I can’t tell you how many students I have spoken with that say “I love going to open houses! I want my license!” Now get out there and do it!
What is involved in previewing property?
Previewing property involves searching the MLS for homes and then scheduling times to physically walk the properties. As an additional prospecting method, some agents even knock on the doors of nearby homes to let neighbors know of the home that’s for sale. This can be particularly valuable in the event there isn’t a For Sale sign on the property you are previewing. When knocking, a good script could be to ask nearby owners if they know a friend, family member or co-worker that might be interested in the home for sale, it’s a great opportunity to “pick their new neighbor”. This is an easy and natural way of networking with nearby owners.
It’s free for you to do
One of the biggest benefits of previewing properties is the fact it’s an absolutely free method of gaining local market knowledge. The only investment is your time - and most new agents have more time than money. Savvy real estate agents who preview properties on a routine basis find they get more listings, obtain valuable market knowledge in the areas they work in and grow their businesses faster.
You can obtain valuable knowledge about the market
When you follow the strategy of previewing property you will gain a stronger understanding of the local inventory. This will empower you to rapidly identify properties for interested buyers. For instance, knowing a geographical area intimately means you’ll be armed with the ability to quickly answer questions clients have about inventory in the area. This boosts your professional reputation and people will start to see you as an expert.
Agents who have previewed properties may also have earned access to unpublished or not widely publicized information. Additionally you’ll learn what homes are on the market and the routine of previewing property will force you to dig into the local inventory daily.
You’ll have the ability to generate more leads
Physically going out to look at homes in a specific market means you’re also actively meeting people and expanding your professional network. While you could just view Matterport tours from your home or office there really isn’ta substitute to getting out in the field and touching the inventory. An added bonus is that you never know who you’ll meet that wants to hire you.
Buyers will be impressed with your proactive approach to understanding the market and know you’ll be equipped to help them find their dream home.
Sellers will appreciate that you have your pulse on the market and are more inclined to list with you because they’ll have faith you can help them present a solid marketing strategy.
Agents may also find as they preview homes, they stumble across properties not listed on the MLS, such as pocket listings, FSBOs, expired listings, and owners who want to sell but temporarily removed their homes from the market.
Networking is an important activity for any industry but has a special place in a direct sales business like real estate.
You gain information to have a powerful listing presentation
When you are on a listing presentation, rest assured that the seller is looking to hire an agent who knows the neighborhood, knows the street and knows their home. Previewing 3-5 properties daily will aid in your listing presentations because you’ll be able to demonstrate to your seller that you intimately know the market having seen all the inventory in the local marketplace. This is a non-negotiable as you don’t want to be seen as an agent who knows less than the client.
The net-net bottom line is that previewing properties will give you a reason to get out of the office – you just never know where it’ll bring you or what clients you’ll land next.
Remember what that sales manager told me so long ago - the money in real estate isn’t made sitting in the office.
Love,
Kartik
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The U.S. real estate market changed significantly during 2020 and 2021 during the COVID-19 pandemic. The most obvious change is that many owners fled crowded cities to suburban and even rural areas fueled
The U.S. real estate market changed significantly during 2020 and 2021 during the COVID-19 pandemic. The most obvious change is that many owners fled crowded cities to suburban and even rural areas fueled by the possibility of remote work.
A consequence of this was that home inventory was tight and prices soared. Buyers who were lucky enough to purchase and obtain financing in 2020 or 2021 enjoyed ultra low rates on their home loans. Many are wondering if the 2022 market will be tumultuous or if things will normalize.
The following are five housing trends to keep an eye on this year.
1. Housing inventory will increase
Realtor.com® predicts housing inventory will see a 6.6% increase in 2022, which is good news for everyone. More sellers are comfortable putting their homes on the market, and they’ll still enjoy a market that is favorable to them. However, it’ll be competitive since first-time homebuyer percentages are expected to outpace any recovery in inventory that occurs this year. Buyers will have more home options to choose from as more sellers list homes and new construction continues to be on the uptick.
Homes will still continue to sell quickly, and sellers will definitely retain the market advantage. Although, experts both concede and caution there may be levels of uncertainty ahead in 2022 and beyond.
2. Mortgage rates will climb dramatically
Throughout 2020 and 2021, the U.S. experienced breaking-record mortgage interest rates, with an all-time low for a 30-year fixed mortgage occurring in January 2021 at 2.65%. This situation is slowly correcting itself, and rising inflation and consumer spending are contributing to the recent boost in interest rates.
While rates are still lower than previous years, early in 2022, experts predict interest rates will continue to inch back up throughout the year and with inflation rising at a record rate we may see rates get into the 6%+ range by summer of 2022.
3. Home prices will stabilize or decline
As more housing inventory comes on the market and interest rates rise downward pressure on prices is likely. The best properties based on price and condition will continue to see bidding wars, but these might be more isolated.
As price appreciation finally slows down, this will result in some level of home prices cooling.
4. Demand for suburbia continues
The COVID-19 pandemic sent everyone into isolation as people fled from city apartments and townhomes into the suburbs to buy homes, enabling them to have more space to work and play. As levels of normalcy returned in 2021, urban living has become more popular again, but the suburbs are still taking the real estate market by storm.
Realtor.com predicts urban areas will “continue to be pricier and faster-paced,” but people moving to the suburbs will receive “better bang for the buck,” especially since the housing inventory is creeping back up. Many Americans will continue to work remotely so this will play a significant role in their housing decisions – and many of them want the amenities and lifestyle suburban areas offer.
4. Demand for suburbia continues
The COVID-19 pandemic sent everyone into isolation as people fled from city apartments and townhomes into the suburbs to buy homes, enabling them to have more space to work and play. As levels of normalcy crept back in in 2021, urban living has become more popular again, but the suburbs are still taking the real estate market by storm.
5. Technology’s role in the market will increase
Whether you are taking our real estate courses by Zoom or self study, you already know that technology plays a significant role in the real estate market. Don’t expect this to slow down as tech-savvy millennial buyers dominate the buyer pool and the older members of Gen Z are right behind them. These two generations are highly drawn to tech and have come to expect it in most areas of life.
Today’s buyers expect the ability to hop online, increasingly doing so from their mobile devices, to find, view, and purchase homes. Using features such as 3-D virtual tours, interactive floor plans, and other types of touchless services will continue to be the norm. I wrote an article about the use of Matterport cameras when COVID first hit, feel free to check it out.
Additionally, technology will play an important role in other aspects of the home buying process, such as obtaining mortgage approvals and home appraisals through digital channels. Agents are also getting into the action with digital transaction management tools – the market can also expect to see more data analytics and artificial intelligence integration.
The year 2022 will continue to be a hot market like the previous two years but appears to be on the road to normalization. Bottom line, the U.S. real estate market should essentially expect a whirlwind year with some hiccups. If so, this will be due to the pandemic continuing to play a role in market demands, along with supply chain and labor disruptions for new housing.
An important thing to remember is that whether the market is appreciating, declining or staying flat, real estate agents are simply in the middle of a transaction. Up or down we still get paid.
Love,
Kartik
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To say that the world has changed over the last few years is certainly something of an understatement. As the pandemic began to take hold in March of 2020, suddenly in-person gatherings of any kind
To say that the world has changed over the last few years is certainly something of an understatement. As the pandemic began to take hold in March of 2020, suddenly in-person gatherings of any kind were all but impossible. In the real estate world, this created a bit of chaos as agents and clients wondered how to show a prospective buyer a house when multiple people can't be in the same place at the same time? Moreover, how do real estate agents operate in a world where everyone is suddenly doing business remotely?
COVID created a perfect storm for the real estate business and allowed for some pretty powerful “virtual” or “cloud” brokerages to come to prominence. Such companies mostly exist online - meaning that there are very few, if any, physical office locations to speak of.
Realtors who join such companies typically feel that having traditional office space doesn’t really matter because the nature of our work doesn’t mean we sit at a desk all day. These online companies also often offer higher commission splits to their agents because of lower overhead. The firm doesn’t have to spend money renting an office space or buy furniture, office equipment or pay utilities.
Some seasoned agents who already have an extensive book of business are attracted to this virtual model as the more experienced salesperson doesn’t need as much basic training and handholding as those who are new to the field.
This type of brokerage does have it’s downsides, however. In a traditional real estate firm, agents have the option of reporting to a location in the morning and leveraging support staff and have the ability to meet with clients and more. Larger real estate firms that have a significant brick and mortar presence are often perceived to have more credibility than a strictly online operation. Local buyers and sellers are often assured by a large real estate firm sign on the side of a building in their hometown that the company - and the agent - are there to stay. If you are wondering how to choose a real estate office to work at consider watching this video.
Another big downside of the “virtual” brokerage can be a lack of community. While some real estate agents are comfortable with the idea of working without the distractions of the workplace, some might find it difficult. Agents are often social beings (arguably even more than the average person) and long hours with only a computer screen and a phone can be painful for some salespeople. Building a career in real estate is hard enough and without a sense of community the journey can be that much more difficult.
Then again a virtual real estate firm might make sense when you consider what the duties of a real estate agent actually are. Most of the actual money making activities in the real estate industry are not performed sitting at a desk. When an agent has a client, they are either at the client’s home advising them on marketing strategy, going over offers, or touring a home or building.
Whether you decide to join a brick and mortar traditional real estate firm or go with a virtual one, just make sure that you will have support from the management team so that in the event you have questions or need marketing or other support you have resources.
Either way, your journey starts with real estate license courses and remember - even though we are a school that operates online, there are real people manning our phones. =)
Call us at (888) 768-5285 if you are ready to get started!
Love,
Kartik
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It's certainly possible for someone to buy or sell a home on their own without a real estate license. But if they wish to do so in a professional capacity and sell homes for others, they need a
It's certainly possible for someone to buy or sell a home on their own without a real estate license. But if they wish to do so in a professional capacity and sell homes for others, they need a real estate license. More than that, they'll need a license in each state that they plan to operate in. All state's requirements are different, it's important to research as much as possible before starting a career in the field.
But a lot of people don't realize that getting your real estate license doesn't just mean that you're destined to become a realtor. In fact, there are a wide range of different jobs that require a real estate license - all of which are more than worth exploring.
Real Estate Agents
Obviously, the prime example of a job that requires a real estate license is that of the real estate agent Here, a seasoned professional will work with prospective buyers and sellers on a transaction that hopefully meets the needs of both parties.
From the point-of-view of the seller, a real estate agent will try to get them the best price for their home that the market will allow. From the perspective of the buyer, they'll try to find anew home that meets as many of their needs as possible - all at the best price they can. Regardless, the industry is heavily regulated and there are a lot of rules that must be followed - which is why a real estate license is essential.
Brokers
Many people assume that real estate agents and brokers are essentially the same position - but that is incorrect. In the real estate industry, a real estate agent is simply someone who has been licensed to sell property in whatever state they live in. A broker, on the other hand, is someone who has gotten additional licensing and is now able to start their own real estate firm. This means that they're able to hire additional agents and have people working underneath them, thus building a business in a particular area.
Real Estate Paralegals
There are many law firms that specialize specifically in real estate and that is where real estate paralegals come into play. A paralegal is an invaluable part of a firm's support staff in that they help make sure that things are running as efficiently as possible. They provide support to lawyers working on various transactions and, in a larger sense, make sure that documents and other important data are always in the hands of the people who need it the most. In addition to offering help with the legalities of various transactions, they also need to know as much as possible about regulatory compliance in the various fields of real estate as well.
Property Managers
Property managers are those individuals who have been hired by a property owner to oversee the day-to-day operations of said dwelling. It could be the property owner themselves, but this isn't always the case.
In an apartment complex, for example, a property manager would be responsible for all back office tasks like collecting rent and handling maintenance requests. In the context of a private dwelling that someone is renting out, the job may simply come down to handling tenant needs as they come up. With regard to single family homes, it's not uncommon for a property manager to oversee multiple dwellings at the same time - making a real estate license (and the credibility that comes with it) crucial given the fact that it is an income-based property.
Commercial Property Managers
Commercial property managers are those professionals who are tasked with overseeing any non-residential property. This means places like office buildings, retail locations, storage facilities and more. Depending on who they are employed by it would not be uncommon to see them handle shopping centers as well. Commercial property managers will need to be adept at tracking rental income rates, total monthly expenses and other important jobs. They'll also be responsible for handling work orders and general property maintenance and will need to make sure that their properties are following all local and federal regulations.
Foreclosure Specialists
Finally, we arrive at foreclosure specialists - those professionals who deal with foreclosure duties in particular. Their job is a complicated one, as the foreclosure process can often take a great deal of time. They'll need to carefully manage various cases and, for a deal to be closed successfully, they'll have to make sure that it meets all federal, state, and local requirements.
Foreclosure specialists will both work with homeowners who may need to restructure their mortgage as well as investors who wish to sell a recently foreclosed upon property. Regardless, they'll need a real estate license in order to do so.
If you'd like to find out more information about the types of jobs that require a real estate license or if you just have any additional questions about how to get your real estate license, we are happy to help. Call us today (888) 768-5285..
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The real estate industry is highly regulated, with each state granting licenses to individuals who complete specific studies and pass certification exams. Like any other type of license, a real estate
The real estate industry is highly regulated, with each state granting licenses to individuals who complete specific studies and pass certification exams. Like any other type of license, a real estate license is a privilege and can be taken away if an agent fails to abide by regulations set on the federal level or by their state.
This means individuals who act unprofessionally and, as a result, receive a suspension cannot perform any real estate function requiring a license. Below are 10 common activities agents should avoid lest they face the consequences associated with a license suspension.
1. Mishandling clients’ money
Real estate agents must always pay careful attention when handling a client’s money. Many agents who mishandle money don’t do so intentionally, but can still lead to a suspension (although stealing client money is a huge no-no obviously). In addition to losing a license, criminal charges could accompany the suspension. To avoid money mismanagement, agents should never use a personal account, always maintain accurate bank records, and ensure clients receive receipts for any transactions.
2. Failure to disclose
Agents are required to be transparent about any financial interests they have to all other parties involved in a potential real estate transaction. An example would be if the agent is the buyer, seller, or investor of a property and asks a family member to represent them in the transaction. This rule is put into place to avoid possible conflicts of interests, however, by being upfront and honest by issuing full disclosure of personal interests in transactions, agents can keep their licenses intact. Another example is if an agent convinces a seller to not disclose certain types of problems with a home to make it easier to sell.
3. Criminal conviction
Real estate agents convicted of crimes can potentially lose their licenses. How license losses are dealt with for criminal convictions will vary by state. The State of California is a no-nonsense state when it comes to prior or post-licensing criminal convictions. All agents must submit to a criminal background check and fingerprinting which stays on record. Individuals who receive their license and commit a crime, especially a felony, can find their license suspended. (The crime doesn’t have to be related to real estate.)
4. Mortgage fraud
Agents engaging in mortgage fraud are highly likely to lose their licenses. This scenario typically unfolds when a client isn’t approved for a mortgage and the agent decides to adjust figures or disclose false information to make the sale and tells the client they were approved. This is not just a license suspension activity, it’s a criminal offense..
5. Fail to cooperate with investigators
If a regulatory agency receives a complaint or other red flag during an audit related to a specific agent, they’ll follow up with an investigation. Agents who ignore the requests of regulatory agencies or otherwise act uncooperatively can find themselves in hot water, including a potential loss of a license.
6. Failure to meet licensing requirements
A common reason why agents lose their license is they get too busy to follow up on their continuing education (CE), which is a requirement in most instances (specifics are determined by individual states). This can be avoided by not leaving CE needed for licensing requirements to the last minute or skipping them.
7. Step across the line of other professionals
Good real estate agents know the boundaries of what is in their realm and what’s best left up to other professionals. For instance, an agent should never try to offer advice that is outside their area of expertise. Examples would be inspectors, attorneys, and appraisers—if questionsor concerns arise, they should always be routed to the right individual.
8. Confidentiality
Anything clients tell their agents should be assumed to be confidential. This includes occupation, marital status, family members’ names, or other personal details a client shares. For instance, if a real estate agent nets a huge sale for a celebrity, this cannot be disclosed publicly because it violates the privacy of the high-profile individual.
9. Violation of the Fair Housing Act
The Fair Housing Act was designed to prevent people being discriminated against when they looked to sell, buy, or rent property. This act prohibits discrimination in housing due to race, sex, color, national origin, religion, disability, or familial status. Violations of the Fair Housing Act are serious offenses and agents will lose their license.
10. Failure to supervise
Real estate brokers are responsible for any sales agents they work with and it’s their duty to ensure all agents comply with regulatory standards. To avoid failure to supervise, brokers can provide ongoing training, require regular check-ins, conduct license monitoring, and offer an open-door policy for agents.
These are 10 major reasons why real estate agents lose licenses. However, there are numerous other acts that lead to license suspensions. Real estate professionals are wise to thoroughly understand both federal and state rules to ensure they don’t inadvertently break them.
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As a new real estate agent, you're probably already aware of open houses' key role in the industry. They are a fantastic way to showcase a property, attract potential buyers, and build relationships within
As a new real estate agent, you're probably already aware of open houses' key role in the industry. They are a fantastic way to showcase a property, attract potential buyers, and build relationships within your community - which could lead to additional listings. But the idea of hosting your first open house can also be intimidating. You might feel fear and apprehension creeping in at the thought of stepping into the spotlight, fielding inquiries from seasoned home buyers, or handling unexpected situations.
If you're nodding your head in agreement as you read this, don't worry—you're not alone. These feelings are more common than you think among new real estate agents. But the good news is that fear and apprehension are just feelings, and emotions can be managed and overcome.
I’ve gotten so many calls from students asking me to address these concerns that I wanted to write a quick guide to provide practical tips to help you overcome your fear of hosting open houses. I want to turn that fear into confidence and that apprehension into excitement. It's all part of becoming a successful real estate agent.
First of all, it’s essential to understand the fears that may arise when hosting open houses. There are several common concerns new agents often encounter:
Fear of Rejection: The fear of rejection can be daunting. The thought of potential buyers dismissing the property you're showcasing or questioning your expertise can be unsettling.
Fear of Public Speaking: Open houses are public speaking events. If you're uncomfortable speaking in front of a group or worried about how you'll be perceived, this can create a high level of anxiety.
Handling Difficult Questions: Can you answer every question thrown your way? What if a visitor asks about a property detail you’re unsure of? The fear of not having all the answers can be intimidating.
These fears are entirely natural and shared by many new real estate agents. Recognizing that these feelings are common and part of the learning curve is essential. They do not define your capability as a real estate agent or predict your future success.
Understanding your fear is the first step to overcoming it. Once you've identified your concerns, you can begin to develop strategies to confront them head-on. As you gain more experience, you'll find that these fears diminish, and your confidence grows. Remember, every real estate agent (myself included) had to host their first open house at some point—and they survived, thrived, and continued on to successful careers. You can too.
Preparing for Your First Open House
Preparation is key in any professional undertaking, and hosting open houses is no exception. Let's delve into three fundamental areas where thorough preparation can help to alleviate your fears and set you up for success:
Product Knowledge: Knowing your product inside and out is crucial in real estate. Your product, of course, is the property you're showcasing and the neighborhood it's in. Familiarize yourself with every aspect of the property - the year it was built, the type of architecture, any recent renovations, the unique selling points, and potential areas of concern for buyers. Also, expand your knowledge of the neighborhood - the schools, parks, shopping areas, local attractions, and anything else a potential buyer might be interested in. Buyers will appreciate your deep knowledge, and it will build their trust in you as a real estate professional.
Role-play Scenarios: Role-playing is one of the most effective ways to prepare for the unpredictable nature of open houses. This involves envisioning potential scenarios, then acting them out with a colleague or mentor. Role-playing helps you prepare answers for tough questions, handle different types of clients, and become more comfortable with the whole process. The more you practice, the more confident you'll become in handling real-life situations.
The Power of a Good Presentation: Hosting a successful open house is all about making a great impression. This means presenting the property in the best light possible. Staging is an integral part of this. Ensure the property is clean, decluttered, and visually appealing. Use signage to direct visitors to key areas of the home. Also, prepare handouts with property details and your contact information for visitors to take with them. The goal is to create a memorable experience that leaves potential buyers imagining themselves living in the property.
The fear of hosting open houses can seem daunting, but with adequate preparation, you can confidently walk into each event. By knowing the property, practicing various scenarios, and staging a successful presentation, you'll reduce your anxiety and increase your chances of making a sale. Remember, a well-prepared agent is a confident agent.
Building Confidence
Confidence is an essential trait for a real estate agent. It helps you perform better and instills trust in your clients. Here are some strategies for building your confidence:
Develop a Positive Mindset: I know this sounds cheesy, but your thoughts really do shape your reality. If you go into an open house expecting the worst, your actions might follow. On the other hand, if you anticipate success, you'll likely project positivity, attracting more potential buyers. Practice affirmations, envision a successful open house, and maintain a positive attitude. You might be surprised by how much of a difference this can make.
Self-care: Stress can often lead to a drop in confidence. Make sure you're taking care of yourself physically, mentally, and emotionally. This could mean taking time for regular exercise, eating a healthy diet, practicing mindfulness or meditation, or simply ensuring you have downtime to relax. When you feel good, you're more likely to perform well.
Learn from Each Experience: Every open house is a learning opportunity. Whether you consider an event successful or not, there are always lessons to be drawn. Maybe you stumbled over your words when describing the property or needed an answer to a visitor's question. Instead of criticizing yourself, treat these instances as areas for improvement. Use them to prepare better for the next open house. Over time, your confidence will grow as you learn and adapt.
Celebrate Small Wins: Did you handle a tricky question well? Or a potential buyer complimented your presentation. Celebrate these moments. They are signs of your growing competence and confidence.
Building confidence is not a one-time event but a continuous process. With every open house you host and every challenge you overcome, you're becoming a more confident and capable real estate agent. Confidence comes with time and experience, so be patient with yourself as you navigate this journey.
Effective Communication Skills
Hosting a successful open house goes beyond acing your real estate exam; it's about engaging with potential buyers, building relationships, and addressing objections effectively. All these tasks require excellent communication skills. Here are some key aspects to consider:
Active Listening: As a real estate agent, your job is to provide information and understand your client's needs. Active listening involves fully concentrating on what is being said, understanding the data, and responding thoughtfully. This skill helps you tailor your responses to address each visitor's unique needs and concerns.
Clear Communication: From explaining the details of a property to outlining the buying process, your ability to communicate clearly is crucial. It's not just about using the real estate jargon you've learned for your real estate exam but making sure potential buyers understand the information you're presenting. Avoid using industry-specific language, and ensure your message is clear and understandable.
Non-verbal Cues: Communication isn't just about the words you use. Non-verbal cues, like maintaining eye contact, using open body language, and nodding to show understanding, can help establish trust and rapport with potential buyers. For example, if you are continually checking your phone during a conversation with an open house visitor it's a clear sign you are not fully engaged.
Handling Objections: You'll inevitably face objections or tough questions during an open house. How you take these can make a significant difference. Stay calm, understand the concern behind the objection, and address it confidently and professionally. Remember, every question or objection is an opportunity for you to showcase your knowledge and problem-solving skills.
By developing effective communication skills, you're increasing your chances of hosting successful open houses and growing as a professional. This is integral to your journey beyond the real estate exam to become a successful agent.
The Power of Networking and Mentorship
As a new real estate agent, you must understand that you're not alone on this journey. A whole community of experienced professionals is out there, and many are more than willing to share their wisdom. Networking and seeking mentorship can provide invaluable support as you navigate the world of open houses.
Networking: Attend industry events, join online forums, and engage in social media groups. These platforms provide opportunities to connect with other real estate professionals and potential mentors. By networking, you can learn about the industry's best practices, stay up-to-date with market trends, and gain insights that can help you host successful open houses.
Mentorship: A mentor can provide personalized guidance, share their experiences, and offer practical advice. This one-on-one relationship can accelerate learning and help you avoid common pitfalls. For example, watching your mentor in action at an open house can be an absolute masterclass in hosting. You can observe how they handle tricky situations, engage with potential buyers, and showcase properties effectively.
Building Confidence: Networking and mentorship are influential confidence builders. By learning from other's experiences and successes, you realize that your fears and challenges aren't unique - others have faced them and come out on top. This realization can inspire confidence and show you that you, too, can overcome any obstacles that come your way.
Remember, the real estate industry thrives on relationships, not just between agents and clients but among agents themselves. By actively networking and seeking mentorship, you'll learn and grow and build a support system that will help you confidently navigate your career.
Handling Setbacks and Rejections
Setbacks and rejections are inevitable in the real estate industry, especially when hosting open houses. However, how you handle these situations can significantly impact your professional growth and success.
View Rejections as Opportunities: Rejections may feel personal, but it's crucial to remember that they're often not a reflection of your skills or value as a real estate agent. Instead, consider each 'No' an opportunity to learn and improve. Ask for feedback and use it to refine your approach.
Adopt a Growth Mindset: Adopting a growth mindset involves viewing challenges and failures as chances for growth rather than setbacks. If an open house doesn't go as planned, focus on what you can do better next time instead of dwelling on the negatives.
Every 'No' is a Step Closer to a 'Yes': It's a well-known saying in sales for a reason - it's true. With each rejection, you're getting closer to a potential 'Yes.' Remember, real estate is a numbers game. The more people you interact with, the higher your chances of making a sale.
Practice Resilience: Resilience is the ability to bounce back from setbacks. This might mean taking a moment to acknowledge your feelings after rejection and then shifting your focus to your goals and the actions you need to take to achieve them.
Stay Positive: Maintaining a positive outlook is essential even when faced with setbacks. Celebrate your wins, however small they may be, and let them fuel your enthusiasm. Positivity is contagious and can significantly impact your interactions with potential buyers.
Remember, rejection is not a measure of your worth or capabilities. Instead, view it as a stepping stone towards success. The most successful real estate agents have learned to take rejection in stride and use it as fuel to keep moving forward.
Embracing Technology
As a new real estate agent, it's understandable to feel overwhelmed by the logistics of planning and hosting an open house. But fear not – technology is here to lend a hand. By embracing the right tools, you can streamline your processes, reach a wider audience, and host more effective open houses.
Virtual Tours: Virtual tours are an excellent resource for pre-qualifying prospects. By offering a 3D property tour using Matterport as an example, potential buyers can experience the space virtually before deciding to attend the open house. This feature saves time and makes your open house more effective, as attendees are already interested in the property. It also offers you a chance to practice presenting the property's highlights in a less pressurized environment.
Online Advertising: Digital platforms have made reaching out to potential buyers easier. You can promote your open houses on various platforms, such as social media, real estate websites, and email newsletters. With detailed targeting options, you can ensure your promotions reach the right audience, increasing the likelihood of attracting genuinely interested attendees.
CRM Tools: CRM tools can significantly reduce the administrative workload associated with open houses. They help keep track of your contacts, automate follow-up communications, and even analyze attendee behavior to inform future strategies. By removing these administrative tasks, you can focus on what really matters: engaging with potential buyers and selling the property.
Augmented Reality (AR) and Virtual Reality (VR): AR and VR technologies can enhance the open house experience for potential buyers, allowing them to visualize different furniture arrangements or renovations in real time. As an agent, this gives you an edge, making your open houses more engaging and memorable.
Interactive Floor Plans: Interactive floor plans allow potential buyers to explore the property's layout interactively, giving them a clearer understanding of the space before they enter the house.
By leveraging these technological tools, you can make your open houses more efficient and less intimidating. They allow you to focus on honing your hosting skills, addressing visitor inquiries, and making the sale rather than being bogged down by logistics. In the age of digital real estate, embracing technology isn't just a recommendation; it's a necessity for success.
Embarking on the journey of hosting open houses can feel intimidating, especially for new agents, but remember, it's part of the growth process. This journey is an exciting opportunity for learning and personal development. It's normal to experience fear and apprehension; the key lies in acknowledging these feelings and taking proactive steps to overcome them.
With adequate preparation, including thorough product knowledge and role-playing scenarios, you can navigate your open houses confidently. Remember, the power of a good presentation lies in effective communication and active listening. Don't shy away from seeking mentorship or networking - these interactions can provide invaluable insights and boost your confidence.
Handling setbacks and rejections is essential; each 'No' is a stepping stone to a 'Yes.' Embrace them as learning opportunities, not failures. And last but not least, harness the power of technology. Tools like virtual tours, online advertising, and CRM platforms can make the process of hosting open houses less overwhelming and more efficient.
Approach every open house as a new learning experience and an opportunity to refine your skills. The fears you feel today will pave the way for the confidence you'll have tomorrow. So, embrace the challenge, and remember success lies beyond fear.
As always, if you are interested in getting your real estate license or building a career in real estate call us at 888-768-5285 or visit www.adhischools.com
Love,
Kartik
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When investing in real estate, it’s important to know the various types and their function. As one of the most diverse industries in the world, many people considering putting money into this area
When investing in real estate, it’s important to know the various types and their function. As one of the most diverse industries in the world, many people considering putting money into this area may not be sure what specific types exist or how they function. Take a look at the 4 main types of real estate.
Residential Real Estate
This is real estate of any type that is used for residential needs. That includes the typical single family home but also other types of property. It is the largest component of the real estate market. Residential real estate is a large component of the investment market. Some examples of residential real estate include:
Single-family homes
Townhomes
Condominiums
Cooperatives (co-ops)
Duplex
Triplex
Fourplex
Mobile homes
Commercial Real Estate
Commercial real estate is any type of property that’s used for business purposes. Also known as CRE property, there are many forms. This type of real estate makes up about half as much of the U.S. market as residential. It is important and can be a valuable investment opportunity. Some examples ofcommercial real estate include:
Retail space including strip malls, indoor malls, restaurants, and other shops
Office space including office parks, medical centers, and office towers
Self-storage spaces
Parking lots and parking garages
Movie theaters
Grocery stores
Leisure and hospitality property
Apartment complexes and mobile home parks fall into commercial property as well, even though people live there. That’s because they are not owner-occupied.
Industrial Real Estate
This type of real estate is typically used for manufacturing and production across numerous industries. This is a working type of real estate because it involves more elaborate fixtures and equipment. Some types of industrial real estate include:
Manufacturing properties
Warehouses
Freezer and refrigerated storage buildings
Production facilities, including food processing locations
Power plants
Data processing locations, including data server locations
Research and development organizations
Land
When the term “land” is used in reference to real estate, it typically refers to vacant or underdeveloped property. It’s easy to see what land entails, but it includes a range of property types, including:
All types of undeveloped land
Recreational land, including areas used for fishing or hunting
Farms
Ranches
Forested areas and timberland
Orchards
Prior to their development, planned urban developments and subdivision properties also fall into this category.
Special Purpose
Some real estate is called special purpose. This type of real estate is typically any real estate that is used by the public. These properties may sometimes be purpose-built properties because they typically have a specific function. Some examples include:
Transit-related properties
Gas stations
Mixed-use projects that may mix residential with office space or retail
Senior living communities
Churches and other types of places of worship
Recreational facilities such as sports courts and golf courses
Schools
Student housing near schools
The more you know about the real estate market, the better you can make decisions about how to invest in it for yourself or for others.
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The rental market in California has seen some significant changes as a result of the pandemic, the resulting jobs crisis, and changes to the economy as a whole. Large cities have seen some of the biggest
The rental market in California has seen some significant changes as a result of the pandemic, the resulting jobs crisis, and changes to the economy as a whole. Large cities have seen some of the biggest changes. As workers ended up furloughed or even with job loss after pandemic problems hit businesses hard, the trickle-down effect impacted the real estate markets too. Here are some thoughts on those impacts and what they might mean for the future.
Laid-Off Workers Leaving Multi-Family Units
Workers facing job losses or furloughs who live in big cities find themselves in a position where they need to leave their costly apartments. Without income, the rent becomes unmanageable. However, these job losses have extended longer than many people anticipated, and as such many of these apartments have been left vacant.
The result of these vacancies is rent falling in many major cities. Vacant apartments cost landlords money, and they are better served by lowering the rent to bring in tenants than leaving the apartments empty. As uncertainty about the economic future of the country and the state of California lingers, real estate experts do not anticipate seeing a change in this trend.
Fewer People Moving Out on Their Own
Another factor that is impacting the rental markets in large cities inCalifornia is the number of people choosing not to move out on their own. The economic uncertainty and job losses have led many people to choose not to form new rental households. Instead, they are choosing to stay with roommates or family longer because they do not have the money to pay rent for a new household. This trend is further driving down rental costs in these larger areas.
Suburban Areas Seeing Increases
While large cities are seeing decreased numbers of renters, those displaced tenants need to find somewhere to live. As a result, suburban areas are seeing an increase as people flee the high-cost cities in search of more affordable rentals. The multifamily market segment seems to be increasing in suburban communities or areas that have traditionally lower incomes. If the housing market starts to improve, these areas will likely see the growth first before people feel comfortable moving back into the city.
Changes May Last Several Years
How long will these effects last? Only time will tell, but a recent post in the L.A. Times indicates the pandemic’s effect on the California real estate markets may last through 2023. Investors and renters need to be prepared for long-term effects and changes as they navigate this new normal for the next few years.
If you are considering entering the market as a renter or an investor, or if you are currently part of the market, understanding these changes and shifts is important. Armed with the right knowledge, you can enter the markets confidently and make wise choices about your own real estate investments.
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Home design is an ever-evolving field that reflects our changing lifestyles, needs, and preferences while shaping the aesthetics and functionality of our living spaces. Keeping an eye on emerging design
Home design is an ever-evolving field that reflects our changing lifestyles, needs, and preferences while shaping the aesthetics and functionality of our living spaces. Keeping an eye on emerging design trends is crucial for homeowners, designers, and enthusiasts alike. It helps them stay up-to-date with the latest innovations and styles, ensuring their homes remain comfortable and visually appealing.
Trends in home design ebb and flow over time, influenced by various factors such as technological advancements, shifting cultural values, and even global events. Exploring new design trends that inspire and redefine our living environments is essential, fostering spaces that cater to our evolving needs and preferences while simultaneously promoting a harmonious balance between form and function.
In the competitive world of real estate, it is essential for professionals looking to become a Realtor or obtain their real estate license to stay ahead of the curve by keeping up with the latest trends in home design. A thorough understanding of current design preferences enables agents better to advise their clients on property improvements and market expectations, maximizing the property's appeal and value. Moreover, staying informed about home design trends establishes the agent as an expert, instilling confidence in their clients and setting them apart from the competition. As they prepare for their real estate license exam, aspiring agents should consider incorporating home design trends into their studies to ensure a comprehensive understanding of the industry and enhance their professional expertise.
Patterned Hardwood Floors
Patterned hardwood floors have emerged as a leading design trend in the real estate industry, redefining contemporary living spaces with artistic and visually appealing aesthetics. Known for their intricate designs, patterned hardwood floors provide a unique focal point that elevates the overall interior design. The popularity of this flooring option can be attributed to its ability to create a sense of luxury and sophistication while offering practical benefits over traditional carpeting.
One significant advantage of hardwood floors over carpet in general is their durability. Hardwood floors are resistant to wear and tear and can be refinished multiple times, prolonging their lifespan and maintaining their appearance for years. Conversely, carpets tend to wear down and accumulate dirt, allergens, and stains, requiring more frequent replacement. Furthermore, hardwood floors provide a more hygienic living environment as they do not harbor allergens and are easier to clean and maintain.
As homeowners and designers embrace the resurgence of patterned hardwood floors, certain wood types have become increasingly popular in real estate design. With its warm tones and distinctive grain patterns, oak is a favorite choice for creating striking floor designs, such as herringbone and chevron. Walnut, renowned for its rich and deep color, offers a luxurious and sophisticated touch, making it ideal for creating eye-catching patterns like parquet or basketweave.
Another trending wood type is reclaimed wood, which contributes to a unique and rustic aesthetic and promotes sustainability by repurposing previously used materials. Bamboo is gaining popularity for those seeking an eco-friendly option thanks to its fast growth rate and inherent strength. Finally, exotic woods like Brazilian cherry, teak, and tigerwood are also making waves in the real estate design world, offering a range of stunning patterns and natural colors that will make a statement.
Patterned hardwood floors are a popular design trend in real estate, offering many benefits over carpeted floors. They deliver an unparalleled aesthetic appeal, durability, and easy maintenance, making them a sought-after choice for modern living spaces. With various wood types, homeowners and designers can create personalized and visually captivating flooring designs that cater to individual tastes and preferences.
Black Accents
The rise in popularity of black accents in real estate design can be attributed to several factors, including their versatility, timelessness, and ability to create visual interest. Black accents have become a sought-after design choice in contemporary interiors, as they effortlessly complement a wide range of color schemes and styles, adding depth and sophistication to any space.
One reason black accents are a good design choice is their ability to serve as a visual anchor, providing balance and contrast in a room. When used strategically, black elements can accentuate specific features or areas, drawing the eye and emphasizing the overall design. Furthermore, black accents can add a touch of elegance and refinement to a space, making it feel more polished and complete. Their neutral nature allows them to seamlessly blend with various color palettes, from minimalist monochromatic schemes to more vibrant and bold designs.
Incorporating black accents in interior design can be achieved in numerous ways, depending on the desired impact and personal preferences. Consider using black hardware on cabinetry, door handles, or light fixtures for subtle and understated black elements. This approach adds a touch of sophistication without overwhelming the space. To create a more dramatic effect, opt for statement pieces like a black accent wall, a large piece of black furniture, or bold black-and-white artwork. These elements will draw attention and create a stunning visual contrast.
Another effective way to incorporate black accents is through textiles and accessories. Black throw pillows, rugs, or curtains can add depth and richness to a room while allowing play with textures and patterns. For a cohesive and harmonious design, consider using black accents in multiple areas of the space, tying together different elements and creating a unified look.
Black accents have risen in popularity in real estate design due to their versatility, timelessness, and ability to elevate a space. They can be used in various ways to create visual interest and provide balance and contrast in a room. By incorporating black accents in different forms, homeowners and designers can achieve a stylish and sophisticated interior that appeals to a wide range of tastes.
Light Colored Floors
The growing popularity of light-colored flooring in real estate design can be attributed to its ability to create a sense of openness, its versatility in complementing various design styles, and the trend toward minimalist and Scandinavian-inspired interiors. Light-colored floors have become a favored choice among homeowners and designers alike for enhancing and brightening any living space.
One of the main reasons light-colored flooring is a good design choice is its ability to make a room appear larger and more open. Light floors reflect natural light, allowing it to bounce around the room and create a bright and welcoming atmosphere. This effect is especially advantageous in smaller spaces, where maximizing the perception of square footage is essential. Additionally, light-colored floors provide a neutral base that seamlessly blends with different color schemes and design styles, making them a versatile choice for various interiors.
Depending on the desired aesthetic and functionality, incorporating light-colored flooring in interior design can be achieved with various materials and finishes. Light hardwoods, such as white oak, maple, or ash, are popular choices for their natural beauty, durability, and warmth they bring to a space. Light-colored laminates and luxury vinyl tiles offer more budget-friendly and low-maintenance alternatives while still delivering a visually appealing look. For a more contemporary or industrial feel, polished concrete or light-colored tile flooring can create a sleek and modern foundation for the room's design.
When using light-colored flooring, it is vital to consider the balance and contrast with other elements in the room. Pairing light floors with darker or more colorful furniture and accents can create a striking visual contrast and ensure that individual pieces stand out. Alternatively, combining light floors with soft, neutral furnishings can create a serene and calming environment, perfect for spaces meant for relaxation and rejuvenation.
Versatile Spaces/Home Offices
The increasing prevalence of remote work and flexible working arrangements has led to a surge in demand for functional and versatile workspaces within the home. This trend has prompted homeowners and designers to create multipurpose spaces catering to work and leisure needs, ensuring that the home remains adaptable and efficient even as lifestyles and work arrangements evolve.
A dedicated work area at home is conducive to maintaining productivity, providing a space where individuals can focus on tasks without the distractions of everyday household activities. Moreover, a well-designed home office can promote a healthier work-life balance, enabling individuals to separate their work responsibilities from their personal lives more effectively. I recorded a YouTube video explaining how to balance working from home that you can watch here.
However, the need for a dedicated home office may diminish as work situations change and employees return to the office, either full-time or in a hybrid capacity. In such cases, it is beneficial to design a space that can serve multiple purposes, allowing homeowners to maximize the functionality and utility of their living areas. A room that functions as an office today can easily be transformed into a lounge, a display room, a guest room, or any other purpose the homeowner desires.
To create a versatile workspace that can accommodate various needs, it is essential to select furniture and decor that are flexible and multifunctional. For instance, investing in a desk that can double as a console table or a fold-out wall-mounted desk that can be easily tucked away when not in use, can provide valuable workspace without compromising the room's potential for other uses. Similarly, incorporating modular storage solutions, such as bookshelves or cabinets with adjustable shelves, allows easy reconfiguration to suit the room's changing functions.
In terms of decor, it is crucial to choose elements that complement both the office setting and the alternative uses of the space. Neutral color schemes, versatile lighting options, and adaptable decorative accents can help to create a cohesive and harmonious design that seamlessly transitions between different functions.
In conclusion, the growing trend of incorporating a multipurpose work area at home is driven by the need for flexibility, efficiency, and adaptability in response to changing work arrangements. By carefully selecting furniture, storage solutions, and decor that cater to various uses, homeowners can create a space that serves their work needs and contributes to a comfortable and dynamic living environment.
Biophilic design
Biophilic design can be traced back to the 1980s when biologist Edward O. Wilson introduced the term 'biophilia' to describe the innate human affinity for nature and living organisms.
However, integrating biophilic elements in architecture and interior design has gained significant momentum in recent years, particularly as environmental awareness and the desire for healthier living spaces continue to rise.
The growing popularity of biophilic design can be attributed to the increasing recognition of its physical and psychological benefits. Biophilic design helps reduce stress, improve cognitive function, and promote overall well-being by incorporating natural elements into the built environment. Furthermore, as urbanization expands and people spend more time indoors, the desire to reconnect with nature becomes more pronounced, making biophilic design a sought-after solution to bridge the gap between indoor and outdoor living.
To effectively incorporate biophilic design into homes, designers can consider the following tips:
1. Introduce greenery: Adding indoor plants, vertical gardens, or green walls enhances the aesthetic appeal of a space and purifies the air, and creates a calming atmosphere.
2. Maximize natural light: Prioritize large windows, skylights, and open floor plans to allow natural light to flood the living space, boosting mood and energy levels.
3. Use natural materials: Incorporate materials like wood, stone, or cork in flooring, furniture, and decorative accents to evoke a sense of connection to the natural world.
4. Embrace natural colors and patterns: Utilize earthy tones, such as greens, browns, and blues, or organic patterns inspired by nature to create a visually soothing environment.
5. Incorporate water features: The sound and sight of water can induce a sense of tranquility and relaxation. Consider adding a small indoor fountain, aquarium, or water wall to your design.
6. Opt for organic shapes and textures: Choose furniture and decor items with soft, rounded edges or irregular shapes that mimic the fluidity and unpredictability of nature.
7. Create a seamless indoor-outdoor connection: Blur the boundaries between the interior and exterior spaces by integrating elements like large sliding doors, outdoor living areas, or balconies that encourage interaction with the natural environment.
The biophilic design trend has gained traction due to the increasing desire for a connection with nature and its numerous physical and psychological benefits. Designers can easily incorporate biophilic elements into homes by prioritizing natural materials, colors, light, and greenery. This creates a living space that promotes well-being and fosters a deeper connection to the natural world.
Hope these design trends help. If you’re interested in learning about starting a career in real estate visit www.adhischools.com or call us at 888 768 5285.
Love,
Kartik
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Getting your real estate license and passing the real estate exam is only the beginning of your journey in the real estate world. As an agent fresh from real estate school, you're not only tasked with
Getting your real estate license and passing the real estate exam is only the beginning of your journey in the real estate world. As an agent fresh from real estate school, you're not only tasked with helping your clients find their dream home but also offering them advice on how to keep that home secure once they've settled in. Home safety is an essential aspect of homeownership that many people may overlook, but it can make all the difference in providing peace of mind for your clients.
Change the Locks Immediately After Moving In
After your client has closed escrow on their new home, one of the first recommendations you should make is to change all the locks. During the home-buying process, multiple individuals may have access to the keys, including other real estate agents, appraisers, and contractors. To ensure maximum safety, advise your clients to replace all the locks as soon as the sale closes, ideally before moving in or starting any renovations. This is a simple yet effective first step in home security that might not be covered in a traditional real estate school curriculum but is a crucial tip for new homeowners.
Hide Alarm System Wiring
Many homeowners choose to install alarm systems for added security. If your clients decide to do this, remind them to conceal all the alarm system wiring. Exposed wires could be cut by intruders, thereby disabling the system. Though professional installation companies usually take care of hiding the cables, if your client opts for a DIY approach, this tip could be invaluable. Safety precautions like this are only sometimes emphasized in real estate license courses but are essential to maintaining a secure home.
Keep Entryways Clear When Landscaping
In your real estate school, you've probably learned about the importance of curb appeal. While landscaping is an important part of this, it's crucial to remind your clients to keep safety in mind when designing their outdoor spaces. Bushes and trees can enhance a home's aesthetic appeal, but if they're too close to the house, particularly near doors and windows, they could provide cover for potential intruders. Encourage your clients to plan their landscape design to leave entryways clear and visible.
Encourage Clients to Build Relationships with Neighbors
One safety tip often overlooked in traditional real estate education is the value of community. Encourage your clients to get to know their neighbors. A close-knit neighborhood community can be a strong deterrent against crime. While they don't need to be best friends with everyone, being on good terms and maintaining open communication with those living nearby can provide an extra layer of security.
Illuminate Dark Areas Around the Property
Ensuring proper exterior lighting can significantly increase home safety. Advise your clients to identify and illuminate any dark areas around the property. Well-lit exteriors are less attractive to potential intruders, who are more likely to target homes that offer easy, concealed access. This goes beyond what's taught for the real estate exam and falls under the practical advice you can provide as a real estate agent.
Establish a Safety Routine
Installing locks, alarms, and lights is one thing, but maintaining them is equally important. Encourage your clients to establish a safety routine. This could include nightly checks of all doors and windows, monthly tests of the alarm system, and bi-annual checks of outdoor lighting and smoke alarms.
Install a Home Security System
While this might seem an obvious suggestion, it's worth mentioning because of its significant role in home security. Today's home security systems have evolved and offer a variety of features, including smart technology integration, real-time monitoring, mobile alerts, and even emergency service dispatch. While the potential cost may initially put off many homeowners, a security system's added security and peace of mind can be invaluable. As an agent, you can remind your clients that various options cater to different budgets and requirements.
Regularly Check and Update Exterior Doors and Windows
Doors and windows are the primary entry points for intruders. Encourage homeowners to regularly check the condition of all doors and windows, making sure they close and lock properly. Reinforce doors with deadbolts and consider upgrading to solid-core doors, which offer better resistance against forced entry. Safety measures for windows include adding window security film, installing window or glass break sensors, and using window bars (Ugly, but might help depending on the area. Make sure these are up to code, however and allow fire release and other legally required features.)
Use Timers for Lights and Electronics
Have you ever seen a house with lights, a TV, or a radio on and assumed someone was home? Well, that's precisely what timers for lights and electronics can do - they can trick people into thinking someone is at home even when the house is empty. This is a great trick to keep your home safe, especially if you're away for a vacation or won't be home for a while.
So, how do timers work? It's actually pretty simple. A timer is a device that you can set to turn your lights, TV, or radio on and off at certain times. For example, if you're away, set the timer to turn on your living room light at 7 p.m. and turn it off at 10 p.m., just like you would if you were home.
The cool thing is, with new technology called "smart home technology," you can manage these timers with an app on your smartphone. That means you can control your home's lights and electronics from anywhere. So, even on vacation far away, you can use your phone to turn on your lights or TV back at home.
Using timers like this can make your home safer by making it seem like someone is home. Most people who might try to break into a house would think twice if they thought someone was there. So, using timers for your lights and electronics can help protect your home, even when you're not there!
Be Cautious with Social Media
While this may not be the most traditional safety advice, in the digital age, it's increasingly relevant. Advise your clients to be cautious about what they share on social media. Posting about being away from home could alert intruders that their property is unoccupied. Sharing vacation photos or posts after they've returned home is advisable rather than during their time away.
As a real estate agent, your job extends beyond passing the real estate exam and helping clients find new homes. By providing these tips and continuing your real estate education beyond what's taught in real estate school, you can help ensure your clients feel secure and satisfied in their new homes.
Your journey toward getting a real estate license has given you the skills and knowledge to guide your clients in home buying. Now, with these safety tips, you're better equipped to provide them with valuable advice for their life as homeowners.
As always, if you are interested in getting your real estate license visit www.adhischools.com or call us at 888-768-5285.
Love,
Kartik
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The one constant in home decor is that tastes are always changing. The styles that turned heads just a few years ago are now starting to roll eyes. What can you do to keep your home looking modern?
The one constant in home decor is that tastes are always changing. The styles that turned heads just a few years ago are now starting to roll eyes. What can you do to keep your home looking modern? Here’s a preview of what you’ll see in the coming year.
Patterned Hardwood Floors
Your home is more than just a place to dwell - it’s a way for you to express yourself. And while anyone can get a carpet, having a patterned hardwood floor is a true testament to your unique personality. A shape or pattern on your floor breaks up the monotony of plain flooring while adding an individual flourish that makes your floor all your own.
Taking a minimalist approach can also be highly effective. Instead of making a big shape, you can sporadically accent your floor with wood of a different shade. Think of a basketball court and the different pieces of wood you might see on the floor. It’s a neat way to approach the traditional yet trendy hardwood floor.
Black Accents
An overly black color scheme can appear a bit drab or even morbid. But using black accents to add to a bright color scheme is highly effective. The key is the idea of highlighting negative space -- in other words, the area surrounding objects in the room. If those items simply exist in a white room, they’re just there. A bit of black to accentuate your decor can break up the white, making the room appear bigger, fuller and more elegantly decorated. Of course, it’s easy to get carried away with accents of any kind, so start small and take a slow but steady approach toward getting your rooms to pop.
Natural Lighting
It’s well-known that the sun provides more than light -- it also provides a nice little boost of serotonin, which helps increase moods. Plus, natural light helps to save on lighting costs and reduces strain on the environment. Therefore, natural lighting is a natural fit in modern homes. Large windows and skylights are becoming more commonplace, enabling homeowners to save money while getting more exposure to the sun. It’s a win-win that benefits everyone, while also giving you a more fashionable home.
Light Colored Floors
With carpets less popular in modern times, your flooring matters more than ever. And a light colored floor can help to make your rooms look bigger and brighter. What’s more, light colored flooring pairs well with the patterns floors we discussed earlier, giving you something bold to go alongside a floor that’s easy on the eyes. Best of all, a light floor works in any type of house, from a sleek modern home to a more traditional cottage.
Versatile Spaces/Home Offices
With so many people working from home these days, an office is a must in any home. But what happens when you go back to work, especially if it’s not a full-time return to the office? You want a room that can function as an office, but can also be used in other ways. A room that’s an office now can also become a lounge, a display room, a guest room or any number of purposes. Use your imagination and find decor that works for the office and for any other uses you might have for that space.
Mixing Dark and Earthy Tones
Earth tones -- colors you typically see outside -- are frequently cited as home design staples. However, it’s not always clear how you should work in those colors. Mixing dark colors into those earthy tones helps those unique colors to stand out amid dark backgrounds. The combination can really make your earth tones pop, especially if you’re already utilizing bright rooms with light floorings and plenty of natural light. It’s a winning formula that’s sure to wow your guests and put a smile on your face every day.
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You don't need to attend a real estate school, such as ADHI Schools, or pass the real estate license exam offered by Crash Course Online to understand that investing in real estate can be highly rewarding.
You don't need to attend a real estate school, such as ADHI Schools, or pass the real estate license exam offered by Crash Course Online to understand that investing in real estate can be highly rewarding. In this article, we'll delve into the many benefits of property ownership and discuss how furthering your education and obtaining a license can enhance your ability to capitalize on these advantages.
Steady Passive Income
Many view real estate ownership (particularly home ownership) as a practical solution – no rent payments and stability for years. However, the benefits of owning real estate extend far beyond that, regardless of your investment goals or motivations.
Even if you are starting your real estate journey, you know that real estate offers significant financial rewards, including tenant-paid passive income. Besides the recurring monthly income, property values typically appreciate faster than inflation rates. Over the past 30 years, real estate values have risen by over 5% annually, with recent years showing even more significant increases. This growth makes real estate an attractive option for those looking to establish roots, stabilize their family, or invest in rental properties.
Financial Security
Whether you are discussing owning a single-family home as a primary residence or a rental, real estate ownership is a powerful tool for achieving financial security, as it serves as a tangible asset with the potential for long-term appreciation. By investing in real estate, you can build equity, increasing as you pay your mortgage and the property value rises over time. This equity can be utilized in various ways, such as securing loans or providing a cushion during challenging times. Additionally, rental properties generate a steady stream of passive income, which can contribute to overall financial stability by offsetting mortgage payments or supplementing your primary income source.
Moreover, real estate investments typically offer a hedge against inflation and can diversify your investment portfolio, reducing risks associated with economic fluctuations. Owning real estate paves the way for long-term financial security by providing multiple avenues for wealth generation and protection.
Tax Benefits
Owning real estate offers numerous tax benefits that can significantly enhance an investor's financial situation. One of the most notable tax advantages is the mortgage interest deduction. Up to a specified limit, homeowners can deduct the interest paid on their mortgage from their taxable income, reducing their overall tax liability. In the early years of a mortgage, when the interest payments are generally higher, this deduction can be particularly beneficial.
Another tax benefit of real estate ownership is the property tax deduction. Homeowners can typically deduct up to $10,000 of their local and state property taxes from their taxable income. This deduction can result in substantial tax savings, especially for individuals residing in areas with high property tax rates.
For rental property owners, there are additional tax benefits. They can claim deductions for expenses related to their investment properties' management, maintenance, and operation. These expenses may include repairs, property management fees, insurance, and travel costs associated with maintaining the property. Check out our blog on DIY repairs here if you are a handy investor. Furthermore, rental property owners can take advantage of depreciation deductions, which allow them to recover the cost of their investment over time. Depreciation essentially acts as a non-cash expense, offsetting rental income and reducing the taxable income derived from the property.
For investors, another valuable tax benefit of real estate ownership is the 1031 exchange. This provision allows investors to defer capital gains taxes when selling an investment property, provided they reinvest the proceeds into a like-kind property within a specific time frame. By deferring taxes through a 1031 exchange, investors can rapidly grow their wealth and maintain a more diverse real estate portfolio.
Stability
Imagine a future where you enjoy unparalleled stability and peace of mind, all thanks to a single wise decision: real estate ownership. Unlike the uncertainties of renting, owning a property secures your position, allowing you to take control of your living situation and financial destiny. When you own a home, you eliminate the need to rely on landlords, worry about rent hikes, or face the constant threat of eviction. Instead, you're planting your roots, taking charge of your life, and laying the foundation for long-lasting stability.
In contrast to the precarious nature of renting, real estate ownership allows you to build equity over time. As you pay down your mortgage and your property appreciates, you'll accumulate wealth that can be used for various purposes, such as funding your children's education, financing your dream vacation, or serving as a cushion in times of financial hardship. Furthermore, owning a property provides a sense of accomplishment and pride, knowing you've made a wise investment in your future. This investment offers financial stability and contributes to your emotional well-being as you enjoy the satisfaction of having a space to call your own.
Moreover, real estate ownership offers protection against market fluctuations, making it a relatively stable investment compared to other options like stocks. While the value of stocks can swing wildly based on economic factors and global events, real estate has historically demonstrated consistent growth and resilience, even during periods of economic turmoil. This stability is further amplified by the real estate being a tangible asset backed by the intrinsic value of land and structures, ensuring it will always hold some value.
Stronger community ties
One persuasive argument for the belief that homeowners have stronger community ties than renters is rooted in the long-term nature of homeownership. When individuals or families invest in purchasing a home, they acquire a physical structure and become a part of the local community. This long-term commitment often leads homeowners to develop a vested interest in the well-being and success of their neighborhood. Consequently, they are more likely to engage in activities that contribute to the community's stability, safety, and overall development. Even as a real estate professional, you’ll want to learn how to host these community events to tap into the residents in the area and the community at large to brand yourself as the go-to-agent in the area.
Homeowners are also more likely to form deeper connections with their neighbors, as they share common concerns and goals for their community. This sense of belonging fosters cooperation and mutual support, strengthening social bonds and collective action to address local issues. For instance, homeowners may join neighborhood associations or participate in local events, helping to create a sense of unity and shared purpose. These connections ultimately contribute to a safer, more resilient community better equipped to face challenges and celebrate successes together.
Furthermore, homeowners who take pride in their property are more likely to maintain and improve their homes, yards, and surrounding areas. This investment in the local environment enhances the neighborhood's aesthetic appeal and sends a powerful message about the community's values and priorities. As a result, areas with high homeownership rates often experience lower crime rates, increased property values, and a greater sense of safety and well-being among residents.
In conclusion, the long-term commitment and shared interests that come with homeownership encourage individuals and families to invest their time, energy, and resources in their communities. This increased investment leads to stronger community ties, improved neighborhood stability, and a safer, more vibrant living environment for all residents. While renting may offer certain short-term advantages, homeownership fosters a more profound sense of connection and responsibility that ultimately benefits the individual homeowner and the entire community.
Retirement security
A compelling argument favoring homeownership as a means to secure financial stability during retirement revolves around reduced or eliminated housing costs. For many retirees, housing expenses constitute a significant portion of their monthly budget. By owning a home that is fully paid off by the time they retire, homeowners can effectively eliminate one of their most significant financial obligations, freeing up resources for other needs and desires during their golden years. In contrast, renters will likely continue to face rent payments throughout their retirement, which can be particularly burdensome when living on a fixed income, especially if the rent increases with regularity.
In addition to reduced housing costs, homeownership can also provide retirees with a valuable financial asset. As the value of a home typically appreciates over time, homeowners can benefit from the increased equity they have built up in their property. This equity can be accessed during retirement in several ways. For instance, retirees may choose to downsize by selling their current home and purchasing a smaller, more affordable property, thus freeing up cash to supplement their retirement income. Alternatively, they may opt for a reverse mortgage, converting a portion of their home's equity into tax-free income without selling or moving.
Moreover, homeownership offers retirees the flexibility to generate income by renting out a portion of their property. This option can be particularly advantageous for those with additional space, such as an in-law suite, a finished basement, or a separate dwelling unit. By renting out this space, retirees can establish a steady stream of income that can help them maintain their quality of life and cover other expenses during retirement, such as healthcare costs and leisure activities.
Homeownership provides retirees with significant financial advantages contributing to a more secure and comfortable retirement. By eliminating or reducing housing costs, offering the opportunity to access built-up equity, and presenting options for additional income generation through renting, homeownership serves as a reliable foundation for financial stability in one's later years. Contrastingly, renters may face ongoing housing expenses and a lack of financial flexibility, potentially leading to a more challenging retirement experience.
The end of the day, the numerous benefits of homeownership solidify its position as a superior option to renting and a practical path to wealth creation. By allowing individuals to build equity, providing long-term stability and control, and offering tax benefits, owning a home is a wise financial decision. Moreover, homeownership fosters stronger community ties, ensures privacy, and instills a sense of pride and accomplishment. Additionally, real estate ownership demonstrates its enduring value as a hedge against inflation and a means of securing financial stability during retirement.
Investing in real estate empowers individuals to take charge of their financial future, transforming their living space into a tangible asset that can generate wealth and security for years.
Love,
Kartik
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The California housing market stayed blue-hot through 2021, leaving many potential home buyers waiting in the wings. Whether you are getting your real estate license or are a retail consumer, you might
The California housing market stayed blue-hot through 2021, leaving many potential home buyers waiting in the wings. Whether you are getting your real estate license or are a retail consumer, you might be wondering if home prices will continue to rise through 2022. On the flip side, you’re undoubtedly interested in whether or not the market might cool off, so you can finally make your big purchase. To figure all that out, you just have to take a peek at this guide to learn all you need to know about the housing market conditions in California.
2021 Housing Market Outlook
All across California, the already expensive housing market got even pricier as 2021 went on. This was a surprise to most people, as many thought that the pandemic would wreak havoc on the real estate market. To be fair, I have been a bear since 2018 as evidenced in this YouTube video.
In reality, quite the opposite has occurred since this recording. Prices have continued to rise through the pandemic with record jumps in home prices in the suburbs outside Sacramento, Riverside, and other urban centers. Inside the city centers, property prices continued to rise as well, although not quite as fast as the suburbs. Most people attribute this to the desire for social distancing and being a little further away from one another.
Overall, reports indicate that single-family home prices rose by over 12 percent through 2021 in many areas, landing thei median price tags in the $800,000 range by year’s end. Although that’s double the median sales price for homes across the United States, certain areas of California have even higher typical home prices. In San Francisco, for example, homes sit at $1.5 million on average, while homes in upscale Montecito often have an eye-watering $6.5 million asking price.
Cooling Ahead in 2022
The price hikes naturally result from low housing inventory and high demand, which will probably change at least a little in 2022. The always rosy-eyed California Association of Realtors projects that the cost of homes across the state will increase by a rather moderate 5.2 percent. Their housing and economic forecast points to the economic recovery, remote workforce, and overall supply/demand status as the factors driving the continued price increases.
These price increases will likely be tempered by rising interest rates. Mortgage interest rates have continued to stay at historic and unsustainable lows for more than a decade. The likelihood of rates staying at these low levels is extremely low without triggering massive inflation.
The combination of increased inventory coupled with decreased demand due to higher interest rates will likely cause the housing market to cool in 2022.
Should you buy now?
If you have the means and truly want to buy a home in California, consider getting all your ducks in a row and taking the plunge. Over the long run, California home prices have continued to march ever upward, after all, as California continues to attract people from far and wide. While rates will likely rise significantly in 2022 and there might be short-term downward pressure on prices this will only be for a period until prices rise again.
Timing the market is an impossible feat.
Not sure if it’s smart to start looking for a home to buy? Reach out to me at the office or through Instagram direct message.
Either I or a member of my team will be able to guide you appropriately. We can discuss your options and help guide you through your home buying journey.
If you’re reading this as you study for the California real estate exam I suggest you read more of my blogs to get acquainted with the real estate market.
Love,
Kartik
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As you look to improve your living situation, that age-old question has likely come up: “Is it really a good time to buy a house?” There’s no one right answer for everyone, of course. But with
As you look to improve your living situation, that age-old question has likely come up: “Is it really a good time to buy a house?” There’s no one right answer for everyone, of course. But with a look at the most favorable months for home buying, the overall market conditions, and your personal factors, you can make the best decision for your needs. To help you get started, here’s a look at what to consider on your mission to find the best time to buy a house.
Find Favorable Months
The time of the year you plan to buy a home matters when it comes to pricing, inventory, and ease of tackling your move. Each real estate market responds to the seasons differently, especially when severe weather systems come into play.
In areas with heavy snowfall, for example, winter brings a marked decrease in inventory because many people don’t want to move in the snow. In tornado-prone areas, the spring might come with lower inventory numbers instead. The silver lining is that inventory decreases bring down house prices due to the low competition for housing.
In general, late summer and early fall offer the best balance of inventory and pricing. To make sure, just ask a real estate agent in your area for the inside scoop about the best months for homebuying.
Look at the Market Conditions
Market conditions can have a big impact on everything from inventory and pricing to mortgage terms and interest rates. To figure out if the market favors your homebuying journey, take a good look at the overall real estate market conditions nationwide and in your area.
Then, look at the current state of the economy along with projections for the coming year. After that, you must look at your local job market, including the unemployment rate, to see how your local economy is faring.
Then, look at the current state of the economy along with projections for the coming year. After that, you must look at your local job market, including the unemployment rate, to see how your local economy is faring.
Consider When It’s the Best Time for You
No matter what the market is doing, your homebuying journey must happen on your time schedule. If you need housing right away and cannot find rentals that suit your needs, then it might be wise to start looking for a home to buy. Before you can do that, you must make sure that your income, savings, and credit score are ready for the mortgage application process.
If everything lines up, use your findings from the prior sections to get ready for what lies ahead. In periods of excellent housing availability, you’ll need to prepare for higher prices, bidding wars, and lots of showing appointments. When inventory is low, prices might come down, but you’ll have to look long and hard for a property that meets all your needs.
As you consider all these factors, it’ll become quite clear if it’s a good time to buy a home or if you should wait it out a bit. Just remember that market conditions can always change either way, so waiting it out might not get you the results you seek. But as long as you practice your due diligence, you’re on the right track to ensuring your success in properly timing your home purchase.
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Broadly speaking, an encumbrance is some “burden on the title” to a piece of property. If you’re reading this article, you probably already have been exposed to the term “encumbrances” in
Broadly speaking, an encumbrance is some “burden on the title” to a piece of property. If you’re reading this article, you probably already have been exposed to the term “encumbrances” in Real Estate Principles but I wanted to write a quick article about it as a refresher.
I chuckle when I hear people say things like “I would never buy a home with an encumbrance!” because this is essentially an impossible request. All properties are going to be encumbered in some way whether either through zoning regulations, private restrictions like CC&Rs when buying a condo or even something as common as a mortgage.
Encumbrances are of two basic types. Some involve money and others do not involve money. In the sale of California real estate, sellers are required to disclose encumbrances on a property and generally a title insurance company is a backstop to ensure that buyers are made aware of any encumbrances on a property prior to the purchase.
An encumbrance may or may not affect the value of the property – it depends on the type of encumbrance. There are some encumbrances like a lis pendens (explained below) that may prevent the sale of the property altogether.
Mortgages and Deeds of Trust
Mortgages and trust deeds are among the most common types of encumbrances out there. Any time a buyer of real estate gets a loan on a property the lender will place a deed of trust or a mortgage against it. I know we are accustomed to calling any home loan a “mortgage” but in California the instrument is actually a deed of trust.
These are very common encumbrances on a piece of real estate because most properties are not purchased cash.
If you’re interested in learning more about the differences between a mortgage and a trust deed I recoded a YouTube video about it here.
Deed Restrictions
A private owner might restrict the use of his or her property in some way. These restrictions usually stay with the property upon transfer. For example, a member of a church may decide to donate some land to the church on the condition that it be used only for religious purposes.
Prior to the enactment of civil rights legislation, there may have been race or other (now illegal) conditions prohibiting the sale to members of a specific ethnic minority group or religion. Such deed restrictions are neither valid nor enforceable
Zoning
Zoning is a public control on real estate. Every city and county in California is required to have a comprehensive, long-range plan for development within an area. This plan is known as the general plan. If you need a refresher on this, check out this link.
Even though most people do not think of zoning as an encumbrance, it is in fact an encumbrance. For example, a property that is zoned residential generally cannot be used for a commercial business - making it encumbered in some way.
Liens
A property could have voluntary or involuntary liens. A voluntary lien is one that is freely agreed to by the property owner. Reading that, you might wonder why anyone would voluntarily place a lien on their property but these liens are actually very common in the form of mortgages and trust deeds which I outlined below.
On the other hand, involuntary liens are those that get placed on a property by operation of law. Examples of involuntary liens include property tax liens, income tax liens, mechanic’s liens, and lis pendens. These liens are involuntary because the property owner does not need to specifically authorize the creation of the lien. The lien is created by law.
From your real estate crash course you might remember that a mechanic's lien is one that a party can place on your property if you did not pay for labor, services, material or equipment used upon a property.
Mechanics liens (like all liens) are another example of an encumbrance.
Easements
An easement is a type of encumbrance that gives others permission to use a portion of property - often for access. Imagine there are two houses, one in the front and one in the back. Let’s say the only way that the back house can get home is to cross over the front house. The right of way over the front house is known as an easement.
Another example of an easement is an easement in gross which mostly involves utility companies. The water utility, for example, typically has the right to lay underground water pipe through a subdivision and the electricity company will typically have the right to string wires over a subdivision.
Encroachment
An encroachment is a physical invasion of another’s property. Examples of encroachments include walls being built extending onto a neighbor’s property line, structures being built across boundaries or even airspace encroachments where branches of trees extend into an adjacent parcel, for example.
It may be challenging to sell a property that has an encroachment upon it.
A solid understanding of encumbrances will help you not only pass your real estate examination, but also be in a better position to help your clients.
If you need more help passing the real estate exam, call us at 888 768 5285 and we can help.
Love,
Kartik
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The need for a quick sale is prompted by an opportunity. People, family, job change, or other needs mean that your client has to sell fast. No matter the reasons, a quick sale can often be a tough promise
The need for a quick sale is prompted by an opportunity. People, family, job change, or other needs mean that your client has to sell fast. No matter the reasons, a quick sale can often be a tough promise to make, even in a booming real estate market. Employing the tactics below can give you and your client the best chance of selling quickly for the price that you want.
1. Cultivate contacts with as-is buyers.
House flippers and people who buy real estate for the rental income are two groups who are typically open to as-is purchases and quick closing. Keep a list of these buyers as you encounter them and reach out when you have a property you want to sell in 7 days.
It pays to keep these relationships fresh even when you do not have a home to sell quickly. Email regularly to check in and ask about the types of properties they are currently seeking. Forward news articles that are of interest. By reaching out regularly, you keep yourself top of mind so they are quick to open your emails when you have a great property to share.
2. Give your sellers a crash course on staging.
First impressions always matter, but never as much as they do when you want to sell fast. Helping your sellers prep their home for market can make a huge difference in your results. Talk to them about the importance of tucking away personal items and removing furnishings to make rooms look bigger. Teach them how to show off features like great storage. In some cases, it can be worth the expense of bringing in professional home stagers.
By ensuring that the home looks beautiful and inviting for every open house and tour, you can increase the chances of winning a buyer's heart.
3. Suggest some quick, high-impact updates.
When you want to sell a listing in 7 days, there's no time for an extensive kitchen remodeling project. But, small, high-impact updates can help a lot.
Start with a focus on curb appeal. A freshly painted home entrance and neatly manicured landscaping start things off on the right foot. Inside, a fresh coat of paint can change the entire feel of a room. Finalize the effect with new lighting that makes the home look bright and welcoming.
4. Take amazing photos.
With today's phones, everyone has the ability to take images worthy of Architectural Digest. Increasing your skill with natural lighting photography can help you get great results. Professional photography lighting may be needed to get the best results in some rooms.
The right lighting and composition can truly showcase the elements that makethis property the perfect new home for one lucky buyer.
5. Invest in paid social media.
Organic growth on your social media channels helps with day-to-day exposure. But, when you have a special listing that you want to move fast, it can pay to invest in promoted posts. Careful audience curation ensures that your posts show up in front of the audience most likely to want to look at the home for sale.
It is also a good idea to be on multiple platforms. Facebook is a common choice, but do not neglect Instagram and Pinterest. Even TikTok can be useful. There are a number of agents who have amassed massive followings by presenting home tours on the video short app.
6. Optimize your real estate listings.
Listing sites like Zillow and Trulia offer far more listing customization than the MLS board does. Update your written description of the property with a call to action. Include your name and phone number and tell interested buyers how to get in touch.
You should also update your listing photos for the best impact. These sites automatically add all the images from your local MLS. Choose the best image of the front of the property and put it in image slot #1. For extra impact, edit the photo to add a custom banner with your contact information and your logo.
7. List low and start a bidding war.
An expert with Forbes Real Estate Council said that she had great success listing great homes for around 10% less than their current value. The combination of a well-staged home with great pictures and a low selling price brings in a ton of interest. Potential buyers are intrigued because one of the best looking houses in the area is also going for far less than comparable properties. By the time potential buyers are making offers, they will often push the price much closer to the seller's target price.
There is no one strategy that will guarantee a sale in one week. But, using the tips above can dramatically increase your chances of closing the deal quickly.
Love,
Kartik
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One of the best ways to ensure success as a real estate agent is to be an active and contributing member of your local community. Being a recognizable face provides you with a sustainable stream of
One of the best ways to ensure success as a real estate agent is to be an active and contributing member of your local community. Being a recognizable face provides you with a sustainable stream of prospects. It also gives you a chance to show your community that you care. Hosting community events allows you to connect with neighbors, build new connections, and highlight the vibrant culture of your local area.
Best Community Events for Real Estate Agents
There are many types of events you can organize to give something back to your community. The right ones for you will depend on your interests, talents, and what works best with the community around you. A few great examples:
holiday events. During the summer months, consider 4th of July outdoor concerts, picnics, and other fun in the sun. Spring provides opportunities for Easter Egg hunts. Get creative with charitable drives at Thanksgiving or Christmas.
professional workshops. These types of events can bring together groups who are interested in subjects like real estate investing or home improvement.
game nights. Choose a local charity to support with raffles or bingo, then invite everyone to have fun.
Benefits of Putting on Community Events
A community event can be a lot of work, but it provides great rewards for you and your community. Some of the benefits you can see from hosting an event:
awareness of your brand. This is a chance to get face to face with members of
your community. Hosting regular events helps you solidify your role as the real
estate agent local people think of first.
networking. People typically find a real estate agent by either approaching one they already know, or talking to someone in the community who they trust. By hosting events, you get a chance to meet new people and make valuable connections.
goodwill. Hosting a memorable evening or contributing to a local cause is something people remember.
How to Host an Event
Putting together a successful event takes a lot of work and organization. Think about what you will need for your event to work.
First, set a budget. This sets the stage for everything else that follows and allows you to determine the scope of your event.
Who is the optimal audience for your event? Think of the types of people you represent as a real estate agent and what would interest them most. If you mostly work with people who have small children, a child-oriented event like meeting Santa can be a great fit. An agent who works with retirees may decide to host a lecture or a classic rock music night.
Will you provide food and drinks at the event? Are there going to be giveaways or gift bags? See who you can connect with in the community for this. For instance, you can hire a local caterer for food, or source gifts and prizes from local businesses.
Partnering with other local businesses can help defray costs and share the benefits. For instance, you can reach out to a local event space for donated space for a charity event. Local radio stations may be amenable to interviewing you before the event or hosting a show from your location. Ask businesses in the community to put up posters and flyers to promote the event.
Determine how you will collect contact information from attendees. For small events, pre-registering or having a sign in sheet is a great way to get names, phone numbers and emails. for larger events, consider options like drawings where people share their contact info on either their business cards or a printed entry.
Once you have a concept and a place to host, it's time to start working out the details. Will you need event insurance? Do you need to set up a schedule and fill it with speakers? Do you need materials like signs, agendas, or worksheets?
Making the Most of the Benefits
A successful event can provide returns for weeks and months afterward. Create an event hashtag and encourage people to post their photos from the occasion. Take quality pictures of your own and print them to display in your office.
After your event, reach out and thank everyone who contributed. This sort of appreciation can cement the good will you generated by bringing everyone together.
If an event works well, consider making it an annual occasion. The more years you are able to host this event, the deeper your connections to your community, and your influence in it become.
Over time, you become the person people think of first when they are ready to buy or sell a local home. You'll be recognized as someone friendly and helpful, and just the sort of person they want in their corner when it comes to this important transaction.
Love,
Kartik
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Both prospecting and advertising can be great ways to bring in more clients for your real estate business. As an agent, you'll probably want to spend your time doing a little of each. But it's
Both prospecting and advertising can be great ways to bring in more clients for your real estate business. As an agent, you'll probably want to spend your time doing a little of each. But it's important to spend the majority of your energy on the area that will be the most valuable to you and your career. To do that, you need a good understanding of both of these methods of gaining clients. Here's what to know about prospecting vs. advertising, so you can decide where you want to focus your efforts.
What is Prospecting?
Prospecting is the concept of looking for your ideal clients. When you prospect, you need to know who you're looking for, where to find them, and how to attract them. That sounds simple, but in practice it can take a lot of time and consideration. The first thing is to determine your dream clients, and understand who they are. You may be looking for high-end clients only, or you may want to target middle-income people moving to your area for the jobs that are being created. There are all kinds of client groups.
When you prospect for clients, you want to be sure you have the right ones in mind. If you're not sure who they are yet, it's time to do some research and soul-searching. Once you have a client base that you're focused on targeting, the next step is to know where you can find them. You won't find most of your million dollar clients at the same places you'll find clients with more modest home-buying abilities, so knowing where to look is a big part of prospecting for your real estate clients.
As you learn more about your clients, what they like to do, and where they're likely to be, you can start looking at ways to get in front of them. Yes, that translates to advertising. But it's a different way of advertising. You're targeting a much smaller group of people, and you're also looking for people who you want to work with. That's not to say you won't take on other clients, but some are much more ideal to your goals and future plans than others. Prospecting focuses specifically on that client group, above any others.
What is Advertising?
Advertising doesn't take your ideal clients into account. Instead, it casts a broader net when it comes to finding people who want to work with you to buy or sell realestate. In other words, it's open to nearly everyone who needs your services. But that doesn't mean you don't have a target market you're most interested in. You might even direct your advertising dollars toward that market -- but you're not seeking ideal clients. You're only seeking typical clients.
Advertising is more about creating the conditions and interest levels that bring in the dream clients, as opposed to going out and specifically hunting for those clients, instead. As you do that, you'll also attract a lot of other clients that may not be ideal for you, but who will be clients you can work with or refer to others in the real estate profession. You may bring in a larger client base when you advertise versus when you prospect. But you'll need to be aware that some of these clients won't be a good fit for you.
Many real estate agents advertise in ways that are very open and inviting to the largest number of clients. For example, you may want to consider a billboard, or an ad on a bus or park bench. You may also advertise online with sponsored posts on social media, or put magnetic signs on the sides of your car. All of those ways to advertise can work for you, depending on the kinds of clients you're trying to attract, where they're located, and how much they're exposed to the advertising you're creating.
Which Option is Better?
There's no right answer to which option is a better one. They're both good choices, and which one of them will be right for you depends on what you're working toward with your real estate career and client base. Many agents are very focused on a big group of clients, and they want to bring in as many people as possible. Others are more interested in a specific niche of clients, and they'll cultivate that instead of looking for a wider audience. If you work toward ideal clients, you can also help others along the way.
What's the Bottom Line?
The bottom line on prospecting vs. advertising for any real estate agent, is that it's very important to know what direction you want to take. That way, you can spend your time and energy on the right type of clients, and the kind of cultivating that's going to work for your career and your future. In short, prospecting usually takes more work, but can produce more specific results. Advertising may be less detailed, but won't be as targeted toward ideal clients. Many agents use a mix, to build a strong client base.
Love,
Kartik
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As a newer agent, you might not really be sure about marketing or how much you should budget for your business. The good news is that your marketing budget can be whatever you want it to be, provided
As a newer agent, you might not really be sure about marketing or how much you should budget for your business. The good news is that your marketing budget can be whatever you want it to be, provided you can afford it. But you do need to spend some time setting up that budget and managing it correctly. Here's what to consider, and why you should use and stick to a marketing budget template.
What's In It?
The first thing to think about with a marketing budget template is what you want to put in it. You can find a template that's premade, but that might not give you all the areas you want to consider. It could also contain a lot of things you may not use or don't really need. That's not to say that premade marketing budget templates don't have any value, but only that you should carefully consider whether you want to use one, or would prefer to make a template of your own, that you can use and adjust as needed.
Fixed Costs
Fixed costs are one of the main sections that should be in a marketing budget template. These are the expenses that you have to incur when marketing. For example, that can be the yearly amount you've designated for client gifts or lunches. It could be the amount you spend every year on billboard ad space, putting your name on the side of a bus, or even buying business cards. Whatever you're doing to market yourself as a real estate agent, it's a fixed cost if it's stable and repeating at a certain price.
Variable Costs
Variable costs are just what they sound like. They're expenses that are part of your marketing budget, but that can change frequently. They aren't fixed, because they aren't the same all the time. But they're still very important and need to be included. For example, if you decide to spend more on seller leads one month, or you need to boost the sponsored posts you're putting on social media, those costs are variable. They're going to change all the time, and you can adjust them throughout the year.
How Do You Make One?
Making a marketing budget template as a real estate agent doesn't have to be difficult or confusing. You just need to know what specifics to include. Then you can set your amounts for each area, and come up with a total budget. As you move through the year, and record what you actually spent, you'll be able to see if you're on budget, under budget, or overspending in specific areas. That can mean making adjustments as needed, so the budget doesn't get out of control before you realize the problem.
Monthly Spending
Your monthly spending is one of the most important areas to track. You may create your real estate marketing budget for the entire year, but you don't want to just set it up and then forget about it until the year is over. Instead, you need to take a look at it every month, and make sure you see what you're really spending versus what you had planned to spend. If there's a big discrepancy, correcting it at that time helps to keep your budget on track. It's generally easier to make small changes more frequently.
Defining Channels
Every channel that you're using should be defined in the marketing budget. You don't want to leave anything out, or you'll end up with a budget that generally doesn't work for you. Whether you're a new real estate agent or you've been one for a long time, understanding your marketing budget can be a big part of how you handle your career. The more you plan for a budget that works for your needs, the more comfortable that budget will be. Some channels to think about adding include:
Seller Leads
Buyer Leads
Open Houses
SEO
Social Media
Billboards
Photography
Listing Advertising
Print Advertising
These may or may not be the kinds of channels you want to put into your marketing budget template. If you find that you aren't using some of these, or you need to break some of them down into additional categories, you can do that, as well. It's your budget template, and you should set it up the way you want it, so you'll get the most benefit from it. Keep in mind that a good template is one that you'll use, not one that looks fancy or that works for other people. Make sure you're creating it for you and your needs.
What are the Benefits?
The biggest benefit for you as a real estate agent is being able to truly see where your marketing budget is going. If you're spending too much and not sure why, or you don't feel like your marketing is getting the results you want, setting up a template is a great way to catch those kinds of problems. Then you can make changes that work for your future.
Love,
Kartik
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Are you looking to improve your home, either to get it ready to sell, or to make it more enjoyable to live in now? There are many DIY projects you can tackle to breathe new life into your home, without
Are you looking to improve your home, either to get it ready to sell, or to make it more enjoyable to live in now? There are many DIY projects you can tackle to breathe new life into your home, without spending a lot of money. Here are some you might want to consider.
1. Add Glass Cabinet Inserts
Glass cabinets are all the rage. They let you display some of your most beautiful
dishes while keeping them off of the counters, and they give the kitchen a bit
more character. You can upgrade to glass cabinets without completely gutting
your kitchen. Pick a couple of your cabinets and swap out the interior wood
panels with glass sheets, keeping the overall look of the cabinet intact while
providing visual interest in your kitchen.
2. Wallpaper Without Losing Your Mind
If the thought of wallpapering gives you flashbacks to serious issues, consider a peel-and-stick option instead of a traditional glued wallpaper. This can add a pop of color to your favorite room or brighten up an otherwise drab corner, and you can do it in an afternoon. When styles change, there’s no need to scrape and scratch to remove the wallpaper. Just peel it off and replace it with something that better fits your tastes.
3. Update Dated Fixtures
You’ll be surprised at the change if you remove a dated fixture and replace it with something more modern. Ceiling fans and lights go out of date quickly, but a simple swap will update the space. Since the wiring is already there, this does not have to be a complex project, and it can add quite a bit of character to the room.
4. Add Smart Home Features
Is your home “smart?” New smart home features, like a self-programmable thermostat or a camera doorbell, can make it more enjoyable to live in, while also helping you add value to your home. You can upgrade your entertainment system to be easily controlled on a mobile device, or add a smart appliance in the kitchen to make cooking easier. Consider adding smart home features that transform the energy efficiency of the space or make it more intuitive to the way you use your home.
5. Make Your Closets More Usable
Are your closets organized or chaotic? Sometimes a little refresh is what you need. Add shelving or hanging systems to the closet, then put in your belongings carefully to ensure you’re only keeping what you love. The closet organizing system will make it simpler to store your stuff in a useful way, and pairing down your items will keep the clutter at bay in the future.
6. Make a Home Office
Many people are working and schooling from home these days, but they may not have a space to do so. Consider turning an unused or non-essential closet into a home office space or transforming the guest room into an office room. In a closet, a desk and custom shelving are all it takes to create an office space, and you can remove the doors to make it less confined. This change will make your home more functional, and it could show additional value to a potential buyer in the future.
7. Swap Out Hardware
If your cabinets or closets are looking a little dated, consider swapping out the cabinet hardware. This will give the space an uplift without a lot of money invested. Updated, modern kitchen cabinet hardware can transform drab cabinets into something appealing, even without refinishing the wood. You can change hardware in your kitchen, bathroom, and closet or bedroom doors to make your home look more modern.
8. Paint It
If something in your home is not fitting your goals for your space, paint it. You can paint walls, trim, doors, and cabinets. Make sure the type of paint you use is appropriate for the surface you are painting, and if you are painting wood, sand it first. Otherwise, a gallon of paint and an afternoon can transform many spaces in your home.
9. Add Some Shelving
Many homes can benefit from additional storage, but knowing where to put it is not always easy. Look around your home and determine if you have any unused spaces where you can add shelving. Floating shelves, corner shelves, and built-in shelving can all give you additional storage and make use of an unused area of your home. You’ll love the function and look that this project brings.
10. Install Crown Molding
Crown molding adds quite a bit of character to your home, and it’s easier to install than you might think. Pick up pre-painted crown molding at your hardware store, trim it to size, and use a nail gun to attach it. If you don’t have a saw, ask the hardware store to cut it for you.
Fixing up your home doesn’t have to cost a lot or take much time. With a little work, you can transform your space and make it somewhere you are proud to live, all while adding value to it at the same time.
Love,
Kartik
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One of the best and most rewarding ways to grow your real estate business is through referrals. Real estate referrals allow your family and friends to tell other people what a great agent you are, and
One of the best and most rewarding ways to grow your real estate business is through referrals. Real estate referrals allow your family and friends to tell other people what a great agent you are, and they carry quite a bit of weight with new potential customers. Yet asking for referrals from family and friends often feels awkward. Having a script in your back pocket that you can use to request referrals will help you overcome this feeling of awkwardness and get you those valuable referrals.
Tips for Asking for Referrals
Before delving into specific scripts to use, first consider these important tips.
1. Ask in Person
If you are going to ask a friend or relative for a referral, ask in person. You are more likely to get a “yes” response when you are talking face-to-face with someone than if you ask via text or over email, which is much easier to ignore.
2. Request a Favor
Ask for the referral as a favor to you. This tactic makes the person feel like they are your hero, and this positive feeling increases the chances they will do it.
3. Don’t Make It About You
When having a conversation asking for a referral, make it about the person you’re talking to. Tell them were wonderful as a client or as a support to your growing business. Be genuine but supportive because this will help them want to help you out.
4. Leave Your Inner Salesperson Behind
As a real estate agent you probably have a bit of salesmanship inside. This is not the place to let it out. Keep the conversation personable and natural.
5. Look for an In
When asking for referrals from family and friends, you may not be working directly with a past client. These individuals can still give you referrals, but you need to find a way to ask. Watch for opportunists, such as questions like:
How’s the business going?
What’s the market like?
Any big sales lately?
After answering the question, ask for the favor of referrals. You’ll have the chance to show your knowledge and then turn the conversation around toward what you need.
6. Keep It Short
Don’t linger over the referral request. People will zone out, and you won’t get any referrals. Keep it simple and short.
7. Give Them an Out
A phrase like “no pressure” or “if you want” gives someone an out. No one wants to feel pressured into a referral they aren’t comfortable delivering.
Real Estate Referral Program Scripts
So just how do you ask for the referral. As you get more comfortable, the asking will get more natural, but while you’re learning, consider one of these scripts for in-person conversations:
“Hey _____! It was great catching up today. Hey, you know I’ve been growing my
real estate business. Could I ask a favor? If you know someone who is looking for an agent, give them my name. I’d really appreciate it!”
“By the way, most of my business comes from word of mouth. I love how personal it is. If you know someone who could use my help, pass my name along. Thanks!”
“By the way, do you know I sell real estate ? I’ve been doing it for ___ years, and I’ve been wondering if you have talked to anyone lately who’s thinking about buying or selling? If you do, would you keep me in mind? Thanks!”
You should also have a script for social media contacts. Use social media posts to
share a story, then request referrals:
“Check out this recent sale! The Johnson family is so thrilled with their new home. Take a look at those walk-in closets! Do you know someone looking to buy? I can help!” — Make this post about the story of the sale, then tag on the ask at the end.
“Did you know? 75% of my work comes from referrals from people like you. I couldn’t do it without you!” — This is effective because it makes it all about the reader, and you don't even ask! Yet if someone reading it needs real estate help, they’ll know you want a referral.
Remember to tweak the script to make it personal to the conversation, and don’t linger on it. While you won’t get a referral every time, you will get some, and that will help your real estate business to grow.
Remember to Follow Up
Follow-up is key when looking for referrals, but it can feel very sales-y. Try to weave conversation about your real estate business into your conversations about life. It's a big part of your life, so it should be fairly easy to do this.
Start Growing Your Network
Finally, start growing your network of people you know in the local community. Get out and involved in community events and charity work. Add people to your social media pages when you meet them and take a genuine interest in them and their lives. This will help you grow a network that will eventually lead to more referrals.
The key to making a successful request for a referral is to keep things personal. Take a genuine interest in the person you’re talking to, then weave the conversation around to your goal. This will help you appear less like a salesperson and more approachable, which will generate a better number of referrals for your business.
Love,
Kartik
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If you are enrolled in our California real estate school , no doubt you would have seen the term “easement” pop up in your studies.
Simply put, easements in real estate are the right of
If you are enrolled in our California real estate school , no doubt you would have seen the term “easement” pop up in your studies.
Simply put, easements in real estate are the right of one party to travel over the land of another for access.
What is an example of an easement?
Consider the case where there are two properties adjacent to one another- a front house and a back house. Assume that the only way the owner of the back house can get to their property is by crossing over the front property. The right of the back house to travel over the front house is known as an easement.
Who are the parties in an easement?
Since the back house has the legal right to travel over the front house for access, the owner of the back house is known as the “dominant” tenement. Because the front house is burdened by the easement they are known as the “servient” tenement.
While the simple example of a front house and a back house is the most common type of easement, there are others as well. For example, an electric company might have the right to string wires over a subdivision or a water utility might have the right to lay underground water pipe through an area. These are also types of easements, but they are known as easements in gross.
So how do you know if you have an easement?
Easements in real estate are almost always recorded with local authorities such as county or city clerks' offices. A title search would reveal easements that cross the property, and would appear in a preliminary title report obtained through a title insurance company.
So how does an easement differ from a license?
If you are taking our real estate crash course you have seen a discussion around the differences between an easement and a license. A license is a personal right to cross over the land of another held by an individual or entity. Licenses are not associated with the land itself, rather they correspond to an individual. An easement, on the other hand, is an appurtenant right. That is, easements are associated with the real property itself and run with the land. As such, easements are transferred to the new owner upon the sale of the property.
Example of a license:
I give Betty the right to travel over my land. I specify that this right is exclusive to Betty and it is able to be taken away from Betty.
Analysis:
This is a license because the right to traverse my property is exclusive to Betty and it not tied to the land. Finally, the right to travel over my land is able to be taken away from Betty hence it is a license not an easement.
To reiterate, remember that an easement differs from a license based on the revocability of a license. In other words, an easement that is recorded in the county recorder’s office generally can’t be revoked by the servient tenement.
A few ways that easements can be terminated, however, are:
Release of the easement by quitclaim deed signed by the dominant tenement.
Merger of both the dominant and servient tenements.
Restruction of the servient tenement.
Abandonment of a prescriptive easement for at least 5 years.
But notice in an easement, the servient tenement cannot unilaterally terminate the easement like the grantor could do with a license.
In summary, remember that an easement is the right to cross over another’s land for access. This simple definition should help you on the real estate exam .
Love,
Kartik
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Customer Relationship Management software (CRM) can be one of the best ways for a new real estate agent to become more effective at managing the varied aspects of their business. With CRM software, you
Customer Relationship Management software (CRM) can be one of the best ways for a new real estate agent to become more effective at managing the varied aspects of their business. With CRM software, you will be able to make better use of your time, enhance your sales and marketing efforts, gain practical knowledge concerning lead generation and servicing, client contacts, deal forecasting and profitability, and gain a powerful sales reporting tool. Use it to schedule your bookings and appointments, manage more leads and close more deals. Chances are that if you join an established brokerage firm as a newly-licensed agent, there will already be a CRM in place. However, based on 2021 information, here's an overview of the 10 most-highly-rated platforms on the market in 2021. They are tailored to help you become the real estate "superstar" you want to be.
Monday CRM
This award-winning software boasts an extremely user-friendly and intuitive interface and is thoroughly customizable with no need for coding or IT. It's also extremely flexible and allows high-level collaboration between sales, marketing & customer service teams. With a 9.9 rating on a 10-point scale, it also offers a 14-day free trial and is budget-friendly at a rate of $8 per month per user, with a minimum of three users.
Pipedrive
This highly-rated CRM puts the focus on managing leads and closing deals, with the ability to easily track calls, emails and contact history, in addition to more than 150 advanced integrations. It is suitable both for small business and enterprise use, and features an exceptional customer support response time of one minute or less. It, too, is priced per user, at a current rate of $12.50 a month,and has a 14-day free trial.
Fresh sales
This CRM offers an automation solution that simplifies both pipeline tracking and individual account management for sales teams. With drag-and-drop navigation, and a built-in ability to predict revenue and forecast sales, it is highly customizable and relies on AI to help users with sales forecasts and revenue predictions. It is probably best for sales teams that will benefit from insights into the best deals to pursue. It offers a 21-day free review, but its more expensive than the previous two options.
KEAP
This platform, available as a mobile Android app, gives users the ability to easily integrate CRM, marketing and sales automation and payments. Agents can personalize messages sent to clients or leads, automate follow ups, access all client activity in one place, and sync with Gmail or Outlook inboxes. With a strong focus on tracking of customer activity, this is a good CRM for a single user interested in client management and messaging. It also offers a 14-day free trial and is reasonably priced.
Capsule
The biggest advantage of this CRM is its ease of use and quick setup. Although simplicity may be its major attraction, it offers the ability to attach an unlimited number of documents to lead records, in addition to the ability to share leads with other team members. Deemed highly advantageous for new real estate agents, it requires minimal training and offers a generous 30-day trial. It,too, can be integrated with Gmail or outlook. Data import or export is also easy with Capsule.
VCITA
If you're seeking a CRM designed for small businesses, this might be the perfect choice for you. It is flexible and intuitive, but still offers integration with dozens of other platforms, and has strong tools to maximize customer engagement and track follow-up efforts. In addition, it provides a distinctive client portal that allows for some unique self-service use and easy exchange of documentation. It not only includes tools for customizable workflow automation and a built-in billing and invoicing system, but it is available for both Android and iOS mobile apps. VCITA offers a 14-day trial period and pricing varies.
Whether you are a solo entrepreneur or a member of a real estate team, there are many different software packages that you might consider. Each will have pros and cons, and not all are best for newly-licensed real estate agents. Deciding which one will best suit your needs can be difficult. In general, cloud-hosted solutions that can be quickly deployed offer the most flexibility, and those with a large user community and good support network will typically be easier to set up and use.
Many CRMs offer a free trial but beware of "free" or very low-price software. Look for a CRM with the ability to connect or integrate with other services you use. Read the reviews of the various products, thoroughly analyze your personal needs and expectations, evaluate CRM support-team availability and, if possible, talk to other users and ask for advice and insights from experienced brokers and other real estate professionals before making a decision. The free trials offered by most CRMs can provide needed time for you to evaluate the ease of use and suitability of a specific platform. However, understand that there are distinct advantages to be gained from early adoption of a CRM as you begin your real estate career and look forward to success in the exciting world of real estate. To read more about how to begin your career and become a real estate agent and to read more success stories from other agents you can go to our website to learn more https://www.adhischools.com.
Love,
Kartik
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The basic goal of having a professional presence on social media is to increase your visibility among prospective clients. Your goal should be to establish trust and a professional persona, "friends"
The basic goal of having a professional presence on social media is to increase your visibility among prospective clients. Your goal should be to establish trust and a professional persona, "friends" and “likes" are a by-product of your content but should not be the goal.
I’m going to go through the various platforms in this article and explain how they can be used to obtain business. If you’re wondering what to post online, I wrote an article about this here that might be of interest to you.
You should strive to develop and maintain a social media presence that is diverse and steady and demonstrates to the public that you are knowledgeable and competent and likable.
Does that sound like a tall order? It does not have to be. It doesn't have to take much time each week, but your activity on the various platforms should be coordinated and deliberate. You don’t have to be a professional writer, nor an accomplished photographer, but you should strive for personable and authentic posts.
The Giants of Social Media
The big four social media platforms are Facebook, Instagram, Twitter and LinkedIn with TikTok quickly accelerating and hoping to catch up to the established players. This will change over time, however. If you read old articles on the business of social media you’ll see references to Flickr, Myspace and even Friendster so I know that this article isn’t going to age well - but that’s kind of the point. Being able to bob and weave and pivot to where the puck is “going to be” will help you stay fresh and relevant as a business person.
You really have to be fine with trying different approaches on all platforms. Some real estate agents find YouTube to be highly effective, while others migrate in the direction of short form TikTok videos or more graphic social media sites like Pinterest.
Facebook
With more than 2.7 billion users worldwide, Facebook could be seen as the anchor of your social media presence. Although it may not be the younger generation's favorite, your real estate clientele is likely to be among its users so embrace it.
There is a debate around the ratio of personal posts compared to business ones. A best practice here would be to try all sorts of things until you find a rhythm that works for you and your audience.
We would love to get you know you on Facebook! Connect with us here.
Instagram
Instagram is a quick and effective way to share photos and video content with your followers. With 1.2 billion monthly active users, it is another indispensable way to reach potential clients and boost your following. Another advantage is that, because of its affiliation with Facebook, each Instagram post can be shared on Facebook, and vice versa making posting to both platforms seamless.
Don’t forget that Instagram has cool buttons like “vote”, “quiz”, and question/answer type buttons. These interactive features allow you to get to know your audience and also provides insight into what your followers like. If you are interested in connecting with our real estate school on Instagram we would love to connect!
Twitter
Tweets are short (they have been increased to 280 characters from their former 140) and short-lived, and the platform is instantaneous in a way all its own. It doesn't take much time to get the hang of it, and it can gain you a following fairly quickly as a knowledgeable real estate professional when used correctly. It's an ideal way to share information -- such as a daily change in the interest rate, an interesting new listing, or a price reduction -- with your followers.
LinkedIn
Microsoft purchased this business-oriented social media platform and its influence among professionals cannot be underestimated. LinkedIn also gained importance during the pandemic as the platform for B2B interaction. Be sure your personal profile is complete and that you use a professional photo for your headshot. Regular posts and interaction with other professionals is beneficial.
LinkedIn can also be used to gain referrals for your real estate business from out of area agents. Every referral received by a real estate agent can be worth $10,000+ so being recognized as the go-to agent in your area can be very valuable.
If you are one of our real estate school students, there’s nothing wrong with you posting right now that you are enrolled in our real estate classes online on your LinkedIn so that your audience knows that you are going to be a future real estate agent.
Develop a Posting Calendar
Develop a social media schedule. Aim for a minimum of two or three social media posts each week on each platform in the beginning and share links between platforms when appropriate. Send a tweet to point followers to a Facebook post, for instance, or share an Instagram photo automatically to your Facebook page. Write a short article for LinkedIn and post a short sentence and a link on Facebook. Use Twitter to tell your followers that a specific home you listed just closed, that the price on a specific property was lowered, or that interest rates are slated to rise next week, according to the latest financial news.
Encourage interaction, try your level best to respond to comments, and thank your followers for their support. Introduce a new buyer to the community by posting a photo of them at their new front door (with their permission, of course). Lend your support to a community event or don’t be shy to promote your latest achievement to your audience. Share a humorous story or post a cute "puppy" picture just for the fun of it. Just make sure your posts are believable, accurate and in good taste. And have fun with social media.
When done properly you’ll reap the reward through increased business.
If you are interested in getting started in real estate courses, click here or reach out by phone at 888-768-5285 or @ us! :)
Love,
Kartik
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Downsizing your home comes with a wide range of different benefits. Sometimes your kids have left the home to go off to college and you just don't need as much space any longer. Other times, you realize
Downsizing your home comes with a wide range of different benefits. Sometimes your kids have left the home to go off to college and you just don't need as much space any longer. Other times, you realize that you never needed as much space in the first place. Regardless, it can be a great way to free yourself of some clutter and also save some money on your monthly bills at the exact same time.
When you do search for a smaller home, there are a few key things you should look for. Chief among these is how much square footage your new home will have. You'll also want to examine the potential for storage spaces depending on the amount of items you're bringing with you. But more than anything, you want to consider WHY you want to downsize. Are you doing this for yourself, or are you doing this because you think you need to? Regardless, once you make the decision and you begin to embark on this journey, there are a few key tips you need to downsize to a smaller home that are always worth remembering.
Downsizing Your Home: What You Need to Know
By far, the most important thing to remember when moving into a smaller space is that you should begin by making a list of all those personal belongings and other items that you don't really need anymore. You should do this before you start to pack, as it can save you a tremendous amount of effort in the long run. Take an inventory of your items and try to separate anything out that you truly know you don't need. If you were a collector who no longer has a passion for what was your former favorite hobby, consider getting rid of those items. If you have four television sets but know that you're only going to need two at your new place, sell them before you have to move to make the process go as smoothly as possible.
Along the same lines, you should also use apps to sell your stuff. Obviously, there is always eBay - you can list virtually anything you want at a certain price and let people bid on it until it sells. But there are also options like the Facebook Marketplace or Nextdoor that allow you to listen items that will be visible to people who are in your immediate geographic area. This can potentially be a great way to not only sell items, but to do so without needing to ship them because you can have buyers come pick them up by way of a "Local Pickup Only" option.
At the same time, you should also start cleaning out your wardrobe for any items that you don't wear anymore. More than anything, you want to try to visualize the new space that you're moving into and how your new items might fit into it. If you have a particular type of bed, for example, walk into your new bedroom and try to envision where it may best be positioned. Do the same with other furniture that you have to try to create a mental image ahead of time of where those items may best be located. This, too, will save you a lot of trouble during the move itself. Just because you don't like a particular shirt anymore doesn't mean that someone else won't, after all.
Maximizing the Space in a Small House
Once you actually move into your new home, you'll probably find that a bit of an adjustment period is necessary. After all, you're used to a certain amount of space and those immediate days and even weeks after the move can begin to feel a little cramped. Thankfully, there are a number of techniques that you can use to maximize the space in a smaller home - chief among them being the installation of wall mounted storage. Many big box furniture stores offer wall mounted storage and you can also likely find custom solutions in your area. The benefit here is that you still get all of the space made available by shelves and cabinets, but you're not taking up any additional floor space, either. This in and of itself is a great way to take an admittedly small room and make it feel as big as possible.
At the same time, you should also consider opportunities to increase storage space in your kitchen. People often don't realize just how many kitchen utensils and other items that they have until it comes time to try to find a place for them. Whether this means installing new storage or coming up with a more inventive solution will obviously vary depending on the situation - but this is definitely one of those areas that you should focus a lot of your attention on.
You can also consider shopping for multi-functional furniture - meaning those pieces that serve more than one purpose. A couch doesn't just have to be a couch - it can also fold out into a bed to give people a place to sleep when they come visit. Oftentimes you can find an ottoman for the living room that acts both as that and as a convenient storage location for remote controls, gaming consoles and similar items. Downsizing can change your life for the better. It can help you free yourself from clutter and save money as well. Overall, if you have the opportunity to do so it's a good idea - and tips like those outlined above will certainly help.
Love,
Kartik
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Most people, especially adults, are a little intimidated when it comes to taking an exam; it somehow doesn't matter if it's a driving test or an exam to qualify for a license, or the culmination of a
Most people, especially adults, are a little intimidated when it comes to taking an exam; it somehow doesn't matter if it's a driving test or an exam to qualify for a license, or the culmination of a special training program. It can be stressful, but there are a number of ways to calm your anxiety and boost your level of confidence.
The required California Real Estate Exam is one of those tests that determines whether you will become a licensed professional, qualified to act on behalf of buyers and sellers to transact business in the state. It is an important step, and after weeks of serious study, you'll want to make every possible effort to pass the exam on your first attempt. Here are some ways to do just that, and to easily achieve your goals. The test consists of 150 questions; you are allowed three hours to complete the exam, and a passing score requires that at least 70% of the questions be answered correctly.
Review Smarter and Better
There is no magic formula to help you fill in the blanks correctly. Advance preparation is important, and pre-exam review of the myriad real estate topics you have studied is vital. Cramming, however, might lead to greater apprehension. A planned timetable of review is a better idea, and one that will also prepare you more fully for the day-to-day skills and knowledge that a real estate agent or broker requires.
Create a Study Schedule: If you have been enrolled in a real estate course, plan to review your class notes and course materials thoroughly before scheduling the exam. Enlist the help of your spouse, partner, or best friend to help you with concepts and to act as a coach or sounding board as you review the various topics and principles.
Form a Study Group: Learning and understanding are enhanced when you receive input and feedback from others. Keep the group small and informal, if possible, and limit the duration of study sessions to encourage lively discussions and prevent burnout.
Review Vocabulary and Terms: Be certain that you have a grasp of the defining vocabulary and specific designations that characterize real estate roles and transaction responsibilities. Review Concepts to Gain Understanding. Role playing can be highly instructive. Use it to demonstrate the different aspects of any real estate transaction -- from initial contact with a prospective client to discussion of specific prohibitions of language and topics that you may encounter in your real estate dealings.
Watch YouTube Videos: There are some highly instructive materials online. Seek out professionally-prepared videos and presentations that will illustrate the situations any real estate professional must understand.
Enroll in a Review Course: If it has been some time since you first enrolled in a real estate licensing course, you might want to schedule a quick pre-exam review. Online reviews, flash cards, and comprehensive study guides can all be helpful. Take a Practice Test. A practice test will provide basic familiarity with the type of questions you'll encounter. However, use practice tests judiciously, and don't make the mistake of "practicing" too much. Not everything you need to know will be covered in any test; understand that your real estate career will always present you with new challenges, and that it's better to understand concepts than to memorize answers to specific test questions.
On the Day of the Test
During the week leading up to your testing date, try to get plenty of rest and exercise, and try not to stress about the upcoming exam. Prepare yourself by reviewing to the best of your ability and try to be physically fit and mentally relaxed when the day arrives.
Follow your normal routine as much as possible. If you normally eat a healthy breakfast, do so and don't stress unduly about the rest of your day. If, on the other hand, you have only coffee for breakfast, go ahead, but don't overdo the caffeine. Also, remember to bring a snack or something nutritious available for sustenance prior to the exam. Bring water as well; it's important to stay hydrated.
Plan to get your normal quota of sleep the night before the exam. You might want to rise a little earlier than usual, however. Get in some stretches for your body or read something motivational to get your mind in gear -- whatever seems appropriate. Arrive early at the test location, armed with everything you've been instructed to bring, but nothing else. Breathe deeply, get comfortable, and don't stress.
Don't rush through the questions. If there are questions that are confusing, or answers you're unsure of, skip over them and move on. A later question might trigger the correct response for you, and you can then return to answer the questions confidently.
Be confident; don't overthink the multiple-choice answers. Understand that the test is not designed to trip you up, but that some real estate principles and practices are subject to interpretation. In most cases, trust your judgment and choose the one answer that seems to be the most logical and correct. Progress through the 150 questions, answering all that seem easy. Try to allow ample time to review your work and to reconsider answers to questions you were unsure about. Once you have made a final choice, however, move on.
Don't stress. Remember the concepts. Understand the topics. You’ve been preparing for this. Be confident and know that you’ve got this!
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Regardless of how long you've been engaged with your real estate career, getting a steady stream of new clients is always a top priority. In this particular industry, consistency is king - the more
Regardless of how long you've been engaged with your real estate career, getting a steady stream of new clients is always a top priority. In this particular industry, consistency is king - the more people you have knocking on your door, the more revenue you're able to generate. In an effort to do precisely that, many agents take to the process of farming.
Real estate farming is a specific type of marketing technique that is used to develop business in a precise geographic area. Rather than attempting to cast the widest net possible, you instead attempt to cast the right net - meaning that you focus your attention on what may be a smaller area, but that you know like the back of your hand and that you're already intimately familiar with. Yet at the same time, real estate farming isn't quite as straightforward as it may seem. If you truly want to utilize the best that farming strategies have to offer to find your next client, there are a number of important things you'll want to keep in mind.
Real Estate Farming: Your Guide
The single most important best practice that you can put to use when real estate farming involves making sure that you've found the right area to focus on in the first place. Begin your efforts by comparing multiple areas and even multiple locations to help come to a determination as to which one has the most overall appeal. You can use a variety of data points to do this, including but not limited to average home sale prices, the average amount of turnover, the amount of competition you'll face in the area and more.
To help verify that you've made the right decision, use recent sales to help calculate the average sale price in this particular part of town. Based on that, you'll be able to see what you're likely to earn on a commission per sale. You'll also want to pay close attention to the turnover rate to make sure that there is enough business in the area to sustain yourself. But again - you don't want to do this for just one particular neighborhood. Create a table to show your top three real estate farming areas and weigh the pros and cons of each one equally. At the end of this process, you should have all the insight you need to determine your best neighborhood.
What You Need to Know About Real Estate Farming and Marketing
Along the same lines, you should also be prepared with those real estate farming techniques that will allow you to attract the attention of - and ultimately win - more leads in the area you've selected. This is something that you can do in a few different ways and, in all likelihood, you'll want to use a combination of them to succeed. Create a real estate marketing plan and focus on a niche. If your specialty is single family homes, be sure to find an area with a lot of single family homes. If your specialty is condos, be sure to find an area with a lot of condos. Likewise, be sure to pay attention to the size of the farms so that you don't pick an area that is too big for you to reasonably cover.
On an ongoing basis, you should also make sure that you're always the first person to welcome new homeowners into the neighborhood. Whether that means stopping by and knocking on the door to say "hello," picking up the phone and making a call or even just sending something nice in the mail doesn't matter - what is most important is that you're reaching out and making your presence known.
Moving forward, you should also make sure that you know every time a home goes on the market so that you can be the first to preview it. Especially in a market that is as "hot" as the one we're in right now, newly listed homes move quickly. If something goes on sale that you know would be perfect for one of your existing clients, you need to act fast. Making a priority to understand the current inventory goes a long way towards guaranteeing exactly that.
Understand that having the right materials is always a critical part of knowing precisely how to farm a neighborhood in real estate. These materials can include but are certainly not limited to newsletters, postcards, flyers, market reports, "Just Listed/Just Sold" notices and more. Always utilize direct mail marketing companies to do the work for you, such as sending out farming cards. They can automatically send out postcards as soon as one of your listings hits the market or sells. This can help free up the maximum amount of your attention so that you can focus on the thing that matters most of all: your career.
You can also use a company like FarmingCards, which is an intelligent postcard marketing solution that helps organizations connect with potential clients. It's a convenient, end-to-end, artificial intelligence-facilitated service that helps agents maximize the overall return on investment of their marketing. It allows you to design postcards instantly that let you find your ideal clients using smart targeting and other features. At that point you can sit back and relax as FarmingCards prints and delivers to your farm - precisely the way it should be.
Love,
Kartik
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One of the most important things to understand about operating successfully in the real estate industry is that you're really trying to sell two distinct things at the same time.
Yes, it's absolutely
One of the most important things to understand about operating successfully in the real estate industry is that you're really trying to sell two distinct things at the same time.
Yes, it's absolutely true that you're helping someone sell or buy a house. A big part of your job is to help them navigate what may very well be the biggest financial decisions they'll ever make. But beyond that, you're also selling something arguably more important:
Yourself
In order to build the type of career you've seen for yourself in the industry, you need to be able to establish yourself as an authority. You need to show, not tell, people that you know what you're talking about. That yours is a voice worth trusting and paying attention to. Only then will they feel confident enough asking you to come along with them on this journey - which is how a book of business is eventually built.
To accomplish that, you need been capitalizing on your Sphere of Influence - something that you've been building with every interaction you've made up to this point, possibly without even realizing it. In the simplest possible terms, a Sphere of Influence is the collection of all the people you know. Not only does this include friends, family members and other loved ones, obviously, but also any loose connections you've forged or acquaintances you've met along the way.
It's also something that will soon become the secret to your success in a wide range of different ways that are worth exploring.
Why is a Sphere of Influence Important?
A number of recent studies have illustrated just how important a Sphere of Influence truly is, particularly in an industry that is as connection-driven as real estate.
According to one report, over 80% of all real estate transactions are the direct result of contacts from people you already know. That means not only previous contacts or any referrals they may bring you but also friends, family members and people you know personally.
This is crucial, as another study revealed that 74% of home buyers say that they would gladly use their agent again in the future and had plans to recommend them to others. Along the same lines, about 84% of people say they also trust recommendations from their own collection of peers when it comes to determining who to do business with.
All of this paints a very clear picture of just how the real estate industry operates. Yes, it's possible to "cold call" people and obtain new clients who you've had no interactions with in the past. But in the vast majority of all situations, your business will come from those people who are already in your life - even if only tangentially. Therefore, your Sphere of Influence isn't just an important asset to capitalize on - it may be the single biggest contributing factor to your future as a real estate agent.
Get Comfortable on Social Media
When it comes time to actually take advantage of your Sphere of Influence, there are a few key techniques you can try. Chief among these is the idea that if you're not already comfortable on social media sites like Facebook and Twitter, now would be an excellent time to start.
Indeed, visualizing your Sphere of Influence through a social media platform like Facebook is actually one of the easiest way to do it. Think about your current contact lists and ask yourself which platforms they're the most active on. Facebook in particular shows you mutual friends and other important metrics like that. Spending a few hours on these sites seeing who you know, and who they know, and who THEY know, is a great way to illustrate how big your Sphere of Influence really is.
All the while, you should also be taking the opportunity to post relevant, valuable and otherwise meaningful content to your pages for these people to see. If there's a particularly interesting industry topic that you can provide insight on, link to the article and write a few paragraphs containing your thoughts. Help people see things from an angle that they may have otherwise missed. Again, it's a great way to establish yourself as an authority - thus expanding your Sphere of Influence as well.
Maximize the Power of Printed Materials
Similarly, distributing printed materials is a tried-and-true tactic and an effective way to create awareness for both you and your business. This, too, is something you can do in a few different ways.
If there was a particularly impressive home sale in the area recently, or if the market is heating up, don't be afraid to print up a flyer and distribute it to the neighborhood outlining your thoughts. Give people information that they don't already have and leave them with something of value without asking for anything in return. It's a great way to both let people know that you're out there and continue to build up your trustworthiness, too.
Of course, it doesn't have to be quite that complicated. Always have business cards handy ready to give to everyone you meet, for example - you just never know who might be looking to buy or sell.
In the end, your Sphere of Influence should always be getting bigger over time - and it likely will in a natural way. You must resist the urge to overlook this critical asset, as it will absolutely be the secret to your success in the future.
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When the time comes to sell your home, it stands to reason that you'd want to get as much value out of it as possible. But few people realize that increasing your home's value is less the product of any
When the time comes to sell your home, it stands to reason that you'd want to get as much value out of it as possible. But few people realize that increasing your home's value is less the product of any one major move and is more about a series of smaller, more strategic ones. In truth, increasing your home's value is fairly straightforward - you just need to keep a few key things in mind along the way.
Improvement #1: Kitchen Renovations
By far, one of the biggest ways to immediately add value to your home comes by way of renovating your kitchen. This is because kitchens tend to be one of the areas of any house that fall out of date rather quickly. Whether it involves putting in new cabinets, investing in more modern and state-of-the-art appliances, installing new floors or performing some combination of these improvements all at the same time, it's a great way to instantly breathe some much-needed "fresh air" into a space.
Modern appliances tend to be more energy efficient than their older counterparts, making this a great way to help prospective buyers save money almost immediately after purchase. When a buyer looks at a home and sees that they don't have to perform any of these upgrades themselves, it can also help your home sell faster and for a higher price, too. Not only that, it also helps people more effectively picture themselves in a space. They can see how much time they'll be able to save when preparing meals, for example, and it's easier for them to envision what they'll be able to do with increased storage space (in the event that you're putting in new cabinets).
Improvement #2: Bathroom Updates
Another major way to increase your home's value is to invest in a bathroom upgrade. Again, this is a great way to not only reduce clutter, but also to help potential new homebuyers become more ecologically friendly at the same time. According to one recent study, even a relatively "minor" bathroom update can give you a 102% return on investment when it comes time to resell your home. This is the type of thing that prospective homebuyers take seriously, which means that you need to do so as well. Never forget that even the smallest rooms in a house can have a big, big impact on its ultimate resale value.
Improvement #3: Lighting Upgrades
Lighting upgrades may seem like a relatively minor improvement, but they're absolutely not as far as the resale value of your home is concerned. This is a topic that you can approach in a number of different ways depending on your perspective. In some situations, it could be as simple as replacing all of your existing light bulbs with energy efficient LED alternatives. This is another way to help make your home environmentally friendly, which will make it far more enticing to prospective buyers. You could even take the additional step of installing "smart" lighting, with Philips Hue bulbs being a prime example of that. Smart lighting can be connected to "intelligent" home automation systems like Amazon's Alexa or Apple's HomeKit, allowing you to control your lights using a smartphone or via voice command. This comes with the added benefit of being able to control the lighting in your home while you're away, or by setting automatic schedules that respond in real-time to certain events. But regardless, the brighter a room feels, the bigger it looks. Whenever you're thinking about selling your home, you want every space to look as big as it can possibly get.
Improvement #4: Fresh Paint
As was true with lighting, a fresh coat of paint can also make a space feel both cleaner and brighter in equal measure. According to another recent study, painting the interior of your home can result in a massive 107% return on investment when it comes time to sell. Even painting the outside leads to a 55% return on investment. The same source indicated that while painting the interior of your home costs an average of $987, it could increase the overall value of your home by as much as $2,000 or more.
Having said that, you'll still want to keep a few key things in mind. Always select warm, neutral colors for the best results and know which rooms need your immediate attention. Utilize paint to make smaller rooms look and feel bigger and place an emphasis on your kitchen, your bathrooms and entryways for maximum impact.
Improvement #5: Landscape Improvements
Finally, we arrive at the landscaping of your home - something that is far more important than most people realize. Always pay special attention to the entryway of your home and make sure that it looks as striking as possible - particularly for those listing photos. Be sure to repair or replace any damaged stepping stones, concrete paths and porch plants that you can to generate as much curb appeal as possible. While you're at it, be sure to give the front door a fresh coat of paint. If you don't necessarily have a "green thumb" to the point where you don't want to plant anything, add some potted plants to really cement the effect that you're going for. Overall, you always want people to be excited when they walk through the door of your home. The aforementioned best practices go a long way towards guaranteeing precisely that.
Love,
Kartik
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The majority of people who are not in the real estate business have little to no understanding of what an emotional rollercoaster it can be to be a realtor. The good days are really good while the bad
The majority of people who are not in the real estate business have little to no understanding of what an emotional rollercoaster it can be to be a realtor. The good days are really good while the bad days can be pretty tough to get through. Here are some of the toughest struggles that every realtor has to deal with on a daily basis.
1. Uncertainty about real estate market
This is perhaps one of the biggest uncertainties realtors have to deal with on a daily basis. Every realtor is worried about not being able to sell their properties and how it will affect his or her commissions at the end of the month. This uncertainty is real and can cause a lot of stress for realtors and their clients. The best realtors really do care about their client's properties and genuinely want to find them a buyer as soon as possible. It’s safe to say, realtors can carry a lot of weight on their shoulders.
2. Constantly being on the go
A realtor is always on the go, they are always thinking of new ways to market themselves and bring in potential buyers for their clients' homes. They spend most of their time on the road or on their phone calling both real estate agents and potential buyers. Not to mention, being on the go can last well into the night. The hours are different every day. It’s not uncommon for a realtor to be submitting offers at 10pm or receiving calls from agents at 12pm or calls from clients at 6am.
3. Commission is by no means a guarantee
In real estate, nothing can be guaranteed. Even if you do everything right to sell that house, from staging it perfectly, to showing the house as often as possible, there is still no guarantee that you will make a sale. The realtor will spend money marketing the home, paying for photography, doing open houses, finding buyers, etc. Even when the home is in escrow there are still occasions where it does not close escrow and you may have to start all over again. Most of the time realtors won’t get a commission check until 30 plus days after their listing receives an offer. There are times however that a everything right to sell that house, from staging it perfectly, to showing the house as often as possible, there is still no guarantee that you will make a sale. The realtor will spend money marketing the home, paying for photography, doing open houses, finding buyers, etc. Even when the home is in escrow there are still occasions where it does not close escrow and you may have to start all over again. Most of the time realtors won’t get a commission check until 30 plus days after their listing receives an offer. There are times however that a listing will not sell and a realtor will essentially not get paid for their time and efforts marketing that listing.
4. Being underpaid for hard work
As real estate agents, they put in more work than any other profession but are only compensated about 3% on the home sale. Just think about it, realtors get paid almost nothing for everything they do. They spend hours upon hours of their time marketing homes and placing phone calls, but real estate agents get paid very little for all of their hard work. There is a ton of time spent going back and forth in communication between escrow, loan officers, listing agents, etc. They juggle going back and forth to communicate with all parties in the deal and may have to deal with major headaches along the way. You never know what kind of setback will come up because someone on the other end isn’t meeting a deadline or doing what was asked. When working with buyers, the real estate agent can spend days, weeks, or even months showing house after house and put in several offers on behalf of their clients. Sometimes offers will not get accepted, other times they will, and sometimes the buyers will cancel even after the going back and forth to communicate with all parties in the deal and may have to deal with major headaches along the way. You never know what kind of setback will come up because someone on the other end isn’t meeting a deadline or doing what was asked. When working with buyers, the real estate agent can spend days, weeks, or even months showing house after house and put in several offers on behalf of their clients. Sometimes offers will not get accepted, other times they will, and sometimes the buyers will cancel even after the offer is accepted. You literally have no idea how each deal with go. Realtors deal with surprises and setbacks all the time.
5. Dealing with difficult clients
All realtors have had to deal with difficult clients at least once in their real estate career. Clients are always coming up with the most ridiculous demands and realtors have to deal with them no matter how crazy they may sound. Most realtors will do anything it takes to make their clients happy because realtors realize that it is all about building long term relationships. Sometimes realtors may have to end relationships with certain clients whose expectations are unrealistic and impossible to attain. It is the realtor’s job to educate their clients as much as possible about the real estate world. If the realtor has done everything they can to give their clients an understanding and guide them in the process of buying or selling and their client refuses to listen, it may be time to cut ties with that client.
So, are the ups and downs worth it?
Absolutely. Becoming educated about the industry and the expectations that come with being a realtor are a necessary part of starting in this industry successfully. Knowing what to expect can help tremendously when overcoming obstacles and dealing with the uncertainty that comes with the territory. Remember, the more experience you get the better you get at something. This goes for anything in life and if you stick with it, your sure to reap the benefits. The harder you work in real estate the more money you can make. The potential is endless. So stay consistent and don’t give up when the going gets tough.
Love,
Kartik
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At its core, a contingency is a condition that needs to be met before an offer like a real estate transaction is allowed to proceed. From a certain perspective it's a bit like a safety net and it's far
At its core, a contingency is a condition that needs to be met before an offer like a real estate transaction is allowed to proceed. From a certain perspective it's a bit like a safety net and it's far more important than people realize. For the sake of example, let's say a home buyer visits a property that they absolutely fall in love with. After quick negotiations with the seller, they agree to the purchase price of $350,000. Contracts are drawn up, documents are signed and an initial deposit is handed over. Everything proceeds as it should, until the appraisal comes in... and all parties find out that the house is only worth $300,000. What, in that situation, do you do?
If they had an appraisal contingency in the contract, the buyer would walk away without a care in the world. An appraisal contingency means that if the home you want to buy doesn't appraise for the amount that you've already agreed to pay, you get to walk away from the deal with your deposit in hand. This is because an appraisal determines the fair market value of the home you're trying to buy.
All told, they're a hugely important part of the real estate process for a wide range of different reasons, all of which are worth exploring.
How Does the Appraisal Contingency Protect You?
As stated, the purpose of an appraisal contingency is to protect both the buyer and the lender from overpaying for home. No lender will ever want to lend someone more money than a home is worth because from the moment that buyer gets the keys, they'd immediately be underwater. Likewise, no home buyer should ever want to be in that situation because part of the reason you purchase property in the first place is for equity - something that you wouldn't have in that situation.
During the appraisal process, a licensed and trained professional will come to the property in question for what is essentially a physical, in-person inspection. They'll take into consideration specifics like the condition of the outside and inside, the size of the yard, home improvements that have been recently made and more - all in an effort to determine the current fair market value of the property. They'll also take a look at any recent renovations that have been made, or additions that have been built since the last time the home was appraised.
Note that an appraisal is not the same thing as a home inspection and they should not be treated as such. They're similar, to be fair, but they serve different purposes.
Overall, these contingencies protect people financially if there's a serious difference in value between what the home is worth and what they're actually being asked to pay.
When NOT to Use an Appraisal Contingency
Having said all of that, there are a few key situations when using an appraisal contingency as part of a real estate transaction may not be a good idea.
Chief among them is if you're buying when it is a seller's market - particularly one that is as active as it is right now. A seller's market, as the name suggests, means that there are often multiple offers for a single some and buying competition is high. Right it's extraordinarily high - driven in large part by the combination of historically low interest rates and the scarcity of inventory across the country. Things have gotten to the point where it's not uncommon to hear about a situation where a buyer doesn't just waive an appraisal contingency - they waive a home inspection as well. Obviously, this won't always be the case - but it's also the perfect example of when an appraisal contingency will probably lose you a home.
When a seller has the ability to choose between multiple, similar offers in a market that favors them greatly, they're obviously going to choose the one that is the most beneficial to themselves. Any offer that comes with strings attached like an appraisal contingency is obviously less appealing to that person. If you really love a home, you can strengthen your offer by waiving your appraisal contingency. You must also, however, be willing to risk a lower appraisal when that day comes.
You may also consider waiving an appraisal contingency if you're buying a home with cash. Cash sales don't actually require an appraisal because there is no lender involved to deny a mortgage if there is a big difference between what the home is worth and what you're paying for it. Obviously, you could always run the risk of overpaying to begin with - but so long as it's a risk you're willing to take on, this would be considered appropriate.
In the end, the appraisal contingency is one of the more complicated parts of the real estate process - but it's also one of the more important for the protections that it offers. It's also a perfect example of why it's so important to work with a trusted real estate professional to begin with. They can help navigate the market, helping buyers to understand when and why to use things like the appraisal contingency and others. It's just another in a long line of examples of how they assist home buyers in enjoying all the benefits of this process with as few of the potential downsides as possible. If you would like to become a real estate agent , read our success stories to learn more about what the real estate career is like.
Love,
Kartik
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The California real estate market has been remarkable in recent years, with a severe inventory shortage and historically low mortgage rates fueling one of the strongest housing markets in generations.
The California real estate market has been remarkable in recent years, with a severe inventory shortage and historically low mortgage rates fueling one of the strongest housing markets in generations. As a result, navigating this hot sellers' market can be challenging for homebuyers, and as a real estate agent, it's your responsibility to help them avoid common mistakes. To further your real estate education, consider enrolling in a real estate school or taking online real estate classes. Remember to check out real estate exam prep resources as well.
One of the most critical errors homebuyers make in a hot market is hesitation. Properties sell rapidly, often before they're officially listed, and bidding wars can erupt within hours. Prepare your clients for this reality by emphasizing the importance of making fast, decisive (but not impulsive) choices. Additionally, if you're considering entering the real estate industry and are wondering how to get your real estate license, we have plenty of resources are available to help.
Set an appropriate budget from the beginning
Another common pitfall is failing to search for homes within a client's budget. Although market activity has inflated home values, homebuyers must stick to a realistic price range. Encourage your clients to establish a maximum budget early on and remind them to stay within those limits when searching for comparable properties.
When embarking on the journey of purchasing a home, it's essential to establish a budget before you begin your search. Setting a budget beforehand allows you to make informed decisions and avoid financial strain, ensuring a smoother and more enjoyable home-buying experience.
One of the primary reasons for setting a budget first is the ability to narrow your focus on properties that fall within your financial means. This targeted approach saves time and energy, as you will only waste valuable resources viewing homes within your reach. Furthermore, by understanding your budget constraints, you can identify homes with the most desirable features within your price range, ultimately leading to greater satisfaction with your final choice.
Additionally, having a predetermined budget in place helps prevent emotional decision-making. When you encounter a dream home beyond your financial capacity, it can be tempting to stretch your budget and make an impulsive offer. However, overextending your finances can result in long-term consequences, such as difficulty meeting mortgage payments or sacrificing other financial goals. By committing to a budget from the outset, you can resist the allure of unaffordable properties and maintain a disciplined approach throughout the home-buying process.
Finally, setting a budget before house hunting gives you a strong negotiating position. With a clear understanding of your financial limits, you can confidently make offers and negotiate with sellers, knowing you are making a well-informed decision. This confidence can enhance your credibility in the eyes of sellers and potentially lead to more favorable negotiation outcomes. In conclusion, establishing a budget before looking for homes is the right strategy for prospective homebuyers. By focusing on properties within your means, avoiding emotional decisions, and strengthening your negotiating position, you can ensure a successful and satisfying home-buying experience.
Don’t Act Out Of Impulse
The urgency of a hot market can also lead to impulsive decisions, with clients quickly making offers on dream homes they can't truly afford. As a real estate agent, it's your job to help clients maintain perspective and make informed choices, even in the face of rapid market movements.
As a Realtor, it is crucial to guide clients through the home-buying process and help them avoid making impulsive decisions. While the excitement and anticipation of purchasing a new home can be overwhelming, it is essential to consider the long-term implications of such a significant investment. Impulsive decisions can result in unforeseen challenges and financial strain, ultimately detracting from the client's satisfaction with their new home.
One of the primary risks of impulsive decision-making is the potential to overlook crucial details about a property. In haste to secure a seemingly perfect home, clients may need to pay more attention to thorough inspections, research on the neighborhood, or a careful review of the property's history. Failing to consider these factors can lead to unexpected issues, such as costly repairs, disputes with neighbors, or declining property values. By encouraging clients to take a measured approach to their home search, they are more likely to make a well-informed decision and enjoy long-lasting satisfaction with their investment.
Moreover, impulsive decisions can lead to financial strain and compromise a client's financial health. When clients become enamored with a home beyond their budget, they may be tempted to stretch their finances and make a hasty offer. Overextending financially can result in difficulty meeting mortgage payments, an increased risk of foreclosure, or sacrificing other critical financial goals, such as retirement planning or saving for a child's education. By guiding clients to remain focused on their predetermined budget and carefully evaluating each property, they can avoid financial pitfalls and ensure a successful, stable homeownership experience.
Don’t Skip the Home Inspection
Another common mistake is forgoing a professional home inspection. A thorough inspection can reveal critical issues with a property, such as structural problems, outdated electrical systems, or potential safety hazards. Skipping this step can lead to costly repairs and unexpected problems after moving in. Homebuyers should always invest in a reputable home inspector to ensure they make an informed decision and protect themselves from potential financial pitfalls.
Keep Additional Expenses In Mind
Many homebuyers focus solely on the purchase price of a home and need to account for the myriad of other expenses associated with homeownership. These include property taxes, homeowners insurance, maintenance costs, and homeowners association (HOA) fees. Neglecting to consider these expenses can lead to financial strain and may result in buyers purchasing a home they cannot truly afford. Homebuyers must research and budget for all related expenses before making an offer on a property.
Ultimately, both you and your clients want the best possible outcome. Guiding someone through the largest purchase of their life is a rewarding and fulfilling experience as a real estate agent. If you're considering entering the industry, visit ADHI Schools to get started on your real estate pre-licensing courses and take the quiz:Should I become a real estate agent?
Love,
Kartik
|
Before making a move from one brokerage to another, be clear about your motivations and what is driving your desire to make the change. Define the work culture you want. If you prefer to work with a small
Before making a move from one brokerage to another, be clear about your motivations and what is driving your desire to make the change. Define the work culture you want. If you prefer to work with a small company with close relationships with your colleagues, you should look for a brokerage that has that kind of cultures and do research accordingly. See how each brokerage differs and go with the one that fits your needs the most.
If you want an all-business atmosphere, you’ll want to look into the brokerages that are business focused with little to no interaction between colleagues. If you like to work and just do your thing independently, find a brokerage that will fit that need and help you stay focused on business. It’s important to know how the company’s culture, values, and business approaches can affect your ability to succeed there.
An important aspect of brokerages you should consider is the leadership. You should examine the leadership at every level. What is their reputation within the industry and their organization? Ask questions like what does the new brokerage offer that will make you even more successful? Are they forward thinking? Forward-thinking business leaders don't see employees as just putting in the required hours. They see people who are essential to the success of the business. A forward thinking business leader will focus on developing the knowledge and skills of an individual and get them to a place where they can take on more responsibility and leadership roles of their own.
Business support is critical when it comes to running your real estate business. Look into the kind of business support the brokerage offers such as percentage splits, mentorship, technology, and resources. While most realtor’s want the highest pay possible, a higher percentage split should be considered, but should not be the most important decision factor. You should be satisfied with the split you are offered, and you should ask what opportunities there are to earn a higher split. When doing your research, also consider technology and how the right technology can help you. With the right technology, real estate agents can streamline their process to better serve clients. Using innovative tools and services can help you increase efficiency and gain a competitive advantage to close more deals. Email marketing platforms, CRM systems, and other apps are essential in today’s digital world.Make sure the brokerage not only offers these technology services for their agents but look into their efficiency as well.
Before interviewing brokerages, you should have a clear understanding of what kind of support will be most critical to you. What you are looking for in the new brokerage and how they can be the best support to you should be at the top of your list as you examine and compare potential brokerages Whether you are thinking about changing brokerages today or in the future, your choice should be rooted in what is best for yourself and your career. Consider how the potential brokerage can make you happier as an agent and how it can give your clients the best customer experience. Moving brokerages is a business decision and should be treated as such
Be rational and critical when thinking about this change. Do what you know is best for you and don’t let outside opinions affect your decision. Take your time and remember to ask the questions you need about the things most important to you. By keeping in mind what motivates you and the factors driving your need for change, you’ll be sure to find the right brokerage to call home for the long term.To get started on getting your real estate license click here
Love,
Kartik
|
At its core, commercial real estate is exactly what it sounds like - any property that is owned exclusively to produce an income. When people hear the term, they usually call to mind images of office buildings
At its core, commercial real estate is exactly what it sounds like - any property that is owned exclusively to produce an income. When people hear the term, they usually call to mind images of office buildings and similar structures. But really, commercial real estate can include any type of property - and even just the land itself - which has the potential to generate a return on investment on behalf of the person who owns it.
Just a few examples of this include the aforementioned office buildings, retail spaces, industrial facilities, medical and hospitality properties and any other commercial space that can be leased for the express use of the business in question. All told, commercial real estate brings with it a wide range of different benefits for investors - all of which are worth exploring.
By far, one of the biggest advantages of commercial real estate for investors comes by way of the significant cash flow opportunities these properties often bring with them. Once you purchase a commercial property and begin to rent it to tenants, you start to generate a reliable stream of rental income. You can use that money to pay down the original purchase of the property without putting out any of your own money. Not only that but once the property is paid off, that revenue becomes a largely passive form of income - particularly if you hire a third party to actually manage the day-to-day operations of it on your behalf.
If you're purchasing commercial real estate with an eye towards establishing a larger portfolio, you also get to enjoy the advantage of significant equity appreciation. As you build more and more equity in the property, its value naturally rises - allowing you to leverage it to continue to grow your own company without putting yourself in financial risk.
If this is something that you're planning on making a career out of, it also gives you an incredible amount of flexibility when the time comes that you want to retire. You can always choose to continue to own the properties to rely on that "passive" income as outlined above, or you can sell them and collect a significant amount of money to fund the lifestyle that you've always seen for yourself. The choice is yours - which is exactly why so many people do it in the first place.
Experts also agree that investing in commercial real estate is also a great way to fight off things like inflation. One recent report indicated that commercial real estate investments in the United States tend to have the highest correlation to inflation, especially when compared to other types of investments like stocks and bonds. As inflation increases, so does the price of commercial real estate - meaning that you're protecting the value of your money of the long-term, regardless of what is currently happening in the context of the larger economy.
Having said all of that, it's crucial to understand that nothing in this life is a guarantee and success in terms of commercial real estate is chief among them. No two markets operate in quite the same way, which is why you cannot assume there is a "one size fits all" approach to investing in this field properly. Before you enter the fold, you need to analyze the local market and understand current trends and progressions that may give you an indication of which investments are worth your time and which ones may not be quite as lucrative as they appear.
Likewise, long-term success with commercial real estate is always about creating as much value as possible. This means that especially during those early days, you're likely going to be taking a number of steps to improve the quality of the building to improve net operating income as a result. That means investing in more features and amenities for tenants. That means making improvements to the structure itself for the purposes of safety and desirability. The more value you can create, the more money you can generate by way of rent and lease prices.
It’s important to understand that commercial property is valued in a different way than residential property - meaning that you'll want to throw out what you think you know and learn how things really work. The income potential on a piece of commercial real estate like an office building is directly impacted by its usable square footage. With individual homes, that isn't the case. This is a big part of why investors start working with commercial properties in the first place - this different valuation simply opens the door for greater and longer cash flow over time.
For the best results, you need to create a strategy before you begin investing and stick to it as much as possible. Know what your limitations are - what you're comfortable doing and what you're not. Know where the hot properties are in the market and make an effort to understand the current market conditions and, most importantly, why they are the way they are. Know how much you can potentially make on an investment before you actually execute it. The more effort you put in at the start of this process, the greater your chances are at finding long-term success with this and other investments moving forward. To learn more about commercial real estate or a real estate school visit our website
Love,
Kartik
|
At its core, house flipping is a process in which a real estate investor purchases a particular home with the express intention of soon selling it for a profit. For a house to be considered a true "flip,"
At its core, house flipping is a process in which a real estate investor purchases a particular home with the express intention of soon selling it for a profit. For a house to be considered a true "flip," it needs to be purchased with the idea of selling it quickly - usually to capitalize on certain trends in the market at large.
House flipping has become incredibly popular over the last several years, particularly due to the potential return on investment if executed properly. In 2017, for example, one study indicated that just 5.7% of all home sales fell into this category. Flash forward just a few years to 2020 and that number had already climbed to 7.5%.
It's a process that is especially prominent in a "hot" real estate market and in areas where home prices are on the rise. Another study indicated that in 2017, the average gross profit on a flip was over $66,000 - and this is after any investments needed to make improvements on properties before they could be sold. Pittsburgh, Philadelphia, Baltimore and Cleveland were among the most popular markets during that time. But as is true with all investments, one must proceed with a certain degree of caution in order to make sure the process goes as it should. A significant ROI is never a guarantee but by keeping a few key things in mind, you can improve your chances as much as possible.
By far, the most important thing to understand about house flipping is that you need to decide how much you can afford to spend on an investment property before you actually do so.
In other words, it's a bit like gambling - never spend more money than you can afford to lose if things don't quite go your way. Again, given the uncertainty of the market and considering that there are a lot of parts of this process that are outside your control, nothing is a guarantee. Something may seem like a sure bet, but it never is - and you don't want to leave yourself disappointed or financially stretched because of a lapse in judgement.
Along the same lines, you should always focus your investment property search on various types of distressed properties that are themselves in need of major fixes and repairs. This accomplishes a few important things at the same time. First, you can usually purchase these properties at a significantly reduced cost because they've been sitting on the market for longer periods of time. Likewise, families and people who plan on buying a home to actually live there rarely want to deal with the work required to get it to a habitable condition.
But more than that, the amount of money you do pour into the home by way of fixes and repairs will increase its value significantly - meaning that you'll be able to command a premium price once you're on the other side of this process.
For the best results, select a few properties in a particular area to analyze to decide on the most profitable opportunity for a beginner real estate investor. This step is crucial, as it gives you a "bird's eye view" of what is going on in a particular area and what the long-term potential is in that market. It also helps you gain a better understanding of the highs and lows of the process, which should allow you to gain more insight into where you should be focusing your efforts and which "opportunities" aren't nearly as lucrative as they may initially appear.
You can also start building relationships with other real estate investors in the local housing market - a good idea for a few different reasons. For starters, someone who has been involved in this process for longer than you have will almost always have insight and wisdom to provide so that you don't have to make certain mistakes "the hard way." They can give you tips and outline best practices that help you get the most out of house flipping.
Beyond that, there may also come a day when one of your contacts identifies a great opportunity that they themselves cannot take advantage of. Maybe they have too many houses on the market right now and they don't want to take the chance to stretch themselves too thin - but there's nothing stopping them from picking up the phone and informing you about what they've discovered.
In the end, it's important to follow the "70% Rule" in house flipping. Essentially, this means that you should never pay more than 70% of the "after repair" value of a property (minus the costs of the repairs necessary to renovate the home, of course). This will give you an idea of the maximum amount you should spend on a home to achieve the highest possible return on investment. By using this as a general rule of thumb, it will help ensure that you always emerge with a profit - which in and of itself has always been the biggest priority.
Overall, house flipping certainly isn't for everyone - it takes a significant amount of care and attention-to-detail to get right. But those who follow best practices like those outlined above can enjoy a great amount of success - particularly in a market like the one we're in right now. To learn more about how to become a real estate agent or to learn more about real estate success stories visit our website
Love,
Kartik
|
You can finally apply for your real estate license online! It’s easy to do and you can upload all documents on the website https://secure.dre.ca.gov/elicensing/
To get started, you’ll need to create
You can finally apply for your real estate license online! It’s easy to do and you can upload all documents on the website https://secure.dre.ca.gov/elicensing/
To get started, you’ll need to create an account through e-licensing. During the
online application process you can pause at anytime and return later to pick up
where you left off.
Choose from 4 different types of applications:
Sales exam only
Sales exam and license combo
Brokers exam only
Brokers exam and license combo
Keep in mind if you apply for the exam only, you will have to go back onto the
e-licensing site to apply for your license after you pass your test.
If the application type is a combo exam and license, there will be an area for youto enter the main office address of where you will hang your license. If you do not have a designated office yet, click on the checkbox “I do not have a main office address at this time. Please issue my license in a non-working status.”
You’ll need to provide your social security number, driver’s license and proof of education which are your real estate class certificates. If you have changed your name you’ll need to provide any name change documents you have. Acceptable documents would be a marriage certificate or court order. Save all your uploaded
forms as PDF then upload.
Online payment methods accepted are:
For Credit cards
Visa, Mastercard, Amex, & Discover
For Debit cards
Visa & Mastercard
At the bottom of the page, there are two buttons. Click the “Sign and Pay” button when you are ready to submit the application to DRE. If you are not ready to submit the application, click the “Sign Later” button to return to the home page.
To check the current application processing timeframes, there is a link below the existing online applications table, which has more information, or navigate
directly to http://www.dre.ca.gov/Licensees/CurrentTimeframes.html
If you need to get started on your real estate classes here's how
Love,
Kartik
|
Launching your career as a real estate agent is an exciting venture filled with opportunities. But along with it comes the responsibility of managing your finances, particularly understanding the nuances
Launching your career as a real estate agent is an exciting venture filled with opportunities. But along with it comes the responsibility of managing your finances, particularly understanding the nuances of tax deductions. I wanted to write an article designed to help you navigate the intricate world of real estate tax considerations, shedding light on essential aspects that could maximize your earnings. Let's dig in and untangle the complexities of taxation so that you can focus on what you do best - making successful real estate deals.
As you venture into your journey as a real estate agent, it's crucial to understand how your earnings and taxes are structured. As you know, your income will predominantly be based on commissions from property sales and leases. Since you're classified as an independent contractor, you'll receive IRS Form 1099 at the end of each tax year. This classification makes understanding tax write-offs an important aspect of your real estate business. To ensure this guide provides the most value, let's delve deeper into tax considerations that every Realtor needs to know.
Classifying Realtors for Tax Purposes
Real estate professionals operate under a brokerage, but unlike traditional employment, they aren't classified as W-2 employees. Realtors are self-employed individuals running their businesses within the framework of their affiliated brokerages. This means that you're in charge of paying your taxes every year, and it's really important to know about possible tax deductions to help you manage your money better.
Understanding Tax Deductions: An Important Step for Realtors
A tax advisor can provide detailed guidance on what expenses can and cannot be deducted. However, a basic understanding of potential deductions from the onset of your real estate career is beneficial. This awareness will help you keep detailed records of your expenditures, an essential practice should you ever face an IRS audit.
Ordinary expenses that a Realtor can deduct span various areas of their professional activities. For example, mileage tracking becomes necessary, given how much travel the typical real estate agent does.
Similarly, marketing materials can be written off to promote your real estate services or property listings—such as business cards, direct mail postcards, open house signs, flyers, staging, professional photography and signage. Given its broad requirements and applicability, the IRS advertising expense deduction is a valuable resource for Realtors.
Beginning Your Realtor Journey: Costs and Deductibility
Starting your career as a real estate agent involves various costs that you should be aware of. For example, agents focusing on residential sales must join the California Association of Realtors and the National Association of Realtors after obtaining your real estate license. These fees, while necessary, are business expenses that can be written off on your taxes.
Access to the MLS (Multiple Listing Service) database, a vital tool for any Realtor, and Supra E-Key lock system also require payment. Furthermore, your brokerage may levy a desk fee and other monthly dues. All these costs are integral to doing business and can be written off as business expenses on your tax return.
Working from Home: Deducting Home Office Expenses
In today's digital age, remote working has become commonplace, bringing home office expenses into focus. If you're operating your real estate business from home, you can write off a portion of home-related expenses. This might include a portion of your costs for phone, computer, internet, and a portion of utilities. The IRS provides clear guidelines on calculating these deductions, depending on the size of your home office and its dedicated use for your business.
Building Client Relationships: A Closer Look at Deducting Gifts and Meals
As a real estate agent, fostering strong relationships with your clients is at the heart of your business. Often, this involves offering stellar professional services and nurturing these relationships on a personal level. This can mean taking a client out for a meal or gifting them a token of appreciation upon the successful closing of a sale. Let's delve deeper into understanding the tax implications of these client relationship-building expenses.
The Art of Gifting in Real Estate
Gift-giving is an integral part of the real estate profession. It's not uncommon for Realtors to present clients with closing gifts as a token of appreciation for their business or as a warm gesture to celebrate their new home.
When it comes to the tax implications of such gifts, the IRS imposes a limit. Only the first $25 spent on gifts for each person each year can be deducted. While this may seem modest, it's essential to remember that this limit applies per person. If you're gifting something to a couple or a family, the amount can be multiplied by the number of individuals.
This deduction may appear minor, but these gift deductions can cumulatively reduce your taxable income as you expand your client base. It's important to note that the $25 limit does not include incidental costs like engraving, packaging, or mailing, so these can be deducted in addition to the gift cost.
Client Meals: A Recipe for Deductions
Taking your clients out for meals is another common practice among real estate agents. Whether it's a casual lunch to discuss listing options or a celebratory dinner after a successful deal, business meals are a part of the real estate profession. The tax code recognizes this, allowing Realtors to deduct 50% of the meal's cost as long as the meal is business-related.
The nature of the meal is important here. It needs to be directly related to the active conduct of your real estate business or associated with a substantial and bona fide ordinary and necessary business discussion. It's best practice to keep detailed records of these meals, including the business purpose and the individuals present.
Remember that while client meals offer a chance for a deduction, they also present an excellent opportunity for building deeper relationships with your clients. By understanding your client's preferences and tastes, you can tailor these experiences to create a lasting impression, reinforcing your reputation as a thoughtful and dedicated professional.
In summary, while client gifts and meals are excellent ways to strengthen your relationship with clients, they also offer tax benefits. You must track these expenses diligently and work with a tax professional to maximize these deductions effectively. As a real estate agent, these relationship-building activities are an investment in your clients and a strategic move for your business's financial health.
Expanding Your Business: Don't Overlook Commission Deductions
As your real estate business grows and flourishes, you may pay commissions to other agents or employees who work with or under you. These commissions are an ordinary expense often overlooked but can offer substantial deductions. It's important to keep detailed records of these payments as they can quickly accumulate and provide significant tax relief.
Your Guide to Maximizing Deductions
It must be directly related to your real estate business to qualify as a deductible expense. As a real estate professional, it's crucial to consult with a tax advisor and refer to IRS Publication 535 for a detailed list of potential deductions. Meticulous record-keeping, staying updated with tax laws, and clearly understanding eligible write-offs are your keys to maximizing your tax deductions.
Navigating the complexities of tax deductions may seem daunting initially, but with the proper knowledge and planning, you can confidently manage your real estate business's financial aspect. Don’t forget to consult with your tax advisors to make sure you are applying these rules properly.
Are you embarking on a career in real estate? Remember to check out our interactive quiz to learn more about what this exciting and rewarding career offers!
Love,
Kartik
|
Homeownership is an essential part of the American Dream. Most people that are seeking to own a home turn to buying an existing home. It might not be exactly what you want, but you can see and feel it.
Homeownership is an essential part of the American Dream. Most people that are seeking to own a home turn to buying an existing home. It might not be exactly what you want, but you can see and feel it. You also have the option of building your own home. Let’s compare buying a home versus building a home.
Buying an Existing Home
Shopping for a new home can be fun and exciting as you plot the next journey in your life, but it can also be stressful. In tight markets, you must plan on bidding wars and making quick decisions. Getting pre-approved by a bank will tell you what you can afford and the type of home you can buy.
When you buy an existing home, you see exactly what you are getting. You can envision what the house will look like when you move in. Sure, you need to look past the wallpaper or outdated light fixtures, but those are cosmetic changes you can replace on your own time schedule.
After you find the house you like and agree on a price, you can expect the time it takes to close on your home to be from 30 to 60 days, depending on your bank’s mortgage approval process and the legal process in your state.
Be aware of the competition for the home you want. The better homes will sell fast, often within days of being listed for sale. If you want a move-in ready home, you need to have your paperwork in order and be ready to make an offer.
Building a Home
If the town you want to move to doesn’t have the type of home you are looking for, or you just want to build that perfect new home, then building a home is an exciting alternative. You will need to shop for a buildable lot and deal with zoning regulations, permits and contractors.
Building your own home can be an exciting process. You get to make all of those important decisions like designing the floorplan and selecting energy-efficient appliances. A good architect will guide you through the process.
This process takes time, often more than a year, from the time you purchase a lot to the time you can move in. In addition to obtaining a construction loan, you will need to obtain permits, attend hearings, hire contractors, and oversee the entire process.
It can be a challenge to build your home. You may need to deal with purchasing mistakes, poor materials, construction errors and even environmental factors like bad weather. Home construction projects often run over budget.
When deciding between buying a home or building a home, no matter what direction you take, you should obtain the advice of a licensed real estate professional who can guide you through the entire process from start to finish.To get your own real estate license start here - To take our quiz Should I become a real estate agent?
Love,
Kartik
|
Buying a home is a huge commitment – arguably, one of the biggest commitments you'll make in a lifetime. Because of this, the buying process can’t be taken lightly. Homeownership comes with many new
Buying a home is a huge commitment – arguably, one of the biggest commitments you'll make in a lifetime. Because of this, the buying process can’t be taken lightly. Homeownership comes with many new responsibilities, and finding the perfect property takes both patience and due diligence. However, if done correctly, owning a home can be both financially and personally rewarding.
Whether you’re buying your first home or your “forever” home, it’s incredibly easy to fall in love with a certain property and overlook vital details. If you’re ready to take the leap, you need to ask some key questions before buying a home.
The logical place to start in any home search is determining your budget. If you don’t consider how much you can afford independently of a mortgage company, you run the risk of taking on the maximum loan you’re approved for – whether you can actually afford that payment or not. In general, it’s smart to keep your monthly payment at or below 25 percent of your take-home pay.
While many prospective buyers are under the assumption a 20-percent down payment is required to buy a home, this is simply not the case. In fact, the average first-time buyer puts just six percent down, and certain loans require as little as zero. The right down payment for you depends on your financial situation, savings and goals. However, if you can afford it, a 20-percent down payment allows you to avoid paying for private mortgage insurance (PMI).
The down payment isn’t the only cash you’ll be spending on closing day. You’ll most likely also be responsible for closing costs, which can range from between two and five percent of your home’s purchase price. Your lender will provide you with a complete breakdown of the costs before closing day.
Keep in mind, the longer a home has been on the market, the more motivated a seller might be to make a deal. This means you may have more flexibility in the initial offer, terms, credits Keep in mind, the longer a home has been on the market, the more motivated a seller might be to make a deal. This means you may have more flexibility in the initial offer, terms, credits and more. While many homes sit on the market simply because the original listing price was too high, there are some cases where there is something drastically wrong with the home. Either way, a thorough inspection is important.
Always do your research regarding the local real estate market and recent sales in the neighborhood to help you determine if the asking price for the home you want is reasonable. This data can help you negotiate a lower offer or certain concessions, such as closing costs.
The quality of a neighborhood is one of the main reasons people choose to buy a certain home. It will also affect your ability to sell the home in the future. Because of this, it’s extremely important to research things like safety, convenience, schools and more.
Understanding a seller’s motivations for moving can give you more room for negotiation. A good buyer’s agent should be able to figure this information out and gauge how flexible the seller might be. For example, a seller relocating to a new state for a job will most likely be more motivated to negotiate than a seller simply exploring the market.
Do some research into the property’s history of insurance claims because it may affect your ability to get homeowners insurance and/or the price you’ll pay for insurance coverage. Because of this, it’s important to ask the seller for the full history of insurance claims.
Avoid taking on debt for furniture and decorations. Use what you already have, buy used and take it one room at a time. Many first-time buyers feel the need to take on another loan or more credit card debt to furnish their new place. It’s not always necessary!
Buying a home is a huge financial investment, and it is your responsibility to put in the necessary time and effort when researching potential properties. Asking the right questions and being fully prepared about the home buying process before placing an offer can save you both money and headaches down the road.
Love,
Kartik
|
Over the past year as more people have been working from home, many people are realizing their home needs are also changing. Working from home is on the rise so now is the time to reevaluate your changing
Over the past year as more people have been working from home, many people are realizing their home needs are also changing. Working from home is on the rise so now is the time to reevaluate your changing real estate needs to find the home that works best for you.
Working from Home Gives You Options and Flexibility
You may have found that working from home gives you options you didn’t have before. A majority of the workforce doesn’t need to be tied down to one specific area to do their job. These workers now have more flexibility and can pretty much live wherever they want. This means these workers can now move to a lower cost of living area or the location they have always dreamed of. You may be able to find a home in a more affordable area and get more house for your dollar. You’ll start to enjoy new benefits such as having more space and a dedicated home office. With the requirement of commuting gone, remote workers can now live in an area where they have always dreamed of vacationing, whether this is the mountains or near the beach. Relocating to a highly desired area also means you can live in an area that gives you better amenities, whether it’s the community or weather. Without a specific location for the job, the options are practically endless, and you can find your ideal spot. More people are moving away from the big cities and work centers, such as Los Angeles, Miami, Boston, New York, and San Francisco, entirely in favor of suburbs and more relaxed living. People may choose to go to communities that have a better quality of life but fewer job opportunities since they no longer must live where job opportunities are.
Flexibility Even for Part-Time Remote Workers
Some employees are now going back to the office part time, but this doesn’t mean that all flexibility is lost. Relocating within the region that gives you a better location but is a bit further away from the office can still be a good choice. You may have a longer commute, but you won’t be going into the office every day.The longer commute could be worth it to have a home with more comforts,space, or features. If you are going to be working from home, then finding a home that better suits your needs can be a priority.
Having a Home Office
Whether you are home part time or full time, having a home office is a necessity.Working from home has people recreating rooms in their homes to be used as office space. Some are looking to sell and buy homes with offices already in their new homes. Most people are seeing this as an opportunity to get the house they have always wanted so you can work comfortably from your home and still have a work life balance.
Love,
Kartik
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In a host of different ways, real estate is a truly great business to get into. Not only does it bring with it the potential to make a significant amount of money, but it also offers flexibility and the
In a host of different ways, real estate is a truly great business to get into. Not only does it bring with it the potential to make a significant amount of money, but it also offers flexibility and the power to be your own boss. But before you decide to get started with your own career in the industry, try taking this quiz, "Should I become a real estate agent?" Do your research and know that there are a few important things to keep in mind.
The Ins and Outs of Being a Real Estate Agent: Your Guide
By far, the most important thing you need to understand about being a real estate agent is that it takes a tremendous amount of time to be successful.
Building your business takes time and consistency. It takes time to build your clientele. Direct mail marketing is a good way to market your business by mailing out direct mail marketing materials to let people know what is going on the local market and that now might be a good time to sell. Let people know who you are, what your focus is and how you can help them. Consistently build your outreach efforts to get your name in front of as many people as possible. By being consistent with this method, you will eventually find a buyer or seller who will become your client!
Likewise, you need to be aware that you can't just wake up one morning and declare yourself a realtor - before you get started you are required to take a wide range of different courses and you'll have to take the state exam. But beyond that, understand that all of those governing laws change on a regular basis - which is why it takes continuing education courses to actually keep your license.
In a general sense, one of the most critical things to understand about a career in real estate is that real estate agents do not get regular paychecks. You would think that people would know that by now, but you'd be surprised by how many people are shocked to hear this.
Real estate is a commission-based enterprise, meaning that the more you work, the more you make. You make more money on more expensive homes, and so on and so forth. But the reverse is also true - if you have a particularly slow period where you're not selling (or helping to buy) any homes at all, you're not generating income during that time.
This can be a difficult thing for people to wrap their heads around, which is why you need to make a business plan and stick with it. Based on your personal financial goals and business expenses, sit down, and calculate exactly how much money you need to make during a given period. With that, you can reverse engineer the total number of transactions that you need to be involved in to meet that goal. That will tell you how many new leads you need to generate on a monthly basis, which in turn will give you a good indication of what you need to be doing every day.
Yes, it's true that there is the potential to make seven figures in real estate. People do it all the time. But it's hardly a passive form of income - meaning that if you want to get to that level, you're going to have to work for it.
Finally, understand that real estate agents work long hours and irregular days - meaning that if you're coming into the business looking for something like a more traditional "9 to 5" experience, you'll likely want to look elsewhere. Oftentimes you'll need to show homes on nights and weekends. You might put in 12 hours or more one day trying to get a home ready for showing. But as stated, the earning potential is incredibly so if you're able to be successful, the effort will be more than worth it.
In the end, there will always be a need to buy and sell real estate - meaning that there will always be a need for real estate agents. The market goes up and down and some periods will be more fertile than others, but if you truly understand trends and "get" how the local market works, you can find a tremendous amount of success in the field.
If you approach your real estate career by having realistic expectations and a good understanding of what you need to accomplish your goals, there is truly no limit to what you can accomplish.
If you want to become a real estate agent, see these motivational success stories from top realtors
Love,
Kartik
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Great Ideas to Help You Maintain Client Relationships in Real Estate
Almost more than in any other industry, people tend to come into the world of real estate with many pre-conceived notions about what
Great Ideas to Help You Maintain Client Relationships in Real Estate
Almost more than in any other industry, people tend to come into the world of real estate with many pre-conceived notions about what their day-to-day jobs will be like - and which factors are truly important.
Yes, you're helping someone navigate a massive financial purchase - certainly one of the biggest they're likely to make in their entire lives. If you're helping someone sell a home, you're going a long way towards assisting them when it comes to securing their financial future. If you're helping them buy a home, you're potentially allowing them to start a family in a wonderful new place, or to finally begin to build that life they've always seen for themselves. All of this is true.
But a career as a realtor is also about so much more than that. If nothing else, real estate is a business of working with people.
Therefore, more than even an individual sale or a particularly successful quarter, success in terms of real estate will depend on your ability to build relationships. It's crucial to know how to set up and maintain a good foundation with your clients, as the more you do this the more likely it is that you'll have a steady stream of new people coming right to your door.
Building Relationships in Real Estate: Your Overview
By far, one of the best ways to build stronger, longer lasting relationships with your customers involves understanding that listening is a fundamental part of creating a good working client experience.
If you come into a situation and try to cram someone into a "one size fits all" box when it comes to looking for a new home, they're going to start to see you as cold and cynical - because that's exactly what you'll be. People will quickly pick up on the fact that you're not really trying to help them accomplish their goals because you're unconcerned with their wants and needs to begin with.
Instead, you need to ask the right questions and, above all else, listen to the answers. Why is someone looking for a home? What features are important to them and why? Where do they see themselves in five years? Ten years? Are they planning on starting a family at some point in the future?
Along the same lines, open communication is key when it comes to working with clients. If you take someone to a home and they decide they don't like it, don't just rush them along to the next one. Have a conversation with them and figure out what they didn't like and, more importantly, why. Talk about their goals and create an environment where they feel comfortable coming to you with questions, concerns, and advice.
Again - talk with your clients about more personal areas of their lives, such as their family and hobbies, to create a rapport and connection. Let them know that you see them as more than just another client.Never forget that people come to real estate agents because they need legitimate help and guidance. They're often feeling overwhelmed and have more questions than they know how to answer. By taking the time to talk with them and establish that connection, you'll build a tremendous amount of trust and loyalty as a result.
Finally, consider the fact that a meaningful way to express your appreciation and leave a lasting impression is with gift giving. This is especially true of clients that you've already worked with, as you always want to remain at the forefront of their mind.
When Thanksgiving rolls around this year, you could have a promotion where all your past and current clients can stop by the office to pick up a free pumpkin pie. If you know that one of your older clients is having a birthday, feel free to pop a card in the mail. Things like this are small gestures, but they do go an incredibly long way towards making people feel appreciated - which is how relationships are grown and maintained.
In the end, understand that the quality of your business is directly tied to the quality of the relationships that you're able to build with those around you. This is another one of those reasons why most experts recommend picking out a niche and sticking with it. If you choose to "farm" a particular geographic area - particularly one that you're already familiar with - you put yourself in a much better position to bring as much value to people's lives as possible.
Then, with each successful transaction, something magical happens. People see that you're every bit as invested in their success as you are. They see that you're willing to go above and beyond to help them accomplish their goals. They see you as a true partner in every sense of the term - which truly is the target you should be trying to hit, day in and day out.
An important part of maintaining relationships in real estate is reminding people that you're out there, to learn about the types of email campaigns to send to past and present clients click here
Love,
Kartik
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One of the most important things to understand about being a realtor is that you're never "just selling a house." Sure, on the surface, that's literally what you're doing. But you're also pitching something
One of the most important things to understand about being a realtor is that you're never "just selling a house." Sure, on the surface, that's literally what you're doing. But you're also pitching something so much more important:
Your personal brand.
People aren't going to come to you to buy or sell a home out of the kindness of their heart. They're going to do so because they trust you. Because they consider you an authority. Because they believe you have the skills, the knowledge and the expertise necessary to get them whatever outcome they see for themselves.
To put it mildly, you're not going to be able to get to this point overnight. As the old saying goes,"Rome wasn't built in a day."
That, in essence, is why open house marketing is so important. Over the short-term, it's a great way to help move whatever piece of property you're working with at the moment. In the long run, however, it's also an invaluable way to help show as many people as possible that you have what it takes to succeed - especially during your first year on the job.
The Importance of Open House Marketing in Real Estate: Your Overview
By far, one of the biggest reasons why open house marketing is so essential to new agents in particular is because it gives them a powerful opportunity to learn as they go.
When you walk into your first open house, you're probably going to be a little bit nervous. You're going to be interacting with members of the public and giving people personalized tours of a space. The chances are incredibly high that you're going to make mistakes with your presentation - and open house marketing gives you a chance to make them over and over again.
Now, that may sound scary - but it really isn't. Every mistake that you make is a learning opportunity, and the more you realize how to personalize the experience for the people standing in front of you, the better you get at it over time. Over the course of a day or two you'll probably walk dozens of people through that house and you'll get an invaluable opportunity to refine your process every time. You'll start to get a better sense of what they like and what they don't, and how to play to those strengths in an effective way.
Simply put, you'll get better at the gig the more you do it - and open house marketing allows you to do so as quickly as possible.
From an actual marketing perspective, open houses also allow you to build a brand that lasts. The more people see your name, the more likely they are to remember it. You'll begin to take marketing more seriously than ever, which is a big part of how real estate agents carve out a niche for themselves in a particular demographic area.
As you start to see the return on your investment - meaning as you start to see more people responding to your marketing collateral and walking through those doors - you'll be in a better position to take marketing seriously. That in and of itself may be the most important benefit of all.
The Investments of Marketing
In an effort to get as many people to that next open house as possible, there are a few key techniques that you should definitely lean into.
For starters, there are apps that are available to help with open house marketing right now in both the iTunes and Android app stores. Especially in a market as "hot" as the current one, people are always looking for great new homes in their area and if they're ready to buy, they typically want to move fast.
Therefore, by posting your listings and contact information on these apps, you're more likely to attract the right kind of attention as quickly as humanly possible.
Beyond that, you should absolutely use social media to spread the word about your next open house far and wide. Take to Facebook and Twitter and pay attention to the types of hashtags that are being used in the real estate industry. Make a post letting people know where the open house is, when it's taking place and other relevant information. Continue to post in the days leading up to the event.
Likewise, if you see someone post on social media that they're looking for a new home in a particular area, don't be afraid to send them a message and let them know what you have coming up. They may not necessarily be interested, but they'll immediately become aware - and all of their other followers will, too.
In the end, gaining clients with these open house marketing tactics is a fine line to walk - but it's very much possible. Resist the urge to include every last detail about the property - that's what the open house is for. You don't want to offer too many photos or too much information to the point where someone thinks "no, that's not for me." You want them to be enticed to the point where even if they're not sure, they still want to stop by the place and take a look around.
If you're able to get to that point, you'll have a steady stream of new leads walking right through the door - which in and of itself is the point.
Love,
Kartik
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One of the most crucial things to understand about lead generation in the real estate industry is that it's both slightly easier and slightly more difficult than you think.
For those unfamiliar, lead
One of the most crucial things to understand about lead generation in the real estate industry is that it's both slightly easier and slightly more difficult than you think.
For those unfamiliar, lead generation is a term used to describe how you not only attract the attention of potential buyers and sellers - but how you also convert them into actual, legitimate clients. In other words, you're trying to reach out to people who are interested in buying or selling a home to let them know that you're out there and that you can help.
The reason why this process is slightly easier than you likely think it is has to do with the fact that there are many, many opportunities to generate leads - especially in a market like this one. The reason why it's also slightly harder is because it takes a great deal of effort to actually do this properly
You need to be willing to put the time in and execute your lead generation strategy in a consistent way. You need to understand what goals you're working towards and how many leads you need to get there. You need to know where your ideal clients are spending their time, along with what they need to hear and how they need to hear it.
Getting to this point is entirely possible, even as a new realtor in your first year. It does, however, require you to keep a few key things in mind along the way.
What You Need to Know About Real Estate Lead Generation
By far, the most important thing to be aware of when it comes to real estate lead generation is that you need to be as specific with your own personal goals as possible.
If you became a realtor for the express reason of "I want to become the most famous and most successful agent around"... well, you're going to need to be a bit more detailed than that.
Think about the financial goals that you have for your own business, especially within the context of the next year. How much do you want to be able to grow? How much money do you want to make? How much money do you actually need to handle things like marketing and potentially even renting a space of your own (if that applies to your situation)?
The answers to questions like these need to inform absolutely everything you're doing, because you can use them to work your way backwards to the exact number of leads you need to be able to generate.
Once you know that number, you can track your progress throughout the year to make sure that you're still on schedule. You'll be better informed as to whether or not your marketing efforts are actually working, and you can ramp up or ramp down as needed. But you can't get to this point without knowing what your financial goals are in the first place, which is why you need to decide on them (or let fate decide on them for you) as soon as possible
There are many tools online that you can use to make this part of the process easier - with income and lead calculators being chief among them. They're often free, simple tools that allow you to specify how much money you want to make over the next year, at which point they'll tell you exactly how many leads you need to score.
You can input how much you want to make in commissions, the current number of leads you're generating per month, and even the average price of a home in your particular area. Some even factor in additional elements like the average percent of the commissions you're making, along with your own personal average close rate.
After including all of that information, the tool will spit out everything you need to know including the number of homes you actually have to sell, the total number of leads you'll need to generate to get to that point, and the average number of leads in a month you should be getting. It's a great way to contextualize your larger goals against all of the hard work you're doing.
Beyond that, a critical part of the process also involves knowing where you'll generate those leads from - something that will vary depending on your situation. For a new agent who has only just gotten your foot through the door in the local area, you'll probably want to use a service like Vulcan7. It bills itself as the "most accurate and effective real estate seller leads resource" that is available to prospect expired, FSBO and FRBO leads in your area.
You'll also want to immediately begin forming relationships with a lot of the other people who will be involved in real estate transactions that you're likely to be a part of in the future. Don't be afraid to make friends with people at local title companies, for example.
You should also begin a social media presence and scour sites like Facebook and Twitter for potential clients. Also, send out direct mail collateral to people in your area to let them know who you are, what you do and why they should be paying attention.
In the end, real estate lead generation isn't something you "do once and forget about." It's something that will require consistent effort over time. Soon, though, your effort will begin to generate its own momentum - and that is a very exciting position for any agent to be in.
Love,
Kartik
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By far, one of the most common misconceptions that new agents make when entering the real estate industry has to do with the assumption that they need to be targeting the widest possible audience of
By far, one of the most common misconceptions that new agents make when entering the real estate industry has to do with the assumption that they need to be targeting the widest possible audience of potential buyers and sellers at all times.
There may have been a time when this was true - but it has long since ended.
Instead, success involves targeting the right audience with the right message at exactly the right time - which is what building a niche in real estate is all about.
Rather than assuming that you're speaking to "anyone and everyone," you need to develop a niche - meaning a specialty in your business - and use it to gain leads. Once you've decided on this niche, it should inform a large part of most of your daily activities.
Thankfully, getting to this point is a lot more straightforward than most people assume it to be. It simply requires you to keep a number of key things in mind along the way.
Developing a Niche in Real Estate: Your Guide
For most new agents in particular, one of the best ways to develop a niche in real estate and gain leads involves specializing in a certain neighborhood.
This could be an area that you're already familiar with, or one that doesn't have too much competition from other agents. Regardless, you need to pick a location and become a subject matter expert in it as soon as you're able to.
Research absolutely everything you can about this particular area. Off the top of your head you should be able to quote the prices that recent homes have sold for. You should know what types of homes are in the area and what their distinctive features are. You should be able to talk about local features and points of attractions, like the quality of the schools and the distance to interesting entertainment venues.
In other words, you need to know this area as well as you possibly can - all so that you can establish yourself as a legitimate authority and build as much trust as possible at the exact same time.
Obviously, getting to this level of knowledge isn't something that is going to happen overnight. It's going to take a significant amount of hard work and dedication. But when you consider that you'll quickly start to build a reputation for yourself as a real estate agent worth paying attention to, all of that effort will be more than worth it.
Once you've honed your specialization in a certain neighborhood, you can focus on the next most important part of building a niche in real estate: marketing.
Again, you should focus your marketing efforts on a specific group - meaning people who are A) already looking to buy or sell, or who B) may be open to the idea within the next year or so.
At a bare minimum, you should send out marketing collateral introducing yourself and letting people know a little bit about who you are and what you do. This doesn't necessarily have to mean that you're "selling anything" - really, you want people to know your name and you want to pop up on their radar.
Over time, you can expand your offers in a variety of strategic ways to continue to stay at the top of their minds. Whenever a home sells in the area, use it as an opportunity to send an email (or consider using direct mail) letting people know about it. If there are any interesting market trends that you feel people need to be aware of, send them information about it and provide your own unique perspective. Even holidays can be a great opportunity to just send out mailers, wish people a wonderful season, and remind them that you're out there.
The more often you're able to do this, the more likely it is that you'll begin to develop your reputation as the go-to realtor in the area. If someone decides that they want to sell their home, the chances are high that the first person they call is you. Even if people aren't ready to buy or sell today, they'll remember you so that when that day does come, they pick up the phone and give you a call. They'll likely also recommend you to friends and family members who they know are interested in beginning this process.
Beyond that, you'll always want to develop your specialty as much as possible. There's more than enough room in the real estate industry for everyone - you just have to find your own special corner and capitalize on it at your earliest opportunity. Some people choose to build their niche around the purchase of historic properties, for example - something that there are certainly a lot of in California. Others choose to focus on luxury properties, or condos.
Others still choose to focus on distressed properties that can be quickly sold to development companies. Vacation properties, senior homes, it doesn't matter what you choose so long as you make a selection and commit to it.
In the end, building a niche in real estate isn't just a great way to get your career started. It's also a way to gain leads and develop a steady, reliable stream of business for yourself - which in and of itself may be the most important benefit of all.
Love,
Kartik
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According to one recent study, California home prices saw a major increase of 20% in April of 2021 - shattering another already impressive record and reflecting the incredible surge of activity in the
According to one recent study, California home prices saw a major increase of 20% in April of 2021 - shattering another already impressive record and reflecting the incredible surge of activity in the market over the last two years.
In Southern California in particular, prices hit an all-time high of $655,000. Not only is that an enormous 20.2% increase over 2020, but it's also approximately $25,000 higher than the price record that was set just one month prior, in March.
The Factors That Impact Home Price Appreciation: An Overview
But the strength of the market isn't the only thing having a significant impact on home price appreciation - far from it. Equally important is the growing net worth of the homeowners themselves.
"Net worth" is a term used to describe the total value of all of a person's assets, minus the value of all of their debts and various financial liabilities. It's an important number to know, as it's a quick way to truly understand someone's larger financial health.
It's also important to understand within the context of real estate, because the average net worth of homeowners tends to be dramatically higher than people who are renting. According to one recent study in 2019 the average net worth of people who owned homes was literally 40 times higher than those of renters. Those who fell into the former category had a median net worth of $255,000, while those who fell into the latter had a median net worth of only $6,300. As expected, this is a financial gap that has only been getting more significant since the onset of the Great Recession more than a decade ago.
But if you understand how real estate works, this actually makes a great deal of sense. Someone's home tends to be their primary source of wealth. As average home values skyrocket and houses continue to appreciate, their wealth goes up. You don't get to enjoy the same benefits if you're living in someplace like an apartment, for example.
Another important idea to understand has to do with the fact that home price appreciation and home equity are directly linked. Home equity is described as the total value of someone's interest in their current home. One of the fastest ways to build equity is to make the largest down payment that you can. If you make a down payment of over 20% (assuming you're financially able to do so), it will instantly offer more equity than it would if you had made a smaller payment.
The vast majority of all people don't purchase homes in cash - they get the necessary funds via a mortgage loan. When that loan originally begins, the financial institution who gave it to you has a much larger interest in your home than you do. But as you continue to make payments, your interest goes up while the bank's goes down until the loan has been paid off. Therefore, another way to look at home equity would be to say that it's the part of your home that you actually own - meaning a financial representation of what you've already paid off on the original loan.
Additional Considerations About Home Value Appreciation
Of course, real estate is a complicated topic - and home value appreciation is no exception. While the factors outlined above are certainly important, there are a number of others that will directly impact a home's price appreciation, too.
One of these are the neighborhood comps - something that a lot of homeowners in California are benefiting from right now. When similar homes in a neighborhood sell - meaning ones with similar floor plans, features or other qualities - that can absolutely cause a home to appreciate much faster. Because the real estate market across the country is so hot right now, a lot of people are finding that their homes are growing in value much faster than they otherwise would have had things been more stagnant.
Location is also another factor that impacts home price appreciation. The quality of the local school district, the total number of desirable employment opportunities, and even the distance to points of attraction like shopping or entertainment venues can all make a home's value increase.
Finally, any upgrades or updates that have been made to a home can also cause the value to appreciate. This is especially true in older homes that may have already had outdated features.
If you own a home in Los Angeles with a current estimated value of between $150,000 and $250,000, for example, choosing to remodel your kitchen could add between $19,000 and $23,000 to the value of your home immediately after the project is completed. Adding a bedroom could add between $8,000 and $10,000, and even adding just a full bathroom could add between $1,900 and $2,300. Obviously, how much value certain upgrades will add depends largely on the area of the country where you live.
In the end, understand that home price appreciation is still somewhat at the mercy of the local market. If someone is buying in a buyer's market, they'll be able to negotiate on the price of a home far easier than they would if it were a seller's market for obvious reasons. But the good news is that in California in particular, home prices are expected to continue appreciating for the foreseeable future - a trend that shows absolutely no signs of slowing down anytime soon.
Love,
Kartik
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The real estate business is not only competitive for buyers and sellers, but also for real estate agents. Your business thrives on constantly bringing in new clients to fulfill their home dreams. Yet
The real estate business is not only competitive for buyers and sellers, but also for real estate agents. Your business thrives on constantly bringing in new clients to fulfill their home dreams. Yet what you wear can have a significant impact on whether the client wants to work with you or if they move on to the next firm.
One of the interesting things about the real estate business is that many agents believe anything goes when it comes to dress attire because this is their chosen career. Since they may work for themselves instead of with a brokerage that has a dress code, they believe that their dress decisions should only matter to them. This factor may often lead to them wearing things that may turn off buyers or sellers, such as see-through clothing, over-gaudy jewelry, or even tacky shorts.
However, your dress attire will be the first impression that buyers and sellers get about how knowledgeable and professional you will be with your services. Clients know that they could be working with you for several months. They do not want to have the impression that you do not want to take the job seriously, or that you may be so new to the real estate industry that you won't quite know how to handle negotiations or closings. Find out what the appropriate dress is that you may want to stick to when working as a real estate agent.
One Size Does Not Fit All
The good thing is that you do not have to stick to the strict cookie-cutter business suits and dresses, unless that is what you desire. There is no one-size-fits-all when it comes to what to wear in this profession because buying and selling buildings are not restricted to corporate developers or big city Realtors. No client would expect their real estate agent to show up to the beach wearing a three-piece suit or selling a ranch while wearing oxfords as you step around the livestock.
Think About the Region
Certain regions have a particular type of clothing trend that is popular to that area. Straying from this trend can often make real estate agents stick out in a negative fashion, as if they are someone new who is just muscling into the real estate game in that location. For metropolitan areas, a more formal business attire would be expected when working with clients interested in hi-rise apartments or commercial spaces. In more rural towns where everyone basically knows just about every neighbor by their first name, a more casual attire would be expected.
Think About Your Clientele
Based on the types of real estate that you work with, you may have clients of a specific demographic, such as families, retirees, empty nesters, and young couples. Some demographics may be a bit more lenient when it comes to the attire you pick. Others, such as older clients, can expect a more formal business attire. For families, they may look toward semi-formal to business casual. Consider the clientele so you can make the best first impression possible while developing a loyal customer base.
Clothing to Avoid
While you should dress in such a way as how you want to portray yourself as a real estate agent, there are usually a few pieces of clothing that should strictly only be worn during personal hours. Some clothing not to wear as a real estate agent includes:
• see-through clothing
• ripped jeans
• workout clothes
• graphic t-shirts
• short shirts that show the midriff
• tube tops
• shorts
• tight-fitting clothing
• miniskirts
• hats
It can be left to debate on whether some of these items can be worn for real estate work, such as wearing a graphic t-shirt with the name of the real estate firm on it. While this may be acceptable in certain circumstances, always remember that you do not want to cause any friction with a client who may not want to see certain graphics. For example, you may want to show team spirit by wearing a t-shirt of your favorite sports team. But if the client roots for an opposing team, this can sometimes create bad vibes at the first meeting.
Dress to Impress
You cannot go wrong with dressing to impress your clients. If you are working at a firm, ask the managers and coworkers about the best attire to wear when meeting clients inside and outside the office. Then consider the location, regional dress trends, customer demographic and your personal branding as factors when choosing the appropriate attire. You are sure to come up with your go-to real estate clothes that will help you find the perfect clients and professionally close deals while you become the top real estate agent in the country. To read real estate success stories from some of the top real estate agents click here If you are inspired to become a real estate agent visit our website or give us a call!
Love,
Kartik subramaniam
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So you finished real estate classes, you’ve chosen a broker to work with, you’re sitting at your desk and thinking: Now what? to buy a home right now. Sure, they know that they want to and that
So you finished real estate classes, you’ve chosen a broker to work with, you’re sitting at your desk and thinking: Now what? to buy a home right now. Sure, they know that they want to and that special day may very well be on the horizon. But they could also be waiting for a job transfer to come through, or for more savings to hit their account. They could even be trying to improve their credit - a process that certainly isn't going to happen overnight.
For most of the students that go through our real estate school, the potential for unlimited income played a large role in the decision to get licensed. Truly, there is no limit to how much you can earn thanks to the commission-based structure that the real estate industry provides. This, coupled with the fact that real estate agents can set their own schedules and the added satisfaction that comes with helping people achieve their dreams of homeownership, creates something of a perfect storm in the best possible way.
But at the same time, the chasm between becoming a Realtor and becoming a successful Realtor is a deep one, indeed. Rising to the status of the latter is something that takes an incredible amount of hard work and perseverance - often more than people are expecting when they begin their first day on the job in real estate.
In fact, the first 30 days as a real estate agent are critical for setting the tone for everything that transpires afterwards. Because of that, making sure that your career launches properly is mission critical to your long-term success in our business.
TL/DR - What you should expect in your first 30 days:
1. Join the Association of Realtors
2. Get MLS access
3. Get your eKey
4. Tell your friends and family that you’re in the business
5. Update all your social media
6. Preview at least 5 properties a day for at least the first 30 days
Getting the logistical stuff squared away
Standing up the logistical tools needed to get your real estate career started might seem obvious but they are worth mentioning. Simple items like ordering your business cards, getting your Board dues paid, making sure you have MLS access and Zipforms should be done in the first week at most.
Some companies may hold your hand through this process of onboarding but many real estate companies have so many new hires that these items could slip through the cracks. Take things into your own hands if needed and get them done quickly.
You also will want to write a professional bio, get your headshot done, as well as update all your social media profiles. Registering and creating profiles on sites like Zillow, Yelp, LinkedIn and Facebook won’t take long but they need to be done. If someone should Google your name, you want the first thing to come up to be a professional bio (complete with that previously mentioned headshot) to instantly give off the impression that you mean business and have social proof that you’re in the game.
I’d also recommend gathering the names, addresses, emails and other bits of contact information of everyone you know - this will act as the new sphere of influence that you will slowly build from over time.
Once that database is complete, you'll want to create a short letter or email to send out to every last name on it. The goal is simple: you want to let as many people know that you're now in the real estate profession and it isn’t just a hobby. Unless you hit this list, you’ll never know whether they're looking for a house right now or whether they're considering selling at some point in the future. The worst feeling is seeing one of your friends post on social media that they are selling or buying and would have done the deal with you had they known you were an agent.
This is also the period when you'll want to make an effort to truly understand your market. There are a lot of real estate agents who know how to help someone buy or sell a home. The key to your competitive advantage will be your ability to do so better than anyone else and become the local real estate expert in your community - which is why you need to do research, and lots of it.
Venture out into the area and show yourself around a few homes on the market. Test out that eKey, get comfortable with the process. Drive by homes that are for sale in your MLS. Not only will this help you get more familiar with the area you'll be operating in, but it'll also help you get more comfortable with the very process itself.
Speaking of the MLS, use the first 30 days as an opportunity to run real estate market reports to make sure you're aware of all current market conditions. At any given moment you should know how fast homes are selling, the average prices they're going for, the list-to-sales price ratios and more. You could also consider offering free home valuation reports to all of your friends, to both get comfortable with the process and to show as many people as possible how serious you are about your new career.
Networking and Beyond
Your first month as a Realtor will also be one where networking with other agents is critically important. Plan on attending every open house that you can and preview plenty of properties listed by other agents. Ask to shadow a seasoned veteran for a day. It doesn't matter - connect with as many people as possible, because you never know who will be able to help.
You should also draft a business plan to set some straightforward goals (not to mention a budget) for your first 90 days and beyond. Make an effort to set realistic goals for each week over the next few months, both to make sure that you're always moving in the right direction and so that you avoid feeling too overwhelmed.
Finally, you need to understand that even beyond your first 30 days, you need to take advantage of every opportunity to learn and grow as a real estate professional. Take classes with your local Association of Realtors. Determine and understand what your unique selling proposition is and be able to communicate why someone should care about it. Attend any new agent orientations you can find. Review as many real estate contracts as you can get your hands on and write some of your own. I remember when I was just starting in the industry, I would draft purchase contracts on random houses at night just so that I could learn the contract.
If you're able to find time for all of the above, you'll have done more than just make excellent use of your first 30 days. You'll have created a rock-solid foundation that the rest of your career will be built upon.
For more resources to help in your first 30 days see blog
Good luck!
Love,
Kartik
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As a real estate agent, you will inevitably encounter clients needing more time to buy a home. These long-term buyers may be waiting for a job transfer, building their savings, or improving their credit.
As a real estate agent, you will inevitably encounter clients needing more time to buy a home. These long-term buyers may be waiting for a job transfer, building their savings, or improving their credit. Regardless, your role as their real estate advisor remains essential. Here are some tips to help you guide long-term buyers and ensure their future success in purchasing a home. Additionally, consider enhancing your skills and knowledge through a real estate school, online real estate classes, and real estate exam prep to serve your clients better.
Caution Against Large Purchases
Buyers must exercise financial prudence when buying a home, and realtors play a vital role in guiding them through this process. One essential piece of advice that realtors should offer long-term buyers is to postpone any significant purchases that could negatively impact their credit.
Encouraging clients to prioritize their home purchase over buying a new car or financing expensive furniture can make a considerable difference in their home-buying journey.
Large purchases can increase a buyer's debt-to-income ratio, lower their credit score, and affect their mortgage approval chances. Additionally, these financial decisions might signal to mortgage lenders a need for more financial discipline, raising concerns about the buyer's ability to handle mortgage payments.
Warren Buffet's concept of delayed gratification offers valuable insight into why buyers should delay these expensive purchases. Delayed gratification is the ability to resist the temptation of an immediate pleasure in the hope of obtaining a more valuable and long-lasting reward in the long term. By practicing delayed gratification, buyers can prioritize their long-term goal of homeownership over short-term desires for material possessions.
The ability to delay gratification is linked to many positive outcomes, including academic success, physical health, psychological health, and social competence. This skill is closely related to patience, impulse control, self-control, and willpower, all of which are crucial in home-buying.
By advising clients to embrace the concept of delayed gratification, realtors can help them focus on the long-term benefits of homeownership. As they resist the temptation of immediate rewards, buyers can work towards securing their dream home, ultimately reaping the rewards of their patience and financial discipline. By incorporating this perspective into the home-buying process, realtors can better guide their clients toward a successful and rewarding home purchase.
Promote Timely Bill Payments
Stress the importance of paying bills on time, as missed payments can harm their credit and delay home-buying. If they're at risk of missing a payment, suggest they contact their creditors to work out a solution.
TLDR - Pay bills on time or early.
Discourage Large Bank Transactions
Remind your clients to avoid large withdrawals or unsourced deposits to their bank accounts, as mortgage lenders scrutinize financial history thoroughly. Unusual transactions can lead to mortgage application denial.
When purchasing a home, buyers must be mindful of their financial transactions, as mortgage lenders pay close attention to their financial history. Large withdrawals or unsourced deposits can raise questions and potentially jeopardize the approval of a mortgage application. Understanding the impact of such transactions and why avoiding them is vital during the home-buying process is essential.
Mortgage lenders evaluate an applicant's financial stability and ability to repay the loan by analyzing their income, expenses, credit history, and existing debts. Unusual transactions, such as significant withdrawals or unsourced deposits, can raise red flags and suggest potential financial issues or undisclosed liabilities. Lenders may perceive these transactions as signs of financial mismanagement or an attempt to conceal relevant financial information, leading to doubts about the applicant's creditworthiness.
Moreover, mortgage underwriters must verify the source of funds used for the down payment, closing costs, and reserves. Unexplained or unsourced deposits can complicate this process, as they need clarity regarding the origin of the funds. This lack of transparency may lead lenders to question the legality or legitimacy of the funds, which can ultimately result in a mortgage application denial.
Maintaining transparency and consistency in financial transactions is crucial when applying for a mortgage. Buyers should avoid large withdrawals or unsourced deposits to their bank accounts during the home-buying process, as these unusual transactions can raise concerns for mortgage lenders and jeopardize the approval of their mortgage application. By keeping their financial activities clear and well-documented, buyers can increase their chances of securing a mortgage and successfully purchasing their dream home.
Warn Against New Credit Applications
Instruct your clients not to apply for new credit, including credit cards and financing large purchases. Also, ask about recurring payment plans, such as the iPhone Upgrade Program, which may perform "soft pull" credit checks that could negatively impact their credit score. New credit applications can impact your credit score for several reasons, and it's crucial for people in the process of buying a home to avoid applying for new credit during this time. Here's why:
Hard Inquiries: When you apply for new credit, lenders perform a "hard inquiry" on your credit report to assess your creditworthiness. Each hard inquiry can lower your credit score by a few points, and multiple inquiries within a short period can have a more significant impact. A lower credit score may result in less favorable loan terms or even denial of your mortgage application.
Debt-to-Income Ratio: Applying for new credit can increase your overall debt and raise your debt-to-income (DTI) ratio. Mortgage lenders consider your DTI ratio when determining your loan repayment ability. A high DTI ratio may lead to higher interest rates or disqualification from certain mortgage programs, making it more challenging to secure a mortgage for your desired home.
New Credit Accounts: Opening new credit accounts, such as credit cards or personal loans, can affect your credit score in several ways. Firstly, it reduces your average account age, which can lower your credit score. Secondly, it can impact your credit utilization ratio – the percentage of available credit you're using – another factor lenders consider when evaluating your mortgage application.
Financial Instability: Mortgage lenders prefer financially stable applicants with responsible credit behavior. Applying for new credit during the home-buying process can signal financial instability or the inability to manage existing debts, which may raise red flags for lenders.
To ensure a smoother home-buying process and increase the chances of securing a mortgage with favorable terms, it's essential to avoid applying for new credit during this time. Instead, focus on maintaining a healthy credit score, paying bills on time, and keeping your debt-to-income ratio low.
Maintain Regular Communication
As a real estate agent working with long-term buyers, maintaining regular communication throughout their home-buying journey is critical to your professional success. By keeping in touch with your clients, you demonstrate your commitment to their needs and ensure that you remain their go-to expert when they're finally ready to make a purchase.
Regular communication helps build trust and rapport with your clients, which is essential for fostering a strong, lasting professional relationship. By staying in touch and providing valuable information, you show your clients that you are genuinely invested in their long-term goals and ready to support them at every step. This proactive approach to client communication allows you to anticipate their needs and provide guidance on any potential challenges they might face during the home-buying process, ultimately making their experience smoother and more enjoyable.
Additionally, consistent communication keeps your clients informed about the latest market trends, new listings, and potential opportunities that align with their preferences and budget. By providing regular updates, you ensure that your clients remain well-informed and prepared to make educated decisions when the right opportunity presents itself. This level of attentiveness can set you apart from other agents, who may not prioritize long-term clients similarly.
In conclusion, maintaining regular communication with your long-term buyers is essential for securing your position as their trusted real estate advisor. By staying in touch and providing valuable guidance throughout their waiting period, you demonstrate your dedication to their success and ensure that you remain top of mind when they're ready to buy. In a competitive industry, this level of client care can make all the difference in securing future business and building a reputation for exceptional service.
Remember, not all clients will be ready to purchase a home immediately. By following these tips and investing in your education through a real estate school, online real estate classes, and learning how to get a real estate license, you can better serve long-term buyers and improve your chances of converting them into successful homeowners in the future.
Love,
Kartik
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As a new real estate agent, making the right first impression is critical . Details matter. That includes the way you look, your approach, and your personality. It also relates back to the type of
As a new real estate agent, making the right first impression is critical . Details matter. That includes the way you look, your approach, and your personality. It also relates back to the type of image you portray with your vehicle.
Why Your Vehicle Matters
First impressions matter to home buyers and sellers. They want to know that the person they are working with is successful, even if they are brand new. Having a car that is both functional and impressive enough is a key part of the process. Since most real estate agents will help buyers see a variety of homes often by driving them around, this can be an important decision to make. To be clear, packing everyone into the same car while COVID rages probably isn’t the wisest decision, however, COVID will be behind us and it will be back to business as usual.
Most agents aim to find some balance between their image and the relatability of the vehicle. That is, while you want to have a nice and comfortable vehicle, you do not want something that’s too flashy that could scare away some of your most likely buyers. How do you do that?
What Every Real Estate Agent’s Car Should Have
One of the first things to start with is the basics. There are some features that are critical that every vehicle has. These make a difference in the type of experience the buyer and seller may have. Some key starting points include the following:
Air Conditioning: Comfort matters. You want to be sure that anyone that is in your vehicle is comfortable. A nice feature to have is adjustable cooling for the backseat. That helps your buyers to be able to control their heating and cooling to find the right temperature of comfort. It helps keep them happy on a hot day.
Radio: It’s a good idea to have a reliable radio. You may not need surround sound and top-of-the-line speakers, though. It is a good idea to have some music playing in the background when you pick up your buyers. When it is silent in the car, people feel uncomfortable. A big part of what you are doing now is keeping everyone enjoying the experience. You may even want to create a playlist for your car that is upbeat, positive music.
4 Doors: There’s no situation in which your buyers want to try to climb out of the backseat of a car. More so, it should be a roomy enough backseat that they are able to sit comfortably even if they are a bit taller or need more room. Be sure to choose a four-door vehicle that’s designed to accommodate your needs outside of work, too.
Clean: Perhaps the most important part of your vehicle is how clean it is. People who are stepping into your vehicle expect it to be comfortable and sanitary. This is very important, especially in a pandemic world. If you are buying a car then, be sure to look for features that make it easy to keep clean. That may include leather or leather-like material. If you can choose a vehicle that has easy-to-remove or clean carpeting, that can help as well. Keep it litter free as well.
What Kind of Car Should I Drive?
New real estate agents are often overwhelmed by this decision. It does not
have to be a complex process, though. You want to provide a positive
experience for your buyers. They do not expect a top of the line vehicle, but
they want something reliable.
There is no benefit to you, especially as you are just starting, to have a too expensive car. If it has features that make a difference to you, such as a navigation system, that’s great. If not, you still have your smartphone you can use to help with getting around. What’s most important is not to overspend at the beginning of your career and to choose a car that fits into your budget as a new real estate agent . Over time, you can upgrade as you see fit.
Choose a car that is not going to break the bank. It’s okay to buy a car that fits your personal needs, too, especially since most agents will use their car for this as well. Take the time to find a car that fits your personality and your client’s most likely needs. Then, be sure to take care of it to keep it looking sharp.
Love,
Kartik
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As we move deeper into 2021, home design trends are predicted to be rather bold and personalized. This makes sense after the nation has been spending so much time at home. More and more people are
As we move deeper into 2021, home design trends are predicted to be rather bold and personalized. This makes sense after the nation has been spending so much time at home. More and more people are becoming attuned to their daily surroundings, noticing the nuances that add character and taking joy in some of the simpler pleasures. We'll look at what's on its way out and what everyone is making room for.
Interior Design Trends Going Away in 2021
Modern farmhouses, white kitchens, fast furniture, and single-use spaces look like they're soon going to be a thing of the past. The modern farmhouse look, with its barn doors and somewhat impractical sinks, was becoming far too ubiquitous for people's tastes. While it might work in the country, it's just not natural for an NYC apartment.
Perhaps more surprising for 2021 is that open floor plans also seem to be going out of style. As people turned their homes into makeshift schools, gyms, and home offices, there was a certain drawback to having so many undefined spaces in the home. Instead, people are starting to see more advantages to walled-off rooms that can be used for a variety of activities throughout the week.
2021 Predictions for Home Interior Design Trends
Here's what's likely to dominate the interiors of the most fashionable homes this year. Don’t forget to keep these in mind when hosting an open house this year.
Self-Expression
In a world of strip malls and housing developments, plenty of homeowners long to do something a bit more daring. The pandemic has only intensified this need for creativity, with more people viewing the empty space as a fun challenge rather than a daunting threat. So whether a person drags out old souvenirs from past trips or clears out a space for a more minimal interpretation, more decisions will have a larger purpose for the homeowner.
Post-Modernism
Post-modernism doesn't always have the best of connotations, sometimes prompting us to think of horrifying photos from the 1970s of busy rooms in all the wrong colors. But there's been a comeback in this movement as we round its 50th anniversary. Essentially an adverse reaction to the bare spaces of modernism, post-modernism is debuting new materials and ornaments for this year. It's a fun trend that can breathe a little life into an old room.
Industrial Styling
If even the latest twists in post-modernism don't suit your tastes, you might consider industrial styling as an alternative. The stonework, metal elements, and neutral colors have some of the same principles as minimalism or modernism, yet incorporate more details to explore in the home. This blend of styles is most often recommended for multi-purpose spaces with high ceilings. (It's a great way to pay homage to talented craftsmen in your area too.)
Black Kitchens
White kitchens were once the rage for luxury kitchens, but as with any song that's been played too long, they're starting to wear out their welcome. Now, people are looking for sleek black countertops, cabinets, and lighting as a way to distinguish the living room from the kitchen. If you have an open floorplan, this is especially recommended if you're not planning to build any walls. Of course, don't necessarily expect this trend to replace the beloved Carrara marble just yet though.
I’m also starting to see a lot of brass and copper tones set against these darker colors.
Sustainability
This one has clearly been on the rise for a while, but worth noting for 2021. This design trend goes hand-in-hand with transparency. People are looking for brands that aren't afraid to share how their products are made and how they treat their employees Rather than giving people vague promises, this year's customers will be looking for companies that highlight diversity in their staff and how the company is doing its part to protect the Earth.
Natural Shapes
Few things in life are picture-perfect. (The edges of a flower petal would be difficult to measure with a straight ruler.) Maybe that's why we're starting to see wavy shapes nearly everywhere. These more organic choices are thought to remind us of nature and stimulate our creativity. When we've been so cooped up at home, it makes sense that we're all gravitating toward this particular form of expression — whether they're found on a table, painting or pillow.
More Plaster
On a more practical note, plaster could see more of a resurgence this year. For years, drywall has been the favorite. It's easy and fast to install, plus it offers a clean and uniform surface for the owner to decorate. On the other hand, plaster has to be layered over wood, presenting logistical challenges that don't always end well. But there's also a depth to plaster, one that offers more texture and (you guessed it) personality to the room. If you're interested in this one, experts recommend coating a drywall with a thin layer of plaster to see how it looks (and avoid demolition cost).
So there you have it, an educated guess as to what's to come. Considering the unpredictability of 2020 though, anything can happen with home design. It will all come down to how different design elements speak to the homeowners and what promotes functionality for all of the home's residents.
Love,
Kartik
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Before I get deeper into this article, it is worth noting that I love California. I’ve lived in southern California nearly all my life so this article isn’t meant to sound cynical about the state
Before I get deeper into this article, it is worth noting that I love California. I’ve lived in southern California nearly all my life so this article isn’t meant to sound cynical about the state of affairs around here. I just thought this would be an interesting article to research amid rumors that COVID lockdowns, taxes and regulations are chasing Californians out of dodge.
Just in case you were concerned that the reported exodus of California residents to other states has been exaggerated, it seems to not only be true, but perhaps it is gaining momentum. That in itself is maybe a bit surprising, and some of the other facts surrounding the reports will also surprise you.
Just to clarify, according to the California Department of Finance, the population of the Golden State was still increasing, but ever so slowly, in the period between July 2019 and July 2020. The state showed a net growth of just 21,200 residents, translating to a percentage growth rate for the 12-month period of just one 1.5%. The growth rate has slowed over the past two decades, but this was a record-setter, something that had not been matched since 1900.
During the same period, Los Angeles County reported a net loss in population of more than 40,000, and Orange County is said to have lost nearly 25,000 residents. If you're wondering how to reconcile those numbers, you must dig deeper. The United States Census Bureau confirms that in 2019, 653,000 residents left the state for what they considered greener pastures in other parts of the country. Only 480,000 U.S. residents traded zip codes for one within California. That represents a net loss of 173,000 residents. And that was pre pandemic. But foreign-born new residents were still arriving.
The Facts Behind the Stats
California, with a population nearing 40 million, grew dramatically for most of the 20th Century. With enviable weather, great natural beauty and plenty of space left for new homes and businesses, it seemed to be the land of opportunity, with a booming job market, lively culture, and great cities, food and entertainment. In the second half of the century, the population almost tripled, but for the last 20 years the growth rate has been relatively flat, and it slowed dramatically in 2017. Reasons include a higher than average cost of living, rising home prices, taxes and overall costs, and a slow but steady change in demographics.
As in the rest of the country, California's population growing older, and its birth rate has also declined. But its average age is still young when compared to other states. Unlike the majority of states, however, California is heavily populated by immigrants and minority groups.
According to the Public Policy Institute of California (PPIC), the state has unique diversity. Its share of foreign-born residents in 2018 was larger than any other state, estimated at 10.6 million. It is also a state with no single race or ethnicity constituting a population majority. Latinos now account for 37% of the population, surpassing the white population in 2014. Other substantial population groups include Asian-American at 15%, African- American numbering 6%, multi-racial groups at 3%, and American Indians or Pacific Islanders under 1%.
Reasons for Relocating Out of California
In order to understand why California residents are leaving, you cannot discount standard explanations. People relocate for many personal reasons, including new job opportunities, wanting to be closer to family and friends, or simply wanting to taste a new lifestyle. But why aren't people moving into the state? That may also not be difficult to answer.
There is no doubt that traffic and weather play a part in the decision-making process. California has suffered more than its share of natural disasters in the past few years. Rising prices of goods and services, a scarcity of affordable housing -- particularly in major cities -- government regulation on business and rising taxes on individuals, and political considerations all have an effect.
Rural areas lose residents primarily because jobs disappear, while cities seem to lose people due to rising prices and a lack of safe and affordable housing. California's operating farms have been decreasing for generations by some estimates, and its major cities have become known not for their cosmopolitan atmosphere but for their problems that include escalating prices, a culture of drugs, crime and homelessness, and questionable governance.
The effect of COVID-19 also must be considered, and it is not insubstantial. The state has been viewed as a hotspot of infection, and has faced a lot of criticism for its handling of the crisis on local levels. It should be noted that some residents left and sold their home during the pandemic, but that the virus also prevented others from crossing the border into the state, which affects total population numbers.
Where Are People Going?
Favored destinations for California expats are Texas, Arizona and Idaho, for various reasons. Texas mounted a serious campaign to attract new business, especially from California, several years ago, and it has paid off. With no state income tax, a stable economy, a relatively favorable climate and a friendly vibe, new residents feel at home in Texas. Real estate agents are quick to point out the advantages of selling high and buying low, something that is entirely possible when moving to Texas from other places in the nation. That has helped sustain a building boom in Texas that began shortly after the crisis of 2008. Texas is a hot market for buyers from out of state. Austin and the Dallas-Fort Worth Metroplex are the prime areas.
Other California residents, especially those who can continue to work remotely for their employers, head for Phoenix or to Boise, Idaho, which each have some of the same lifestyle, tax and housing advantages, and favorable climates. California real estate spokesmen are quick to confirm the trend. Some of them have even joined the expats, working remotely from new homes out of state, while continuing to represent sellers and buyers in California.
What Does the Future Have in Store for the California Population?
Will the trend be reversed in the future? It's hard to say, but right now it seems as if California is on the downward slope in terms of population. It will, however, no doubt retain its status as the most highly-populated state for at least the foreseeable future.
Love,
Kartik
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Part of becoming a real estate salesperson, the law requires that you work for a broker. In case you are new to the real estate industry, examples of brokers are Keller Williams, Coldwell Banker
Part of becoming a real estate salesperson, the law requires that you work for a broker. In case you are new to the real estate industry, examples of brokers are Keller Williams, Coldwell Banker and Century 21. It’s important to company to work for - and making the right decision to that end - can absolutely turn into something of an existential question for any new salesperson.
But at the same time, all hope is certainly not lost. By asking yourself a few key questions at the beginning of this process, and by understanding the potential pitfalls you could fall into if you make this decision haphazardly, you'll go a long way towards making the best possible choice in terms of both your career and your future.
Do this company's values line up with my own?
Obviously, the most important question you want to ask yourself before you choose a real estate broker to work for is, in many ways, the most immediate. Does the option you have in front of you line up with your own values? Meaning, is this the type of company you would feel good about working for to begin with?
If you're the type of agent who likes to take a more personal and intimate approach to what you do, obviously you wouldn't want to work for a "real estate mill" who is simply trying to turn over agents as quickly as possible. Likewise, do the social values of the company and its leadership line up with your own?
Making the wrong choice here could get you into some hot water. Don’t fall prey to the broker who claims to give you all the support in the world but then disappears when you actually need help. Make sure that you talk to some other agents at the company who have been there for at least a year and get the scoop on what it’s really like to work there.
What are the opportunities to learn and grow within the organization?
Another important question to consider before you choose a real estate broker to work with has to do not with the position you'll be starting at, but what that job might grow and evolve into over time.
Obviously, the "right answer" here is going to vary in large part depending on the career trajectory you see yourself in. Some people aspire to be a part-time real estate agent - that's it - and they're totally fine sticking with those basic responsibilities for the duration of their career. But others want the opportunity to find a mentor and maybe even start their own team or have ownership in a brokerage. This will likely require that you get in touch with someone who will teach you the "tricks of the trade" and who can help mold you into a far more sophisticated agent than you could ever be on their own.
Which of these two camps you fall into depends on what type of real estate broker you should look for. Again, some leave very little room for growth in the long-term and you may hit your ceiling pretty fast as far as advancement is concerned. Depending on your perspective, that may be okay - but if it isn't, you'll want to find the type of brokerage that actually offers those opportunities.
Why Picking the Right Broker Matters More Than You Realize
Again, all of this matters so much in large part because picking the right broker can absolutely set the tone for the rest of your career. This is especially true if you're a new agent, as you don't really have a standard definition of what "normal" is supposed to look like yet. You don't want to find yourself short-changed right away, or worse yet forced to accept that this is all there is to your career. You want to pick a company with a vision that aligns with your own to help bring that vision into reality. Likewise, being around a group of productive, like-minded people can definitely help put your career on the right track.
But most importantly, starting with what might seem like a better offer initially - and then having to restart with a whole new firm later when you realize that wasn't true - may very well set you back. It's nothing if not costly to switch brokerages, mostly because the broker often makes the agent pay for things like their own business cards, "For Sale" signs and other collateral material.
Therefore, picking the right broker today can help you avoid a lot of major issues and potential career setbacks tomorrow.
Need help picking a broker? Reach out to me and I would be happy to talk through it with you.
Love,
Kartik
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According to one recent study, the vast majority of all experiences between a services provider and customers still begin in the exact same way: with a search engine. If you needed just a single statistic
According to one recent study, the vast majority of all experiences between a services provider and customers still begin in the exact same way: with a search engine. If you needed just a single statistic to underline the importance of your online presence as a realtor, let it be that one.
Thanks to the rate at which technology continues to advance, consumers are doing more research before purchases than ever before. They want to collect as much information as possible and weigh all of their options carefully before making the decision to part with their hard-earned money. If they're putting in hours upon hours of careful research before investing in something like a new computer, how much effort do you think is going towards some of the larger purchases they'll ever make like a home?
In short, quite a lot.
This is why it's critical for you to understand that, as a realtor, your online presence is one of the most important elements of your business that you need to keep a careful eye on. This is true for a wide range of different reasons, all of which are worth exploring.
Keep an Eye on Google – How Well Does Your Brand Rank?
As stated, most experiences between you as a realtor and the people you've dedicated yourself to serving are going to begin with a search engine like Google. This means that if you go to Google right now and type in your business' name, you'd better show up as high on the page as you possibly can.
This means not only creating a real estate website or using an online social media platform to showcase yourself, but elevating it above acting as a simple "virtual business card" and into the realm of a helpful online resource that people actually want to use. You need to write blog posts, record videos and offer other helpful content to help people understand why you're someone worth paying attention to in the first place. People have questions and concerns when it comes to buying a home - your website is an opportunity for you to answer them in a way that builds trust and empowers your larger SEO (search engine optimization) efforts at the same time.
Improve Your Reviews on 3rd Party Sites Like Zillow and Yelp
Of course, people aren't just going to take your word for it that you know what you're talking about when it comes to real estate - they want this confirmed from other real people that you've worked with in the past. Reviews on Zillow or even Yelp may also come in handy when servicing new clients.
Use Facebook and Instagram to Make Yourself Available 24/7
It's equally important for you to keep in mind that when it comes to the level of research people are doing ahead of a major purchase like a home, they're not limiting their activities exclusively to "normal working business hours." They're doing research early in the morning and in the middle of the night. They're pouring over options on weekends and at virtually all hours of the day. This means that a successful online presence as a realtor depends on making yourself available 24 hours a day, seven days a week via sites like Facebook and Instagram.
Think about it like this: if someone has a question, they want an answer now. They're not going to wait for you to get back to them - they're going to keep trying until they find someone who will. By giving people the opportunity to contact you anywhere at any time, you're making sure they complete the majority of their customer journey with you.
In the end, traditional word of mouth may still be the best way to secure real estate leads - but that doesn't make an online presence any less important. Still, both of these things are in service of the most important marketing opportunity of all: doing whatever it takes to generate as many satisfied customers as you can.
Love,
Kartik
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As a first-time home buyer, one of the aspects of the process that people may not be prepared for has to do with the sheer volume of documents that will be required to get qualified for a loan. Of course,
As a first-time home buyer, one of the aspects of the process that people may not be prepared for has to do with the sheer volume of documents that will be required to get qualified for a loan. Of course, it's in their best interest to get these items ready as early on as possible as most sellers expect you to have a pre-approval letter for a mortgage. Having this ready not only shows that they're serious about the process, but it also makes sure that everything goes through without delay.
Not only that, but getting pre-qualified for a mortgage can also act as a useful estimate of how much someone can actually afford to spend on a home - thus making sure that they (and you as their real estate agent) are not focusing their attention on the wrong areas. Thankfully, gathering all of these documents together won't be nearly as difficult as you may be assuming. You just need to keep a few key things in mind along the way.
Proof of Income
By far, the most important document that will be needed to qualify someone for a loan involves some type of proof of income. This will usually require that the buyer produce their W-2 wage statement from the past two years, but recent pay stubs and proof of any additional income (like bonuses) may also be needed. Likewise, buyer's will probably have to produce their most recent two years worth of tax returns.
Proof of Assets
At that point, buyers will have to produce their proof of assets - which will typically involve bank statements and investment account statements to prove that they have the money necessary for any down payments or closing costs.
A Credit Check Containing Your FICO Score
Typically speaking, buyers will also have to have good credit in order to qualify for a loan - which means that they'll need to produce what is necessary to run a credit check. For a conventional loan, this means having a FICO score of at least 620 if not higher. If the buyer will be getting a Federal Housing Administration loan, they can usually get by with a score of at least 580.
Employment Verification
Next, buyers will have to provide some type of employment verification as lenders usually only deal with people who have stable employment. In addition to providing pay stubs, a lender will likely call the buyer's employer to verify that they actually work there.
Driver’s License and Social Security
Finally, buyers will have to produce a copy of their driver's license and their Social Security number. In addition to being necessary for running a credit score, this will help make sure that the lender has everything they need to confirm that someone is capable of paying back the type of mortgage they are requesting.
Final Step: Getting a Mortgage Preapproval Letter from the Lender
Once the buyer has all of these documents prepared, their lender will have everything they need to approve a specific loan amount and that will be valid for somewhere between 60 and 90 days. Loan officers will use these documents, along with their own internal systems, to qualify the buyer based on what they've provided and underwriters will be a big part of this process, too.
As a real estate agent, you should always ask buyers if they are pre-qualified for a loan BEFORE putting a lot of work in to help them find a home. If nothing else, this will be a useful indicator of what types of potential homes you should be steering them towards. It will also instantly help you separate the more serious home buyers from people who may just be casually looking, thus freeing up as much of your own time as possible to focus on those matters that really need you.
Love,
Kartik
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Regardless of the type of business you're running or even the industry that you're operating in, marketing is all about getting the right message in front of the right person at exactly the right time.
Regardless of the type of business you're running or even the industry that you're operating in, marketing is all about getting the right message in front of the right person at exactly the right time. This is especially true with regards to the real estate industry, where listings need to do everything they can to differentiate themselves from every other house available on the market in an effort to move as quickly as possible.
Once you've put in the hard work of collecting all information about the property you're trying to sell, taking stunning photographs and putting together that perfect listing, you then need to pull out all the stops to make sure that people actually see it. Therefore, if you really want to craft the perfect marketing campaign to make sure your listing moves quickly, there are a number of factors you'll want to take into consideration.
1. Take Full Advantage of the MLS
The first step you should take when marketing a new real estate listing involves using a multiple listing service, also commonly referred to as an MLS, to get the word out about your property. This is a database built by cooperating real estate brokers to provide data about homes for sale in a particular area. This lets agents see each other's listings of properties for sale, commission and agent details, all in the name of connecting buyers to sellers as efficiently as possible.
Important Note: The MLS and Zillow are not equal
Note that an MLS and a site like Zillow are NOT the same thing and should never be treated as such. That's not to say that sites like Zillow won't be effective for getting the word out about your property, because they will be. Buyers can visit Zillow on their own and see great information and pictures of homes currently for sale, all without ever leaving their computer chairs, but also direct them to use www.realtor.com. This provides access to the MLS database on a user side.
2. Get Active on Social Media - Connect with Your Audience
Another important step you'll want to take involves harnessing the full power of social media sites to your advantage. Sites like Facebook, Instagram and even Twitter don't just connect you to countless potential buyers - you can also use social media to target your efforts to specific geographic areas and even towards precise demographics to help get your message in front of as many of the RIGHT potential clients as you can. Be sure to include an overview of the property and as many of your standout photos as possible. Even if someone sees your information on Facebook and isn't ready to buy a home, they may know someone who is - thus allowing them to share the post and get people to contact you as well.
3. Send Emails to Past and Current Clients
Along the same lines, you should also send out email blasts to both current and past clients, as well as to all real estate contacts you've established. Again, you never know who is ready to buy a home and you shouldn't write anybody off at any point. By making people aware of the property, you could end up motivating someone who was "thinking of maybe moving in the next year or so" to get excited about doing so sooner rather than later.
4. Send Postcards to Your Real Estate Farm
Finally, be sure to send postcards to farm the area to drum up as much attention for the listing as possible. In real estate, farming is when you pick a particular geographic area and establish yourself as the local market authority. By bringing this new listing to everyone's attention, you'll likely increase the chances of selling it as quickly as you can. If nothing else, this is a way to stay in contact with those current and past clients to show them how active you are in their community.
So from that perspective, it's killing two birds with one stone, so to speak. You're not only selling your listing quickly, but you're further cementing yourself as the authority that people in the area can trust.
Love,
Kartik
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As a real estate agent, one of your main jobs is to help people navigate through what will undoubtedly be one of the biggest financial transactions of their life: buying a new home. But keep in mind that
As a real estate agent, one of your main jobs is to help people navigate through what will undoubtedly be one of the biggest financial transactions of their life: buying a new home. But keep in mind that you need to approach this in more than just a literal sense. Yes, the "nuts and bolts" process of buying a home is as difficult as it is time consuming, so people are going to need someone they trust (read: you) to help make sure that everything proceeds exactly as it should.
But there are a lot of agents out there who can help people BUY a house. They're also going to need your assistance in terms of FINDING that perfect house to begin with. They don't just want any old house - they want "the one" that is everything they've been searching for and then some. Therefore, in an effort to help your clients choose that home of their dreams and walk away as satisfied with the process as they'd always hoped they would be, there are a few key things you'll want to keep in mind.
Provide Objective, Constructive Insight About the Home
By far, the most critical thing you can offer your clients as they search for a new home involves objective, constructive insight whenever possible. Even if a client walks through the door and is immediately enthusiastic about the property, you still need to make sure that they're thinking clearly.
Help Them Weigh the Pros and Cons of the Home
This means helping them weigh both the pros and the cons. Consider things like the status of the property and even the age and let them know what they might expect five or even ten years down the line. No home is perfect by any means and part of being a homeowner involves dealing with unexpected issues. Use your experience to offer guidance about THIS property in particular and make sure they understand the situation from all angles.
Determine the “Wants” and “Needs” of Their Dream Home
Likewise, go through a checklist of "wants" and "needs" with your clients and see how a particular property aligns with those goals. What are the elements that a client's "absolute perfect" home MUST have? How any of those boxes does this particular property check? What are the odds that they're going to be able to find a home that meets every last qualification on their list? These are the things you need to be thinking about to help someone make the most informed decision possible.
Assess How Your Client is Feeling About the Home
Of course, there are certain questions you need to ask of yourself during this period, too. Chief among them is simply "how is the client feeling right now?" Are they excited to the point where they can't stop thinking about the property? Are they already to the point where they're thinking about furniture placement and they can see themselves building a life in this house? If they are, the chances are high that you might have helped them find "the one." If they're not, you'll likely want to continue your search, at least for awhile.
Consider the Aspect of Time
Finally, you need to consider things from the perspective of time - something there just isn't as much of as people want. How much longer can the client keep looking? What are the current market conditions, and how fast is a property like this one likely to stay on the market? Is inventory high enough where it's even possible to keep looking for a new home indefinitely? Even if someone looks at a home and doesn't consider it to be "the one," can they work with a general contractor and eventually get it to that point one day? This may be what you need to recommend if this property is likely to move fast.
While it's possible to follow all of the best practices outlined above and STILL not locate "the one," doing so will still put you in an excellent position to offer as much value to your clients as possible and help them get over the house that got away. That's not just how you help someone buy the home of their dreams - it's also how you turn them into a loyal, lifelong client who will continue to return to you for years to come.
Love,
Kartik
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The ongoing COVID-19 pandemic has changed just about every industry you can think of dramatically over the last year, but that's especially true in the world of real estate.
Gone are the days where
The ongoing COVID-19 pandemic has changed just about every industry you can think of dramatically over the last year, but that's especially true in the world of real estate.
Gone are the days where you could comfortably hold massive open houses on a Saturday or Sunday afternoon, gathering everyone together in a confined space to try to drum up as much attention as possible. Thanks to COVID-19, you'd be hard pressed to find anyone enthusiastic about drawing that many people together - to the point where some might not feel comfortable stepping into a stranger's home at all.
However, all hope is not lost. As savvy real estate professionals have shown, it is entirely possible to manage a successful listing during COVID-19. You just have to keep a few key things in mind to help people stay as safe as possible before, during and after the period in which your listing goes live.
Be Prepared and Purchase Personal Protection Products: Hand Sanitizer, Face Masks and More
At a bare minimum, real estate agents should purchase general hygiene and other personal protection products when both pulling together the information needed for a listing, as well as when showing off the home at a later date.
This means bringing along hand sanitizer with at least 60% alcohol, for example. Likewise, face masks and other coverings should be worn for all in-person activities. Experts also agree that you should bring along plastic bags for the disposal of all personal protective equipment and related items that you have brought onto a property.
Best Practices to Follow if an Inspection is Needed
When it comes to the listing appointments themselves, keep in mind that any initial listing interviews need to take place remotely for the foreseeable future. If any type of inspection needs to be done of the property to guarantee accurate pricing or to assess safety issues, you should keep all of the following best practices in mind:
Limit the number of people who will be present for the in-person listing appointment as much as possible. Generally speaking, there should be no more than three people: the agent and the two parties involved in the sale of the home, if applicable.
Anyone who lives in the home but who is not directly related to the sale should be asked to leave until the appointment has been completed. If that isn't possible, adequate social distancing rules (staying at least six feet apart at all times) should be followed.
Anyone who is going to be at the listing appointment should be prepared to complete a verbal health screening prior to it beginning.
All people at the listing appointment need to use hand sanitizer and wear face masks.
How to Hold an Open House During COVID-19
With regards to actually showing off the property to potential buyers once the listing has gone live, it is recommended that you encourage the use of virtual showings whenever possible. Yes, this is a significant change from the way things are typically done. But to look on the bright side, virtual showings could attract the attention of a wider range of potential buyers who may not have otherwise been able to see the property. This is especially true for any buyer who may be out of state but who can't travel right now for obvious reasons.
Finally, all showings must be held by appointment only and you should schedule at least 30 minutes in between showings for proper sanitization of the environment.
If possible, you may want to consider limiting potential showings to only people who have been pre-approved by a mortgage lender. Or, you could do so for people who demonstrate that they have the money and/or financing available to actually buy the property. Doing so isn't just a great way to maximize the use of your time - it can also help significantly cut down on the risk by making sure that you're only showing to people who are actually interested buyers in the first place.
Love,
Kartik
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As a real estate agent, the importance of keeping in contact with your past clients is something that simply cannot be overstated. On the one hand, if you've just put someone in a new home that they're
As a real estate agent, the importance of keeping in contact with your past clients is something that simply cannot be overstated. On the one hand, if you've just put someone in a new home that they're overwhelmingly enthusiastic about, you may be asking yourself "what's the point?"
Why Staying in Touch with Real Estate Clients is So Important
The point is, unless they've told you that they are 100% confident that this is their "forever home," they're eventually going to move again one day or even purchase income property. By staying in consistent contact with them over the years, you'll increase the chances that when that day comes, the first person they pick up the phone and call is YOU. Along the same lines, just because THEY aren't looking for a property doesn't mean they don't know someone who is - and with real estate being a word of mouth business, this is one effective way to generate as much of it as you can and a great way to create a real estate referral system.
All of this is to say that keeping your clients for life means staying in contact with them, and email campaigns for your past and current clients are an effective way to accomplish precisely that. Creating the most helpful and effective campaigns, however, requires you to keep a few key things in mind.
How Often Should You Email Your Real Estate Clients
One of the most important things to consider throughout all of this has to do less with the type of emails you're sending and more about how often you're sending them to begin with.
Running these types of email campaigns depends on consistency, but at the same time you don't want to send out messages too often or you run the risk of people tuning out. Typically, be prepared to send a few general updates once a month, or every two months, just to keep people informed as to what is going on in the community around them. This will help you stay at the top of their mind, all while continuing to establish yourself as the local market authority.
4 Email Campaigns You Should Send to Past and Current Clients
1.Reach Out to Your Real Estate Clients During the Holidays or to Celebrate Birthdays
Having said that, there are certain situations where you should break from this consistency and send out messages more frequently. Whenever the holidays come along, for example, you'll absolutely want to check in with everyone and wish them well. If you know that one of your past clients has a birthday coming up, you'll also want to reach out to them with a personal message to show them that you're still thinking of them and paying attention. Any other types of big life events (if you know a past client just welcomed a baby into the world, for example) will absolutely fall under this umbrella.
2. When the Seasons Change, Share Home Décor Tips
If you DON'T have a new listing on the market that you want to show off to people, you can still use these periodic check ins as a way to bring something of value to past clients, too. You could always send out an email message dedicated to nothing but home decor tips, for example - especially as the seasons change and people are thinking of switching up their current look.
3. Share Home Renovation Project Ideas
If you know a certain number of your past clients have been in their homes longer than five years, you could also offer insight on potential renovation projects they may want to participate in. This would have been particularly helpful if you were able to do it at the onset of the COVID-19 pandemic, as people suddenly found themselves stuck indoors with a lot of free time on their hands.
4. Send Delicious Recipes That Pair Well with the Holidays
You could even just send out messages with recipes that people might want to try when they get the chance. Did you sell a lot of homes to first time homebuyers last year? With the holidays here, you could send out a message giving them all the ins and outs of cooking the perfect holiday treats to really "break in" their new home in style.
Remember to Keep in Touch
Regardless, you'll always want to capitalize on any opportunity you have to remind people that you're out there, and these are the types of email campaigns that allow you to do precisely that.
Love,
Kartik
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To say that the stakes are high when purchasing a home is an understatement.
Not only is any new home purchase one of the turning points in most people's lives, but it also represents an enormous financial
To say that the stakes are high when purchasing a home is an understatement.
Not only is any new home purchase one of the turning points in most people's lives, but it also represents an enormous financial investment - the likes of which you may never actually make again. One of the most critical parts of this process is also, unfortunately, the one that a lot of people tend to overlook until it's too late:
The home inspection.
Why Buyers Should Never Skip a Home Inspection
Buying a home is costly, yes, to the point where you may be tempted to capitalize on any opportunity to save a little money where you can. But you shouldn't do so with regards to your home inspection. A good home inspector is worth their weight in gold and the inspection brings an array of benefits that you literally cannot afford to ignore.
Reason 1: It Protects the Buyer by Identifying Potential Safety Issues
By far, one of the biggest reasons why a home inspection is so important comes down to how it can protect the buyer before they move in. A trained home inspector can help detect issues that you won't necessarily see on a simple walk-through, ranging from radon to carbon monoxide problems to mold and more. A home inspector will also be on the lookout for any work that was done on the house without a proper permit, or in a way that wasn't up to code.
For example, this expertise can be critical in terms of the home's electrical system, which should only ever be worked on by a qualified electrician. Just because the lights work or because "the house hasn't burned down yet" doesn't mean you're out of the woods from a safety perspective.
Even if there are no major issues but you still have work that wasn't completed without the proper permits, it could impact the amount you'll pay in insurance, taxes and even your ability to re-sell the house again in the future. All of this is to say that if you needed a single reason to underline the importance of a home inspection, let it be that one.
Reason 2: It Uncovers Costly Repairs in the Future
Of course, the benefits certainly don't stop there. A home inspector can also give you valuable information about the age (and condition) of the home your Realtor might not even have. They'll be able to take a closer look at things like plumbing, your HVAC system and more - all so that you can get a better idea of how much (and when) you'll have to pay for upgrades in the future.
Reason 3: It Can Be Used as a Negotiation Tool
On that point, this can also be a particularly useful negotiating tool before the sale itself goes through. If a home inspector tells you that the heating and cooling system needs to be replaced and it'll cost an estimated $3,000, you could potentially have your real estate agent negotiate to have the seller take care of it (or, conversely, have them drop the price or credit you by that same amount to get the sale completed faster).
Reason 4: The Inspector Can Give Valuable Homeowner Advice
Your home inspector should also be able to suggest specific, actionable tips for how to maintain your home as well - which itself could save you thousands of dollars over the lifetime of your ownership.
Additional Considerations About Your Home Inspection
One thing to keep in mind, however, is that home inspectors in the state of California aren't actually licensed by the state - meaning that anyone can start their own home inspection business without any type of regulatory oversight to speak of. Therefore, you should do your research before deciding on a home inspector to go with.
In the end, a new home is one of the most important investments you'll ever make - and that investment deserves to be protected. Getting a home inspection is a great way to accomplish precisely that, all while giving you enough actionable information necessary to make smarter and more informed decisions through the purchasing process.
Love,
Kartik
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Without a doubt, real estate is primarily a sales-driven job. Regardless of how skilled a particular agent happens to be, getting objections from both buyers and sellers is a common part in the daily life
Without a doubt, real estate is primarily a sales-driven job. Regardless of how skilled a particular agent happens to be, getting objections from both buyers and sellers is a common part in the daily life of a Realtor . Sometimes they'll be completely legitimate concerns and it's part of your job to ease the client’s mind. On the other hand, on occasion there are instances where the client may be acting more out of emotion and not reason, and you'll need to figure out how to deal with those types of situations, too.
How to Handle Common Real Estate Objections
Still, HOW these objections are handled - and knowing what to say and how to say it - will no doubt lead to more sales moving forward. Therefore, if you want to get better at handling objections from both buyers and sellers, there are a few key things you'll want to keep in mind.
Take the Time to Understand Their Point of View
By far, the most important thing to keep in mind when fielding an objection from anyone is that you need to be proactive about trying to understand someone's position. Don't just think literally about what the objection is - try to go beyond the words and really get a sense of where this is actually coming from.
Buying or selling a home is a major transaction (not to mention a significant moment in someone's life), and that's naturally going to put people on edge. Likewise, some people are simply more risk adverse than others. By really trying to understand someone's position and by getting a better sense of their point of view, it can help focus on exactly what you need to say to move forward with the deal, and how to best present it moving forward.
Be Sure to Validate Their Opinions
Similarly, you'll also want to make sure that the prospect feels validated. Don't simply write off their concern as irrelevant because that's only going to put you farther away from your goal, not closer to it. Even if an objection is coming up simply because of someone's fear of change, that's okay - you can't help that someone feels the way they feel.
As an example I’m writing this six months into the Coronavirus pandemic and prior to a presidential election. Your buyer might want to wait until after the election to make a buying decision. This may or may not be a wise decision but I would dig deeper into their motivation for buying a home. Do they want to get wrapped up into a one year lease and pay a year worth of rent while they “wait it out”. Are they willing to risk interest rates increasing while they try and wrap their minds around the market? Are they willing to risk losing out on their dream home if one is available now?
The major reason why all of this is important is because your ability to handle objections to everyone's satisfaction also helps build trust, an invaluable part of the relationships you're currently navigating. Remember that trusting someone isn't as simple as turning on a light switch - it ultimately takes time and care to build.
Build Trust by Actively Listening
By showing buyers and sellers that you're really listening to them and that you're paying attention to what they have to say, you're naturally in a better position to use trust to overcome the objection. Because at that point, they'll be able to see that you care about their success and that you clearly have their best interest in mind. Most of the time, that's all someone is looking for in the first place and sometimes objections happen when that sense of trust just isn't there yet.
As Always, Remain Positive
Whenever objections come up, try to remind both buyers and sellers of the positive side of what is going on. With rare exception, those positives will far outweigh the negatives and if you can just get them to say focused on those qualities that really matter, the situation will undoubtedly resolve itself and you'll be able to move forward in no-time.
Love,
Kartik
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One of the most important elements of the real estate process is also, for many people, among the most misunderstood: escrow.
At its core, escrow is simply a legal arrangement in which a third party
One of the most important elements of the real estate process is also, for many people, among the most misunderstood: escrow.
At its core, escrow is simply a legal arrangement in which a third party (typically referred to as an escrow company) temporarily holds a large sum of money or a piece of property until a particular condition has been met.
In other words, if you're about to buy a brand-new home, an escrow company might hold onto some funds until the transaction has been finalized. At that point, the money would move into the hands of the seller and the title into the hands of the buyer and everything would close exactly as it should.
Why Escrow Matters and When Is It Used?
Depending on the transaction, escrow will be used for one of two different reasons. For starters, it's a way to protect the buyer's good faith deposit (also commonly referred to as earnest money) so that the money is guaranteed to go to the seller according to the conditions that have already been laid out for the sale.
Secondly, escrow companies hold onto a homeowner's funds for the purposes of taxes and insurance for a lender and borrower - thus making sure that they actually get paid and that nothing holds up the completion of the transaction for any of the other parties.
Special note: Escrow accounts don't cover ALL of the expenses related to one's impending homeownership. Things like homeowner's association fees, or money needed to pay current utility bills, would not be covered by escrow accounts.
The key thing to understand here is that earnest money is designed to show a seller that a buyer is serious about making a sale. If the contract falls through due to anything having to do with the buyer, like if they suddenly decide to back out at the 11th hour, the seller is supposed to be able to keep that money. If no third-party escrow company was present, it's feared that buyers would try to keep funds that are no longer rightfully theirs.
Likewise, the reverse is true. If the home purchase goes through successfully, that earnest money is supposed to be applied to the buyer's down payment. If that money were just handed over to the seller ahead of time, there is a fear that they might try to find some excuse to keep it.Obviously, this is problematic because of the sheer sum of money that you might be talking about.
Additional Situations When Escrow is Critical to a Real Estate Transaction
Another related concept it's important to understand has to do with what is called an escrow holdback - or a situation where funds are held in escrow beyond the completion of a transaction.
One of the most common reasons why this might happen has to do with a buyer who may find something problematic with the home during a final walk through and home inspection . The seller may agree to fix the issue,but it will take a week or two - thus triggering the hold back and the funds to be held in escrow.
Another situation that may require a holdback is when a buyer agrees that the seller can stay in a home for a longer period of time beyond the closing date. This, too, is quite common as sometimes sellers need additional time to get their new home ready.
Likewise,if you're a buyer in the process of actually building a new home from the ground up, that money will likely remain in escrow not until the completion of the transaction, but until you've had a chance to sign off on all the work.
Remember, Escrow Companies Are There for Your Protection
Regardless, escrow (and by association, escrow companies) are essential in that they protect the best interests of ALL parties involved in a real estate transaction. They are seen as objective third parties with a tremendous amount of responsibility and they're often one of the major reasons why transactions are completed successfully at all.
Love,
Kartik
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In a lot of ways, the real estate industry is unique in that there are so many moving parts at play. Every property is different, and the same can be said for every buyer and seller. But the one common
In a lot of ways, the real estate industry is unique in that there are so many moving parts at play. Every property is different, and the same can be said for every buyer and seller. But the one common thread that runs through it all is that there is often a passionate industry professional involved.
What kind of personality does best in real estate?
But of course, this begs the question - exactly what makes for a good real estate agent anyway? What personality traits are required to move from real estate agent to “successful" real estate agent as quickly as possible? The answers to those questions are largely straightforward - they simply require you to keep a few key things in mind.
1. Having a Problem Solver Mindset
By far, one of the most important personality traits to have as a real estate agent involves a true problem solver mindset.
Every transaction you're a part of will have several "moving parts," and sometimes things can go unpredictably. You'll be asked to come up with creative solutions to interesting problems and issues on a daily basis. Likewise, something as simple as showing a home can be a challenge as every property is truly unique in and of itself. None of this is a problem at all if you're the type of person who genuinely loves coming up with solutions to these and other types of issues.
What happens if you are on the listing side of a transaction and the buyer completes their home inspection and asks for a laundry list of repairs? How are you going to handle this and keep your deal together? How will you deal with a difficult client? What happens if you are in a divorce transaction and suddenly one spouse no longer wishes to sell the home after you’ve spent 30 days heavily marketing it? You can see that the ability to think on your feet and problem solve is paramount.
2. Being an Ambitious Self-Starter
Likewise, the importance of being a self-starter is hard to overstate. Even if you're working in a firm with a lot of other agents, you're still the "master of your own domain," so to speak. You'll largely set your own hours and you'll need to be a driven, self-motivated person if you're going to make it work.
3. Tenacity
This relates to another one of the most important personality traits to have as a real estate agent - the type of tenacity that will serve you well all throughout your career. In addition to a great work ethic, you need to understand that leads in real estate aren't just going to generate themselves. You'll have to market your clients' properties - sometimes in aggressive ways - in order to attract as much attention as possible from qualified individuals.
There ARE buyers out there for every property, just like there is a home out there for every home buyer. It's just that they aren't going to suddenly land in your lap - you're going to have to go out and find them and some days that will be easier than others.
4. Be Engaging and Having a Winning Attitude
Finally, a critical personality trait that all successful real estate agents share is that they have an engaging and winning personality. A big part of your success as a real estate agent involves marketing yourself every bit as successfully as you market those properties. Being personable, acting with integrity and having confidence as an agent are significant pieces of the puzzle.
In the end it's important to note that despite all of the above, it's absolutely true that any personality will do well in the real estate industry provided that you know exactly what to expect. It's certainly not a profession for people who cherish the ability to work a standard "nine to five" job. It also may not be the best fit for someone who likes a rigid, predictable structure in terms of their professional life.
While the above traits are certainly helpful, they are not a requirement to succeed as a real estate agent. Provided that you have a deep passion for what you do and relish the opportunity to help people in your area find the types of homes they've always dreamed of, you will absolutely be able to succeed and make a real career out of it.
Love,
Kartik
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While this topic might be a little more advanced, especially if you are just starting real estate school online, it’s an important topic, nonetheless. Generally speaking, the way the real estate industry
While this topic might be a little more advanced, especially if you are just starting real estate school online, it’s an important topic, nonetheless. Generally speaking, the way the real estate industry typically works goes a little something like this:
A real estate agent works for a broker (think any company like Century 21, Coldwell Banker, etc.) and together, they combine their resources to help sell a home. More often than not, the company keeps some percentage of the overall commission fees that are paid out after the transaction in question has closed. As a direct result of their hard work and dedication, the real estate agent gets to keep some percentage of that commission. This process repeats itself, again and again, as each home is sold.
Over time, the real estate agent will sell more and more homes. Sometimes the average value of the homes they are selling increases. Sometimes their frequency increases. Regardless - this person continues to build experience and generate business for the broker and, as a result, the amount of money they get to keep should increase, too.
However, this doesn't necessarily happen automatically.
Typically, there will come a time when a real estate agent actually has to go into the broker’s office and negotiate to keep a higher percentage of the commission - something that can be particularly scary if you haven't been in the real estate industry for very long. But thankfully, the process itself is quite straightforward - provided that you're able to keep a few key things in mind along the way.
Most companies are going to have a published schedule wherein the commission splits are very transparent but what if you want to move up quicker? What if you have a huge deal you are working on and want a special arrangement on that transaction?
3 Negotiation Steps to Getting a Higher Commission Split
1. Analyze your Progress
What may be the most important thing to understand about this process is that before you even think about walking into the boss' office and asking for what amounts to a salary increase, you need to do your due diligence.
Decide on a period of time and pour over the data about each transaction to essentially track the trajectory of your career. Use cold, hard numbers to show not only how you've improved in your position, but how the value that you've been able to bring to the broker has increased, too. Maybe you've been selling more homes than you were when you first started. Maybe the average transaction price has increased exponentially. Maybe it's both at the same time.
Regardless, at a large company your broker might not “just know this” and they might not take your word for it. You need to be able to clearly illustrate the value that you're currently bringing to the operation and why that value is worth a higher commission split. You're not going to be able to get to that point without preparation, so this process begins here.
2. Do your Research
Likewise, you need to make sure that you're well aware of what commission split plans are in place to see exactly what you qualify for to begin with. Not only is this a great way to enter into the conversation armed with as much information as possible, but it's also a way to proceed without seeming too demanding as well.
So instead of going into someone's office and saying "I want X," start a conversation about your current split and why you have earned more. See which ones you qualify for and ask if there is one that will promote your growth within the company faster than the one you're currently on.
3. Review your Goals
Finally, you always want to make sure you know where you're headed before asking for your next commission split increase. Essentially, you need to know what your goals are for your career in the next five years to determine what you should be asking for to begin with.
If you know what the next "level" is and what you need to do to achieve it, suddenly something that was once overwhelming doesn't seem so insurmountable anymore. You've broken the process down into a series of smaller and more manageable steps, which will absolutely help you stay motivated at the same time.
If you can find time to do this between managing your client expectations and meeting your broker’s, you can be sure that you’re on the right track to taking your career to the next level.
Love,
Kartik
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An interesting thing about the real estate industry is that there are far more people involved in the sale of a home than a lot of people realize. Of course, there is a buyer, a seller and their respective
An interesting thing about the real estate industry is that there are far more people involved in the sale of a home than a lot of people realize. Of course, there is a buyer, a seller and their respective licensed real estate agents - that much is obvious. Sometimes, the roles are clear - nobody questions what an appraiser does, because the job description is explanation enough.
But one of the most often overlooked positions in real estate is also, in a lot of situations, among the most important. The role is that of the transaction coordinator, and in a lot of ways their specific job may very well be one of the most important of all.
What is a Real Estate Transaction Coordinator?
While a transaction coordinator is not a legal requirement in a real estate transaction, as the name suggests, a transaction coordinator is a real estate professional tasked with managing all of the paperwork and deadlines involved in a real estate transaction. If you've ever purchased a home and felt overwhelmed about the sheer volume of paperwork you're expected to read and sign, just think about how the person who had to prepare all that paperwork must feel.
Why are Transaction Coordinators Important to the Home Selling Process?
The reason why this role is so important is because a good transaction coordinator is trained in every step of the sales process. A big part of their job involves monitoring the life of the transaction, from the moment a seller and buyer enter into contract all the way through the steps required to properly close.
What Does a Transaction Coordinator Do?
Just a few of the jobs they have to perform on a regular basis include but are not limited to ones like:
Opening escrow
Coordinating inspections
Overseeing repair negotiations
Communicating important updates to clients
Monitoring all documentation that is submitted
Coordinating the closing process and more.
In a larger sense, this is the person who is making sure that the wheels don't fall off the car, so to speak. It's their job to both make sure that an agent never gets bogged down by administrative tasks so that they can always focus on the client, as well as to make sure that nothing falls through the cracks and everything gets done properly and on-time based on the purchase agreement.
Transaction Coordinators Help Simplify a Complex Process
Overall, they're in charge of making sure that no unnecessary delays happen during this admittedly complicated process, all in service of the most important goal of all: closing a transaction and helping to create the most positive experiences for clients, no exceptions.
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If you had to make a list of some of the most important traits that any successful real estate professional should have, confidence would undoubtedly be right at the top. In a lot of ways, being a real
If you had to make a list of some of the most important traits that any successful real estate professional should have, confidence would undoubtedly be right at the top. In a lot of ways, being a real estate agent involves selling yourself every bit as much as you sell those properties in your area. There are so many real estate professionals in your area - people don't just need to know that you can get the job done. In a matter of moments, you need to be able to convince someone that nobody does what you do quite like how you do it, and why that will be such an advantage to them in the weeks and months ahead.
Without confidence in yourself and your abilities, that won't just be difficult - it'll be impossible.
But at the same time, a lot of people often come into the real estate business as a second or even a third career - making it a scary prospect for a lot of them. After all, there is no base salary. There are no health benefits. Most agents are independent contractors and, as stated, the competition is fierce.
If you truly want to separate yourself from the pack, increasing your confidence is how you do it - and this is something you can accomplish in a wide range of ways, all of which are worth exploring.
3 Ways to Build Your Confidence as a new Real Estate Agent
1. Find a Real Estate Mentor to “Show You the Ropes”
By far, one of the best opportunities you have to build confidence in your abilities as a real estate agent involves finding a mentor who can "show you the ropes," so to speak. They'll do more than just help build your skills and knowledge – real estate mentors also teach you how to better yourself in a way that you'd be hard-pressed to replicate on your own.
If you work day in and day out with someone who is a proven success, you'll be able to see first-hand what works and what doesn't. You'll see everything that goes into each victory and how they deal with each failure. It's a process that takes years but it's also one that is more than worth it.
2. Be Patient – Give Yourself Time to Learn and Gain Experience
Another one of the best ways to be more confident as a real estate professional involves giving yourself permission to be patient with your abilities. You're not going to come right out of the gate and be an overwhelming success in your field. You're probably not going to sell your first house immediately after you stage it. You will make mistakes and some days will be more difficult than others.
All of this is more than okay, because each part of it is a big factor in determining your career trajectory.
There's an old saying that tells us it takes a long time to become an "overnight success" - whoever coined that phrase was talking about real estate whether they realized it or not. In other words, try not to be too hard on yourself and just be patient. Slowly but surely, your confidence will build as a result.
3. Master Your Craft by Continuously Learning
Finally, you need to understand that continuing education and a willingness to keep learning and keep improving is one of the core components of a confident real estate professional. Anyone who tells you they've "done enough" to develop their career or they've "learned all they can" about the industry or their local real estate markets is someone who lost a game they never truly understood in the first place. Any confidence they have is unearned at best.
You should always look for new opportunities to improve your abilities. You should always capitalize on a chance to hone your skills, or develop a new trait. Your willingness to grow and learn will always impact your ability to do both. Once you acknowledge that, you'll see each incremental growth step - regardless of how small - as a victory in and of itself. Truly, the confidence that comes with that alone is more than worth the effort for most people and it certainly will be for you, too.
Love,
Kartik
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According to one recent study all of the popular social media networks combined have nearly 3.725 billion active users between them. To put that into context, this represents the vast majority of the 4.54
According to one recent study all of the popular social media networks combined have nearly 3.725 billion active users between them. To put that into context, this represents the vast majority of the 4.54 billion Internet users worldwide - and a pretty significant percentage of the 7.8 billion people on our planet.
Whether you're attempting to reach the largest audience possible as a Realtor or want to attract the attention of a small, niche and decidedly local market, social media can help you do all of this and more. But it's important to understand that you need a genuine strategy at the heart of your efforts - something to not only help make sure you're moving in the right direction, but that is also custom built to help you accomplish your specific goals (regardless of what they happen to be).
Therefore, if you truly want to succeed on social media sites like Facebook, Instagram and Twitter as a Realtor in the modern era, there are a number of best practices you'll want to keep in mind.
It All Begins and Ends With Value
By far, one of the most important opportunities that you have to leverage social media to your advantage as a Realtor involves communicating the raw value you're able to bring to the table as clearly and as concisely as possible.
Really, this is a best practice that you should be following across all of your marketing endeavors - not just social media, but it will certainly help. Generally speaking, everyone you're going to be communicating with probably already knows what a Realtor does in a large, over-arching sense. They don't need you to provide them with an overview of your job description.
This means you shouldn't be afraid to dive deep into the parts of your job that a lot of people don't think about - like how you're an expert in the ever-changing conditions of your local market. Showcase your knowledge of the average time on the market for homes in your area and provide insight into what it means to be a buyer's market versus a seller's market.
Ask yourself what you would want to see if you followed a local Realtor.
The answers to this question will guide every piece of content you create - not only for social media sites like Facebook and LinkedIn, but all across your marketing strategy. Always place the emphasis on the people you're trying to reach instead of yourself.
You Have to Play the Numbers Game
Another important thing you need to be aware of in terms of leveraging social media as a Realtor involves the fact that you should NOT be shy to send direct messages on sites like Instagram, Facebook, LinkedIn or even Twitter. If there's a particular niche that you serve, always go out of your way to reach out and make direct contact with someone to see if you can begin a conversation online and continue it in "real life."
Now, the critical thing to understand about this is that you should NOT expect every single person that you message to write you back. They may never see your message at all - or they may leave you on "read" and never respond.
This is perfectly okay... so long as you're aware that it's an inevitability and that you do NOT take it personally. Just keep reaching out to the people in your target audience in a concise, consistent manner.
But if you send messages to 100 people, maybe 20 will respond. Good news - now you have 20 opportunities to convert prospects into genuine leads that you didn't have before you started.
Always, Always, ALWAYS Research Someone First
But while reaching out to people via direct messages is always recommended, it's definitely not something you should do blindly. Luckily, you already have a resource that will tell you just about everything you need to know about someone:
Their social media profile.
Before you send any type of message, make sure that you take a long, hard look at their account for five or ten minutes. This is critical because if someone just posted a picture 20 minutes ago about how their cat passed away earlier in the day, they're definitely not going to be receptive to a hard sales pitch. At best, you're wasting your time and you'll never hear a response from that person. At worst, you'll inadvertently cause such a negative experience that they'll tell their friends and family members about you and at that point, every one of those people is cut off from you permanently.
Personalize, Personalize, Personalize
Speaking of personalization, one of the biggest mistakes that you can make in terms of establishing your social media presence as a Realtor involves simply copying and pasting messages from person to person.
There's no faster way to get someone to hit that "Delete" button than to open a message with "Dear Sir/Madame."
These days, people don't want to be "sold to" any longer. They simply don't have the time or the patience for it, considering that they're being bombarded by marketing messages nearly every minute of the day. They get ads in their email inboxes. They get ads on the websites they visit. There are already paid ads on social media. People have started to tune them out - they're little more than "white noise" at this point.
The Power of Visual Communication
For example, don't be afraid to send pictures through direct messages of houses or buildings that you or your company has recently sold. Sure, you could go into detail about the transaction and what the property has to offer - but you won't be able to make the same type of immediate impact that a picture can with text alone.
Overall, this visual approach helps you accomplish a number of things, all of which are critical to your social media success. For starters, images again are just naturally more engaging than text alone and if there's one thing you need as a Realtor on social media, it's engagement.
But secondly, images are a great way to show off that you or your company (in the case of new agents) are very active in your community and the area you've dedicated yourself to serving. If people can see all of the real estate transactions you've been a part of, it again starts to establish you as someone worth paying attention to. This in turn generates an enormous amount of social proof as people start to share those images, thus exposing even more potential clients to your brand.
Whether you are just starting out in our great real estate business or you are a veteran Realtor it doesn’t hurt to lean into social media as far as possible and cultivate new relationships.
Love,
Kartik
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The truth is that any marketing can work it’s just a matter of how effective it is. As it relates to direct mail, it’s hard to envision a world where the volume of mail is dropped to absolute zero.
The truth is that any marketing can work it’s just a matter of how effective it is. As it relates to direct mail, it’s hard to envision a world where the volume of mail is dropped to absolute zero. As a consequence, direct mail marketing should be here for a good while.
The question really comes down to what are some best practices to succeed in making connections that start at the mailbox.
1. Test the Market
It may take a few tries to get your target market down. But don’t give up — once you figure out what works, it will be so much easier to continue. Every real estate market has different types of clients, different price points and potential clients with varying needs. Consider creative approaches like sending direct mailers to those living in apartment complexes to convert them to buyers. Consider sending mailers to a down market on an up market listing and aim for two transactions from one mailer.
As an example, let’s say you have a $900,000 listing. Consider sending information on that $900,000 listing to a $650,000 neighborhood encouraging them to sell their smaller house and upgrade to a larger one.
To this end, A/B testing is absolutely critical. Keep track of what you are sending and to who you are sending it and note the response rates. Pour resources into it.
You never know who is thinking about buying real estate and if they see your marketing materials, you’re going to get the call.
2. Point Your Direct Mail To Your Web Presence
The world of print should always point to easy-to-find information about how to contact you on social media or online. People want to see that their potential agent is relevant online and has a web presence. By checking you out online, potential clients get a feel for whether you're a good fit. If they find you easily accessible and active, they’re likely to refer you to friends after you work together — or even call you again if they make another big decision!
Consider linking all your social media channels on your postcard or letter to make it easy for leads to connect with you. Folks tend to lose interest if they have to search high and low to find you.
3. Be Personal
Ever get mail that just reads “current resident” with your address? How impersonal does that feel? Include the person’s name, because a personal detail goes a very long way. If this person gets two mailers, the one that has their name will likely stick around awhile — at least longer than the one they received that could have gone to anybody.
Most title companies will pass this information to you in the .csv file for your farm mailers.
4. Speak Highly of Yourself
Include ratings, success stories or testimonials if possible. You could even center your whole campaign around a few happy customers in your target market. Hesitancy will decrease significantly if someone sees that other people have been happy with a service.
5. Make It a Keeper
When considering USPS mail, consider adding features that will make your information less likely to go in the trash. As it relates to real estate, this means market data that is hyper local and relevant to the area you are mailing to is less likely to be thrown away.
6. Focus on Cohesive Horizontal Design
Picture your client walking up the steps from their mailbox, likely at the end of the day, fumbling with groceries, keys or even more. Most of their mail, envelopes, postcards and menus will have a horizontal orientation. Don’t be an outlier, or you’ll likely get tossed. Design your mailer to be cohesive and not intrusive. Make sure they don’t have to turn it every which way to get your message. Make it easy for them.
Direct mail is a great way to get exposure. It’s often less expensive than billboards or other advertising methods and it can be passed around and seen by many sets of eyes. Figure out what works for you, and you'll see success.
Whatever the marketing channel, remember that consistency always beats out creativity so just keep going!
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In any real estate transaction, there are closing costs that are to be paid by both the buyer and the seller, and it's important to remember that these can vary from state to state and transaction to transaction.
In any real estate transaction, there are closing costs that are to be paid by both the buyer and the seller, and it's important to remember that these can vary from state to state and transaction to transaction.
I wanted to give you a quick run down from both a buyer and a seller perspective for California.
Typical Closing Costs Paid by the Seller
Let’s start with closing costs that are typically paid by the seller. A back of the envelope estimate would reveal that it would cost most sellers between 6 and 8 percent of the sales price to sell their home. The majority of the this is going to be wrapped up in real estate commissions as the seller generally pays between 4 and 6 percent of the sales price to sell it. The other 1 to 3 percent may be in other closing costs like back property taxes that are owed by the seller that will have to be paid at the close of escrow.
Even if the property taxes are not delinquent, these taxes are a seller responsibility until the escrow closes. For example, if the transaction were to close on April 10th, the property taxes up until April 10th would the responsibility of the seller. Anything after that date would be passed to the buyer side of the closing. Sellers will also have to pay their share of escrow fees and any back homeowner association dues until the date that the escrow closes.
The seller will also pay for any repairs that the buyer successfully negotiates during the escrow process. A home inspection, for example, might reveal that a roof is leaking and instead of the seller fixing the roof, the buyer may ask for a $7,000 credit to fix the roof in lieu of the actual repair. This would be deducted from the seller's proceeds at the close of escrow.
The industry standard in California is also that the seller will pay for a title insurance policy protecting the buyer.
Common Closing Costs Paid by the Buyer
As it relates to the buyer, a quick estimate of their costs would reveal a range between 1-3 percent of the sales price, with most of this is going to go to fees charged by the lender.
A lender may charge a fee, known as a point that is equal to one percent of the loan amount. The point could be categorized as either a discount point or an origination point. The difference between the two is that a discount point is a point paid to the lender to lower the interest rate on the loan. An origination point, on the other hand, is a fee that is paid to the lender to compensate them for actually doing the loan.
Generally, buyers will also pay the lender a credit report fee and are also responsible for their share of prorated property taxes. Generally, buyers will also pay for a title insurance policy covering the lender. This is different than the owner's title insurance policy that I described above that the seller paid for to protect the buyer.
What this means is that there’s two policies of title insurance in connection with a real estate transaction on which there is a loan. First, there is an owner’s policy to protect the buyer as well as a lender policy covering the lender. Buyers will also pay for their share of any escrow fees which are negotiable in California.
Speaking of escrow fees, it’s important to note that there’s usually a base escrow fee of between $200 and $400 and then the escrow fees themselves are often $2-$3 per thousand per side. Larger real estate transactions of several million dollars might have a lower per thousand escrow fee. It's also helpful to remember that many of these fees are negotiable. Certainly real estate commissions are negotiable but an often overlooked point is escrow fees can also be negotiated with the escrow holder.
How to Calculate Closing Costs – A Simple Example
As an example on a $600,000 purchase the base escrow fee might be:
$300
+
$2/$1,000 = 600 x $2 = $1,200
$1,200 + $300 base fee = $1,500 for each side of the deal.
Buyers also generally pay for an appraisal on the property as required by their lender and a home inspection and other inspections as part of their due diligence.
Before you get your real estate license in California, it's important to familiarize yourself at some level with the typical closing costs, so you can properly inform your client. Often, real estate agents will produce something called a net sheet which estimates the costs to complete a transaction. Your broker should train you on how to properly fill these out so you can demonstrate that you're as informed as possible.
Love,
Kartik
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Generally speaking, it's common knowledge that real estate agents are required to be licensed in the state in which they practice. This is more than just a simple formality, of course. Taking the real
Generally speaking, it's common knowledge that real estate agents are required to be licensed in the state in which they practice. This is more than just a simple formality, of course. Taking the real estate classes and becoming a licensed agent proves that you've gone through the training and education necessary to do the job. It's also an example of your commitment to follow the industry ethics and standards of your specific state when it comes to marketing, sales, negotiations and the completion of transactions.
But more than that, a real estate license is also proof of your dedication to all of these ideas in the eyes of your potential clients - thus allowing them to move into a deeper and longer-lasting relationship with you with as much peace-of-mind as possible.
As you progress in your career you may have to hire an assistant one day who might not be licensed to help you manage some of the day-to-day aspects of your operation. Because of this, questions often arise as to exactly what these assistants can or cannot do. Are they a real estate agent in everything but the name? Are their duties limited in some other type of way, especially in the eyes of the law?
Luckily, the California Department of Real Estate has issued a set of guidelines specifically for these unlicensed assistants who work in the real estate industry, shedding insight into exactly what is expected of them and, more importantly, what isn't. It's an invaluable resource for anyone involved in a real estate transaction and understanding it requires you to keep a few key things in mind.
What Unlicensed Assistants CAN Do in California: An Overview
In the state of California, unlicensed assistants are definitely allowed to assist in the performance of cold contacting potential prospects. Indeed, this is a large part of the reason why real estate agents may seek out their help in the first place.
This includes not only making telephone calls, but also using electronic communication like emails or social media sites like Facebook and Twitter to try to generate as much interest in the services of the real estate agent as possible. The unlicensed agent can answer questions about what types of services that the agent can provide, and they can even schedule an appointment so that all parties can meet.
It's important to note, however, that this type of canvassing can ONLY be used to develop general information about the person being called. An unlicensed agent can call to determine whether or not someone would be interested in the services of the real estate agent, for example. They can NOT try to induce the person to use the agent's services in any way.
Another way that unlicensed agents often prove invaluable ultimately comes down to the role they play in open houses. Unlicensed assistants are absolutely allowed to place signs in public areas throughout the neighborhood, for example, and can provide factual information about the house in question either verbally or through pre-printed materials. They can greet the general public when they walk through the door and can even schedule times for further appointments. All of this can again save the agent an incredible amount of time, thus allowing them to devote more of their attention on those tasks that truly need them. They have to do all of this with the express consent of the owner however - they can't just decide to do it on their own.
The Administrative Roles of the Unlicensed Assistant
Unlicensed assistants are also allowed to help their agent in other ways, too, particularly when it comes to a lot of those "back office" duties that are important but that also require a tremendous amount of time.
In the state of California, an unlicensed assistant can:
Make, conduct and even prepare a comparative market analysis for a particular property. It's just that only the licensed real estate agent can actually use it when conducting business, and they have to approve everything contained within the document first.
Unlicensed assistants can let a prospective buyer into a property to inspect some or all of it, so long as this activity is necessary for the preparing of a report regarding future repairs that will be made. So an unlicensed agent can give a home inspector access to a property prior to a sale, for example. It's just that they cannot provide them with any supplementary information to actually complete that report - that will need to come from the agent directly.
Unlicensed assistants are not only allowed to prepare advertising relating to a transaction for their employer - they can actually have input on the design elements of those materials, too. Once again, the agent with the license will need to approve everything before it is published and made available to the general public.
Unlicensed assistants are also allowed to both prepare and complete documents before and during a transaction, so long as they do so under the supervision (and at the direction) of the licensee.
Unlicensed assistants can also mail, deliver and pick up documents relating to a transaction - including obtaining signatures. While they are doing this, however, they are not allowed to discuss the content or relevance of those documents. An unlicensed agent can bring something to a client's house to have them sign it, but the conversation isn't allowed to get any more detailed than that.
On the subject of documents, it should be noted that the guidelines state that unlicensed assistants are also able to thoroughly review the types of materials commonly coming into and going out of a real estate brokerage - so long as their employer has specifically directed them to do so. Overall, they can review documents for completeness or compliance, for example.
Finally, unlicensed real estate agents are allowed to not only accept but also account for and provide a receipt for any trust funds received from a client or other party to a transaction. Of course, this means they can also communicate with those same individuals in connection with the transaction about topics like when reports or other information will be delivered.
In the end, it's important to think of an unlicensed real estate assistant in the state of California as exactly what they are: an assistant in nearly every sense of the term. Under Section 10131 of the California Business and Professions Code, the state government has made it very clear which activities actually require a real estate broker license to execute. Nothing in these guidelines supersedes them in any way, shape or form.
But that's okay, because an unlicensed assistant isn't supposed to replace the need for a real estate agent at all. Instead, it's supposed to support and empower them - helping to relieve as many of the administrative tasks from their plate as possible so that they can focus their attention on actually running their business and executing real estate transactions.
To that end, an unlicensed assistant in the real estate industry really might be thought of as a paralegal in the legal profession. Paralegals are usually employed by lawyers to devote their attention to specialty tasks like case planning, development, management and others. They research legal topics and provide support for any tasks that don't require a law degree. They're not a replacement for an attorney, but then again they were never designed to be and that's not what is expected of them. An unlicensed real estate agent really does operate in much the same way, albeit via an entirely different field.
Finally, it’s important to remember that the rules can change on what the state allows an unlicensed assistant to do so it’s important to check your state’s rules periodically to ensure that you are following the rules.
These guidelines are intended to help not only real estate agents but also the members of the public that they've dedicated themselves to serving - which is ultimately the most important goal of all.
If you are unlicensed and would like to obtain your real estate license visit our website for more information or take one of our free classes
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In the real estate world, building an effective real estate team is a growing trend. Rather than working independently, real estate professionals, and even our real estate students are starting to plan
In the real estate world, building an effective real estate team is a growing trend. Rather than working independently, real estate professionals, and even our real estate students are starting to plan ways to build teams of agents that work with them to make their business run.
These teams have one leader normally known as a “rainmaker”, then a number of support staff underneath who make things happen.
If you are considering the team approach to real estate, getting a team off the ground can be your biggest hurdle. Here are some tips for starting and growing an effective real estate team that will fuel your success.
Step 1 – Self-Evaluation
The first step in building a real estate team is your own personal self-evaluation as the potential team's future leader. What are your strengths and weaknesses? By pinpointing these, you can start building a team that will support your weaknesses and build on your strengths.
Next, consider what you need out of your real estate team. Do you need more buyer agents so you can list more properties? Are you looking for a Transaction Coordinator to help you with the paperwork on your files? Do you need help with your marketing and advertising copy? The answers to these questions will help guide you as you build out your organization.
Finally, prepare your systems. Before connecting with people for your real estate team, make sure you have a foundationally successful real estate business and know how to generate leads. One of the biggest things that potential recruits will want to know is whether or not you have a system in place to bring in leads for them to handle. Once you have a system in place, people will be more willing to buy into your vision.
Step 2 –Choose Your Professionals
Next, choose the professionals you need on your team. Your needs will vary depending on your goals and your skills and weaknesses. It will also vary depending on the structure of your team, whether you are looking to manage a team of sales professionals to support your efforts as an agent or are looking to lead a team of agents.
Some common pieces to a well oiled real estate team include:
Buyers agents
Contractors
Appraisers
Attorney
Accountant
Inspectors
Copywriter
Marketer
Make your list, and start looking for qualified individuals to fill those positions.
Note that lots of these folks don’t necessarily need to be full-time and on your direct payroll. Starting out as a new agent, you’ll want to build out a list of vendors that you know and trust to do the job right for your client.
Step 3 – Start Hiring
Now you are ready to start looking for qualified people and bringing them on to your team. Be careful about the professionals you hire. Make sure they are ready to work in a team environment and have the skills you need.The first person to bring on board as you build your team might be a virtual assistant or transaction coordinator. Your virtual assistant will manage email and office work so you can focus on the client facing aspects of your business. Your TC should ensure that your files are compliant and that all parties are receiving and signing paperwork in a timely way.
The nice thing about building out the administrative functions of your team first is that the virtual assistant can often be turned on and off as needed and the TC can be paid on an a per-file basis.
Make sure you're finding people who are a good fit for your team. One way to determine this is through personality testing. Personality testing will tell you if the person you're interviewing is a good fit for a sales-based business. Look for positive people with a passion for real estate to add to your team.
The personality testing can be critical in preventing turnover of your team. The innate personality of a buyer agent will be vastly different than someone in a dedicated administrative role.
Step 4 – Delegate, but Stay Involved
Once you have a team working well under you, start delegating responsibilities. However, make sure you stay actively involved. This is not the time to walk away from your real estate business. Instead, it's a time to jump in and lead by example. If you've hired well, you should be able to delegate responsibilities with confidence, while still taking an active role in the day-to-day operations of your real estate business.
Step 5 – Keep Recruiting
Even after your initial team is set, continue recruiting quality talent, especially talented agents. If you have proven sales systems in place with active lead generation they will be attracted to your team. Once you have them, make sure you have the right incentives to keep them invested in your team. Retention is just as important as recruiting, and you'll only retain quality people if your team provides them something of value.
Remember it is far more expensive to hire a new person than to retain an existing one.
Step 6 – Focus on Lead Generation
So what could you bring to the table that would make qualified real estate agents want to be part of your team? For many real estate teams, the answer is qualified leads. Finding a source for leads and then offering those leads to the professionals you bring on to your team is a key factor to the success of any real estate team. Your source may be direct-mail campaigns, social media postings, or other online marketing, but find a lead generator and use it well.
Step 7 – Take Care of Clients
Make sure you have a system for your team that keeps clients comfortable while they list with you. You may delegate this to one particular agent or team member, or you may have a proven system in place that each agent follows with their delegated clients. Keeping clients satisfied throughout the sales process will make your team more effective and help with your team member retention.
Step 8 – Keep Refining Your Processes
As you get the freedom to step away from the direct sales of your business, use your new time to refine your sales process for your team. Constantly evaluate what is and isn’t working and make changes and adjustments accordingly. Check with your team members regularly to ensure they are using the systems you have put in place to run their part of the business. Keep lines of communication open to ensure everyone knows what their responsibilities are and what they can expect from you.
Step 9 – Add Training as You Continue Building
After you start your team and get it moving along successfully, you may wish to grow it. Before on-boarding new licensed real estate agents or other real estate professionals, make sure you have solid training in place. Teach your new recruits what you expect and how your business operates, so they can come on board as solid, productive team members. Soon, your process will replicate itself as your team, and your income, continue to grow.
Real estate teams should allow you to make more sales and close more deals than you can do on your own. With these tips, you can build a successful team, retain the talent you recruit, and see your income continue to increase year after year.
Love,
Kartik
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People considering signing up for real estate classes commonly ask the question “Can I do commercial real estate once I get my real estate license?” The answer to this may vary depending on your state.
People considering signing up for real estate classes commonly ask the question “Can I do commercial real estate once I get my real estate license?” The answer to this may vary depending on your state. In the case of California, our Department of Real Estate makes no distinction with regard to licensing commercial or residential real estate agents. The same license to sell a house would be the same license to sell a large building .
While this is encouraging for the new licensee considering beginning a new career, it’s important to understand that there are different specialities as it relates to the world of commercial real estate.
The five commercial real estate disciplines are office, retail, industrial, multifamily and raw land sales. With the exception of land, each of these areas have a couple of different ways to make money: Leasing and sales.
While real estate commissions are negotiable in California, the typical percentage earned is 3-6 percent of the transaction value regardless of whether you are leasing or selling the underlying real estate. As an example - Let's start with a commercial lease.
Imagine you are a commercial leasing agent and you have a dentist looking for 3,000 square feet of space in Los Angeles, and the rent is set at $3 per foot. She is likely going to be signing a lease for a five year term or 60 months. 60 months x $9,000 per month is a $540,000 lease value. This doesn't take into account annual rent increases that you'll likely be paid on also. Generally, representing this dentist would yield you a $16,200 commission. ($540,000 x 3% = $16,200)
This is a handsome payday considering there's no escrow period, no appraisal, and there’s no home inspection. No request for repair or even a termite report. You sign the lease, generate an invoice and get paid. On commercial sales, the commissions can be even larger. Imagine a $6 million office building. You would generally get 3% of this. Your commission would be around $180,000. Not bad.
Commercial real estate can be a lucrative career for someone seeking something a little different from the day to day life of selling houses. What's also nice about commercial real estate is that there are so many different disciplines. You can focus on selling shopping centers or office buildings, or even helping developers find land on which to build. Each one of these practice areas requires a different skill set and has unique vocabulary depending on what you are selling.
For example, in industrial real estate the wiring and power capacity might be important. Do we have 3-phase power? In retail the co-tenancy would be a consideration. Who are the other retailers in the center and how can they help drive traffic to my store? Office and the other disciplines have their own unique considerations.
When you get your real estate license in California, it doesn’t have to be about just selling houses. There are a lot of other career choices that are less competitive, but more lucrative than residential. If you are considering doing both it’s important to bear in mind that very few real estate companies do both well. The skillset, paperwork and databases to sell houses are actually different than those associated with selling commercial.
That's why it's important to make sure that when you do get your real estate license in California, you are lined up with a brokerage that can set you up to succeed. Commercial real estate databases like LoopNet or CoStar can be quite expensive and most residential real estate companies don't have active subscriptions. Similarly, most commercial real estate companies don't have MLS access like a Century 21 or Keller Williams would.
If you have any questions about getting your license or if I can help you get started please call me at 888 768 5285 or drop me a message.
Love,
Kartik
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A question I get frequently from first year real estate agents is “How should I prepare for a listing appointment?” A real listing appointment. Not your mom’s house or your best friend from college
A question I get frequently from first year real estate agents is “How should I prepare for a listing appointment?” A real listing appointment. Not your mom’s house or your best friend from college but a genuine listing appointment from someone you don’t really know.
I wanted to put together a quick guide that will help you as you move through the process of pitching your first seller client! While this is not exhaustive, it should get you closer to a signature than just winging it.
1. Make sure that the person you are meeting with is the owner
The first step to having a great listing presentation is to ensure that the person you're meeting with is in fact, the true owner of the property. As an agent, you don't want to be on the wrong side of real estate fraud. While you don't necessarily need to see a driver license on the first meeting, use common sense. If the person on title is a female, for example, and you're meeting with a male who says they're the representative of the owner, it's important to dig deep and ask additional questions. In that case, that person may have power of attorney over the recorded owner, but your title insurance company and escrow company will need those documents anyway so ask for them upfront.
2. Research liens on the home
The second step is to call your preferred title insurance company and have them pull title on the home to examine liens against the property. This is a prudent second step for a lot of reasons. First, you want to make sure that the market value of the home is greater than any existing liens. If not, this could turn into a short sale, which would trigger an additional set of documents and an entirely different process.
Additionally, a search of the title will reveal if there are any notices of default recorded on the property, which in many states will require a different purchase agreement. A title search is also important because it shows the owner that you were prepared for the listing appointment and are able to work with title to eliminate any liens that may be showing on the property in error.
3. Have a well researched CMA
The main reason that most properties expire out is an improper pricing strategy. A CMA will examine three aspects of the market:
1.The active listings
2.The expired listings
3.The recently sold listings.
Clearly the most important part of this research are the properties that have recently sold as they represent a willing buyer and a willing seller doing a deal with one another. However, the active properties are also important because it shows the seller what the competition in the area is. Finally, the expired listings indicate a warning as to where you should not be pricing the property.
4. Have your documents ready
All documents should be ready for the listing at the time of the listing. You should bring any state required forms you need to take a listing as well as a listing contract itself. The worst thing in the world is to have the seller say that they are ready to list, and you not have the appropriate documents.
Bring multiple copies of the listing contract with you incase you need to make notes or changes.
5. Leave your judgement at the door
If the seller has experienced a loss in income or a layoff requiring them to sell the property, it's important to be empathetic to the needs of the seller and listen while working diligently to try to maximize the net proceeds to the seller.
Understand what your unique selling proposition is, have confidence that you and your company can get the property sold. And don't forget to smile. =)
6. Handle objections professionally and with ease
It's quite likely that you'll face some objections when making your presentation. Invariably, you may get questions about whether you'll “do it for less”, “price it higher”, or “how many years you've been in the business”. It's important to research as many of these potential objections as possible, and have scripted and truthful responses to the seller’s concerns.
There are a ton of free resources online to help in this if your broker doesn’t provide enough training. There are YouTube videos, blogs, and articles that can help you wade through the sea of a dozen or so objections that are most common in our real estate business. Remember that proper prior planning can prevent poor performance and the more you prospect, role play, and rehearse the greater the likelihood of you taking every listing appointment that you go on.
Remember you have to list to last!
Love,
Kartik
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Generally speaking, helping a buyer purchase a home should be one of the most fun and exciting times ever. However, sometimes life has other plans for you and your client.. and they don't necessarily
Generally speaking, helping a buyer purchase a home should be one of the most fun and exciting times ever. However, sometimes life has other plans for you and your client.. and they don't necessarily line up with your own.
Experienced agents have all been here - Imagine for a moment that you're helping your buyer shop for their dream home. You've done a tremendous amount of research and have put in significant time and effort into finding something that meets the needs of your client. You’ve written the strongest offer possible and the communication with the listing agent looks good. Things are finally starting to go your way...
... but you end up not getting your offer accepted.
The sense of defeat you feel in that moment can be crushing, to say the least. But that DOESN'T mean your search for the perfect home should come to an end.
As a buyer's agent, one of the most important things you can do in that moment involves helping the buyer get back on track so they can continue to shop and finally secure that home they've been waiting for. Getting to this point isn't necessarily difficult, but it DOES require you to keep a few key things in mind along the way.
Let the Mistakes of the Past Inform the Decisions of the Future
After getting outbid on a terrific home, it's natural for buyers to start to second guess nearly everything that led them to that point. Obviously, they don't want to make the same "mistakes" again in the future - regardless of what those mistakes happened to be.
As a buyer's agent, part of your job is to instill confidence in your client to the point where they believe they won't fall into the same trap a second time. Of course, this involves taking a look back at what happened and helping them learn from the experience in the most positive way possible.
If part of the reason why your buyer was outbid had to do with their insistence of lowballing, help them understand that buyers can often lose out on their dream home by engaging in exactly this type of behavior. Not only can a really low offer offend a seller - even unintentionally - but it can also make them less likely to negotiate upwards, even if your client is more than willing to do so.
Let your client know that they should find out what type of situation they're entering BEFORE they make their bid. Don't be afraid to come right out and ask if there are other offers and where those offers stand. At the very least, this can help manage their expectations prior to engaging in another bidding war over a property.
Encourage your buyer to consider things that go above and beyond a simple monetary offer. Let them know that they can write a letter to the seller, for example, outlining why they love the home and why it means so much to them. You'd be surprised by how much of a difference this can make when a seller is trying to decide between similar offers.
Put in Backup Offers in the Future
At the same time, you should also encourage your client to put in a backup offer on any home that they're serious about in the future. Even if a seller has indicated that they're going with someone else, this is still a great best practice to follow.
You really never know exactly what is going on across the negotiating table. That "accepted offer" from another buyer could fall apart due to a myriad of different reasons. Maybe those buyers got cold feet, or they were unable to secure the type of financing they thought they could. In any event, let your client know that there are still ways to be the "first in line" if that current deal should happen to fall through.
Have Them Believe Another “Dream Home” Is Out There
But in the end, the most important thing you can do to help your buyer get over a house that they lost involves getting them to believe the simple truth that another "dream home" will absolutely come along.
Don't forget that part of why they're working with an agent like you comes down to your negotiating skill. Not only do you have the knowledge from your real estate courses, you (or your company in the case of a newer agent) have been around the block more than a few times and at this point, you've likely seen it all.
With the real estate market developing as it is the chances are high that you'll be able to find a similar home for your client to the one they lost. You'll probably be able to find one that's even better, provided that you're given enough time to do so.
Indeed, that may very well be the most important piece of advice for this situation: tell your client that it's time to stop looking backwards and to return their attention to the future once again.
Love,
Kartik
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"Why do I need a Realtor, anyway? My house is beautiful and it should be easy to get the best price for my home. How hard can that really be?”
Many people pondering selling their home ask themselves
"Why do I need a Realtor, anyway? My house is beautiful and it should be easy to get the best price for my home. How hard can that really be?”
Many people pondering selling their home ask themselves some variation of those questions early in the process. On the one hand, it's natural to wonder why you need help during a process that seems fairly simple with the help of the Internet.
But at the same time, selling a home is so much more than just another transaction. It can be a long, complicated and precise process that is unfortunately easy to "get wrong" - which is why partnering with a Realtor isn’t only a recommendation these days.
For most people it's become a requirement for a lot of reasons that I wanted to outline below.
Why Realtors Matter: Breaking Things Down
1. A Realtor’s Experience is Invaluable
Maybe the most important reason to bring in a Realtor is that the process of successfully selling a home isn't just lengthy - it can also be inherently complicated. A Realtor brings with him or her a wealth of experience that you simply won't be able to match on your own.
Think about all of the forms, reports, disclosures and other documents that you'll need to complete as a part of this process. Typically these number in the dozens - all of which are filled with reams of technical jargon that can be difficult to understand. Unless you're prepared to become a master in the field while also devoting as much of your attention as possible on getting the best deal for yourself, the chances are high that you may be looking at unfortunate delays (or worse - costly mistakes) if you get this part of the process “wrong."
A Realtor, on the other hand, can help you avoid all of these issues so that you can focus on the big picture piece that matters most: the sale itself. Indeed, they're a partner in the best sense of the term - one that is every bit as vested in your own success as you are.
2. A Realtor Possesses Market Expertise
Another one of the major reasons why working with a Realtor is a good idea is because they're true experts in the state of the market. Active real estate professionals study the market intently. Not just from behind a desk, but also in the field. They are out there each and every day looking at homes and properties just like yours. They really have their finger on the pulse of the market. An overpriced listing is one of the main reasons that property doesn’t sell. A solid Comparative Market Analysis done by an active Realtor can help ensure that your property is priced realistically and competitively.
Everyone wants to get the best deal when selling their home, but everyone has a different definition of the term "best". By providing you with access to objective information rooted in the study of the local real estate market, a Realtor can make sure that everything about your deal proceeds properly.
Note that oftentimes the peace-of-mind that comes with this alone is more than worth the decision for most people.
3. A Realtor Knows How to Market
At the end of the day, one of the most important reasons why consumers hire a Realtor has to do with getting your property in front of as many eyes as possible, all in the name of building anticipation and excitement through all marketing channels.
One of the biggest mistakes that a lot of people make when trying to sell a home on their own involves the assumption that properties sell based largely on advertising alone. "All I have to do is take some incredible pictures and create listing on all of the popular sites like Redfin and Zillow", they tell themselves. "At that point, my house will pretty much sell itself!”
Wrong.
A lot of people don't realize that a significant portion of real estate sales actually come from the contacts that a Realtor brings with them. This includes relationships with past clients who may be in the market for a home again, renters looking to buy, and their own personal network of friends, family members and other associates. Because of this, a Realtor can expose your property to a wider audience than ever - something that you would again be hard-pressed to replicate on your own.
4. A Realtor Brings Negotiating Power to the Table
But overall, maybe the biggest advantage of working with a Realtor ties directly into the negotiation power and knowledge that they've spent their careers honing and perfecting.
All of this is to say that yes - it is entirely possible in 2020 to sell your home on your own. Some people even find success in it. But at the same time... is this actually something you want to do alone, especially if you've never done it before? When the stakes are this high, would you really want to turn down the opportunity to bring someone into the conversation who has been in this situation many times in the past?
In the vast majority of all situations, the answers to those questions are "no" - which is why partnering with a Realtor you trust is and will always be a good idea.
Love,
Kartik
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As a potential real estate agent it helps to understand how you will likely get paid for your time and expertise. I wanted to examine how agents commonly earn a living, how everything is split, and what's
As a potential real estate agent it helps to understand how you will likely get paid for your time and expertise. I wanted to examine how agents commonly earn a living, how everything is split, and what's risks you take on as a real estate agent in hopes of a payday.
The Common Standard: Commissions
The most accepted way for real estate agents to be paid is to charge the seller a commission which is then split among the buyer's and the seller's agent. This amount is typically between four and six percent of the sale price.
Like most sale transactions, there are exceptions to this rule. Raw land sales, for example, sometimes can be as much as ten percent of the total sale price.
On the other end of the spectrum, there are agents and companies that will work for a flat fee that is substantially less than on a percentage basis. Compensation programs like this are generally more common in seller markets where there are far more buyers than listings for sale.
How Everything Is Split
There are a few caveats to note about this seemingly simple arithmetic. The agent does not get to keep all the commission because they must work for a broker in California who will certainly take some portion of the total commission.
When it comes to how brokers split the money with their agents, a lot of it depends on the agent's experience. A brand-new agent may agree to work for a much smaller percentage as a means of getting their foot in the door. A seasoned agent may take all of their commission and pay their broker a fee to rent their desk in the office.
When starting out in our real estate industry, you can expect to keep between 50 and 70 percent of the commission starting out and this should increase with sales volume and experience.
The Risks of the Agent
It's not always easy to see the risks that the agent assumes if you aren't behind the scenes. Not only do agents have to pay the MLS fees as well as the costs of their insurance and dues, but you’re also taking some of the responsibility for the sale.
For example, let's say the agent spends six months trying to sell a home. They've found an interested party, but the buyers haven't quite formalized their offer. If the seller gets cold feet at the last minute, the real estate agent will typically not be paid. (If the seller had received a formal offer and then refused though, then the broker may have still been entitled to their commission.)
These risks explain why some agents seek salaried positions in property management for example rather than be beholden to the commission. These jobs do exist although they are on the rare side. The vast majority of real estate agents are commission-only for the duration of their careers.
Agents do more than just showcase a property in its best light. The right agent can spot red flags before they turn into legal hassles, counsel sellers about the quality of the offers, and give buyers a better idea of when to jump at a deal. Their efforts are rewarded when the sale goes through, according to the terms of the listing agreement.
Hope this helps explain a little about the world of the agent. If you’re interested in taking real estate classes, please give us a call at 888 768 5285.
Love,
Kartik
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For most real estate agents, a cornerstone of their business is conducting successful open houses. Because of this, I wanted to write a quick article about how to have a successful one.
Open houses
For most real estate agents, a cornerstone of their business is conducting successful open houses. Because of this, I wanted to write a quick article about how to have a successful one.
Open houses are a good way to get business because it's a marketing tool that is completely free. An open house is akin to a popup retail store without actually having to pay rent. Think about it - You’re able to set up shop and have potential buyers and sellers meet you, give you their information and walk through a property that you or your company are representing. It's a great way to get business without spending any money.
There are a few things that we can do to maximize our efforts conducting open houses and making sure that we have a positive return on our time.
Tip 1: Make sure you are choosing the right property to hold open
This means the property should be easy to find as well as be priced properly. When I say easy to find, I mean that a great listing at the top of a mountain might be a good listing to have, but it might not be such a great listing to do an open house on. If it takes two GPS systems and a satellite to find the open houses, it's probably not the one that's going to get a lot of traffic.
Having the property priced right is also important. The more fairly a property is priced, the more interest it will garner and the more traffic you're likely to have at your open house.
Tip 2: Check out other homes in the area
It's pretty likely that on a sunny weekend your house is going to have a ton of competition from other agents looking to attract buyers. For this reason, it's important to understand what the competition is. If a buyer comes into your open house and asks you about the house around the corner, an easy way to establish your credibility as a real estate agent is to be familiar with all the homes in the area. For example, it would be nice to say something like, "Yes. I've seen that property. It's a four bedroom, three bathroom for $800,000. Ours is also a four bedroom, three bathroom for $780,000 and has an upgraded kitchen." This is a great way to show a buyer that you know the market well and that your product offering is superior to any alternative.
Tip 3: Make sure you market the open house properly
This means lots of signs, lots of exposure on social media, inputting it in the MLS and advertising it on other websites. You may even want to consider dropping flyers on the doorsteps of some of the neighbors, inviting them to an open house. Consider sending mail to downstream markets that might have buyers for the house you're holding open. For example, if you're holding a house open for $800,000, it would be great to send a postcard a couple of weeks before your open house to a $600,000 neighborhood. The marketing piece will inquire whether those $600,000 owners might want to list their house and upgrade to your listing.
Remember that the more traffic you have, the more lead opportunities you are going to get to pick up other buyers and listings for the open house and even other homes.
Tip 4: Follow up strong on walk in leads
The last step to a productive open house comes after the open house is completed. You'll want to follow up strong on all the leads that walk through your open house that day. This does not mean calling them two days later or even the next day. As an agent, if I hold an open house from 1:00 PM to 4:00 PM, at 4:00 PM I'll go take down all my signs, come back in the home, make sure it's clean and presentable. Next, I'll leave a handwritten note to the seller of the house I just held open.
It might say something like, "Dear Mr. and Mrs. Seller, thank you for sneaking away for a few hours so I could conduct the open house. We had 22 people come through and I'm going to follow up with them aggressively. Thank you again for sneaking away for a few hours." Put yourself in the shoes of the seller - I would want to know how much traffic walked through my home and an update from the agent will help accomplish that.
Before I leave the open house and lock up, I’ll make phone calls to all 22 of those people, thanking them for coming and asking them for any feedback they might have on the property. The reason I don't want to wait until the next day is that I know that my competitors are making those same calls later. I want to be top of mind and I want to be the first person those buyers think of when considering buying or selling a home. Following up quickly and aggressively is something that will help achieve that desired outcome.
Remember that holding open house is still a great way to meet potential buyers and sellers while exposing your listing to potential clients. Open houses also please the seller of the home because it indicates marketing activity. The internet will never replace face-to-face contact and holding open house is a great way to capitalize on a time honored tradition.
Best of all, it's free.
Good luck with your open houses.
Love,
Kartik
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Prepare for the day
The first step in a great day as a Realtor is to prepare for the day itself. This includes going over your schedule, verifying and confirming appointments you may have for the
Prepare for the day
The first step in a great day as a Realtor is to prepare for the day itself. This includes going over your schedule, verifying and confirming appointments you may have for the day, and studying market statistics. The act of studying the market data can be especially helpful for a newer agent as they have time to check the Multiple Listing Service to see what new properties have come on the market, examine properties that have gone under contract, as well as properties that have closed escrow in their marketplace.
This 30-60 minutes of quiet time will set the agent up for business success.
Make sure you role play
As the morning progresses, the second thing that a real estate agent should do is role play. Role playing scripts and dialogues can be extremely helpful for the newer agent, especially because most buyers and sellers have a consistent set of objections that they will give the agent, and understanding how to respond to these objections smoothly and confidently can help increase sales. For example, if you're calling for-sale-by-owners, and the seller doesn't want to pay you a 6% commission, or is hesitant to set the appointment, there are several things that an experienced salesperson could say to increase their chances of success. Consistent role play will help delivery as well as syntax to ensure greater success.
Ensure that you are prospecting
The third thing, once role playing has been done, is to actually prospect. Daily prospecting must be the cornerstone of the salesperson’s day. Finding potential buyers and sellers is the lifeline of your business. As you continue in your career, you will come to realize that income for December actually has to do with how committed you were in October. An October client leads to a November escrow which leads to a December closing.
Understanding the longterm nature of our business means that prospecting must be the cornerstone of your day. High-performing real estate agents typically will spend a minimum of two hours on this activity.
Lead follow up
The fourth thing that should be in the schedule of every high-producing real estate agent is lead follow-up. Simply put, lead follow-up is, as the name implies, following up on the leads as a result of your prospecting. The worst thing that an agent can do is spend a lot of time, energy, and effort into prospecting only to cultivate leads that never get called back or followed up with. The nature of the real estate business is such that the sales cycle can take days, weeks, or even months. Consistently following up with your leads via email, phone, and text message will increase the chance of those prospects ultimately turning into clients and closings.
Schedule time to go on appointments
The goal of lead follow-up, of course, leads us to our fifth activity - going on appointments. Time should be in your schedule every day for face-to-face meetings with clients. This could be listing appointments or showing appointments for buyers who want to look at homes. Sticking to a strict schedule for showing can help you take control of your day. Many newer real estate agents will show property or meet with the client within minutes of them asking. This will lead to burnout because if you're always jumping without any direction, it's easy to get discouraged if deals ultimately don't happen. Having respect for your own time will translate into clients having respect for your time also, so put that appointment block in your calendar, and make sure to follow it as strictly as possible.
Examine the prior day
Finally, at the end of each day, 15 to 20 minutes should be spent reviewing the activities of the day prior and setting up for the next day. Ask yourself questions like, "How productive was I today? How much time did I spend actually and actively looking for business? Are there things that I could have done better today? How can I avoid making the same mistakes tomorrow?" At the end of the day, productive real estate agents ask these questions so they can improve daily.
Incremental improvement on a day-to-day basis will help you ultimately achieve success in the long-term.
Hope this helps.
Love,
Kartik
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If you were looking for a single statistic that underlined why smart home and home automation technology has become so popular over the last few years, let it be the following:
One recent study revealed
If you were looking for a single statistic that underlined why smart home and home automation technology has become so popular over the last few years, let it be the following:
One recent study revealed that the average amount of money a person can save from using smart home products is about $98.30 per month, adding up to roughly $1,179.60 per year. Equipment like smart thermostats, connected sensors and "intelligent" security systems are more than just a "modest convenience" for many people. They're a true investment in every sense of the term - and one that will essentially pay for itself over time with the right application.
But as is true with so many other areas of technology, smart home and home automation tech is evolving all the time. That's why there are a few important trends in this area that all real estate professionals should be paying close attention to in 2020 and beyond.
The Top Home Automation Tech Trends to Pay Attention To
1. Standardization
One of the most critical home automation trends for 2020 is also one that, for many people, couldn't have come along at a better time: standardization.
A major pain point for so many real estate professionals and home builders trying to use home automation as a marketing tool always involved the fact that there were so many platforms to choose from. Ecosystems from Amazon, Google and even Apple all exist - but rarely do they work together in the way someone would want. Limiting users to one ecosystem also limits device compatibility, while trying to put together a system with a mishmash of ecosystems could easily lead to security vulnerabilities, among other issues.
Thankfully, the major technology players have banded together to create a set of standards designed to make smart homes easier to embrace and more secure at the same time - which is something that professionals will absolutely want to keep a close eye on moving forward.
2. Improvements in Smart Home AI
Another essential trend to watch out for involves the continued evolution of the relationship between smart home technology, home automation and artificial intelligence. A lot of smart home devices are already leveraging AI in impressive ways, like with smart thermostats that "learn" your daily usage habits and automatically make adjustments to regulate a home's temperature without the intervention of the actual homeowner.
2020 may very well be the year that this concept shifts to the next level, when things like facial recognition software driven by AI and machine learning allow security and surveillance systems to become more proactive. Rather than simply telling you "there's someone at the door," your smart doorbell may soon be able to tell you that "John Smith is at the door," thus creating an environment where both threat detection and regular alerts are more personalized than ever.
Even going beyond that, smart devices powered by AI will be able to handle more complicated instructions than their current counterparts. This means that the average smart home user will be able to allow their devices to handle even more complex tasks than they can right now - thus freeing up more of their time and attention to focus on those activities that truly need them and that they're more invested in. This will likely drive a major boost in adoption in smart home tech across the board, too.
The Impact of Smart Homes on the Future of Real Estate
While it’s easy to be impressed by these home automation trends it's equally important to consider the impact they will have on both home building and the real estate industry moving forward.
Reports indicate that 43% of all smart home technology users are currently between the ages of 18 and 34-years old. As those that fall into this demographic mature financially and begin looking for houses, home automation is naturally going to become more of a priority - making it more of a selling point for first-time home buyers too.
Indeed, smart home tech is already having a major impact on people who fall outside of this category, too. There are reports that as many as 81% of people who already use some type of smart home tech said that they'd be more likely to purchase a home that already came with some level of connected technology that they could then add onto in the future.
You're already seeing the inclusion of smart home and Internet of Things-connected devices included in a lot of home listings in markets both large and small across the country. This is one trend that shows absolutely no signs of slowing down anytime soon.
All of this is to say that smart home equipment is more than just a novelty or another passing fad. It's already changed the way that many people think about what a home should include - to the point where it will impact the way real estate professionals think about how to market a property.
All this is to say that if you're a real estate professional who isn't currently paying attention to the hottest trends in smart home and home automation technology, now would be an excellent time to start.
Love,
Kartik
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It has been said that branding first started in ancient Egypt as herders and livestock owners branded their cattle as a means to distinguish their property from another's. This way, if cattle was stolen,
It has been said that branding first started in ancient Egypt as herders and livestock owners branded their cattle as a means to distinguish their property from another's. This way, if cattle was stolen, whoever saw the branded symbol could figure out who the actual owner was.
In modern times, branding is a way of marketing and communicating one company, or in the case of real estate, one real estate agent from another. Proper branding results in brand awareness, which is essentially the ability of a customer to understand what products belong to a given company and what products belong to another.
The goal of effective branding is to have what marketers call “top of mind” awareness. Essentially, this happens when the customer thinks of a specific need and a brand will immediately come to mind in a given product category. A good example of branding are the following associations:
Bleach = Clorox.
Face tissue, Kleenex.
Coffee=-Starbucks.
These companies have done an excellent and deliberate job of branding and creating top of mind awareness with their consumer. How does this relate to the individual real estate agent? One of the first steps to branding for a successful Realtor is defining the market area that they are attempting to be an expert in.
Become an Expert in a Defined Market Area
Consider web and print assets that specifically are tailored to these farm areas. For example, if you are focused on a specific condo community in your town, consider registering some domain names that have the name of that condo complex in them and frequent updates as to the market in that building or area will help solidify your brand as an expert in that neighborhood.
Example:
If the condo complex is the “Jolly Arms Condos” the agent might register the URL www.jollyarmscondos.com.
Create a Strong Logo
As it relates to branding, a strong logo is critical. If you work for a national real estate company like Coldwell Banker or Keller Williams, you may want to check with their brand compliance guidelines before executing your strategy. Generally if you have colors or a marketing scheme that fits the area you're branding in, this can help give you top of mind awareness. Remember to choose your colors wisely in your logo. We've all walked through a department store and it's obvious that professional branders and marketers use certain colors to elicit certain emotions. Red and yellow tend to pop more than more muted colors.
Invest in Offline and Online Marketing
Also, remember to use both online and offline methods of branding and advertising. Open house signs, yard signs, and door knocking, along with direct mail, are all strategies to employ to effectively brand you as the local expert in that area. There is a need for differentiation. Remember, there are a lot of real estate agents out there. Over one million people have membership with the National Association of Realtors once they obtain their real estate license. Consumers have a lot of choices and it's important to be able to differentiate your strategy and marketing from your competitors.
Is a Niche Market Right for You?
Consider adopting a specific niche market. Do you focus on retail tenant representation? Do you focus on short sales or bank owned properties? Do you focus on condos or luxury marketing? Being able to brand yourself as an expert in any of these niches is useful to building your brand.
Above All Else, Stay Consistent
Finally, remember that consistency is more important than creativity. Branding is a marathon, not a sprint. Even if your marketing isn't perfect, it's important to remember that consistent branding and marketing will help keep you top of mind in the eyes of the consumer. If you're going to do a blog, make sure your blog comes out with some regularity. If you're going to record YouTube videos, make sure that you have a predefined content calendar and schedule. This will help the public see you as a consistent and reliable source of information when they are considering buying and selling a piece of real estate.
Love,
Kartik
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Maybe you’re considering getting your real estate license because it’s time to sell your house. If you are grappling with the prospect of selling a property for the first time the process can seem
Maybe you’re considering getting your real estate license because it’s time to sell your house. If you are grappling with the prospect of selling a property for the first time the process can seem downright overwhelming.
It doesn’t have to be.
With a bit of information and the right support, you can sell your home for a fair deal with minimal hassles. Here are some best practices to keep in mind.
Step 1: Choosing The Right Real Estate Agent
When I get calls from folks that consider selling their house, one of the first questions most people ask is about real estate agents. While there is no law that says you have to use a real estate agent, there are some advantages and costs to consider.
One of the most basic advantages to using a real estate agent is that they have access to the MLS, a system that compiles all data about the property and gets it in front of other agents and their buyers. Being on the MLS is a huge win because it means more people are likely to see your home.
Another key benefit of working with an agent is that their service is all-inclusive. That means they will handle the marketing, negotiations, and contracts for you.
While there is no legal minimum or maximum commission in California, most real estate agents are going to charge between 4 and 7 percent of the home’s sale price to get your deal done. Typically, that amount is divided to cover both the buyer’s and the seller’s real estate agent fees. This is paid by the seller.
Do you really need an agent? The answer to this question really depends on what you want. Here are a few things to keep in mind:
Do you have the tools and funds to market your home on your own?
If you’re in a competitive market, you may benefit from an agent’s ability to negotiate terms and potentially increase what you get for your home.
You’ll need to meet with prospective buyers, show them your home, and deal with push back over the property.
Some buyers may not wish to work without their real estate agent. That means, if you want to sell to them, you’ll probably need to cover the costs of their agent.
Agents have access to the legal contracts and tools necessary for this transaction. You may need to hire an attorney to help you with the process if you don’t use an agent.
Since most people don’t want to do the above, real estate agents are engaged.
Step 2: Pricing Your Home
The next step is to price your home properly. This is another task that a knowledgable real estate agent can help with. Clearly, the value of your home is dependent on what buyers will pay for it. It is not dependent on what you’ve put into it or how much you think it is worth.
There are websites like Zillow which provide you with an estimate for your home. These websites use data from recent sales in your area to determine the value. Yet, they don’t come into your home to create an accurate assessment of the true worth they only use the broad data available. These site can be a good starting point for knowing what homes like yours are selling for but not the complete picture.
Your agent, if you choose to use one, will help you by creating a comparative market analysis. This provides insight into your home’s true attributes and features along with data on homes like yours that have sold recently.
Step 3: Listing Your House with Confidence
The next step in the process is to get your home listed on the market to be sold. As noted, you can do this with your real estate agent but before you list, it’s important to ensure your home is sell-ready. Here are a few things to keep in mind:
When to Sell
You can sell your home at any time during the year. The spring and summer markets tend to have more buyers, which can mean faster sales and, in some cases, better pricing. However, in the winter, there’s less competition, which can help your home stand out in a desirable market.
Prepare Your Home For Sale
Take the time to walk around your home and create a list of what needs to be updated, repaired, or cleaned. Work to remove as much clutter or extra furniture from your home as possible. This will help to make your home look larger, organized, and clean, making it attractive to buyers. Tackle any types of problems with the home that could lessen the value or throw red flags during a home inspection.
Photos and Videos
Also important is to capture beautiful, professional photos to showcase your home. That’s critical in today’s home buying process. Homebuyers shop online first. If you don’t have photos, they’ll wonder why. If the photos are not professional, that may create the wrong first impression. Professional videos provide clear information to prospective buyers. That means you’re not wasting your time on buyers who won’t fit your home’s specs.
Step 4: Managing Offers and Making Decisions
Ultimately, you do not have to sell your home for anything less than you want, but most of the time, there will be negotiations in the process. When someone comes to your home and places an offer on it, that is an opportunity for you to either agree to the offer or to make changes to it. You can also reject the offer outright. It tends to be best to counter their offer with one that fits your needs. Key things to consider include:
The sale price
Who is paying what closing costs
Any stated repairs or conditions you’re willing or not willing to make
The timeline for closing on the home
Home inspection and repair requests
After you come to an agreement with a prospective buyer, a home inspection will likely be ordered by and paid for by the buyer. Nearly all contracts will be contingent (or dependent) on the home being inspected by a professional. This is a time for the buyer to walk around the home with the inspector to learn about any concerns. They will likely examine the major systems in your home, such as the roof, HVAC, and appliances. If there are concerns, the home buyer may ask you to make adjustments to the contract or to make the repairs necessary. You don’t have to do this, but that may mean your home goes back on the market if the buyer pulls out during their contingency period.
Step 5: Handling the Legal Aspects
Once you and the buyer are ready to move forward, your real estate agent will work with you throughout the escrow process. There are multiple steps involved, including waiting for the buyer’s lender to obtain an appraisal and formally approve the loan and and to close on it. This can take some time, usually 30-60 days. Once the home is ready to close, you’ll need to work with the title and escrow companies to sign the deed and other requirements. This will involve transferring money to you from the buyer or the lender to complete the sale.
I could literally write a 50 page guide on selling real estate, but I wanted to keep this somewhat short.
If you are obtaining your real estate license in the hopes of selling your own property and saving the commission this is totally possible.
Let us know how we can help.
Love,
Kartik
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Doing well on your real estate exam is the first step to getting your career going. If you are like some of our students, this can be a daunting thing especially if you’ve been out of school for a while.
Doing well on your real estate exam is the first step to getting your career going. If you are like some of our students, this can be a daunting thing especially if you’ve been out of school for a while.
It doesn’t have to be.
What’s important is that you understand the information necessary to pass the real estate exam. To help relieve some frustration and improve your chances of success, consider these study tips.
1. Review What’s on the Exam
Take a few minutes to review what’s on the actual real estate exam. If you were a student of ours, this is outlined for you in your Principles book. Merely having a basic understanding of what’s on the exam can calm a lot of fears for students.
The state publishes a percentage breakdown of topics that are tested and our real estate exam preparation website is tailored so the questions are in the same ratio that the government exam is. This way there are no surprises on test day.
2. Create Digital or Physical Notes for Key Concepts
As you are reviewing your notes from your pre-license coursework, consider creating notecards or flashcards with key concepts. Write them in a question format with the answer on the back. There are flashcard apps you can use as well if you want to have access to studying on your phone.
Also, it’s been proven that the act of physically writing things down can go a long way to help retain information.
3. Read Your Notes
If you haven’t done so yet, read through all of the materials you’ve been assigned. Create notes on topics that relate to your real estate exam. It’s a good idea to create notes for topics you are unsure about or very specific elements such as vocabulary terms or other more broad real estate concepts.
As you do, remember how important it is to retain this information. It’s not just about the exam, but it is applicable for day-to-day work as an agent. For example, if there’s a topic that is complex to you, look for a real-life example of how this would apply to your career or the work you do. That way, you’ll better understand what to expect.
4. Don’t Reach Out to Practicing Agents
I would avoid having long drawn out conversations with other real estate agents. Most of the time, they will say things like “Don’t worry what’s on the real estate exam, you won’t use any of that stuff anyway.” The constant repetition of how academic and impractical the concepts tested are can actually discourage some of our students from properly preparing and studying.
While it is true that the real estate exam contains a broad set of topics, all of which are not applicable to every deal, it’s still important to stay focused on the goal of actually passing the real estate exam.
If you can’t help yourself, make sure you talk to agents that support you in making key decisions and learning how to navigate complex topics. These agents can give you insight into real-life applications of the material you’re learning. They can also put your mind at ease.
5. Take Several Practice Real Estate Exams
It’s important to have state-specific real estate license practice exams available to you. You can find them on our website. Luckily for you, our system is modern and up to date to ensure they include the most recent updates to the real estate test itself.
Focusing on our real estate practice exams can point out areas where you need to focus a bit more on your studies. Refrain from taking them one after another. Instead, use them as you study to see areas you should focus on going forward.
6. Understand How To Take Tests
While the material you need to pass the real estate license exam is critically important to know, it’s also helpful to have some test-taking skills, especially if you haven’t dealt with high-pressure tests recently. Consider these strategies:
Read every word slowly in every question. Sometimes, you’ll miss words such as “if” or “all” – and that can change the answer.
Don’t rush through the test. Take your time to read the data and analyze it from a strategic view.
Breathe through your test. If you find yourself overwhelmed or under too much pressure, that’s when you know you need to close your eyes, breathe in deeply, and calm your heart rate.
Make sure you sleep well in the week leading up to your exam. Don’t binge the night before as that can limit your cognitive capacity later on.
Arrive on time for your test. Get a good idea of the layout of the area. You want to feel comfortable.
If you don’t know the answer to a question right away, skip it. You can go back to it later. Don’t put too much time into a single question.
Don’t rush through the exam. Make sure you take your time and focus.
If you’re really struggling with test-taking itself, do a few practice exams in a formal environment, such as in a library or office space. This can help give you some peace of mind.
7. Stay Positive and Upbeat
Passing your real estate exam is a step towards starting a new career. It is a lot of work – and that can seem like a big mountain to climb. However, focus on the big picture. This is a career that you are going to love. The more hands-on experience you have, the better your outcome will be.
Practicing for your real estate exam can be a very eye-opening experience. This is what you’ll soon be an expert in, helping others to achieve their goals of property ownership.
Love,
Kartik
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One of the most difficult skills for new Realtors to learn is budgeting. Along with good time management, the two skills are probably the core requirements for first-year success in this challenging profession.
One of the most difficult skills for new Realtors to learn is budgeting. Along with good time management, the two skills are probably the core requirements for first-year success in this challenging profession. What does it take to create a realistic budget for a new agent? In one word, the answer is "planning." Approach the task in much the same way as a family might make an annual or monthly budget, with research and tracking. Here are the three steps to building a budget that can work for any new agent and is adaptable as time passes.
Track and Analyze
Carefully log every penny you spend for two weeks running and then apply some honest analysis to what you come up with. Logging of all the money you spend will reveal where there are "leaks" in your current monetary habits and will also show what expenses are absolute necessities. The effectiveness of this step, the only one that takes place before making a pro-forma budget, is based on the ancient adage, "Know thyself." Until you know what you spend, when you spend it, and why, there's no way to make a realistic budget.
Build a Budget
List every monthly expense and use a worst-case scenario to estimate average monthly income. If there's more income than expenses, you're still not off the hook. Be certain to go through each expense item and determine whether it can be reduced or cut out entirely. Are you spending too much on eating out, clothing, gifts? If so, snip those expenses down to levels that make sense.
After working with all the data in a spreadsheet and getting a feel for what an "average" month looks like, write out a separate document called "Pro-forma Monthly Budget," and save it to your desktop. For the next two months, allow yourself to fine-tune the pro-forma budget with new revelations or data your forgot on the first go-round. At the end of 90 days, you should have a pretty accurate and useful monthly budget that can serve as a guideline for at least the first year of your practice. In several months, your skills and network will have changed enough to require another round of budget-making. Remember, budgets help you identify ways to cut costs and increase profits, and those are good things. The budget is your friend, not an entity to be feared.
Plan for Emergencies
Real estate agents can take a tip from personal budgeting theory: it's essential to have an emergency fund in place that can cover at least three months' of expenses. Every smart family has a fund like this and so should every real estate professional. Especially in a field where income is notoriously volatile, an emergency fund will help to smooth out the natural income vicissitudes.
Final Thoughts
There's no reason to reinvent the wheel, so do some online research about typical real estate agent budgets to get ideas about common expense categories that might not occur to you as a new agent. Be careful, however, not to assume anyone else's categories or specific dollar amounts will apply to you. Always do the hard work of tracking and analyzing before you begin to create your own personal budget.
Remember, the real estate business is a marathon not a sprint. Being able to weather the storm is more important than ever now.
Love,
Kartik
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The process of buying a home can be complex. What’s even more complex is helping a person to make the best decision for their family. For most people, this is the single largest investment they’ll
The process of buying a home can be complex. What’s even more complex is helping a person to make the best decision for their family. For most people, this is the single largest investment they’ll make during their lifetime. It’s a huge financial commitment. As a real estate agent, it’s your job to help them through this process, ensuring they not only buy a home, but they buy one that’s right for their needs.
It comes down to managing client expectations. From the start of your relationship with a client, it’s essential to create a clear understanding of what their needs are. Managing their expectations isn’t just about closing a deal. It often includes providing complete insight and guidance. Here are some tips to do that.
1. Be Honest, Every Step of the Way
It is quite common for people to make decisions based on perceived thoughts or opinions. Sometimes, your client will be downright wrong. Other times, you need to share with them the other side of the coin. When you meet with your client, be honest with them from the start. Tell them you’re going to point out the good and bad, and always provide authentic information.
2. Don’t Overpromise
When a client walks in the door with too little money, no mortgage pre-approval, and little in the way of a down payment, don’t promise them a home. This is particularly important with first-time home buyers. You’ll do your best, but they need to be realistic about what their money can buy. This is a hard talk to have, because you may feel as though you’ve failed to meet their needs. However, if you’re frank with them and show them data, they’ll understand how they need to adjust their budget.
3. Create Clear Goals
To manage your client’s expectations, you need to know what those are. This often means sitting down and going over what their needs are and what they would like in addition to that. You also want them to know what you’re going to do for them, including the marketing, negotiations, and research you’ll put into the work. Then, outline what you need from them – accurate information, fast responses, and flexibility throughout the process.
4. Ensure Near-Constant Communication
You don’t have to break away from an important meeting with your family to answer client calls every time, but be there for them. In the day and age of text messaging, it’s rather easy to do this. You want them to know you’re available to discuss. Talk about the best ways to communicate and how often is right for them and for you.
5. Provide Them with Reports
Whether you are listing their home or helping them buy a home, you want them to know what you’re doing to support the process. Be sure to provide them with data on the market on a weekly basis. Offer insight into what’s taking up your time on their project and communicate what you’re doing to change things up as needed.
Managing client expectations improves outcomes while also ensuring a more steady and smooth process is possible. You can’t please everyone every time but it’s important to understand that your ability to manage the client through the process is critical to long-term success.
Love,
Kartik
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For real estate agents, past clients represent a wealth of new business in years to come if the relationship is nourished and kept up after the sale. The problem for some agents is that they lose touch
For real estate agents, past clients represent a wealth of new business in years to come if the relationship is nourished and kept up after the sale. The problem for some agents is that they lose touch with past clients after doing business with them, but there are a few reasons you should devote extra time to making sure you remain connected.
In generations past, people often bought their home and stayed there for their entire lives, sometimes even leaving the property to following generations. Today, people are far more mobile than ever before. For real estate agents, there are two big reasons to maintain contact with past clients:
They May Need Your Services in the Future. People rarely stay in the same home for the duration of their lives and many people also invest in other properties. Return business is great because you build an ongoing relationship of trust and friendship. It’s much easier to keep a current client happy than to try and obtain a new one.
Happy Clients Recommend You to Others. Even for clients who will rarely, if ever, need your services again, it's important that you maintain a positive experience and connection. These clients will often have friends and acquaintances who are looking to purchase or sell homes and that can mean a great pipeline of referral business for you. We even see this with our real estate school. The great majority of our new students have been referred to us by a former one.
4 Ways to Rekindle a Connection with Past Clients
If you haven't previously made it a point to market to past clients, you're not alone. Many agents lose or drop contact with one-time clients over the course of months or years since a sale. The good news is that it's never too late to reconnect.
Here are a few ways you can reach out to old clients to build an ongoing relationship.
Start By Going Through Your Past Client Lists. The first step to rebuild these relationships is setting some time aside to go through your past sales. Review notes and old emails on clients to give yourself a quick refresher on who they are and their lifestyle. As an agent, you deal with a lot of people throughout the day, so taking the time to review all the past information you have can be a great start. Remember, though, if a good deal of time has passed, that client has likely experienced some major life changes and may be in a different place financially so tread lightly.
Send a Personalized Note. A great way to reconnect is by simply being honest. Send them a personal note. This can be through email or physical mail. If you do send a letter by mail, hand addressing it can be great because people are less inclined to see envelopes that are handwritten as sales material. The note can be a simple re-introduction, maybe an apology for not being in touch, and a personal note about something in their life. You can also include your personal social media accounts and contact information and let them know you'd like to stay in touch.
Acknowledge an Anniversary. If sending a note out of the blue sounds a bit awkward to you, it's always great to go with the old stand by of sending a card or note for an occasion. This might be the anniversary of the purchase of their home or their birthday.
Find Them on Social Media. Social media can often be the best way to resume contact with old clients. People often accept friend requests from a wide variety of contacts. Take some time to hunt for your past clients on your favorite platforms and use those channels to reconnect. You might include a personal note right when you reach out or once they've accepted your request to connect.
Ways to Maintain an Ongoing Connection
There are a lot of ways to reconnect with old clients, but maintaining that relationship is the real goal. Here are a few ways that you can cultivate an ongoing relationship with these contacts so that you stay in their thoughts if they ever need an agent for future real estate dealings.
Send a Thank You for Referrals. If a past client referred you to someone, make sure you acknowledge that. You can send them a quick thank you note to show your gratitude for the trust and recommendation.
Plan a Coffee or Small Gathering. Small events can be a great way to maintain a connection. You can host a small thank you event for past clients or offer a seminar on some aspect of property ownership. There are a million different ways to plan an event that make it worthwhile for contacts to attend and it gives you the opportunity to build an in person relationship. If your office has a large training room consider using that as free space to host your event.
Send Them Updates On Property Sales in Their Neighborhood. Many people really appreciate knowing when a home goes on the market in their area. They may also be interested in knowing when one sold, so they can introduce themselves to new neighbors.
Keep Them In Your Future Marketing Lists. Whether you send out email campaigns or routinely do newsletters to give your prospects worthwhile information, it's a great touch to keep past clients in the funnel on these efforts.
Past clients can represent a great market for future sales and you've already cultivated their goodwill by doing a great job on the property needs they've had so far. If you've let a lot of time lapse between contact, it's still worth your time to try to reconnect when possible.
If you are considering taking online real estate classes call us at 888 768 5285 and we can help you get enrolled
For additional ideas, check out this blog:How to Keep in Touch with Real Estate Clients Using Email
Love,
Kartik
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When most people think about working in real estate, they immediately think of selling houses. While residential sales are the most common occupation for those with a real estate license, it’s far from
When most people think about working in real estate, they immediately think of selling houses. While residential sales are the most common occupation for those with a real estate license, it’s far from the only option. In fact, there’s a lot you can do within real estate that has nothing to do with the conventional sale of houses. Here are some of the real estate jobs available for those that don’t want to just sell houses.
Commercial Real Estate
If you like sales but don’t love the idea of selling homes to residents, you can still find the career of your dreams within real estate. Instead of selling homes, you’ll sell and lease office space and property to businesses. But the differences between commercial and residential real estate sales don’t end there. In commercial real estate, agents must be knowledgeable about the sectors in which they work and provide valuable analysis to potential buyers. Since newcomers to an area might not know much about the region’s demographics or traffic levels, it’s the commercial real estate agent’s job to fill them in and help find the best location or tenant for a given area. Because of this added analysis, it can be a longer and more difficult process to make a sale in the commercial realm than in the residential space, but the rewards can be greater -- a commercial Realtor can make a great living.
Real Estate Broker/Owner
Although it’s commonly believed that a real estate license is the same across the board, most states actually have levels of real estate licensure. And if you’re not content to act as a conventional real estate agent -- or if you’ve been an agent and want to try something else -- there’s still a way for you to get involved in real estate without being an agent. Becoming a real estate broker requires a healthy dose of ambition, but there could be serious benefits down the road. As a broker, you’ll have your own firm where real estate agents will work for you. It’s a way to keep your hands in a lucrative business while also allowing you to start your own business, applying your knowledge and expertise in an industry for which there’s always demand.
Property Manager
Earning a license also opens up the door to becoming a real estate property manager. Property managers oversee buildings for owners. A common role for a property manager that’s responsible for the units within an apartment complex (or a series of homes owned by a person or company) and is charged with fixing repairs, collecting rent and finding new tenants when existing tenants move out. This type of job is for someone who loves real estate and likes accounting, but doesn’t want to become a Realtor. Property managers are generally paid based on the gross rents collected; property managers can also receive leasing commissions for screening and finalizing deals with tenants.
Real Estate Assistant
The life of a real estate agent isn’t for everyone. Not everyone wants to travel to open houses and to meet with clients. However, for those that simply want to work in real estate while remaining in one location, there’s a way to make it happen -- and you may not even need a real estate license to do it. A real estate assistant provides support for agents and brokers, including answering phones, posting listings and preparing paperwork. These tasks help the agents tremendously as they manage their workflow. It’s also a good introduction for those who are unfamiliar with the inner workings of real estate. A real estate assistant may realize that they want to be an agent after all, and they can continue to work as an assistant while they take real estate license courses.
Financial Analyst
Real estate agents and brokers are often too busy with their everyday duties to take note of emerging trends in the marketplace. That’s where financial analysts come in. Analysts look at real estate data and attempt to predict where real estate is going, particularly in the local area. Financial analysts that work in real estate are also tasked with finding attractive investment opportunities so that the company can properly allocate its resources. Being a real estate financial analyst means being based largely in an office; it also doesn’t require a real estate license. Most large commercial real estate companies will have analysts on their team.
Real Estate Appraiser
If you like numbers, but don’t want to be tied to a desk all day, real estate appraisal might be the career for you. You don’t need to go to real estate license school but you will need to obtain a separate appraisal license. Once you do that, you’re able to determine accurate property values for the houses you examine, based on the home’s characteristics and comparable sales data. Appraisers are used when houses are sold or refinanced.
Inspector
Outside of the agent, the bank and the buyer, an inspector is the most important part of any real estate transaction. Inspectors visit properties before they’re sold and look for potential issues that would not only impact the sale, but would cause problems for the buyers down the road. Inspectors must be highly knowledgeable in all areas regarding houses; they don’t need a real estate license, but if you’re interested in being a real estate inspector, you’ll need to understand the inspector requirements of your state.
Loan Officer
Real estate loan officers don’t actually issue loans. Instead, they’re the intermediary between the bank and the buyer. Loan officers help buyers to get approved for financing, point out any issues that inhibit a buyer’s ability to obtain a mortgage and recommend products based on the unique situation of each home buyer. To become a loan officer, you don’t necessarily need a real estate license. Instead, you’ll have to take a 20-hour pre-licensure class that covers the laws and legalities around real estate lending. After that, you only need to pass the NMLS SAFE Mortgage Loan Originator Test and you’re ready to start working as a real estate loan officer.
There are plenty of cogs in the real estate machine. If any of these fails to function properly, the entire operation fails. Even if you don’t want to be a Realtor or obtain a real estate license, there’s a career option for you in our great business.
Love,
Kartik
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Real estate is most often thought of as being a numbers business. This is probably because it’s an intricate business that includes heavy regulations, lots of red tape, and major financial intricacies.
Real estate is most often thought of as being a numbers business. This is probably because it’s an intricate business that includes heavy regulations, lots of red tape, and major financial intricacies. For many people, their home purchase represents their largest investment. With that in mind, agents sometimes concentrate on the business and legal sides of real estate.
While you certainly don't want to overlook the hard and fast figures, real estate agents need to remember that the core of our industry is people. Unlike other investments, the home you buy is less about the money as it is about emotion. If you need a statistic to back up that premise, look no further than reporting suggesting that staging a home makes it sell faster.
Of course, real estate agents know that the psychology of staging a home is all about helping prospective buyers imagine the life they would have once they purchased their home. It's not about the dollars. It's about the quality of life.
How to Approach Real Estate in a People Centric Way
Whether you're a new real estate school student, experienced agent or investor in properties, it's important that you understand that the end client is looking for more than a great financial investment. That's not to say that buyers and renters aren't looking at the bottom line at all. People have budgets they need to adhere to. But when they do make a final decision on where they're going to live, they're going to choose the best home that meets their lifestyle and emotional goals within a given price range.
For a real estate agent, this means meeting your clients' needs in a proactive way. You have to recognize that they're not only investing in a property, they're planning the kind of life they want to have. The neighborhood and community will play into their decision almost as much as the actual structure of the home.
This is why so many real estate agents use drones and spend a great deal of time learning as much as possible about the neighborhoods. These extra insights help you find the right community and neighborhood for your specific buyer. A couple with a young family may be more interested in a neighborhood with a lot of family friendly activities and amenities. On the other hand, a single professional might be more concerned with culture, nightlife, and easy access to travel.
Finding the right home for a buyer is about finding the right atmosphere, too. A great agent will listen to the types of things their buyer is saying and ask pointed questions about the type of life they enjoy. A buyer might not know all the things they're looking for until they see it, but the right agent will have a great way of getting to know the buyer and showing them all the amenities in a property and area that they will love and appreciate.
It's Not Only About the Property, It's Also About the Experience
Real estate is a bit of a juggling act. You have to know the ins and outs of contracts and loan documentation. You need to know the neighborhoods and market pricing. You need to be up to date on the latest construction and property trends. But the biggest piece of the puzzle is your ability to connect with your buyer.
The home buyer's experience should be a primary goal for any agent. This includes listening to what they're looking for and having the knowledge and foresight to find the best properties that meet their ideal home needs. A great agent knows how important this purchase is for the buyer. A home is unlike any other purchase because, at the end of the day, you're investing in the place that you will raise your family and make your memories.
An agent needs to place customer service as the highest priority. In any business, you want to be receptive to the client and always follow through on the things you agree to - like making sure you remember meetings and scheduled showings. In the real estate industry, you may also need to do a bit more hand holding with some clients.
It can't be overstated how important this purchase is to the client. They may want to view a property more times than average or have extra questions about the property history. Ideally, as an agent, it isn't just about getting the client to purchase. It's making sure that they are happy with their home for years to come.
The big reason I wanted to write this blog post is because I want all our real estate license students to realize that the experience of buying a property is almost as important as the property itself.
Love,
Kartik
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First-time home buyers need all the help they can get. That's not a derogatory statement; it's the absolute truth. Put yourself in their shoes for a moment. Making a decision to spend several hundred thousand
First-time home buyers need all the help they can get. That's not a derogatory statement; it's the absolute truth. Put yourself in their shoes for a moment. Making a decision to spend several hundred thousand dollars is not one that should be taken lightly. Because of this, some real estate professionals specialize in working with new buyers and have come to understand the unique challenges they face.
Whether first-time home buyers are your specialty or not, at some point in your career you're bound to deal with newer buyers. There are even continuing education real estate classes you can take to learn the intricacies of working with this unique group of buyers. If you find yourself with a client who has never purchased a home before, keep the following points in mind so you can do your very best for them from day-one until after closing:
House-hunting: You should help the buyer find the right location, type of home and price range of homes that fit their budget. This means taking into consideration what they want in terms of school district, nearby social amenities, prices, and much more. What comes naturally to you, as a real estate agent, is a brand-new universe to first-time buyers. Help them hunt for the ideal home.
Pre-approval: Explain the key difference between pre-qualification and pre-approval to your clients. The former is not nearly as important as the latter. Pre-approval will let them know what they can afford, and it will guide you as you begin to show them homes that fit their budget. It's equally important that you advise the buyers not to do anything that will change their financial situation between now and closing. They should understand that now is not a good time to buy a car or apply for other loans. Doing so can really jeopardize their chances of being approved as their debt-to-income ratio will be skewed.
Inspections: Help your new buyers choose a competent inspector. Remember, they haven't a clue about any of these issues. In a state like California this is extra important because there is no licensing or regulatory oversight of home inspectors in our state. Perhaps they know about having to get an inspection, but you can guide them to a professional with relevant experience on the kinds of homes they're looking at. It is also essential that you attend the home inspection. Your presence will give vital first-hand knowledge about any issues that come up. Plus, you can walk your buyers through the process of how to use inspection report data to negotiate their position if needed. This is one area where first-time home buyers often lose their way by hiring so-so inspectors and failing to use the report to tweak their offer.
Negotiation: Experienced real estate professionals know how to get the upper hand in a negotiation. First-time buyers often believe that the asking price is carved in stone. You need to show them how to make an offer based on what the house is really worth based on objective criteria. Many buyers report that when they purchased their first home, the real estate agent helped them get a significantly lower price than what the seller was originally asking. Use the tactics you learned in real estate school along with your real-world experience to get the best possible deal for your buyers.
Communication: You, the agent, are solely responsible for keeping the lines of communication open among the parties. All the parties look to you as the quarterback because you are essentially speaking for the very people who will ultimately come up with the funds to make the deal happen. Don't let anything slip through the cracks. Touch base with everyone on regularly. Being a reliable communicator is one of the things you sign up for when you get a real estate license.
Loose ends: Follow up on all the loose ends that crop up just before and after closing, and stay in touch with your buyers after they move in. As an agent, you know there are lots of little things that can slow things down on closing day. Do they have all the ID they'll need for the notarizations, for example? Remember, the buyers will think of you as a friend and mentor long after the deal is done. Maintaining this relationship can mean referrals and lasting relationships with people you enjoy spending time with. Think of it as long-term networking.
After you get a real estate license and work for a few years in the industry, you'll learn that some home buyers are much more experienced than others. People setting out to purchase their very first home need all the encouragement and support you can give them.
Agents learn a lot from their real estate course about different kinds of buyers, but it takes "on the ground" experience to fully comprehend the many ways you can put your knowledge to work for special first-time ones.
Call us at 888 768 5285 for more info on how to get a real estate license.
Love,
Kartik
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If you were searching for a home in the 1950s, you essentially had to do so "the old-fashioned way" - by driving around to available properties in your area and seeing as many of them as you possibly could.
If you were searching for a home in the 1950s, you essentially had to do so "the old-fashioned way" - by driving around to available properties in your area and seeing as many of them as you possibly could. Not only was this a time-consuming process for most people, but it was also inherently ineffective. There are only so many hours in a day and you needed to be very judicious about how you spent them while on the hunt.
Then, in the early 1990s, something incredible happened: the World Wide Web was born. It's not a surprise that the prevalence of the Internet in the homes of average people (as opposed to college campuses and businesses) is directly related to the rise of real estate photography. Around that time, real estate agents realized that by including color photos on websites and listings for properties, they could generate more interest - and more leads - than ever before. Home buyers could benefit too, as now they could not only see properties in an adequate amount of detail without ever actually getting in the car, they could suddenly see homes for sale in other cities or even states.
This gave everyone involved more options than ever and thus, one of the most important real estate trends of the last quarter century was born.
Over the years, this technology has continued to advance and the visual side of the digital experience has become more crucial than ever. Now, it's not uncommon to see real estate agents buying drones so that they can capture high definition videos of a particular property from the air. All of this is in service of an essential goal for any agent: helping someone get a sense of what it might actually be like to live in a property through any means necessary.
But as is true in so many other industries, technology in real estate has never really sat still for long. Advancements like the Matterport camera have not only changed the way that agents and buyers alike think about what a listing can be... they've also essentially changed the touring process itself, both for the better and for all-time.
Enter: The Matterport Camera
Image Source via matterport.com
Originally founded in 2011, Matterport is a company that offers premium camera solutions designed to capture, store and share three dimensional images and models. Based out of Sunnyvale, California, the company's founders say that they started their business to support any customer that relies on integrated 3D models to operate their own organizations - which is a large part of the reason why the platform has been so successful particularly in the real estate industry.
How Does the Matterport Camera Work?
The actual Matterport devices themselves can be paired with any compatible camera, or a smartphone or other mobile devices like an iPhone. Though the specifics will obviously vary depending on the model you're talking about, in general the process goes like this:
First, you use your camera and Matterport to capture HDR panoramic imagery. What makes this solution different from a standard camera, however, is that sophisticated depth information of the environment is captured at the same time.
The Matterport platform synthesizes all of that spatial data and visual imagery, essentially combining it in a way that creates a dimensionally accurate 3D digital "twin" of the environment in question.
The platform provides further tools that real estate agents can use to generate photo galleries and even virtual "walk-throughs" of a space.
The Matterport SDK can be used to integrate this content into an agent's own website or branded applications, thus making it possible to share with anyone, at any time, and from any device.
In other words, it's a way to transform standard 2D images into 3D "twins" that are spatially accurate and engaging in a way that regular photos can never be.
What Are the Benefits of the Matterport 3D Camera?
At the very least, it's a way to allow the photos of a house or other environment to "come alive," offering an experience that is far more interactive than ever before. Matterport images naturally have a bigger sense of dimension to them by design, meaning that people can get a feel for how big a room is or how tall the ceilings are without ever physically stepping foot in that place.
Over the last decade, savvy real estate agents have started to use it to make those early stages of buying a home not only more efficient for their customers, but more fun and exciting as well.
But as is true for so many other examples of state-of-the-art technology, a lot of people viewed Matterport as little more than a "fun addition" to the buying process up to this point. Yes, it's helpful to get a better sense of the way a home "feels" from the comfort of your computer chair. But for most people, it was a way to quickly disqualify a few homes from their tour list so that they can spend more time in those that remain when they scheduled their in-person tours. It was an asset to real estate professionals, to be sure - but few looked at it as something that was really going to "seal the deal" when it came to actually making a sale.
Transitioning to 3D Tours During the Coronavirus Pandemic
Until, of course, the Coronavirus pandemic hit in early 2020.
Just because roughly 60% of Americans are currently under stay-at-home orders does NOT mean those people don't need to buy a new house. A lot of people were likely already in the process of searching when the COVID-19 situation first hit, and others knew that this summer would be the one when they finally moved into the home of their dreams. Being required to stay in your home for an indefinite period of time has certainly hampered those efforts, but luckily the wonders of modern technology have been able to step up and lend a helping hand the same way they always do.
According to one recent study, Zillow in particular said that it saw a massive 191% increase in the creation of 3D home tours in one week at the end of March, 2020, when compared with the average number that were created in February. Likewise, real estate brokerage Redfin indicated that it saw a 494% increase in requests for virtual walk-throughs and agent-led video home tours, up dramatically since the beginning of March.
Truly, this is something that couldn't have come along at a better time - though even those at Matterport would have had no way of knowing that just a year ago. For so many areas in the country, people have no idea how long current social distancing requirements will stay in place. Even once stay-at-home orders are lifted and things begin to get "back to normal," it'll be difficult to find people willing to walk through what is essentially a public space for a home tour with an in-person agent for the foreseeable future.
Thanks to devices like Matterport, however, they don't have to. Virtual tours like those offered from Matterport are a perfect opportunity to show prospective clients a finished, furnished interior in a way that still keeps them as active and as engaged in the buying process as ever, all in a way that seems like it was tailor made for the current environment that we're currently living in.
Tomorrow's Technology, Available Today
In the end, it was already clear that the Matterport camera (or at the very least, something like it) was going to be the future of the real estate industry as we knew it. It's just that thanks to Coronavirus, few people likely could have predicted that the "future" would have arrived quite as quickly as it did.
Even on a basic level, Matterport tours bring with them a host of unique advantages for real estate professionals that can't be ignored. First off, they save a tremendous amount of time because customers can see a property on their laptops, phones and other devices with an incredible sense of immersion. They can instantly get a feel for what it would be like to live there without physically seeing it, thus preventing the need for agents to field constant phone calls and allowing them to focus on other aspects of their business that demand their attention.
They're also an incredible opportunity for real estate agents to cut costs, as they no longer have to spend countless hours driving back and forth to meet potential clients only to have them quickly realize that the property in question just isn't for them.
But in an age when it will be difficult to get people to feel comfortable with actually walking into a home for quite some time, Matterport tours and other 3D options are a perfect way to keep the real estate industry moving forward as efficiently and as strongly as it can. It's also something that is going to continue to get even more popular as the technology at the heart of it continues to advance.
Love,
Kartik
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Many people who are in the market for a home consider purchasing a foreclosure for various reasons. The two most common motivating factors include getting an inexpensive place to live and purchasing so-called
Many people who are in the market for a home consider purchasing a foreclosure for various reasons. The two most common motivating factors include getting an inexpensive place to live and purchasing so-called "investment properties" that can be renovated and sold for a nice profit. There's nothing inherently wrong with these concepts, and a good number of buyers do indeed find major bargains.
But like everything else in the world of real estate, there are pros and cons to purchasing a house that is in foreclosure. The best way to approach the question is to look at what it means for a property to be categorized as "foreclosed," and what the most common advantages and disadvantages are when it comes to buying foreclosed properties. Learning how to invest in real estate can be an important tool for any consumer.
What is a Foreclosure?
In the broadest terms, a property becomes a foreclosure when the original owners can no longer make the payments and the bank takes ownership and possession of the home. At that point, buyers aren't dealing with the former owners of the house. They're buying directly from the bank (different than a short sale discussed below).
Banks don't like being in the home-selling business, so they're often anxious to unload whatever houses they are holding in inventory. There are lots of reasons a home can go into foreclosure, but the inability of the original owners to honor the terms of the original note is the most common scenario.
What are the Main Advantages of Buying a Foreclosure?
Foreclosures can be attractive buys for a number of reasons:
Low price: The most common advantage for buyers is a price that could be lower than market value. In some cases, banks are willing to accept offers that are less than you would pay if the home were being sold by its original owners. As far as banks are concerned, the high level goal of selling a home is to recoup their investment. If they can do that, and if there aren't several other buyers bidding the price up, then they're usually glad to get the asset off their books and into your possession through a sale. Prices on foreclosures can be lower than market value.
Title can still be clear: If you are buying an REO from a real estate broker and there is a standard escrow you can often get title insurance on it guaranteeing that the title is free of clouds.
Financing is virtually the same: In many cases, you can still use FHA, VA or conventional financing options to purchase a foreclosure. The only difference is that you're submitting your bid to a bank rather than a person. Expect the bank to make a counter-offer if they aren't happy with your first bid.
Investment opportunities: If you don't plan to live in the house and have the funds for upgrading or repairing it, then a foreclosure can be a smart way to invest in a potentially profitable piece of real estate. Some people have slowly built up a small portfolio of homes for sale by acquiring low-cost foreclosures and having them repaired.
What are the Disadvantages of Buying a Foreclosed Home?
There's a downside to buying foreclosed homes. Here are common disadvantages:
Closing can take a long time: Depending on the reason the home went into foreclosure, it might take you several months to close on the property after you decide to buy it. If you're in a hurry, or need to use the house as your main residence, time may not be on your side.
This is more true with a short sale. A short sale is different from a bank-owned foreclosure because the seller is not the lender in a short sale. The reason that short sales can take a longer amount of time to go through is because in a short sale, the seller needs approval from their lender to sell the property for less than the amount owed on the home. This third-party approval can take time to process.
Condition is usually "as-is": This is the main disadvantage of buying a foreclosed home. The condition is often quite bad and you have to do your best to figure out how much it will cost to bring it up to par. Generally banks selling foreclosures are exempt from providing a buyer with many of the disclosures that you would otherwise get from the prior owner. That means a thorough inspection at the very least. Next, you'll need to hire one or more contractors to give you estimates for repair work. Perhaps the roof needs to be replaced or there are plumbing problems.
You'll need to be approved and have good credit: You need to check with your lender and see if you can get approved for financing on a foreclosure. That typically means you'll need at least "good" credit and perhaps much better than good. Like any real estate deal, do not venture into the foreclosure market until you get a go-ahead from your own lender.
There's a reason it's still on the market: Foreclosed properties that have been up for bids for a may have "hidden problems." Think of it this way: why have so many other potential buyers passed on the chance to buy the house? By far, the most common reason is the condition and the potential cost to repair it.
The Big Picture
The key point to keep in mind is that buying a foreclosed property can be either a very good or very bad financial move. You have to perform your own due diligence and find out what the pros and cons of a specific property are. Are extensive repairs needed? Do you have the funds to bring the house up to a high standard of quality and sell it for a profit, or live in it comfortably? Will your lender approve your application to purchase a foreclosed property? Are you ready to have the home inspected and take care of the necessary repairs? Are there unknown facts about why the property has been on the market, with no buyers, for x number of days?
Be sure to do a thorough analysis and try to get answers to all your questions. One thing that can be of great help is working with a Realtor who specializes in foreclosures. That way, you'll have the added advantage of expert advice every step of the way. What's the bottom line on buying foreclosures? If you take your time, work with a professional and do plenty of research, it's possible to find good deals. But never approach the process if you're in a rush, know nothing about the real estate market or are expecting to guarantee yourself a quick profit.
If you are interested in learning more about the real estate market or becoming a real estate agent so you can invest on your own, call us at 888-768-5285.
Love,
Kartik
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Referrals are perhaps the most powerful tool you have for building your real estate career. While you can market heavily online and locally, there is nothing more powerful and meaningful than having an
Referrals are perhaps the most powerful tool you have for building your real estate career. While you can market heavily online and locally, there is nothing more powerful and meaningful than having an existing client recommend you to their friends and family. Consumers trust other consumers in every business. The question is, how do you encourage your clients, then, to recommend your services to others?
Be the Type of Person People Will Want to Recommend
The first step in getting referrals is the most challenging. You have to go above and beyond, exceed expectations, and deliver more than what the client expects. That’s a lot to ask for, of course, but it is what helps people to remember you and want to tell the world about you and what you did for them.
At the very heart of this, you should provide excellent service to your clients:
⦁ Respond to them as soon as possible.
⦁ Find solutions to their concerns.
⦁ Work outside of the normal business hours if they need you to.
⦁ If they are worried about the cost of a repair on a home, set up a quote for them.
⦁ Provide recommendations for service providers they may need within their budget.
There are many simple things you can do to address the needs of your client. Most importantly, listen to them. See what their goals or concerns are and provide solutions.
Ask for the Recommendation
When a transaction is successful, it is always important for you to thank your customers. Yet, that is not enough. Take a few minutes and talk about how important they are to you. Ask that if they have friends or family planning to buy or sell that they take the time to recommend you.
You can also ask for your satisfied clients to also share a review of your services online. While real estate agents may find this to be a bit awkward, most consumers are more than willing to do so when they are happy with the service they received. Send them an email with a link to streamline it. Don’t be shy :) - Link them to your Yelp or other review pages.
Build Relationships in the Community
Whether through the local Chamber of Commerce, city council, religious organizations, or professional associations, the more connections you make, the more opportunities you create for referrals. The key is to get to know people who work or live within your ideal area.
When you got your real estate license, you knew the value of developing networks – it is a key component of learning to market your services. Now, work to build those relationships on an ongoing basis. You don’t necessarily have to donate money to create these opportunities or spend a lot of money on the process. Instead, focus on just getting to know people. Give people the opportunity to say to their friends, “I know a really good Realtor…”
Provide Follow-Up Service
When the home sells or the buyer moves into their home, your job is not done yet. While officially it may be, this is the perfect time to follow-up with the buyer or seller to get more insight and clarity. Perhaps a month later, send them a note. Provide a card with a few recommendations of local restaurants. You can even reach out to those restaurants and small businesses to request a coupon you can offer. You can also just send a bouquet of flowers.
If you want to create more of a personal relationship, connect with your clients with a formal email or even a lunch appointment. Ask them what they thought of the process. What could you have done better? Learn more about what their expectations and needs are going forward. Provide a few business cards, so they can recommend you to their friends.
Keep in Contact with Leads – Even Those That Don’t Buy
Some of the best referrals come months – even a year – after a client has approached you about the prospect of buying or selling a home. This is a big decision for most people. As a result, they need to be able to think about and work out the details of the transaction before they commit to the process.
Be sure to have your new inquiries provide an email so you can send them information about current market conditions, new opportunities that come up, or other services and offers that may help. Emails sent consistently and over a period of time, allow you to remain fresh in the minds of your would-be clients. When it is time for them to do their deal they are more likely to call you.
Give People Something to Remember You By
Another fantastic way to keep your image and name in front of people is by giving branded material away. Whether it is a water bottle they can use for years with your logo on it or a t-shirt, the goal is to keep your brand in front of them long term.
Imagine the client that buys a home from you having a branded hoodie from you – perhaps you gave it to them as a thank you gift. They wear it often. They receive questions about it and can tell their friends and family all about your business as a result. This is a fantastic way to get your clients to keep talking about you long after they purchase a home.
Ready to Get Started?
When you become a Realtor, value every relationship you create. Whether it is in meeting friends of friends or connecting with clients that call your office, you need to build a connection. When you really do connect with these leads, you create long-lasting opportunities for them to remember you and the services you offer. People love to share good things about those they know. You want to be one of the people they talk about in a positive manner.
If you are interested in learning more about a career in real estate and how to get a real estate license, call us at 888 768 5285.
Love,
Kartik
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The truth is that becoming a real estate agent is a lot easier than becoming a successful one. Taking real estate classes online and passing the real estate exam is the easy part. After you get your
The truth is that becoming a real estate agent is a lot easier than becoming a successful one. Taking real estate classes online and passing the real estate exam is the easy part. After you get your real estate license, the next step is to get connected with a brokerage and jump into production as quickly as you can.
One way that newer Realtors accelerate their chances of making it in the business is by getting paired up with a mentor. There are many reasons why mentors work and can bend the learning curve for a newer agent. I wanted to share a few of these so you know that you aren’t going to be thrown to the wolves in most real estate offices. You’ll have help in the form of a mentor.
Mentors Increase Your Chances of Actually Staying in the Business
Ask any big broker and they will tell you that the biggest burden they face in their business isn’t actually getting sued by an angry client. It’s actually recruitment and retention. The burnout rate for newer agents is so high that most companies have a stated goal of hiring 5-10 new agents per month because so many new agents don’t end up making it. This in turn means that the broker has to put resources into recruitment leaving them less time to train their newer sales staff. It’s a vicious cycle.
A great mentor can give 1:1 advice to a mentee and help them work through concerns which helps retain great salespeople.
By keeping agent turnover low, the broker can build a strong network of experienced and qualified agents rather than dealing with the constant task of recruiting newer agents to replace the ones that leave.
Time Savings for The Broker
Imagine large real estate brokerages. I define a “large” real estate company as one with at least 100 agents. There is really no effective way that one man or woman can be there to answer questions, coach and train a staff that large and do it consistently.
For this reason, a well thought out mentorship program is an easy way to save the broker time and hassle. By leveraging mentors, newer agents with questions can look to their mentor for help as opposed to hunting down an already stretched-too-thin broker/owner. This frees the broker up to only answer those high-level questions that stump even the best of mentors.
Additionally, mentors also play a vital role in reducing the “on-the-job” training necessary for newer agents working on their first escrow. In effect, the mentor can act as a ‘project-based’ sounding board for help on a deal-by-deal basis. This will allow the broker to invest more time working on higher level training rather than putting out deal specific fires.
Mentors Offer Encouragement and Act as a Cheerleader
Great mentors should help us see those things that we would not otherwise recognize. For newer agents this means that their mentor is able to realize what you are capable of achieving and will put you on the track to realize your potential.
This is especially true in the real estate business where there are several ups and downs in the course of a day and that every deal is on life support at some point in the escrow process.
Helping a newer agent manage their emotions and keep their eye on the finish line is a critical aspect of the business.
A great mentor can give a boost to the confidence that a newer agent needs.
Mentors Have Experience That They Can Pass On
Every veteran real estate agent has had a buyer buy from someone else or a seller who didn’t give them the listing. Understanding how to navigate these emotional ups and downs is critical.
A mentor who is transparent about their experience has likely been where you are, and has made the same mistakes you might have made or are about to make.
A good mentor will share their own mistakes, so they aren’t repeated by a newer agent.
Before you get a real estate mentor, I’m guessing that you need to sign up for online real estate classes. Please call me at 888 768 5285 and I would be happy to discuss your career and help you get started in our great business of listing and selling real estate.
Love,
Kartik
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Whether you are a brand-new real estate agent trying to launch a career or are a seasoned agent looking to increase production I wanted to write a quick article for you. The below is a list of some of
Whether you are a brand-new real estate agent trying to launch a career or are a seasoned agent looking to increase production I wanted to write a quick article for you. The below is a list of some of the common traits I have observed in successful real estate agents.
Whether you are considering enrolling in a real estate class or are about to take a crash course to prepare for the real estate license exam the below list should prove useful
1. Manage Your Energy Level
Being able to run at a high level for a sustained period is critical to your success as a Realtor. It isn’t enough to just say “Work smarter and not harder.” You have to do both. Managing your energy level throughout the day is critical so you can work as hard as possible and continue to push.
The reason that this is so important is because many real estate agents and other outside salespeople tend to eat poorly, work long hours and lack consistent exercise.
The highest producing real estate people consciously try and escape this trap. How do they do this?
A consistent eating schedule of things that (for the most part) fuel their energy long-term - meaning plenty of vegetables, fruit and water. This also means a consistent program of vigorous exercise for at least 30 minutes a day on a ritualistic basis.
2. Focus on Improving One Area at A Time
There is a famous proverb that says “If you chase two rabbits, you will catch neither.”
The best businesspeople attack and focus on one target at a time, reach it and move to the next goal.
The secret is to cut up each goal into bite sized pieces that you can accomplish in short bursts so that you can rapidly move on to reaching the next one.
For example, if your goal is to have a better listing presentation, you might cut the entire presentation into 1/3 pieces.
The first third might be the verbal presentation itself.
The second third might be the physical presentation and other collateral material.
The final step might be objection handling practice.
The best agents don’t move on to tweaking their physical presentation until their verbal presentation is right.
Breaking the broad goal of “I want to have a better listing presentation” into pieces like this will result in the broader goal being achieved but in a shorter period of time.
3. Start with Baby Steps, Then Accelerate
It’s an interesting thing when I talk to newer real estate agents about their goals. I will often ask students why they want to get into real estate and what they plan on getting out of the course and their new career. Often they will say things like “I want to be rich!” Or “I want to make $250,000 my first year!”
I never want to crush someone’s dream or tell them that the thing they seem to want so badly isn’t possible. I think back to when I was a young 20 year old starting out in the business and if someone told me that my goals were unrealistic I would have dismissed them as being too negative and pessimistic.
With that being said, setting goals just for the sake of sounding overly ambitious can be dangerous and not useful.
The best businesspeople set rational and attainable goals with specific deadlines.
In the context of real estate sales this process might involve initially calculating how much you need to live on a monthly basis. Next, determine your average sales price in your area and the average commission per deal. Finally, ask yourself how many deals you need to do to achieve that income amount.
Example:
Average sales price = $600,000
Average commission = 2.5%
Average commission= $15,000
My expenses = $7,000 per month
Needed income = $84,000 per year
I need to sell 6 homes per year to survive.
My goal = 6 homes per year
Once you have proven that doing 6 deals a year is possible, you can then set loftier goals.
Remember that being great doesn’t happen by accident and a process must be followed. I would encourage you at this early stage of your real estate career to adopt habits and set goals that give you the greatest chance of success in a highly competitive industry.
Love,
Kartik
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First time homebuyers are a fulfilling market for the real estate agent. You're helping people move from spending money on rent that they'll never recoup to investing that same money into a property they
First time homebuyers are a fulfilling market for the real estate agent. You're helping people move from spending money on rent that they'll never recoup to investing that same money into a property they actually own. This is a huge leap for most people and, as their agent, you get to help them find a starter home, or even their dream house.
All of this is empowering and inspirational. The problem is that many agents find it difficult to convert renters into buyers. People often rent because they don't feel financially stable enough to own a home. There may be a plethora of obstacles in their way, from salary to down payment to a lifestyle that means more mobility.
The reality is that many people can afford to buy and most would agree that buying would be beneficial for them financially. As their real estate agent, your goal is to educate potential buyers - But first you have to find them.
What Demographics Are Included in the First Time Home Buying Market?
There are different segments of first-time home buyers. Often real estate agents zone in on the ones who have already expressed interested in buying a home. This is an easier demographic to market to because they're already looking for your services. You don't need to educate them on why buying could be beneficial for them because they've already come to that conclusion.
The second hidden demographic are renters who haven't considered buying yet. Renters are often thought of as folks who haven't yet saved enough money to buy. That's not the whole of this demographic, though. There are those who aren’t in a position to buy right away, for certain. But every demographic is accounted for here for various reasons. Some prefer the mobility that renting allows as they are able to move more frequently with less hassle. Some simply prefer the location and amenities available in rental space in their locations.
First time home buyers may not be what you would think without researching, as well. For instance, single women make up a surprisingly high percentage of new homeowners.
When you're considering how to reach first time homeowners, there are a number of channels you can use to capture them. You'll also find that your geographic location will give you more information to help you target your market.
For many homebuyers in California rents have been rising so quickly and consistently that home ownership becomes more and more appealing with every rental increase notice. Remember that your buyers don’t necessarily need 20 percent down like in the olden days. There are many programs that offer down payment options of 0-5% making homeownership possible for more people.
How to Market to Renters to Help Convert Them to Home Buyers
For the renters who have already decided that they want to purchase a home, the marketing campaigns should be tailored more for sales than education, though value based content can still be used here. These future buyers can be considered warm leads because they already have an interest in purchasing.
To reach renters who have not already committed to buying a property, real estate agents sometimes need to use more creative solutions in order to educate and convince this market. The good news is that many renters would prefer to be homeowners. They often believe they can't afford it but in many cases they simply need more education about the buying process.
Educate Prospective Buyers on the Affordability of Buying
There are a number of ways to do this but the reality is that many would be buyers don't even research the idea of buying property because they mistakenly believe they can't afford it. Many of them can and should consider buying rather than renting. They also often believe that their monthly mortgage payment would be higher than their current rent, but that's often not the case, either.
Here are some ways you can reach these renters with more information that can help them to see buying as a good alternative for them:
Online Campaigns. You can use your social media channels and newsletters to help educate renters on the financial realities of buying. This can include statistics and personal stories showcasing the benefits to owning a home over renting.
Value Packed Blog and YouTube Posts. Use your website blog to host informative pieces that can be helpful for renters looking to buy. This can include tips on saving for the down payment for a home and information on finding the right property to fit your budget and lifestyle.
Articles in Local Publications. If renters aren't currently looking to buy a property, they may never visit your blog or pay attention to any of your campaigns. But articles in local publications have a broader reach. This might include town newsletters, local papers, and magazines.
Personal Outreach. Hosting webinars and classes about home buying can be a great way to educate first time buyers.
You'll find that many would be buyers are simply misinformed about the process. Helping to educate them on the benefits of home ownership can be an excellent way to reach this fantastic market
I wanted to write a blog about this because many of our real estate school students start out working with buyers and many of these are first time homebuyers. Having a solid plan of action to target and convert this market segment can prove profitable to the newer real estate agent.
If you are interested in taking real estate classes call us at 888 768 5285 or visit us at www.adhischools.com
Love,
Kartik
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While historic homes don’t make up the bulk of sales for most Realtors, there are some agents who specialize in historic home sales. Still, this doesn't mean that you shouldn't venture into this great
While historic homes don’t make up the bulk of sales for most Realtors, there are some agents who specialize in historic home sales. Still, this doesn't mean that you shouldn't venture into this great market, or that you should defer to a local agent that has more experience with historic properties.
Historic homes can be an amazing acquisition for the right buyer. But there are some things specific to these types of properties that you should be aware of in order to best serve your clients.
Why Historic Homes Can Be an Amazing Purchase
Historic homes and properties within historic districts have amazing features that many buyers prize. For the home buyer who loves classic architecture or enjoys the history behind their residence, no new construction could ever compare. You may have a client who just falls in love with a historic property or you may have a client who is specifically looking for something with historic significance.
Each geographic location has their own historical homes that bring some flavor of past residents to life. The amazing thing with many historic homes is that they've gone through numerous generations and the history of each family is often present in the home itself. You can see this through additions made to the original architecture and a layering of the original design with more modern elements added over time.
The architectural and historic appeal is often the biggest benefit that your clients might be looking at in making their decision. But there are some other benefits that might be available that you should research and point out when applicable.
6 Things to Keep in Mind When Buying Historic Property
While many home buyers fall in love with the romance and history of historic properties, there are some things to consider which are unique to these types of property. Unlike new construction or homes built in recent years, historic homes have some quirks that can at times be costly to maintain. They've weathered many seasons and, depending on the local weather and type of construction, they may be in need of some extra TLC in regular maintenance.
Here are some things to make sure that your clients are aware of when purchasing a historic home:
1. Does the Property Include Elements Besides the Home?
Some historic properties are larger than a typical home lot and may include other structures which may also be historical in nature. They also often include great gems in landscaping, such as very large, beautiful trees, carefully planned gardens and hedges, greenhouses, gazebos, and even ponds.
2. Is There A Mass Appeal to this Home's History?
In cases where the property of someone with great local or national significance or where the architect was someone of note, the home might be used for touring or parts of the property might be useful to rent for events. If you're not interested in opening up your private residence in this manner, you might still find this a major perk just to own a home of this value and showcase it for your own purposes.
3. Possible Tax Incentives and Funding
In many areas, there are available funds and lower interest loans available for people who buy historical homes and wish to renovate them. These loans do come with some strings attached. The renovations often need to be done to certain specifications in order to maintain the home's integrity as a historic place.
4. Higher Than Average Renovation Costs
Each property is different. If your client is looking at a historic home that has already been completely renovated, they may not need to worry over renovation costs. However, in a case where there is major renovation work, it can often be more costly than renovating a newer home. This is because you'll often need to replace pieces that are no longer made or commonly used in newer construction. To maintain the historic significance, you may need to hire specialty contractors or preservationists to work on the home, which can be way higher in cost than a do it yourself project.
5. There May Be Restrictions
In many places, there are restrictions on the types of changes you can make to a historic property. This might include rigid restrictions on the outside aesthetic, such as paint color schemes and landscaping. It also might mean that you're prohibited from enhancing the property with new additions. It's important that buyers know these parameters in advance because they may need to live in a home where the architecture and design is less convenient for today's lifestyle than it was for the generation who built it. In most cases, those historic differences will add to the charm of the place.
6. More Likely to Have Hazards Than Newer Properties
Older properties were often built with materials that are no longer in use because they were found to be hazardous, such as asbestos. They also may be more prone to issues like mold because of the age of the home itself. It's important to have the home thoroughly inspected by a professional before purchasing. They can tell you if there are any issues in advance.
Historic homes provide a wonderful glimpse into past generations and can often be a dream residence for the right buyer. If you want more information about the historic properties in your area, contact the National Register of Historic Places.
As always, the first place to start your real estate journey is with a great online real estate course like ours. Call us today at 888 768 5285 if we can be of service.
Love,
Kartik
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When you're in sales, the first impression can be the gateway to success. For real estate agents, it's the first step down a long and potentially lucrative path. The good news is that working on your first
When you're in sales, the first impression can be the gateway to success. For real estate agents, it's the first step down a long and potentially lucrative path. The good news is that working on your first impression will serve not just your career, but every other relationship you have in life. I wanted to write a blog post to take you through what a solid first impression looks like, how it helps you better relate to your clients, and what their takeaway will mean for your bottom line.
How to Create a Great First Impression
1. The Basics
Most of making a good first impression is common sense. However, just because it's easy to understand, doesn't mean it's easy to do. Even natural extroverts have to continually practice their manners and mannerisms before they get it right.
Smile: Nearly half of all Americans say that the smile is the most memorable feature after meeting someone new. A fresh-faced smile sends a signal to people that you're happy to work with them and you're ready to get the work done.
Focus: When it comes to meeting new clients, the nervousness of making a good first impression can be enough to force your head down. Eye contact is both polite and helps forge an instant connection with clients.
Listen: Anyone who's ever dealt with a salesperson knows how frustrating it can be to feel as though your words are going straight into the wind. Active listening means paying attention, asking questions, and responding to the clients' real concerns.
2. Dig a Little Deeper
A first impression is more than just following the basics. Picture the guy with the comically huge grin plastered on his face, the woman with off putting eye contact, or the agent who effusively responds to every statement as if it's the most fascinating thing they've ever heard. In the strictest sense of the word, they're smiling, listening, and focusing, but they still aren't leaving the right impression.
To really master the directions, you need to practice sincerity with each step. Express genuine emotion when appropriate, but remember that subtlety can also go a long way. Give a small grin when meeting people and save the teeth for the last minute. Follow-up on client statements that are vague or need further information. Blink normally when making eye contact and don't be afraid of looking down for a second if the conversation is getting too intense.
3. Practice Makes Perfect
Practicing your first impression doesn't necessarily mean going to your local bar and talking to endless strangers. It can be as simple as setting up role-playing with people you already know and trust. Have them provide honest feedback and constructive criticism about the sincerity of your smile, the volume of your voice, and the firmness of your handshake. These comments can go a long way if you're trying to understand how other people see you during their first interaction.
When you're shaking someone's hand, look into their eyes and strike a balance between death grip and limp. Use the first name as quickly as possible during the conversation so you're less likely to forget their names halfway through. Make sure that you’re annunciating your words and the volume of your voice is appropriate for the context of the environment.
4. Do Your Prep Work
Once you've taken care of some of the more subjective aspects of the first impression, you should have a much easier time addressing the more practical work of meeting someone. Being prepared can be as simple as getting to a meeting early or donning a sports coat or blazer to make your outfit just a touch more professional.
Before you meet with clients, it helps to know as much as possible about what they're looking for. Even if it's as simple as knowing they want a duplex rather than a single-family. The art of sales can get complicated, so it helps to hit the ground running.
5. Express Yourself
As tempting as it can be to remain neutral during your meeting, blandness will ultimately not help you be memorable. The truth is that even the most successful real estate agent may turn off a client or two with their personality, but it's ultimately better than being seen as forgettable. You can still be polite and respectful while expressing your personal opinions.
To stay on topic and to maximize the first few seconds with a client, some agents may give a short elevator speech where they emphasize their particular brand. So whether you're a bulldog in negotiations or the master of the short escrow, letting clients know upfront can be a good way to stand out.
Unlike most traditional sales, successfully navigating a property sale can take months or longer. If you hope to maintain your reputation and relationship with your clients for that long, you need to get off on the right foot. Use these tips to stand out from the crowd, so you're the one who ends up growing customer base.
This may be a slightly different blog post than I normally write, but so many of our real estate school students express their nervousness in meeting clients early in their careers. Hope this helps.
If you are interested in taking online real estate courses please visit our website or call us at 888 768 5285.
Love,
Kartik
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Changing careers and becoming a Realtor is a major step in anyone's life. As such, a real estate agent has to budget for pre- and post-licensing expenses as accurately as possible. But it isn’t only
Changing careers and becoming a Realtor is a major step in anyone's life. As such, a real estate agent has to budget for pre- and post-licensing expenses as accurately as possible. But it isn’t only real estate agents who have to account for these sorts of expenses. Most professional service providers like accountants and attorneys are just a few of the similar models that budding real estate agents can look at as a model.
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Real Estate School Cost
Before becoming a Realtor, prospective agents have to pay for real estate license classes in order to sit for the state examination. Real estate courses aren't free and as such you should budget the cost of real estate school into your plans.
ADHI Schools’ real estate license courses: $150-$499
Real Estate Exam Fees
In addition to the cost of the licensing courses at a state approved real estate school, there are exam and license fees to consider as well. Also, remember that this article is written and published in March of 2020. These fees can change over time. You are encouraged to check our website or call us at 888 768 5285 to ensure that you are looking at the most recent set of fees.
State examination: $100
4 year real estate license: $350
Criminal background/Livescan fee: $84
Real Estate Broker Fees
Once you complete all these pre-license costs, the broker you decide to associate with will determine the next set of costs. When shopping for a place to hang your hat in the early days of your real estate career, be sure to find out about:
⦁Desk fees, if any, that you will have to remit to the broker. These are fees that the broker charges whether or not you actually sell anything.
⦁ The commission split you have to pay to the broker. Most brokers will take some portion of the commission you pay to them from every transaction that you close.
⦁ What day-to-day expenses, if any, the brokerage will cover.
⦁How and if the brokerage will help you get leads.
Ongoing Costs: Marketing Expenses, Continuing Education, Travel
All the factors listed above should play a part in your decision about which broker to choose after you get your real estate license. Remember, there's much more to your upfront expenses than real estate courses and tuition for real estate license school. Note that, like most other business professionals and entrepreneurs, you will have some expenses even before getting a license. After that, there will be other costs, only some of which should be considered "upfront" in nature. A few, like ongoing marketing expenses, continuing education costs and travel expenses should be put into the "ongoing" category since they need not be paid before you earn your first commissions.
Realtor Membership Dues
Don’t forget that to join professional associations like the National and California Association of Realtors will also set you back over $1,000 annually in California. This will cover your access to the Multiple Listing Service, the contract generation software and an eKey that will allow you to open homes with lockboxes.
Marketing Fees
As an active real estate agent, you will also likely have ongoing marketing fees of at least $1,000 or more per year: This category includes necessary items for getting your name out there, like business cards, flyers, advertising, signs, websites and similar items.
Keep in mind that your broker might cover some of the above expenses for you. That's why it is essential that you discuss all the details of expense coverage, desk fees and commission splits with your prospective broker. Those factors will have a profound effect on what comes out of your pocket as opposed to what someone else will pay once you decide to become a Realtor.
Now That You Know the Cost, It’s Time to Start Your Career
Starting your new real estate career with eyes wide open is helpful. I wanted to write a blog post specifically about this as I know that the newer real estate licensee will likely have many of these questions.
If you haven’t taken the first step to become a real estate agent, enroll in our real estate license courses today! Check out our real estate success stories for inspiration! Call me at 888 768 5285 if we can be helpful.
Love,
Kartik
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Welcome to the world of people. Some clients you have are going to be just terrific. Others can make you regret getting into the real estate business altogether. Most are probably going to be somewhere
Welcome to the world of people. Some clients you have are going to be just terrific. Others can make you regret getting into the real estate business altogether. Most are probably going to be somewhere in between.
With that said, one of the benefits of working in our real estate business is the ability to work one-on-one with people. Not only are you helping to fill their needs, but also create positive, long-lasting relationships in many cases. Remember that after you finish real estate school with us and get out into the real world you’re going to find that not all people are as easy to deal with as you might like. Sometimes, you’re going to have a client that is.. well.. let’s just call them challenging.
Whether you are a seasoned real estate agent or a new Realtor who just passed the real estate license exam, there are a few simple things you can do to make these difficult relationships easier to manage.
#1: Keep Your Calm
No matter how awful the things are that the client may be saying, it’s essential to remain professional. If you have to rant and get some of your frustrations off your chest do so in private (not with agents or other clients). It is always important to keep the focus on the transaction. Remember, you do not have to work with them again.
Consider this. When a client is difficult, you may feel as though they are not worth your time or energy. Keep in mind that some difficult clients may be self-aware enough to recognize this about themselves. If you stick with them long term, they are more likely to continue the process and transact. They may even surprise you and refer you other business. It’s not always going to be easy, but it can be necessary to stick it out and maintain your composure and professionalism.
#2: Listen to Their Underlying Concerns
What happens if you encounter is a client that’s seemingly always unhappy? They complain about every property even though they’ve just asked to see it. They may say that the price is too high and the neighborhood isn’t good enough.
A true leader can recognize that constant negative behavior like this may point to a larger, underlying problem. Sit down with your client and talk about what you’ve looked at and the concerns you have had thus far. Then, ask them what they really want. Try to uncover their concerns. Are they truly ready to buy? Perhaps they are not sure if they have their finances teed up. In other cases, they may be be a fear of completing the purchase and make this type of commitment. Their complaints are just symptomatic of another issue.
Bear in mind that there are situations where their concerns will be valid. Perhaps they don’t feel you’re putting enough time into them or that you aren’t giving them what they need. It’s important to get them to clarify the root of the problem so that you can address it and move on.
#3: Respond to Them Sooner
Let’s say a client contacts you at 9 pm. What he or she said is irritating to you. You want to clarify the situation, but it’s already so late. Are you going to spend the night tossing and turning as a result of this situation? If so, it’s better to respond now and get it over with, so you can sleep.
The key here is when a client raises a concern about any factor, make it a priority to get it figured out as soon as you can. This helps to validate the client’s concerns. That doesn’t mean you are agreeing with them or even accepting any type of blame. Rather, you are simply moving things forward to the next step in the process.
Be sure to restate their claim or concern. For example, you might say, “Thank you for your email. I understand you are concerned with the timing of this sale….” You do not have to provide a solution right away, but you can tell the client you’re working on it or set up a time to talk about it.
#4: Let Go of Fear
Let’s say there is a client that just downright doesn’t understand the rules of the game. The buyer may want to underbid every property you show them. What about a seller who is adamant about overpricing the home? Worse yet, what about a seller who is refusing to make proper disclosures to a buyer? In these situations, you may be afraid to lose the client, but you have to step outside of that fear.
Be frank and honest with your clients all of the time. Tell them what is going to happen in any given situation. “If we underbid this by that much, we’re going to lose it to a competitor’s bid. Here’s what I think we should do.” Or, state, “It’s legally required to communicate this information. If you are not willing to do that, I need to step away from this relationship to protect my real estate license.”
Sometimes, you have to say what they need to hear frankly. Taking charge like this doesn’t mean being aggressive, but it means reminding them, in a positive way, that you know what you are doing.
#5: Find a Solution as a Priority
When clients are difficult, there is generally a reason for this. Your goal is not to ignore that concern. Rather, it is to find a compromise or solution that works for them.
We are in the business of helping people, and that often means figuring out what they want and need without them clarifying this. There will be times when you will miss the mark or make a mistake. The great real estate agent will admit those mistakes and find a solution to recover the client. How can you improve this situation if you were wrong?
On the other hand, if the client is wrong, you may want to throw your hands up and walk away. Before you do that, explain what’s happening. Then, offer more than one solution. By giving your client an option, you put the ball in their court. They now remain in charge of the outcome.
Difficult clients happen in every business. As you work to build your real estate career, you will find that there are 10 good clients for every bad one. Those are good odds, and it can mean that that one individual is pushing you to become a better agent, one that has to step outside of their comfort zone to support their client and your real estate sales business.
I’m always looking to bring our readers value. If I can be of service, please let me know. Feel free to reach out on Instagram or by phone at 888 768 5285.
Side note - If you read this and aren’t scared away at the prospect of real estate sales and want to enroll in our real estate school, feel free to do so here. We would love to have you as our newest student!
Love,
Kartik
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Making the decision to invest your time in real estate school is a big one. After all, starting a new career does take work in order to be successful. The process starts with getting the right education
Making the decision to invest your time in real estate school is a big one. After all, starting a new career does take work in order to be successful. The process starts with getting the right education to prepare you with the tools and resources to thrive in our great real estate business.
The question many people ask when starting their journey is whether or not real estate school is “hard”?
It’s Not Hard – It’s New
Real estate school itself isn’t difficult. However, a new skill set can take time and a little effort to develop. Think about all the things you’re good at now that took a little getting used to. For example, you didn’t learn to drive in just one day. You probably didn’t learn your favorite hobby instantly, either. The fact that skills take a little time to nurture have more to do with the rules of nature, not real estate classes.
To be clear, there is plenty to learn. To prepare for the real estate exam you’ll have to understand property taxation, landlord:tenant rules and basic real property ownership laws. Some topics can be a bit complex but with the right real estate school the process can go a little smoother.
You Have Varied Learning Options
Everyone learns at a different rate and with an individualized learning style. What’s great about our real estate school is that our students can choose the learning method that works best for them.
Some students do best in a classroom with a teacher lecturing them. Perhaps that’s the way you’ve always learned new things. You may like having a dedicated space to go to at a set time to learn. We offer over 20 classroom locations with expert instructors ready and able to answer your questions. We also offer over 500 YouTube videos on various real estate related topics. Finally, each one of our students gets college-level textbooks filled with real estate goodness to help you get started and more importantly finish up and get your real estate license.
So whether you like the classroom, the online world or physical textbooks we have you covered from all angles.
ADHI Schools Offers the Solutions Right for You
Here’s the really good news. At ADHI, you can learn any way that works for you. We offer both online and optional in-person educational programs. They are structured to give you the best opportunity to explore the material in a manner that fits your goals.
How Long Do I Have to Finish?
With ADHI Schools, your enrollment in the real estate program lasts a full year. That is more than enough time to learn the material and to do so at a pace that’s right for you. Perhaps you’re still working another career, or you are balancing personal life responsibilities. With this program, you don’t ever have to feel rushed.
Most of our students finish the program a lot quicker than this
but this type of flexibility gives you the ability to be in control. If you find some of the subject matter difficult, you can use the resources provided to dive deeper into that area than others that you find easier to take in.
The net-net bottom line is that real estate education isn’t too hard, but it is a new skill you need to learn, and that means it takes some commitment on your part. Even if you have no real background in real estate prior to this, it isn’t insurmountable. You may even enjoy all that you are learning. =)
With the right school (like ADHI Schools), and the best support team, (like our staff), you’ll get through every course and topic with ease, walking away with the confidence in what you’ve achieved.
Want to talk? Call me at 888-768-5285.
Love,
Kartik
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Happy holidays! Did you finish your real estate license courses as yet? Have you prepared for the real estate exam?
In a way, I almost feel bad for our real estate school students who get their real
Happy holidays! Did you finish your real estate license courses as yet? Have you prepared for the real estate exam?
In a way, I almost feel bad for our real estate school students who get their real estate licenses during the holidays. Becoming a Realtor in December can be a tough thing. A common objection that real estate agents get around this time of year is that sellers and buyers say they want to “wait until after the 1st”. While potential clients are waiting you aren’t earning.
I wanted to write an article to answer the question of “Is selling your home during the holidays, a good idea?”
Traditionally, home selling during November and December can be a bit slower depending on your market. People often put it off until the New Year for no real reason other than the perception might be that the first quarter of the next year is better than the fourth quarter of the prior one.
It’s important to recognize that there is no “best time” to sell a property - the best time is when your client is ready to move. There are a few key reasons why selling during the holidays could be the ideal choice. If you have clients that are on the fence about moving now, communicate the following as to why this could be the perfect time to list.
There Are Far Fewer Homes on the Market
Perhaps the most compelling reason to list during the holidays is that there tends to be less competition. Depending on where you live, inventory can be a concern. People are buying homes throughout the year – including the final quarter. At the same time, fewer sellers list at this time, creating more opportunities for your listing to sell faster and for more money.
Compare this to the spring and early summer when there are more listings that tend to hit the market. This increase in supply can contribute to more of a buyer’s market as supply increases which can drive marketing times up and prices to soften. When your home hits the market during the holidays and it fits a buyer’s needs, and it’s the only one that does, buyer don’t have that luxury of tire-kicking. This can work in your favor as a seller every time.
You Might Sell Faster, Too
Along with that increased demand for your property is the likelihood that your home will sell faster. Redfin did a study back in 2013 that found homes listed during the fall and winter months sold 65 percent of the time – which is more than any other time of the year. They also found that homes that sold between December 21st through March 21st sold closest to their listing price.
For sellers, this means a sale more likely closer to list price.
Holidays Buyers Are More Committed
When selling a home during the spring and summer months, you’ll find that many of the showings rarely write offers. While that may be for many reasons, one key fact is that many people looking at homes during summer might not be ready to buy. They are browsing or window shopping during the summer. The weather is nicer and open houses can be a “thing to do” on a lazy Sunday afternoon.
However, buyers looking for a home during the winter months are likely to be far more serious. They are ready and tend to be qualified buyers, too. Consider why this may be. A person buying a home in December probably does not want to spend all of their extra time going from home to home – there’s much more to do. Family might be in town during the holiday season, the kids may be off of school - personal time is at a premium this time of yet. Net-net wintertime buyers are often serious buyers and ready to go.
You Can Create Some Holiday Magic to Show Off Your Home
Though you shouldn’t overdo it, adding a bit of holiday magic to your listing can be an excellent way to move buyers into action. For example, if you live in an area where people routinely decorate for the season, adding a few holiday decorations and creating a formal, but elegant display can help people see themselves in that home next year, doing the same. In other words, the holidays can work for you here.
As a real estate agent, the holidays present an opportunity to light up the fireplace and to bake some cookies, too. Why go to this trouble? You’re setting the stage and creating an opportunity for the potential buyers looking at your listing to see what life could be like if they buy from you. What other time of the year is your home as inviting? The holidays can be magical.
People Moving for Jobs Need Homes Before January
Many people switch positions and relocate around the beginning of the year meaning they might be forced or at least incentivized into buying a home in December. You may find that this creates an influx of buyers for you in the last few weeks of the year. If you live in an area where job growth is plentiful and high-paying positions are common, this is a key reason to take listings now rather than wait until the New Year.
When Is The Best Time To List A Home for Sale?
There’s no right answer to this question. We should be ready to help our clients whenever they need it and do what’s in their best interest. The perceived benefit of waiting until the spring months to list might not be real. Remember that the spring and summer periods are when sellers may have increased competition to sell.
If you are considering enrolling in our real estate license school, please feel free to reach out on Instagram or call the office at 888 768 5285.
We are always happy to help! Just like selling a home, starting real estate school to get your real estate license doesn’t have a “best time”. The best time is when you are ready. There’s no time like the present!
I'm looking forward to having you as our newest student!
Love,
Kartik
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I don’t think that anyone can deny that nearly every business should have a website of some sort. To the extent you can, it’s far better to control your own digital footprint rather than have the
I don’t think that anyone can deny that nearly every business should have a website of some sort. To the extent you can, it’s far better to control your own digital footprint rather than have the world do it for you.
According to one recent study, an incredible 93% of all interactions between a business and its customers begin in the exact same way: with a search engine like Google. For that reason alone, the quality and execution of your real estate website is of paramount importance - especially in those fragile early days of your career.
OK so you finished real estate school and have passed the real estate license exam and obtained your real estate license. Your career can begin in earnest. But without the right, thoughtfully designed website to make your presence known, you're not going to get as far as quickly.
Thankfully, designing the perfect real estate website - one that is compelling, that properly speaks to what you do and your value proposition - isn't necessarily as difficult as you might think. All it requires is the right approach, and for you to keep a few core things in mind.
Understand Your Goals
Before you think about the actual design of your website, you need to come to terms with exactly what that design needs to do. Yes, there's a certain element of marketing at play here in that your website is supposed to be selling something. Only instead of pitching your products and services, in our real estate business you're really selling the most valuable asset of all: yourself.
But even more than that, you need to understand that your website is more than just an advertisement. It's a way to make people aware of your unique perspective on the real estate industry, it's an opportunity to establish yourself as an authority in your market and it's a way to begin building trust - essentially all at the same time.
If your site comes off as little more than an expanded advertisement that someone might see when searching through Google, you're not going to be able to do any of those things. Therefore, your real estate website needs to be genuine, honest, informative and legitimately helpful - all in equal measure. These four qualities need to inform every decision you make moving forward, from design all the way down to the type of content you create and share.
Get Specific With It
There's a common misconception out there that the right real estate website needs to appeal to the largest audience that it can. But the truth is that your visitors will rarely come to your site looking for a home across an entire state, or even in a larger city. They're going to be looking for information on current listings in specific neighborhoods, and you need to be able to capitalize on that.
All of this is to say that you shouldn't build your site in a way that claims you're an authority on "real estate in California" or even "real estate in San Diego, California." Hone in on specific neighborhoods and communities that you have the most experience with. Integrate Multiple Listing Service (MLS) and Internet Data Exchange (IDX) search capabilities into your site in a way that allows people to focus their efforts on those places they really want to live in. Establish yourself as an authority at first in a few specifically targeted areas and work on building your reputation - and your client list - over time.
You can always expand your focus later as your business does the same, but in those early days don't be afraid to get as granular as you possibly can.
It's Also About Supplementary Features
Remember that the goal of your real estate website shouldn't JUST be to offer listings for homes in those areas, though. Listing sites are a dime a dozen - the chances are high that people will have seen information about a lot of those current homes in other areas before they ever stumble across your domain.
Instead, you need to go above and beyond that idea - turn your site into a true informational and educational resource in every sense of those words. You should absolutely be writing blog posts that give insight on current trends in the industry. Poke around my blog. I’ve been in our business for almost 20 years and I have written over 200 articles and recorded over 1,400 videos on real estate topics. This helps to establish me as an industry expert. Remember, however, that I started out just like you - 0 followers and 0 content. It takes time and consistency to make it work. The sheer volume of content being produced every second is making it harder and harder to get noticed. This underscores the fact that you have to pump out as much high quality content as possible to get known.
So what to do? As a new agent take the time to write a few hundred words that take an important real estate topic and break it down in a way that is easy for anyone to understand. Write about what people should look for in a first home and what they shouldn't be focusing so much of their attention on, for example. Try and integrate videos, a comment section, mortgage calculators and other things that will make the house hunt as easy as possible.
Don't forget that you're not just trying to get someone to buy or sell a home. You're trying to convince them to buy or sell a home with YOU. To get to that point, people need to see you as an authority - articles and videos go a long way towards establishing precisely that.
Reviews, and Lots of Them
Last but not least we arrive at the concept of reviews - something that is particularly important in terms of your long-term success in real estate.
People aren't just going to take your word for it that you know what you're talking about. Real estate has always been built on relationships - someone wants to buy a new home and they immediately turn to their friends and say "hey, do you know anybody I can call for help?"
The Internet operates in exactly the same way, to the point where a massive 90% of people who responded to a survey who read online reviews claimed that those positive reviews absolutely influenced their eventual buying decision.
When you close on a deal with a client, ask them to write you a review. Then, get that review up on your website as soon as you can. Then, share those reviews on social media sites like Facebook and Twitter - which should also be integrated into your site. Do this as often as you possibly can.
This will help you establish social proof, which truly is the currency of the modern era. The more someone sees that others value what you do, the sooner they'll start to value it, too. At that point, you'll have a steady stream of hot new leads headed straight to your door.
At the end of the day don’t be afraid to shine and show off a little. If you can add value somewhere by earning a 5 star review or writing a blog or recording a video do it! Don’t be afraid to show the world that you are a real estate expert and you know what you’re doing.
If I can be of service, please let me know. You can connect on Instagram here or reach out by phone at 888 768 5285.
Love,
Kartik
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It’s Saturday and I’m at a local coffee shop banging away on the keyboard. I like working on stuff like this on Saturday and Sundays. It’s quiet.
Yes i have a few people in the office today,
It’s Saturday and I’m at a local coffee shop banging away on the keyboard. I like working on stuff like this on Saturday and Sundays. It’s quiet.
Yes i have a few people in the office today, but it’s nothing like the sometimes pandemonium associated with a weekday.
I wanted to write a quick article about why weekends matter to the entrepreneur because it’s not hard to argue that there’s never been a better time to start your own business. Between the ability to reach a large audience and access to technology, individual people with great ideas and a solid work ethic have a better chance to succeed in today's market. However, that does not make success an easy thing to achieve.
Statistics indicate that around 62% of adults think that becoming an entrepreneur can be an excellent career. When you break down those numbers, though, you'll find that nearly 50% think they themselves are equipped to become an entrepreneur and 40% believe it's easy. Let's just cut to the chase — the people who think it's easy are mistaken. Ask any entrepreneur who has even a modicum of success and they have likely taken ridiculous risks and worked very hard to make their baby fly.
Notwithstanding those “entrepreneurs” who have “Phds”. If you're wondering, a PhD means “Papa Has Dough”. For the most part, I’m not talking about those who had a family member give them money to “start their own thing”. I’m talking about the real entrepreneurs who started from nothing and actually built something great.
Entrepreneurship sounds like a great business because Instagram and other social media outlets inundate us with information about the benefits of being self-employed. Some of this propaganda includes an excitement about the work you're doing, the ability to make a living doing the things you love and being your own boss. What you might not be aware of is that small business owners often work longer much longer hours than their employees. At least they do if they're building a successful business.
I'm not totally complaining about the glamour that the Internet has put on the business of real estate. It's helped push lots of people to enroll in our real estate license school and pass the real estate exam.
Still, it's important to remember that there is only so much time in a day and time is your most valuable commodity. This is why many entrepreneurs work every day and set their schedules so that they can optimize the time when they're working. If you have a great idea and are launching your business, here are some reasons you should consider working weekends.
Why Entrepreneurs Don't Follow the Typical Weekend Schedules
For a typical employee, there are set number of days where work is required and specified days off. The most common model by far is Monday through Friday, 9-5. This may vary but, for the most part, Saturday and Sunday are days off to catch up on personal errands or spend time with family and friends. These are the reset days for the typical working world.
For an entrepreneur, taking these days off completely may not be possible if they want their business to thrive. Because the rest of the businesses they deal with are likely closed on one or both of those days, the weekend becomes a fantastic time for entrepreneurs to catch up, refocus, and innovate.
This doesn't mean that you have to work around the clock to run a successful business. In fact, doing that can easily lead to burnout. A work/life balance is important for healthy relationships outside of your career. But most entrepreneurs do find ways to use their hours creatively to improve their productivity. This might mean taking downtime on a weekday so that you can work through the weekend. It might also mean working part of the day on a weekend so that you can participate in social events around your work schedule.
Benefits to Using Weekends for Work Time
There are a few reasons that entrepreneurs work through many of their weekends. Here are a few benefits to working through other peoples' downtime:
• Fewer Distractions. Working on a weekend allows you more time to focus uninterrupted. This is true whether you're a business owner or work on a team. Because your clients and other professionals usually don't work on Saturday or Sunday, you won't have to spend time fielding calls from clients, attending conference calls, or attending to different things that might pop up during a regular business day. This gives you the uninterrupted time you need to focus on a single task.
• Time to Plan. Weekdays tend to fly by with many demands and few chances to catch up. This is especially true for small business owners who often take charge of multiple aspects of their company. With the rest of the world off the clock, the weekend gives you time to assess your previous week. You can check to make sure you've stayed on schedule with assigned tasks (and catch up on tasks you didn't get to). This time is also a great way to plan ahead for the following week. If you choose a day over the weekend to plan and assess your progress every week, you'll be more likely to keep your benchmarks in mind and achieve short term and long term goals.
• Less Rigid Schedule. Working on weekends doesn't have to feel like you never get a day off. You don't necessarily have to work from the office and you can even plan your hours to suit your mood. I’m sitting in a coffee shop right now with my laptop and a latte. It feels little less like work when I’m in a pair of Jordan’s and jeans as opposed to a suit and tie.
There Are Down Sides, Too
Successful entrepreneurs build their businesses to a large degree because they've put in the work and effort. That does come with sacrifices. While it's true that many small business owners use weekend hours to help them get ahead, that doesn't mean it's always easy.
For lots of us including myself the work is something we love and are excited about. We often enjoy putting in long hours and have a sense of pride and purpose in what we are doing. However, that doesn't mean it's always easy to spend your Saturdays and Sundays working when the rest of the world is getting that time to take care of their personal needs.
Here are a few negative points to working weekends that you should be prepared to navigate:
• Loved Ones May Not Understand. If your significant other is on the “regular” world schedule, they may not understand the long hours you put in at your company and it can lead to arguments.
• Most Personal/Social Obligations Are On Weekends. This is especially true if you have children but even single people will find their social calendar is mostly full of events on weekends.
• You Miss Out On Some Great Events. It's not all about obligations. Working those hours also means you'll miss out on fun events that you'd enjoy attending. A football game in the middle of a Sunday might be something that is playing on the TV or online in the background as opposed to you being able to physically attend the game.
Building a thriving business means working longer hours than you would as an employee. That's simply a truth. Weekends offer you hours to catch up and get ahead of your competition.
I’m always looking to bring you value. If there is anything I can do to help, please reach out on Instagram or call the office at 888 768 5285.
If you are interested in becoming a real estate agent, please call me or my team. We are happy to be of service.
Love,
Kartik
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A little different type of blog from me this time. I wanted to write something for those that have already finished our real estate license courses and are working in the field.
I was browsing some
A little different type of blog from me this time. I wanted to write something for those that have already finished our real estate license courses and are working in the field.
I was browsing some listings on the MLS recently and was horrified at some of the pictures agents were uploading but even worse was of the copy used to describe the listings. Problems with syntax, punctuation and tense were not uncommon.
If you have a listing now or are going to take one soon, I would recommend making sure your ad copy is extra tight. Remember that besides pictures, the ad copy is the most important part of your listing marketing material.
There are really no hard and fast rules for writing real estate ad copy, but guidelines exist to help you capture reader attention and generate responses. The goal is to highlight enough desirable features to prompt an online visitor to click through to the full listing, or to prompt a reader to call for additional information.
The prime directive is to avoid the temptation to "oversell." Use superlatives in moderation and be sparing when including value judgments in your descriptions. Remember that only one home can be the "best value" in a neighborhood, and even that is subjective to the point that it has little meaning to a prospective buyer.
Readers tend to gloss over phrases like value-priced, priced to sell and won't last long. Common terms like amenity-filled, chef's kitchen, memorable views, and stunning architecture are overused and ineffective. The goal is to be descriptive in a manner that is meaningful, while still leaving something to the imagination so that the reader wants to know more.
Writing Real Estate Copy 101
Writing ad copy that gets results isn't difficult, but it can require thought. Here are specific elements you can employ to make your efforts more effective.
First, define your target audience: Online property descriptions will have a different focus, and a different tone, than a printed brochure or an open house handout. But all copy should include, at minimum, a headline or title. It might be as simple as the property address; however, if you can use a catchy descriptive phrase, do so. Something like "Come Home to a View of the Ninth Hole" would appeal to someone looking for golf course property.
Then, add gas to the fire of imagination: Place yourself in the potential buyer's shoes and provide a "hook" that makes them want to continue reading. Focus on the lifestyle that can be theirs if they move into the home. "Enjoy a refreshing cool drink on your expansive poolside patio as you look forward to your next tee time at the award-winning course adjacent to your property." A brief description of the overall appeal of the community and the home's general description can be included here.
It can be as brief as you wish, or it might run to several paragraphs, depending on actual space and your purpose. Say something like: "This 3-bedroom, 4-bath, 3-car garage contemporary offers everything necessary for living the good life -- privacy, convenience to schools, shopping and entertainment, an easy commute to the business center, and abundant leisure time enjoyment options with neighbors and friends."
Finally, highlight the most important home features: This is where you should strive to paint meaningful word pictures. Be descriptive, but not overly detailed. Leave some specifics out. You might say something like "Old-world craftsmanship is evident in the finishes used throughout the home's 4,200 square feet, especially in the fine wood paneling and bookshelves of the home's private office."
Or, you can point to the evidence of upscale options and trendy finishes that "include an eco-friendly, sustainable choice of recycled glass countertops in the kitchen, low-VOC paint throughout, and main-level flooring crafted from reclaimed timbers."
Whatever you write in words is always better when accompanied by professional photographs that graphically illustrate the same features. It's not necessary to include a book's worth of photos, but words and pictures are better when they go hand in hand. There is little more disheartening for a prospective buyer than to read a glowing description of a home spa retreat only to find that there is no photograph of the space included with the listing or in the brochure. Coordinate your efforts with your photographer and your marketing team.
Keywords and Buzzwords
Define your potential market. Imagine what prospective buyers would type in to an online property search: Don't simply toss around phrases like "high-end finishes, family-friendly neighborhood, or spectacular views." Instead, utilize popular keywords to generate interest, adding filters and qualifiers as needed, such as the city or subdivision. Examples include:
• Beachside Cottage
• Ski Retreat
• Urban Condo
• City Lights
• Mountain Views
• Polished Wood Flooring
• Gated Community
Know Your Market
The copy you write about a high-end home will naturally be different from the copy that describes a mid-price starter home, but the same principles apply. However, don't make the mistake -- in either case -- of believing that buyers on one end of the price spectrum are any less concerned about quality and value, energy savings and sustainability, style and safety, or built-in features and community amenities.
Make every effort to describe a lifestyle rather than listing specific features. Weave specifics into general descriptions of rooms and spaces. While studies have confirmed that online readers appreciate skimmable copy and bullet points, lists can be overused. Typically, 8 to 10 bullet points are sufficient. Always stop short of making your property description simply a "laundry list" of features.
To write meaningful copy, acknowledge that there are some home features that should be specifically mentioned:
• A backyard pool, because it can be either a selling point or a deal killer, depending on the buyer;
• An eat-in kitchen;
• Ensuite baths for each bedroom;
• A detached garage, casita or other type of auxiliary building;
• Specialty spaces, including an exercise room, home theater or media room, finished attic, in-law or au pair quarters; and oversize lots or adjacent acreage or public land.
• Solar panels, or alternative energy provisions, including 240V electric car charging stations.
Use your in-depth knowledge of the local market to determine what other features deserve mention, knowing that your decision might vary substantially from one neighborhood to the next, and even from one season to another.
Monitor reactions and responses you receive, and adjust the way you write your next property description based on the feedback offered by clients.
Finally, never forget to include your contact and broker information (along with Department of Real Estate license number) and a call to action. You never know who will become your next client, or when and how they will appear. Ensure that you can be reached by anyone in need of your services!
Of course if there’s anything I can do for you, including helping you get started in our real estate license courses, please let me know or call 888 768 5285.
Love,
Kartik
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For those starting in our great real estate business it’s natural to ponder the best way to go about becoming successful. A well-known shortcut between starting a new career and achieving success is
For those starting in our great real estate business it’s natural to ponder the best way to go about becoming successful. A well-known shortcut between starting a new career and achieving success is to model what others before you have done.
Observing the most successful people and implementing the best of their strategies is going to ensure your success more quickly than trying to reinvent the wheel altogether. This is especially true in a simple business like real estate sales. It’s important to recognize that I said “simple” not “easy”. Our real estate sales business is a simple one as long as you do the things daily that are required to succeed. Again, this is a simple process but one that is not always easy.
I wrote down a few characteristics of the most successful real estate agents. As you embark on the journey of obtaining your real estate license I would encourage you to be cognizant of how you are implementing the following:
THE BEST AGENTS UNDERSTAND THEIR LOCAL MARKET
There is an old saying in real estate that “All real estate is local”. To the newer agent this might not make sense but let me explain. Essentially this means that the real estate salesperson that has the most intimate market knowledge and is most deeply connected to the neighborhoods they serve will generally win.
Great real estate salespeople tend to be known in the community. They may sponsor the local little league, help out with local garage sales or door knock frequently. They send direct mail postcards every month or post frequently in local Facebook groups or on nextdoor.com. Whether this connection is established through physical marketing or digital makes little difference.
Net-net: The best real estate agents are known in their local marketplace.
THEY UNDERSTAND THEIR CLIENTS' NEEDS
This one might sound a little too broad to be helpful. You might read the above sentence of “understanding your clients’ needs” and think - “Great but what does this actually mean?”
When representing a buyer, for example the best agents have their client requirements nailed down. If the client requests a property with a bedroom and full bathroom downstairs, don’t bother to show them homes that do not. If they are deeply against having a pool, make sure you check this on the MLS and verify with the listing agent before emailing it to them.
Getting to know your client and being able to anticipate their needs will go a long way to helping you become a successful real estate agent.
THEY HAVE A SYSTEM PERFECTED
Do you have a particular time of the day when you're checking emails? Spending time with clients? Marketing your business? Having a schedule for your routine and daily activities will help keep you organized and be sure that nothing falls through the cracks.
THEY KEEP THEIR SALES PIPELINE FULL
It's one of the things you hear with any real estate sales business. Always be selling. If marketing and prospecting for new clients is a part of your every day routine, you'll never have to worry about a seasonal slow down or slump, because you know that the marketing system you have in place will have the next client through the door soon.
Also, if your Facebook ads aren’t doing as well as they normally do A/B test the ads to ensure that you are staying on top of social media trends.
Don’t ignore door knocking and telephone prospecting either. These activities might not be the most relished by the real estate professional but they are sure to give you more control over your pipeline. Hit a slump? Talk to more people.
DEVELOP RELATIONSHIPS AND MAKE CONNECTIONS WITHIN THE LOCAL COMMUNITY
Successful real estate agents take the time to build a large network of people in the market that they serve. They don’t limit themselves to creating a database of only past, current, and potential clients. Great real estate agents should also make contacts with other experts within their industry, including appraisers and mortgage loan originators. You’ll have a ready list of vendors to refer your clients to and potentially be on the receiving end of referrals when the time comes.
You should also consider building a network of other brokers and agents in outside areas. Remember, it is customary for one broker to pay another broker a referral fee for a client upon closing. (Not among service providers though, that would be. RESPA violation)
THEY USE SOCIAL MEDIA PLATFORMS AND THE INTERNET TO THEIR ADVANTAGE
The impact that social media platforms like Facebook, Twitter, Instagram, and YouTube have on business are undeniable. Formerly, these platforms were looked at as only a way to connect with friends and family or share photos but they have made their way into the fabric of our society.
According to Statista, 91% of U.S. businesses will use social media for marketing purposes. Some of the largest companies in the world are using social media as a way to connect with their customers and potential customers. Why would the individual real estate agent be any different?
As a real estate agent, if you aren't using social media, you are missing out on a huge opportunity.
At a minimum, each agent should have a Facebook page to reach their potential audience. If you have the budget, a highly-targeted Facebook ad can provide additional reach to new potential clients you may not be able to find through your more traditional marketing mechanisms.
THEY ARE PARTICULAR ABOUT THE DETAILS
When it comes to selling real estate, the smallest details can make the biggest difference. Things like staging a home or how to position a property in certain markets can be the difference between a good and a great real estate agent.
Also the intricate details of the purchase contract or the listing agreement are critical to ensure that your client’s interests are protected.
THEY ARE AWARE OF SPEED TO LEAD
A saying that I live by in business is that “Time kills all deals”. The best agents know that the sooner they can get back to a lead the more likely they are to convert that lead to a contract.
This is especially true regarding Internet leads. Whether you are selling residential or commercial real estate, the best agents know that the sooner they respond to an inquiry the more likely deals are to close. I can’t emphasize this enough - in this day and age speed is probably the most important aspect of sales. The faster you move the more likely you are to win.
I’m always looking to bring you value. If I can be of service to you please let me know on Instagram or Facebook. Of course if you are looking to get enrolled in real estate license school, reach out here.
Feel free to also call the office at 888 768 5285.
Many of our students have gone on to be very successful real estate agents! Click on the link to read success stories from past ADHI School Students!
Love,
Kartik
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Most people think that in order to become a great Realtor we need to be good at showing and selling property," we tell ourselves. "What more is there?”
In reality, it turns out there's quite a bit
Most people think that in order to become a great Realtor we need to be good at showing and selling property," we tell ourselves. "What more is there?”
In reality, it turns out there's quite a bit beyond that.
If you’re interested in obtaining your real estate license and become a full-fledged Realtor, it’s probably useful to learn a little bit more about what someone in that role actually does daily.
Once you finish our real estate license school and head out into the real world, you'll find that the daily responsibilities of a real estate agent are actually a lot more involved than you might think. Not in a bad way — but in a way that you should be familiar with before you begin those early days of your career.
The Life of a Real Estate Agent: Breaking Things Down
One of the most important daily responsibilities of any real estate agent actually has little to do with "selling houses" at all. Broadly, you need to be excellent at providing customer service to a wide range of people in a myriad of different situations.
Be The Calm in the Storm
Think about it like this: Buying a home is one of the most important moments in a person's life, particularly if it's the first time they're doing it. So it's an inherently stressful experience and one where people will be looking for an expert to guide them. The best real estate agents understand that they are the calming force in any transaction. You need to be able to provide people with the information they need to make the best decisions possible and you need to do so in a way that simultaneously instills confidence.
It's a lesson you'll begin to learn in our real estate license school but that you'll have to perfect over time on the job.
Understanding Contracts and Paperwork
Another major daily activity of a busy Realtor involves drafting and preparing things like offers and other types of paperwork. This requires a deep understanding of not only the laws and regulations in your particular market, but also the needs and requirements of the people you're actually working with. Remember that as an agent, you are someone else's advocate — they're trusting you to bring a level of experience to the deal that they themselves do not possess. To get to that point, you need to not only be aware of HOW to handle the paperwork that comes with buying and selling real estate, but organized enough to do so in the right way.
That customer service element also intersects with the marketing side of the business — only instead of selling a property, you're really selling your most valuable asset of all: yourself and your abilities.
Similarly, the busy real estate agents spend a majority of their day getting, obtaining and servicing listings in their marketplace. Most of the time, this is done by pouring over the Multiple Listing Service database, otherwise known as the MLS. Most MLS databases are logical but sometimes they are not so intuitive. Only through practice running a variety of different searches can proficiency be obtained.
For example, how do you search for a single-story home, with a spa but no pool in a specific school district below $750 per square foot? This search will take the expert Realtor 1-2 minutes, whereas for a rookie this same search might take 10-15 minutes. Like most things - practice makes perfect.
If someone says to you, "I like this house we're looking at, but it would be better if it had X, Y and Z qualities," you should immediately be thinking of other properties you can show them. You can't do that without putting in the time to research what those listings actually are. Working with the MLS is a crucial part of the daily life of a real estate agent.
Don’t forget to prospect
Most importantly, a real estate agent spends an incredible amount of time collecting leads from other sources, too — either via word of mouth from past satisfied customers or from referrals in the industry. Hitting the phones or door knocking can also be a great way to get a hot tip on a property before it actually gets on the market- especially if it's one that you know would be perfect for one particular client.
That aspect alone can quickly become an omnipresent part of the job — something that you should have at the very least in the back of your mind all day, every day. It's part and parcel for what a real estate agent actually does and, in truth, that rush of getting the jump on your competitors is a large part of why people love the profession in the first place.
Get Comfortable Being Out and About
Of course, a lot of your days will also be spent showing properties which is the aspect of the job that anyone who has ever purchased a home is most familiar with. But again, it's just one small part of a much larger story. Getting your start in real estate comes with the understanding that it's more of a far-reaching profession than most expect.
The great real estate agent is part therapist, part negotiator and available to answer any questions that their clients may have.
Hoping this helps. I’m always looking to bring value to our readers. If I can help you, please reach out on Instagram @kartikspics or call the office at 888 768 5285.
Love,
Kartik
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Frankly, Instagram has brought us a ton of new students. So many of our students enroll because they have seen social media posts from agents about how much money they make. Programs like Million Dollar
Frankly, Instagram has brought us a ton of new students. So many of our students enroll because they have seen social media posts from agents about how much money they make. Programs like Million Dollar Listing have contributed to this perception.
While some of these stories are true and many agents do make a lot of money in our business, I wanted to write a quick article about things you should know before starting a career in real estate. I wrote a few pieces of advice - I thought the title was catchy - before anyone takes the first step in entering our business.
You Are the Boss
It may seem obvious, but people who have spent the majority of their lives working for a manager or supervisor are often surprised by how much discretion they have over their daily schedule. There aren’t any wake up calls in our business. No one complains if you show up 5 minutes late - or don’t show up at all. Worse yet, if you work for a “virtual brokerage” there might not be a person available to bounce ideas off of or to get advice from when you find yourself in a rut. When a decision needs to be made, you are often the person who has to be decisive and take action.
You Need a Business Plan
Being a self-employed person means that you need to come up with a business plan that provides a roadmap for your real estate business. How much money are you setting aside for marketing and advertising? How many transactions do you plan to close in a month, or in a year? Does your business plan call for you to work from a real estate office or work from home? How much time are you setting aside for your business if this is part-time work?
In addition, you also need to understand your tax obligations. You will have to pay quarterly taxes and budget for this. You'll need to track your business income and deductions to ensure you pay enough every year. Most agents have a CPA or other tax advisor that they lean on regularly for this.
It’s Useful To Have a Cash Reserve
What social media posts and television rarely show are the slow periods. There will be a time when you don’t close anything and your pipeline isn’t progressing as quickly as you would like. This period can especially hold true for the brand new licensee that will have a minimum 90-day window to get a handle around the business. Always have at least a small cash reserve built up before starting, and keep adding to it little by little. By having a nest egg, you'll be able to weather slow periods and continue to build until you are at the point where you have a steady pipeline of closings.
Your Schedule is Flexible... Sort Of
It's true that you can work whenever you want. So if you are a night person who loves working at 2am because it is quiet and calm, you can do all your paperwork and get your online marketing accomplished during those hours. On the other hand, remember that you will have clients that can and will contact you at unpredictable times. A certain property may show up that a client wants to see right away and that showing may not have been “in your schedule” but you may feel the need to drop everything and pivot.
If you become a residential real estate professional you will likely have clients that work 9-to-5 jobs. The only times they have to look at a house or arrange for a showing are evenings and on the weekends. Are you accounting for this in your plan?
Somehow Differentiate Yourself from the Rest of the Pack
You have a real estate license. That is an accomplishment not to be undermined. Remember, however, that you were in a full classroom of other people who also obtained their licenses. They’ll likely be working in the same neighborhoods as you. Additionally, you will also be competing against established, veteran Realtors which will be an even more competitive field.
Establishing your personal brand and differentiating yourself is absolutely mission critical. Figure out what makes you unique, whether it is your marketing skills, market knowledge, or negotiating techniques. Then let people know about your skills so that they each out to you first.
Start Your Real Estate Career Today
Are you ready to make the move into real estate and gain the education you need to succeed? Visit our website to learn about how you can gain your license and start this exciting career.
Side note - My intention with this article is not to discourage anyone from starting in our business. It’s simply to pepper a little bit of realism in the basket of fake Instagram and YouTube videos. I have many students that make into the 6 and 7 figures annually. It is possible, but everyone is looking for the secret sauce that’s going to make them successful.
The truth is that there is no secret - it’s just hard work.
Love,
Kartik
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As of early this year, there were more than 2,000,000 real estate licensees throughout the United States. Of that number, around 1.3 million were members of an Association of Realtors. Additionally, a
As of early this year, there were more than 2,000,000 real estate licensees throughout the United States. Of that number, around 1.3 million were members of an Association of Realtors. Additionally, a good portion of this group has had their license for one year or less - further evidence that our industry is a competitive one.
But real estate sales isn't just a highly competitive business - it can carry it’s share of stress, too. It can certainly feel like something of a grind, especially in those early days, which is why jumping into this particular pond head-first might not be the best idea.
Likewise, many people who wish to enter our business don't actually have the financial ability to start on a full-time basis. But that's okay, because becoming actively involved in real estate part-time brings with it a wide range of benefits that can't be ignored. Not only can this help you confirm this is something you actually want to do, but it can assist you in creating a transition plan to get you to full-time and to replace your 9-to-5 income in a thoughtful, intentional way.
Starting a Career in Real Estate: Breaking Things Down
The first thing you need to do to start a part-time career in real estate involves coming up with your own unique solutions to some of the common challenges people face.
Scheduling, for example, is often a difficult hurdle to overcome. It's not necessarily easy to be fully available for your clients at a time that works for them when you have another job to worry about. Unfortunately, there's no "one size fits all" solution to this issue as every situation is unique. Just know that it can be done, but you'll need to hone your organization skills and communicate your hours to prospects clearly and concisely to keep everything flowing as smoothly as possible.
Likewise, it's imperative that you get your own expectations in order. Becoming successful in real estate is already time-consuming - not to mention how long things can take when you're also trying to continue your current employment. If you think that you'll somehow be able to A) work a full-time job, B) do real estate part-time, and C) keep your nights and weekends free, the chances are you're going to have to sacrifice one of those three things. You can only have two, so pick the ones that are most important to you before moving forward. This is on top of family or other personal obligations you might be faced with.
In terms of the actual logistics of becoming a real estate agent, you'll first need to take care of getting your real estate license. This involves figuring out and completing your pre-license requirements, which we can help you with. If you schedule is tight we offer online correspondence real estate courses too. Once you sit for and pass your real estate license exam, you can then take another critical step in joining your local board.
This Association of Realtors organization will allow you access to the Multiple Listing Service, also referred to as an MLS for short, that acts as a centralized repository that all Realtors in your area can use to list properties, view market statistics and more.
You’ll need your license in order to join the association of Realtors which is why our pre-license courses are so important.
Finally, you'll need to find a broker to work with. Here, you have two options: large, national brands like Coldwell Banker and Century 21 or smaller, independent and locally operated brokers. The former will come with benefits like major name recognition, but the latter will offer an intimate connection to the local community that could be quite helpful. Again - every market is unique so there is no "right answer" here. Think about which option fits best with your long-term goals and which offers the most favorable terms as far as the percentage of the commission you enjoy, desk fees and most importantly training. As a part-time real estate agent, you’ll want a company that offers training around your schedule as it will probably be less flexible than someone starting on a full-time basis.
Yes, starting a real estate career part-time is going to be time-consuming and no, it isn't going to be easy. But it is absolutely possible if you enter from the right perspective and are consistent with your efforts.
As the old saying goes - "anything worth doing is worth doing right."
As always, I'm looking to bring you as much value as possible. If I can be of service, send me a message or call the office at 888 768 5285.
Love,
Kartik
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Those considering a career in the real estate field are frequently drawn to the amount of money they can make on each property they sell. Each commission check can be upwards of $10,000, $20,000 or even
Those considering a career in the real estate field are frequently drawn to the amount of money they can make on each property they sell. Each commission check can be upwards of $10,000, $20,000 or even more. This is great for today because it means when you do work hard you will be rewarded handsomely. But what about tomorrow? What about when you get a little older or lose a little bit of that drive?
When you become a Realtor, it’s important to remember that you are in business for yourself and should have a solid financial plan in place that provides for your post-retirement needs. It's exciting to finish real estate school and obtain your real estate license. The early phase of your career is a time to build relationships, learn the trade, and earn money while you establish yourself as a professional. But it's always wise to remember that time waits for no man woman or Realtor. At that point, all your financial planning and regular saving will pay off in the form of a stable, secure retirement income.
What about retirement?
To be clear, there are a lot of great real estate salespeople and brokers that have absolutely no intention of ever retiring. But there’s a difference between wanting to work and having to work.
I think we can all agree that not having to actually show up at some place at some time and have money coming in and available to you would be a great thing.
With that said, many Realtors often wonder how secure their retirement will be. After all, if you become a Realtor and work for yourself then you'll need a financial plan in place to take care of your retirement years. Earning a real estate license is simply an early milestone in your career.
But what about life after real estate school and your sales career? You'll need to create the right kind of retirement plan for yourself. You can do this alone with some help from a CPA and Google or hire a financial planner to lay out the plan for you and keep you disciplined.
Here are some things to bear in mind when thinking about long-term financial security:
Consider investing in real estate.
Early in my career I heard brokers tell me “Kartik you have to become your best client.” Since then a stated goal of mine has been to buy one piece of real estate each and every year. Imagine over a 20 year career in our business owning 20 properties, each with a positive cash flow of just $200 per month. That amounts to $200 per month x 20 properties = $4,000 per month. Over time the values on these properties are quite likely to rise and the loans will eventually be paid off - adding to your wealth in retirement.
Of course in order to buy one property per year, you have to ensure that your income is sufficient to obtain financing - a solid real estate sales career will make this easier. Properly managed, a "nest egg" of real estate can be a smart way to diversify your retirement income resources.
There are other ways to set money aside in retirement funds:
You can opt to put money into a traditional IRA, a Roth IRA, a solo 401(k) or a SEP IRA. All have their pros and cons that should be discussed with an appropriate professional. For example, traditional IRAs have no income limit but there is an annual contribution limit. If you pull finds out before retirement, there is a stiff penalty in most cases. Traditional IRAs are funded with your pre-tax earnings, so you'll get a nice deduction and lower your tax bill in most cases.
Roth IRAs are funded with your after-tax earnings, so you get no deduction right now. The upside to a Roth is that you can take out the contributed funds any time for any reason without paying a penalty. It's also possible to set up a solo 401(k) for yourself, even if you have no employees and work as a sole proprietor. Contributions come from your pre-tax earnings but there's currently a pretty high annual limit on what you can put in.
SEP IRAs are a little more complex but are a good option for real estate professionals who have a few employees. You can contribute up to 25 percent of your earnings but keep in mind that you have to do the same for each employee you have. If you withhold 10 percent, for example, from your earnings for the SEP IRA, you'll need to withhold 10 percent of each employees' earnings as well.
A one-hour consultation with a reputable financial planner can resolve most questions you have about which is the best kind of retirement savings plan for your particular situation.
It’s also important to remember that I’m not a financial planner and laws and rules can and do change. Make sure you’re planning properly and not relying on my blog alone to plan for your retirement. =)
Please call my office at 888 768 5285 or send me a message if I can be of service.
For information on real estate classes visit www.adhischools.com
Always looking to bring you value.
Love,
Kartik
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Obtaining a real estate license after passing the real estate exam is only the beginning of your career in our great real estate business. The next step (and in many ways the more important piece of the
Obtaining a real estate license after passing the real estate exam is only the beginning of your career in our great real estate business. The next step (and in many ways the more important piece of the puzzle) is to prospect for clients.
The high level question the must be asked and answered by the new agent is: What does a buyer or seller want in their Realtor? And next - How do I meet those needs?
Simply put - buyers and sellers are looking for a local real estate expert. Buyers want someone who knows what local restaurants are great, where the nightlife is, what schools are perfect for their kids, and what amenities are popular in the neighborhood.
Sellers, on the other hand, want a local Realtor who knows what the current and future market outlook is, what the comparable sales look like for the house when compared to other similar properties on the market, and at what price to market the home.
So how do you become a local real estate expert for your clients? Here are several strategies to implement once you finish your real estate courses and become a Realtor.
Go to Local Government Meetings and Chamber of Commerce Events
Government meetings and chamber of commerce events will play important factors on how you grow your business and connect to community members. You'll want to pay attention to any changes, regulations or votes coming up with the city council or planning commission that will impact the local real estate market. These meetings could discuss zoning regulations or upcoming development projects, for example. Information gathered at this event can allow you to better track the market and inform clients of developments that can affect the home buying or selling process.
I remember one friend of mine who was showing a high-rise condo to a buyer on Wilshire Boulevard in Los Angeles. The buyer found a home online that he wanted to see and reached out to the agent for a showing. Directly across the street was an empty parking lot that was in the early stages of being the site for a new high rise development. If approved, the new structure would have completely obscured the southern view from the living room and bedroom and would have also casted a dull shadow over the pool deck. The fact that the agent was plugged into the local planning commission and had actually attended some of the Homeowner Association meetings meant that he was in the know and ultimately able to advise the buyer on the proposed development. Surely a large building blocking your view that breaks ground shortly after the close of escrow would be a nightmare scenario for the uninformed buyer.
At chamber of commerce events, you can network with other businesses. You can learn about the roles these employers have in the community, and can share this information with buyers. It’ll also be a great chance to meet other entrepreneurs and refer business to one another.
Get Involved in Social Events and the Community
Prospective clients like to see that real estate agents are getting positively involved in local events. Whether it is partnering up with a local blood drive or volunteering time at an animal shelter, these tactics show that you want to invest your time and work in building a strong and welcoming community.
Also, attend social events such as festivals and get to know people. Shake hands with organizers and speak with the local residents. People will remember your friendly demeanor at the event as they will be inclined to speak positively about your real estate business with others.
There’s nothing wrong with telling people that you are in the process of obtaining your real estate license now and start building those relationships early. Of course, you won’t be able to do anything that would require a real estate license, but there aren’t any laws against getting to know people in the area.
Show You Are an Expert in Emails, Social Media and Personal Interactions
After taking real estate classes Los Angeles, you've gained the knowledge to help people with their real estate dreams. Yet you also have to show them that you are a local expert. You can do this through your correspondence, social media accounts and interactions with clients.
Once you get your license, you’ll need to define the areas where you’ll want to build your real estate practice. Study the properties in those areas and the overall market on sites like www.dqnews.com and in the Multiple Listing Service. Over time, you’ll get to know the types of properties in those areas, the number of certain residential properties (single-family homes, duplexes, and multi-family structures). Also, you've gathered the data about recent home transactions, buyer trends, and average sales prices. Take all of this data and pepper it throughout your emails, newsletters and social media sites.
Drop in facts that will draw in a person's interest and convince them to take the next step in calling for your services. You want to impress them with the market insights that you've gathered as they will feel confident about your skills. In addition, you want to do the same at face-to-face meetings and appointments with clients. Showing people that you've done all the real estate homework will allow you to gain repeat business and positive reviews that will help your career.
By immersing yourself in community events, attending government meetings, and sharing your local expertise through social and other media, you can solidify your position as a top real estate expert in the local market. It’ll be easier to convert leads into real estate transactions by showing your in-depth knowledge about local market trends.
As always, please call my office at 888 768 5285 or visit our website for information on real estate classes online or in the classroom. If you are getting ready to prep for the real estate exam and you need a real estate crash course click here.
Always looking to bring you value.
Love,
Kartik
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Are you thinking about enrolling in real estate license courses? If so, your first thought may be whether or not now is a good time to start.
How’s the market doing?
A career in real estate can
Are you thinking about enrolling in real estate license courses? If so, your first thought may be whether or not now is a good time to start.
How’s the market doing?
A career in real estate can be very rewarding and it all starts with the right real estate school. The U.S. Department of Labor reports the demand for real estate agents and brokers will grow by 7 percent from 2018 through 2028, a rate that’s faster than average for all job growth.
Demand is out there for well-qualified, dedicated agents willing to learn the industry from the ground up.
Should You Enter a Career in Real Estate?
Timing Is Everything
Those wondering if they should become a REALTOR often ask themselves whether now is the right time based on market conditions. The short answer is that while your initial timing can matter remember that getting your license now can open the door for years, no matter how the market swings in the short term.
Here are some answers to common questions:
#1: What Is the Market Like?
The real estate market grows and expands on a consistent basis. There are times when market activity can and does cool like back in 2008 and 2009. However, the current market remains robust with the possibility of ongoing appreciation.
Put that aside for one moment, though. Remember that people are always buying and selling real estate no matter what the market does. Keep in mind that there are always consumers looking for their first home or to downsize after the kids move out. There are always new developments and opportunities. In other words, there is always the need for a qualified real estate agent.
#2: But Is The Economy Slipping?
While there are valid concerns over how long the economy will continue to grow at its current rate remember that transactions happen in all economic conditions. More so, many people move into real estate investing when the stock or other markets begins to decline. I talked briefly about this in an earlier article.
That’s because real estate is viewed as a safer and more tangible investment for some. This also creates opportunities for individuals looking to grow their career.
#3: Are Houses Selling Today?
The answer here is “yes” as well. More so, in the long term, there will be an even higher demand for homes. I don’t think anyone believes that the population is going to decrease throughout the United States any time soon.
The current economic climate has helped push home values high. A combination of low interest rates and high demand have sent prices soaring in many areas.
In some areas, they are simply out of reach for some buyers. As home prices begin to slow their rate of growth, they will become in reach for more consumers, especially those looking to buy their first home. Homes are selling and will continue to sell.
Starting a Career in Real Estate - Is It Right for You?
People will always be buying and selling homes. Demand will ebb and flow. Real estate agents committed to providing a high quality of service to their clients will continue to see significant demand for their services. Your buyers be might everyday consumers looking for their first home as home prices fall. Or, you may be able to work hand-in-hand with investors who are looking for good deals. Real estate classes help you prepare for every market condition, too.
If you:
• Enjoy real estate and looking at homes and buildings
• Love helping people
• Like to negotiate
• Want the flexibility of working on your own schedule
• Want unlimited income potential
A career in real estate could be right for you. You can meet the California real estate license requirements though our real estate school in as little as 54 days and start taking advantage of the current market climate. Once you establish yourself, there’s no telling how the market will work in your favor.
A shameless plug, ADHI Schools is the number one real estate school in California. We can walk you through the pros and cons of being a real estate agent.
Call us at 888 768 5285 or visit adhischools.com to pass your real estate exam the first time.
Love,
Kartik
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Once you complete our real estate school and pass the real estate exam you’ll be out on your own to start your career. Hopefully you’ll be ready to land your first client and take home a big commission!
Once you complete our real estate school and pass the real estate exam you’ll be out on your own to start your career. Hopefully you’ll be ready to land your first client and take home a big commission! =)
After doing well on your real estate license exam, you'll get your desk set up with your broker and start working some leads. You’re probably going to start reaching out to your sphere of influence and let them know you’ve started a real estate career.
As a newer real estate professional, the goal should always be to compress the time between finishing real estate school and cashing your first commission check.
To this end, I wanted to write a quick article exposing some bad habits that real estate agents can develop if they’re not careful.
Remember That Self-Employment Is Vastly Different From a 9-5
A self-employed person is solely responsible for his or her workday. In the real estate industry, it’s a common misnomer that once you pass your real estate exam, you’ll have leads pouring in and homes to sell. That’s not what happens.
Instead, you need to work to create your own business. This often means spending time daily working to drum up business, cultivate leads, market, and respond to internet inquiries. Here are a few of the bad habits real estate agents create that virtually prevent them from becoming a successful Realtor quickly.
You’re Doing "Busy" Work
You’ve ordered business cards. You cleaned up your desk. You have talked to a dozen other agents today about what’s going on in their business and personal life. You may have even touched up your LinkedIn profile and posted a picture of the salad you had for lunch on Instagram. All of these “tasks” might feel necessary but the bigger question is what did you ignore by doing these things?
Are you prospecting for buyer and seller leads? Are you following up on existing ones? In short, it’s easy to “feel busy” without actually building your pipeline, which ultimately cuts into your income.
You’re Frustrated with Your Workday
There are a dozen calls you have to make today for various reasons. Each one of them could be a lead. Perhaps you have some really good leads, but there’s so much on your plate to do right now that you miss those key opportunities to connect. You’re in and out of the office, forgetting appointments, and not seeing the kids. And, you thought this career was flexible?
This is a common concern. The problem is that without any oversight into your activities and a consistent schedule, it’s easy to lose track of what’s important. To be successful as a real estate agent, you have to be organized. You also have to create a schedule that works for you and stick with it. This discipline is actually the key to freedom. Make time to plan for every task that matters during your course of the day.
Remember - The number one calendar item is prospecting.
Other Bad Habits Costing You Your Career
After completing real estate school, it’s easy to become overwhelmed. Here are more of the common bad habits agents have:
You aren’t communicating with your prospective clients fast enough. This is especially true for internet leads. Speed to contact makes a big difference in results. Make every client believe that they are your most important client. Work to return calls as quickly as possible. Try and email back as fast as you can.
Failing to marketing adequately. If you’re not seen in the local industry, you’re unknown to prospective clients. Make marketing a component of your day, every day. Remember that there are over 400,000 real estate licensees in California alone - You have to make noise to stand out!
You’re not looking as professional as you should be. Consumers expect agents to look professional at all times. If you look disheveled, that could indicate you’re less organized and not “with it.”
Not updating your website or social media accounts in quite some time. Remember, if you haven't posted in a year people will wonder whether or not you are still in business.
Send a contract to be signed electronically and tell the client to sign without explaining what they are signing.
Being "too busy" to call other agents back.
Working 24/7 and not taking care of your health.
Getting paid your commission and not setting aside money for taxes.
If you finished at our Orange County real estate school don't forget that this is only the beginning. As Warren Buffett says "The chains of habit are too light to be felt until they are too heavy to be broken." The best way to break bad habits is to avoid them in the first place.
For information on getting a real estate license, call us at 888 768 5285.
Love,
Kartik
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As you complete your real estate classes with us, you may come across a buyer client who is looking to “fix their credit” before buying a property. You may also represent a seller who is in escrow
As you complete your real estate classes with us, you may come across a buyer client who is looking to “fix their credit” before buying a property. You may also represent a seller who is in escrow with a buyer and the buyer’s loan starts to go sideways because of an error on their credit report.
What do you do?
One of the most common questions that consumers ask credit counselors is, "How can I get negative items removed from my credit reports?" The accurate, short answer to that question is this: It's relatively easy to get incorrect information removed from a credit report but can be quite difficult to legally remove items that are reported accurately. In other words, if a debt is yours, and if all the particulars listed on the credit report are correct, they your options for legal removal are limited.
The good news is that there are several ways to potentially eliminate negatives from an official credit report, even when the debt is yours and when it's listed correctly. Here are the strategies that many consumers have used to clean up their credit reports:
Paying to delete negative items: If you contact a creditor and agree to pay the debt in full right away, then they might consider removing it from your report. This technique is especially successful when the amount owed is rather large and the delinquency is not very old. Many creditors are happy to have a large debt paid off quickly and taken off the books. They'll often agree to remove the item from your report if you ask them nicely, in writing and as soon as possible after it has been reported to the bureaus.
Asking for a goodwill removal: After you've paid a debt and the listing is still on your credit report, it's possible to contact the creditor and request that they remove it. It helps to explain that you have otherwise good credit and have been current on any other accounts you have with them. If there were special circumstances that led to the delinquency, be sure to explain the situation to the creditor. This is basically a "hardship" request and doesn't always work, but it's worth a try.
Asking for verification of the debt after several years: Bureaus can keep negative items on a report for up to seven years. After one or two years have passed, you can contact the creditor and ask for the debt to be verified. It's often the case that creditors can't verify older debts that have been paid off and closed out. If they can't verify it, then you can have it legally removed by contacting the credit bureau in writing and disputing the debt. Without verification from the creditor, the bureau will have to remove the listing.
It's important to remember that only the creditor has the power to remove a legitimate listing from your credit report. In fact, they are supposed to leave items on for up to seven years so that other lenders can get an accurate view of your credit-worthiness by reading your report. But, as in the situations noted above, creditors are sometimes willing to remove a negative item if you approach them with the right attitude. Separately, inaccurate information can potentially be removed by invoking the last strategy mentioned.
If you are interested in taking live real estate classes or preparing for the real estate exam, call us at 888 768 5285 or visit www.adhischools.com
Love,
Kartik
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Tips For Real Estate Agents on Social Media
Businesses can’t ignore social media if they want to remain relevant and competitive in today’s busy online marketplace and the real estate business is
Tips For Real Estate Agents on Social Media
Businesses can’t ignore social media if they want to remain relevant and competitive in today’s busy online marketplace and the real estate business is no exception. Social media platforms like Facebook and Instagram can be powerful outlets that help real estate professionals position themselves as industry experts while connecting with their audience and building confidence in their experience and services.
I practice what I preach. Our real estate school has had a Twitter account since early 2009 and a Facebook page for almost as long. Even our original YouTube channel has had content since 2009. That’s 10+ years of going hard on all these platforms.
So how do you win considering that more and more content is being added each and every second to Twitter, Facebook/IG and YouTube? It is getting more and more difficult to get noticed.
The key to getting the most out of your social media presence is utilizing tactics that help you build stronger connections with your audience and inspire them to work with you. Below, I’ve put together my top 4 social media tips for real estate agents, particularly in the residential space as I figure most of our real estate school students are going to start there.
1. Educate your buyers on the market.
Buying or selling a home is a major life decision for most people, and they want to know that they are working with a Realtor that can guide them through the process and answer all their questions as they move through the process. The best way to build this confidence with your audience is by educating them about the real estate market.
In addition to sharing educational articles from your own blog, curate some content from reputable, third-party sources to help your audience understand important parts of the buying and selling process. In addition, you can post your own honest tips and advice to your social media pages based on the questions that you are most often asked by new buyers or sellers.
2. Share information on a particular neighborhood.
When promoting your listings (or those of your company) on social media, go beyond just sharing the features of the homes you are selling. Most homebuyers want to know more about the neighborhood or surrounding areas. Real estate professionals can use their social media channels to educate buyers on the benefits and unique characteristics of local neighborhoods to help them make a more informed decision about where they want to buy.
In addition to sharing your own content about the neighborhoods you sell in, share content from local organization pages. For instance, you might link to an event calendar from the city’s Facebook page or share a tweet from a local restaurant. This is especially true in areas like Downtown Los Angeles or coastal Orange County where the nightlife and social aspects of the community are a lure for buyers.
3. Start a conversation.
The social aspect of social media is often forgotten when professionals use social media channels for marketing. However, if you really want to get to know your audience and build trust, it’s vital that you chat with your fans and followers. Get active in the comments section of your social media posts and pay attention to what others are saying on your pages.
With the instantaneous nature of social media, most users expect an instant response to their questions or concerns. In addition to being active in the comments section, you’ll need to be diligent about checking for and responding to direct messages across platforms. When someone reaches out with a question or concern, make sure that you are available to answer these questions and get them the help they need when they need it.
4. Don’t forget video!
Many real estate professionals will skip video content when it comes to managing their social media pages. However, with the visual nature of home buying, it’s important that real estate agents utilize video to showcase their properties when possible.
Most people reading this article have a television broadcasting system in their purse or pocket with their iPhone or Android device. It’s easy to quickly do a live on Instagram or post a quick story to your page. Just get out there and start. I posted a video of all of my equipment here, but I didn’t start with this much stuff. All I had back in 2009 was one camera with an internal microphone and just started recording videos on HD cassettes. I always knew video was going to be huge across the Internet and would be a valuable marketing tool. The faster you can start engaging with an audience the faster you can monetize.
Video content also helps create an emotional connection with viewers in a way that images alone cannot. Providing a video tour of a property allows the real estate agent to give their audience a better idea of what it is like to experience this home instead of seeing the space out of context.
If you are interested in taking real estate classes online or in one of our classrooms, please call us at 888 768 5285 or visit www.adhischools.com.
Love,
Kartik
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Before the question of whether or not open houses actually “work” is answered we should probably define what the word “work” actually means.
If you are a real estate agent and believe that a
Before the question of whether or not open houses actually “work” is answered we should probably define what the word “work” actually means.
If you are a real estate agent and believe that a successful open house is one where the agent found a buyer for that property on the day of that open house then very few open houses actually “work”.
However, if you define a successful open house as a chance to network with neighbors in a particular farm area, an opportunity to show the owners that you are doing something that is almost expected, and a way to find buyer clients for other homes, then nearly every open house has the potential to be a success.
Like many things in business, a substantial amount of time and effort is necessary to ensure that an open house will attract the right kind of traffic and result in at least a few interested and qualified potential buyers. Sometimes, sadly, even with a high traffic count, the net result might be less than satisfying.
While it’s also true that on occasion, "the buyer" will walk into an open house and make it all seem easy, if not preordained - but this can sometimes be attributed to pure chance.
Folks who are not quite ready to buy immediately frequently visit open houses as a way to solidify their preferences and explore the market. An open house can be the best way for an agent to meet people "up close and personal," demonstrate market knowledge, hand out cards, and take names. You never know when you're going to meet a buyer. It's best to always be prepared.
How to Do a Successful Open House
Use all the tools available to you to stand out from the crowd. You don't have to spend big bucks on advertising, or on refreshments. Use technology to your advantage.
Here are some ideas:
• Livestream the Open House on Facebook, Instagram and YouTube:
Give quick snippets of information as you walk through the rooms. Talk about the neighborhood, the easy commute to downtown, the community pool, the schools or a nearby shopping mall. Show the house at the same time.
• Invite the neighbors:
Count them as your allies to "sell" the good points about the area, rather than as "tire-kickers."
• Consider Unconventional Hours:
If the home has spectacular sunset views, schedule the open house for late afternoon. Or, alternatively, be slightly ahead of the normal 1-3 or 2-4 schedule, and offer coffee or fresh-squeezed orange juice. If you are going to serve alcohol at an open house, other rules can apply. Proceed with caution. I did a video and an article on this as indicated by the prior link.
• Creativity Counts:
Employ an iPad as a digital sign-in sheet and encourage visitors to ask questions. Get back to them via email with specific answers. You'll boost your chances of developing new relationships.
Perhaps most importantly, be there for everyone who walks through the front door. Meet and greet every visitor with a smile and a card. Never simply sit behind a desk or on a kitchen stool. But, be sure to give visitors a chance to walk through the house at their own speed and in their own way.
View an open house as an opportunity to sell yourself as well as the property and then every open house is, indeed, totally worth it!
If you are interested in online real estate school or even classroom oriented real estate courses, call us at 888 768 5285 or visit www.adhischools.com
Love,
Kartik
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Once you complete our classroom real estate courses in California or real estate classes online, you’ll need to put your license with a broker if you want to go to work.
At this early stage in your
Once you complete our classroom real estate courses in California or real estate classes online, you’ll need to put your license with a broker if you want to go to work.
At this early stage in your career, you are probably full of enthusiasm and at the same time have some serious questions and perhaps some lingering fears about whether not you're making the right career decision.
One of the most important steps you will take as a real estate salesperson is to choose a broker, the place where you will, in effect, hang your hat along with your license, and build your initial reputation in the field. Whether you're already licensed, or are shopping for a place to take your real estate classes, finding the right environment is all-important to your future. Even though it's not a lifetime commitment, your choice of initial affiliation will affect not only your earning ability, but also your learning curve, your growth potential as a real estate agent, and your long-term success and fulfillment as a professional.
Brokers also want to ensure that new agents who join their firms will be compatible, hard-working, knowledgeable, committed, enthusiastic, and a good match for the company culture.
How should you evaluate your opportunities? What are the steps to take to assure the best possible fit?
To prepare for your interview, expect to be asked the following questions by a potential employing broker:
1. What drives your decision to become a licensed real estate agent?
Do you have previous sales experience? Is money your primary goal? How do you intend to support yourself until the sales (and closings) start rolling in?
2. Do you have a monetary goal in mind?
If you've given even a little thought to this, you will probably answer this question with a specific dollar figure; then you can go on to explain that you intend to grow your earnings over time to reach your ultimate goal. Also, you'd be wise to impress a potential broker with your knowledge of real estate facts and figures. It's not detrimental to disclose that, in the beginning, you view real estate as a part-time gig, until you can build a reputation and a clientele. This disclosure is important because it will help to understand whether or not the brokerage’s training calendar is going to be a fit.
3. How much time and energy can you devote to the business?
Real estate, unlike a 9-5 job, requires evening and weekend work, coupled with high levels of client accessibility. A broker will want to know that you understand the time commitment, as well as the energy it takes to see a transaction from listing to closing, or from initial contact with prospective buyer to the accepted offer by the seller and the escrow ultimately closing.
Real estate can be an extremely rewarding -- and profitable -- profession. But it requires knowledge, dedication and commitment. Show a broker those three qualities, and you'll be on your way to a mutually beneficial association.
If you need help being placed with a broker or are considering the first steps to real estate licensing or passing the real estate exam, call us at 888 768 5285.
Love,
Kartik
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With hundreds of thousands of real estate salespeople in California alone, clients have choices. The million dollar question is “On what basis will the client decide?” This can be a hard thing to predict,
With hundreds of thousands of real estate salespeople in California alone, clients have choices. The million dollar question is “On what basis will the client decide?” This can be a hard thing to predict, especially If there are two real estate salespeople that are equally competent, have similar experiences and both work for reputable companies - the client might make a decision on who to hire based on pure “likability”.
If one agent is more “likable” than another who do you predict will get the business? It’s not hard to assume that the agent that can win the heart and mind (in that order) of the client is going to get the contract signed.
Because clients are often concerned or nervous through the real estate process, the agent should strive to be the kind of salesperson that brings good energy and enthusiasm into every presentation they go on. It has long been said that sales is simply the "transfer of energy from the salesperson to the customer”. The more energy and enthusiasm you exude, the more likely the client will sign.
Still, there are some real estate salespeople that are the personification of negativity and create roadblocks through the sales process. We have all met people like this. You know the type - they walk into a room and all the plants begin to die and when they exit they spring back to life.
I would urge all of our readers to examine which of these describe them. Are you the kind of person that brings vibrance and energy to every interaction or are you the exact opposite? When you walk into a room is there a big grey rain cloud over your head?
If you aren’t sure how to answer this, have a look at people that you would characterize as being in each of the two groups. Positive and energetic or negative and draining?
Consider the group of people that you know. Think of five or ten people that you know who are real energizers. You probably can think of a few right off the bat. Who do you know that when they show up, when they call the energy is better because of their presence? Who are the few people that you know when they walk into the room the energy shifts to the “dark side”?
Believe me. People notice.
This is important because your likability impacts how much business you're able to do.
So what are some things that we can do to immediately increase likability? The first thing I would urge is to be interested in other people. If you have ever read the classic book How to Win Friends and Influence People by Dale Carnegie a recurring theme is to try and make other people feel special by being interested in them and their story. It’s pretty simple - be interested. Be interested in other people and who they are and what they are about.
People that are interested in others are infinitely more likable than those that are not.
In a nutshell: Try harder to be interested than be interesting.
Another thing to increase that “L” factor is to always leave people better than you found them. In the case of real estate, that could be a critical market update to a buyer or seller. It could be an escrow update to one of your current deals but always look to add value at each and every interaction.
There’s plenty of pessimism in this environment - you don’t need to look hard to find it. Be the person that's optimistic and lights up a room each and every time they are in it. Not only will this be better for your physical health, it’ll be better for your wallet.
If you are interested in real estate classes in Los Angeles or online real estate school call us at 888 768 5285.
Love,
Kartik
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In order to become a real estate agent in California, applicants must complete courses in Real Estate Principles, Real Estate Practice as well as one Elective course. Although there are a number of options
In order to become a real estate agent in California, applicants must complete courses in Real Estate Principles, Real Estate Practice as well as one Elective course. Although there are a number of options available for necessary pre-licensing coursework, there are specific benefits of a classroom scenario to advance your real estate career goals. The give and take of personalized education provided by a knowledgeable and experienced real estate practitioner can outweigh the flexibility and convenience of other choices.
Here's why:
Motivation
Online courses allow learners to work when it best suits them, but they are also easier to skip. Pre-licensing coursework requires a minimum of 135 hours of coursework; if you're not sure of your ability to maintain an unwavering schedule without some structure, classroom time can help. By blocking out a specific time and place for class on a regular basis, many students find that the tendency to procrastinate or postpone is eliminated.
Interaction with Others
There is no substitute for the "up close and personal" attention that classroom real estate courses offer. Students have the ability to ask questions and receive immediate clarification often learn faster and retain information longer than those who simply listen to a presentation online or click through slides. An online classroom is, essentially, a one-way street; interaction is limited, even if visual aids are used and chat room communication is available. The dynamic in a physical classroom is different; interaction with other students is every bit as important as discussion with the instructor.
People Skills
Because real estate is, at its heart, a people-oriented business, association with individuals from varied backgrounds and with different skill sets is always instructive. The classroom can help you hone your people skills, assist you to address unique needs, and open your mind to the varied approaches that must be employed to work with different personalities.
Even if role-playing is not a formal part of the curriculum, students in a classroom situation benefit from the mix, and learn to develop a personal style.
Professional Networking
A classroom provides an opportunity to form business associations with other career-minded individuals, and to develop a professional network of both mentors, "cheerleaders" and motivators. The requirements for real estate licensing and the need to pass state licensing exams can be daunting. Classroom participation with a group of like-minded people offers a "first step" platform into the world of real estate, helping to sustain your motivation, gain professional stature and grow your business. That's an ongoing career benefit.
If you're serious about pursuing a real estate career, it's only natural to feel an eagerness to get started. It's also natural to want a "good deal" financially. Although classroom learning may be slightly more costly on the front end compared to an online option, the above benefits are likely to pay dividends by allowing you to pass the licensing exam with confidence and to start earning sooner.
As in any other field, the old saying, "Time is money," holds true. Enrolling is a real estate class is an investment in your future.
Choose wisely.
For more information about real estate licensing or getting a real estate license in California call us at 888 768 5285.
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Errors can happen on a credit report. What causes these errors? Sometimes it can be something as simple as a father and a son who have the same name and the only difference is a “Sr.” or “Jr.”
Errors can happen on a credit report. What causes these errors? Sometimes it can be something as simple as a father and a son who have the same name and the only difference is a “Sr.” or “Jr.” What if son paid a few bills late and this incorrectly appears on Dad’s credit report?
Worse than the above scenario is a customer who may have been the victim of identity theft. Perhaps their social security number and date of birth were compromised on a website and sold to criminals. Each year we read of many major corporations who have had their databases compromised. Equifax, eBay and JP Morgan Chase are just a few examples of large corporations that have been targeted by hackers. Where then does a customer turn?
The Federal Trade Commission has several recommendations for those that genuinely believe that false and erroneous information appears on their credit report. The Fair Credit Reporting Act mandates that the credit bureau and creditor have a collective responsibility to correct and update any incorrect information in the customer’s credit report.
The individual with erroneous information on their credit report should send correspondence to the credit bureau that has displayed this erroneous information. This could be either Experian, Transunion, or Equifax or could potentially be all three. Mail correspondence isn’t required, however, as the individual can file their dispute online.
If the customer is sending their dispute via mail, the Federal Trade Commission has a sample dispute letter available on their website and this letter can act as a starting point for anyone seeking to eliminate inaccurate information from their credit profile.
In order to increase the chances of incorrect and incomplete information being deleted from the credit report individuals are encouraged to support the claim with any proof that the data is incorrect. Examples of this proof could be cancelled checks or bank statements showing that the bills were paid on time or the fact that the debt is no longer even valid. In some cases, the customer might have paid off the debt and it is still reporting as open on the credit report. Combining the letter or online dispute with substantiation that the information is inaccurate will increase the chances of having incorrect information deleted from the credit report.
The FTC recommends that this substantiating documentation not just be sent to the credit bureau but also to the creditor with whom the customer is disputing the incorrect information. This may increase the chances of incorrect information being deleted from the credit file. If this doesn’t work the customer is able to leave a note in their credit file next to the “incorrect” trade line stating that the customer disputes the accuracy of this information.
Generally, the credit reporting agency must investigate the disputed items within 30 days of the dispute being filed. However, the law has an exception for the credit agencies wherein they don’t have to investigate a dispute that they deem to be frivolous. in the event that a credit bureau is going to investigate a disputed item, they are required to forward everything received from the customer over to the creditor.
Once the investigation is complete, the bureaus are required to give the customer notification of the outcome of the dispute in writing. They are also required to provide a copy of the credit report to the customer in the event that the dispute resulted in a change to their credit report. Statute also requires that the credit bureau provide one copy of a credit report to everyone for free each and every year. A customer who is disputing information on their credit report that results in a copy of their credit file being sent to them will still be allowed their one free credit report per year. What this means is that a customer who is disputing credit information in their file may end up with multiple credit reports per year at no charge.
Because credit scoring can affect so many aspects of a person’s life, the government has a system in place to ensure that incorrect information on a report can be disputed and ultimately deleted. Hope is not lost in the event of identity theft or an incorrectly reported late payment. There is a dispute process in place and will work if done properly. The Federal Trade Commission’s sample dispute letter can be a great place to start.
As always, if you are considering getting into our great real estate business, you'll need to go to real estate school first. Need help passing the real estate exam? Check out our test prep site here.
Love,
Kartik
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So you’ve finished up at our real estate school and passed the real estate exam. You're stoked because you have your first buyer client but their credit is less than perfect. The buyer badly wants a
So you’ve finished up at our real estate school and passed the real estate exam. You're stoked because you have your first buyer client but their credit is less than perfect. The buyer badly wants a home and you’re asking yourself: What advice can I give them to improve their credit score?
The reality is that credit scores today have a profound impact on quality of life. It determines the rates you pay on all sorts of things from mortgage interest rates to whether or not you can rent a car. The difference between good credit and bad credit can also determine where and how you live.
Make sure that only accurate information appears on the credit report
It makes sense that a borrower would want to be sure that their credit report contains accurate information. Any inaccurate data can be disputed with the credit bureaus. Equifax, Experian and TransUnion are the three bureaus and can be contacted to dispute erroneous information.
If your borrower isn’t sure how to start the dispute process there are third party providers that can help quarterback this with the credit agencies. I would recommend checking online or with other folks in the business that can give you a good referral to a vendor that can help.
Pay down revolving debt
Assuming that all the data on the credit report is accurate, the next question is “What else can we do to bump up the score?” One thing that can quickly impact the FICO is to advise the borrower to pay down as much revolving debt as possible. This is known as the “credit utilization” ratio. This ratio is a big deal as it accounts for about a third of the FICO algorithm. The less credit you have available the worse your score will generally be.
In other words if all your credit cards are maxed out, your score is probably going to be low. Do your best to get credit card debt paid down quickly to improve the credit utilization ratio and get that score up.
Try to get added as an authorized user
Another thing that can help bump the credit score is if the borrower can convince a family member or a loved one to add them to one of their credit cards. If mom or dad has a credit card that has a solid payment history and they are willing to add the borrower as an authorized user, this can help piggyback their on-time payments to boost the score.
Make sure bills are paid on-time
A central aspect of good credit is ensuring that the borrower pay their bills on-time. An easy way to do this is to calendar all required payments on a cell phone or Google calendar. Better yet - back up the calendaring with autopay. Autopay eliminates the aspect of human error and also eliminates wasted money spent on a bunch of late fees. Better still - auto pay eliminates the worst case scenario of an altogether missed payment. One missed payment means a catch-up scenario for the borrower and forces them to make two or more payments at once. Letting bills pile up can make it really hard to dig out of a deep hole.
Think long-term with your buyers
Remember that selling real estate inherently involves a very long sales cycle. Even if your prospect can’t buy a property immediately, they may be able to with some future planning. A year is going to go by quicker than you might think. Do you plan on being in the business in 12 months? I would think so. Sticking with a prospect even when it looks like they might not be able to buy immediately will create loyalty and your deal will eventually come to fruition.
As a real estate professional, it’s important to be a valued resource for your clients. Giving great advice can help foster loyalty among your customer base. This can be priceless and irreplaceable.
As always, if you are interested in online real estate courses or even live classroom courses, call us at 888 768 5285 or visit www.adhischools.com.
Love,
Kartik
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OK – So you took our real estate classes in Los Angeles or maybe you took our real estate classes online. Now you have your license and it’s time to do your first open house! You’re hoping to make
OK – So you took our real estate classes in Los Angeles or maybe you took our real estate classes online. Now you have your license and it’s time to do your first open house! You’re hoping to make some great connections with potential clients and you want visitors to roam through the home a little longer. What do you do? Bribe them with ice cream? Booze? Both?
If you decide to serve alcohol at your open house and you don’t have a liquor license (no agent is going to have one) it’s important to ensure that the open house is not open to the public. If you are serving alcohol and your open house is open to the public you need to have a liquor license to do it.
Want to serve liquor at an open house? There are other rules too:
There can’t be any sale of alcohol
It’s important to make sure that there’s no actual sale of alcohol happening at the open house. Agents typically don’t charge for liquor at an open house so this isn’t something that most real estate agents have to worry about.
The premises cannot be maintained for the purpose of keeping, serving, consuming, or disposing alcoholic beverages.
If you’re doing an open house at a residential property, it’s pretty unlikely that the premises are going to be maintained for the purpose of serving liquor. It’s a residential property, it’s not zoned commercial, it’s not zoned retail restaurant or bar. So this second rule isn’t going to be a problem for most real estate agents.
The event should not be open to the “general public” at the time alcoholic beverages are served.
In the hospitality world, this is known as a “private party exception”. For the private party exception to be invoked, the person doing the open house has to have a list of guests prior to the event. Only people on the list are permitted to be admitted to the event and it would become a “private party”.
This means that if somebody does show up at your open house and they’re not on the list, you have to turn them away. If you’re serving alcohol and you let them in the event could be interpreted as being “open to the public” which could trigger a licensing requirement. The list of attendees is important to maintain and should be respected.
Finally, it’s hard to overstate the amount of liability that the agent can incur in the event the agent allows alcohol to be served to someone that is underage. Agents can also be liable in the event that they continue to serve alcohol to someone who is obviously intoxicated or is “habitual drunkard”.
So be smart about it. Make sure that if you are serving wine you need to have proper protocol that’s being followed to make sure we limit our liability at these open house events.
As always, if you are interested in taking real estate classes in Los Angeles or in Orange County please visit www.adhischools.com. Feel free to call the office at 888 768 5285.Love,
Kartik
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Hi all:
I wanted to give my readers a bit of a public service announcement with this article. Recently, 74 people were indicted on wire fraud related to real estate purchases.
How does this scheme
Hi all:
I wanted to give my readers a bit of a public service announcement with this article. Recently, 74 people were indicted on wire fraud related to real estate purchases.
How does this scheme work? Hackers are locating people who are in the process of buying a home or other real estate. The hacker then spoofs an email from the escrow company that you are using for your particular home or building purchase. Wiring instructions are sent saying something like, “Your down payment’s should be sent to our escrow company. Here are our routing number and account numbers.”
As it turns out, that’s not the routing number nor is it the account number of the escrow company, and hardworking Americans send their money to these scammers.
If you’re in the process of buying a piece of real estate my hope is that your escrow company is shares this information with you. It is absolutely mission critical that you call the escrow company, speak with the escrow officer, and verbally verify the account number and routing number. Don’t just rely on things that have come via email. You could find yourself the victim of wire fraud. I’m so happy that almost 100 people have been indicted and taken off the streets so that they can’t harm future purchasers.
The tip here involves ensuring that you call the escrow company directly. Another pro-tip is not to call the phone number on the wiring form that comes via email as that could also be fake. Call the number that you find for them on Google or on Yelp, and verify that you’re talking to the right person before you wire that money in. Better yet – stop by and talk to someone face to face if possible.
Here is a link to the news article about the 74 people that have allegedly committed this crime.
If I haven’t gotten to know you on Instagram, I would love to. I’m @kartikspics. Also, we have a YouTube channel linked here – make sure you subscribe to the channel!
As always if you are interested in taking real estate classes online or even live real estate classes let us know. If you need state examination prep, we also have you covered!
Love,
Kartik
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Recently, I’ve been getting many questions regarding “off-the-top” fees that real estate companies charge their agents.
If you are working at a real estate company, you are probably subject to
Recently, I’ve been getting many questions regarding “off-the-top” fees that real estate companies charge their agents.
If you are working at a real estate company, you are probably subject to some kind of commission split between you and the company. Imagine it's 60/40, 70/30, 80/20 - whatever it is you'll have some split with your broker. This means that you will get a portion of the real estate commission and your brokerage gets a portion of the commission.
Generally if you go work for a massive franchise like Century 21, Coldwell Banker, RE/MAX or Keller Williams, they are also going to have an “off-the-top” fee. Remember, this is in addition to your commission split.
Typically, this is anywhere between three and eight percent of the total commission. This represents a royalty to the franchisor. So Keller Williams corporate in Austin, or Coldwell Banker corporate in New Jersey gets a portion of your commission before you do.
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As an example, let’s say you earn a $10,000 commission and your company charges a 6% off-the-top fee. Before your commission split is calculated the company will take $600 out of the $10,000 and send that to Coldwell Banker in New Jersey.
Now you have $9,400 left. Your commission split will be calculated on that $9,400.
Once you finish taking real estate classes, you are naturally going to interview with various real estate brokers and an important question to ask is “What’s my commission split?”
However, you’ll also want to ask if there are there any other fees that are deducted before the commission split is calculated. Some brokers will charge an errors and omissions insurance fee for professional liability insurance. Some brokers will charge you a document scanning fee, or some other “desk fees” to work there.
As a newer agent these are questions that you need to ask of the broker and be as educated as possible so you are fully aware of what you're getting into.
If you are interested in taking real estate classes in Los Angeles or Orange County, please visit our website.
If we haven’t yet connected on Instagram I would love to get to know you - I’m @kartikspics.
Love,
Kartik
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Many of you taking our real estate classes to obtain your real estate license are probably also interested in real estate investing.
I recently came across a real estate deal that I want to tell you
Many of you taking our real estate classes to obtain your real estate license are probably also interested in real estate investing.
I recently came across a real estate deal that I want to tell you about. Some things make it a good deal, some aspects of it make it less desirable, and I'll let you know about many of these in this article.
There is a local airport with some adjacent land that was deeded to the city on the condition that the property is used for either airport or retail use.
The city owns the land, and a real estate investor went to the town and said, "Hey, I'll lease this land from you." The investor's ground lease totals about $1,000,000 per year to the city and he proposed a very long-term lease. The city agreed.
After securing the ground lease from the city, the investor went to the hardware store Lowe’s and told them, "Hey, you can rent this land from me, and you can build another Lowe’s. I’ll lease the site to you for $2,000,000 per year."
Lowe’s agreed. The investor is now in a “sandwich” position between the city and Lowe's. That is, Lowe's is paying about $2,000,000 a year to the investor, and the investor is then paying roughly $1,000,000 per year to the city.
This ground lease produces about $1,000,000 a year in net operating income to the investor. The financial benefit to Lowe's is that Lowe's gets the site built and can start operating in the location. The advantage to the city is that they collect ground rent, and the benefit to the investor is that they profit from the difference between the two leases.
Now the question becomes, "What are the risks associated with this investment? What are the benefits? What are drawbacks?"
Well, one real risk the investor has is that if Lowe's goes bankrupt or decides to close the store rent may stop. We've seen many retailers, even major ones, close over the last several years. Consider Mervyn's, Circuit City, Borders, and Fresh and Easy. There are a ton of examples of large retailers with their back to the ropes. Giants like Macy’s and Sears and getting squeezed as the internet pounds away at these traditional brick-and-mortar retail models.
In my investment example, the ground lease expires in 2053, so the person that's leasing from the city has contractual obligations for a good number of years. Before making a decision, an investor would have to look at the Lowe's lease abstract. An essential examination of the lease would investigate the length of time Lowe’s remains obligated to pay. Do they have any outs in the contract? For example, do they have the right to terminate the lease before the expiration? Imagine if Lowe's terminated in 2035, the investor might still have another 18 years remaining on their ground lease. This could be horrific for the investor.
As of the time of this writing, the investor is selling their position in the lease at an asking price of $11,400,000 as of the time of this writing. The question is, is this a good investment?
I've pitched this to a couple of my investor clients, and many initially seemed interested. However, after they slept on it they start to think, "I don't own the real estate, so it's just a pure cashflow play - I don't want to pay $10,000,000+ for it”. Number two is when you own the real estate, of course, you benefit from depreciation and a lot of other tax advantages. You don't have that in this instance because you're not buying the fee simple ownership.
I wanted to write this blog and open your eyes to the fact that there's not only one way to invest in real estate. You can invest in cash flow plays. You can invest in appreciation plays. Hopefully, you're getting a little bit of both, but this is a deal that is not an appreciation play in all. It's the exact opposite.
Remember that as time goes on, this deal becomes less and less valuable because Lowe’s lease obligation decreases as time progresses. The cash flow is finite and as time goes on, the time you have to collect the rent from Lowe's decreases.
So, if you're interested in investing in real estate, I'd love to talk to you. I come across a ton of deals each week that I'm calling people on. There are flip opportunities and investment opportunities and syndication. If you want to bounce a deal off me and talk, I'd love to hear from you.
If you want to know how to pass the California real estate exam or are interested in taking real estate classes anywhere in California check out www.adhischools.com. You can also visit our state exam prep site at www.crashcourseonline.com for more information.
Our office can be reached at 888-768-5285.
Don't forget to connect with me on Instagram personally @kartikspics. I'd love to see what you're up to on and offline. I will catch you on the next one.
Love,
Kartik
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I was up in the high desert a few days ago and spoke to a group of students who had recently finished our real estate school and work for Alam Realty. While I was speaking to them something came up that
I was up in the high desert a few days ago and spoke to a group of students who had recently finished our real estate school and work for Alam Realty. While I was speaking to them something came up that surprised me. Many of our recent graduates had clients that they were working with within just days of getting their licenses issued.
I pulled the broker aside and I said, "Mohammad, how are these guys hitting the ground running so quickly? Most new agents have a 60 to 90 day period where they're still learning the purchase contract. They're still learning how to get customers. They're still kind of getting their feet wet. Your team seems to be doing well very soon after getting licensed. Why is this?”
Mohammad said to me, "Kartik, you don't remember I do a class here on Tuesday nights." Turns out that every Tuesday he does a real estate class on sales skills. He also teaches the purchase contract and provides tips about the industry before they get their license.
This got me thinking about what you could do (no matter where you live) as a current student of ours to hit the ground running. One mistake that I see a lot of people make is they're so focused on preparing for the real estate exam test they think, "I'll learn about the contract and pick a broker later on. Let me focus right now on passing the test.”
While that's semi-true I would highly recommend that you start learning about the business and about the industry early in your journey. Don't wait until you get your real estate license to do that. There's no law against you learning the purchase contract or reading the listing agreement now before you get your license. There's no law against you shadowing a successful real estate agent. There's no law against you attending a sales meeting before you get a license. There's no law against you interviewing with real estate companies.
I would try to get immersed in the culture as early as possible as the state will take four to eight weeks to process your exam application. What that means is even after you pass the three courses and you apply for the exam it can take a long while before you're taking the actual real estate exam.
It’s super important to build momentum through the licensing process. Again, one big mistake that I see a lot of people make is that a lot of students are so focused on the test that they don't think about what's going to happen after they get their license. You don't want to run out of steam early in the game.
Remember you don’t yet have a license so you might not be able to solicit for customers. You're not going to have a Supra lock box or an eKEY now but there's a lot of things that you could be doing now that will make sure that you obtain success quickly.
Love,
Kartik
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I recently received an email that went like this:
"Dear Kartik:
“I'm addicted to social media and I can't get over how successful all these real estate agents on Instagram seem to be. I see every
I recently received an email that went like this:
"Dear Kartik:
“I'm addicted to social media and I can't get over how successful all these real estate agents on Instagram seem to be. I see every other realtor on 'the Gram' closing what seems like an endless amount of real estate transactions and I can't seem to keep up. I've done eight deals so far this year and I compare myself to other realtors online and it seems like I'm doing so much worse than they are.
How do I break my addiction because I keep comparing myself to other people online?"
This is a very good question, actually. I think that a lot of people these days are addicted to their cell phones and specifically to social media. I mean, the addiction to our phones and technology has gotten so bad that the latest version of the iOS operating system actually has a screen timer showing the user how much time was spent on their phone.
Anyway, there was actually more to this email. The writer had actually listed a few agents that seemed to be doing really well on Instagram and I used a system called Broker Metrics to look up how many deals these agents had done. Turns out that he author of the email had actually done MORE deals than the agents that he was comparing himself to!
Now, I know that there's different ways that you can count how many deals you did. I understand that sometimes transactions can be co-listed or maybe you're on a team and the offer was written in the name of your "team leader" and you didn’t get credit through the MLS. I understand all that. But, it's important to remember that the things people put on Instagram or Facebook or Twitter are the most pleasant parts of their lives. Society picks and chooses what they want to share with the rest of the world. All these posts to is try and control your perception of their reality.
Remember to keep the following in perspective:
1. Much of society is addicted to technology. Particularly their cell phone.
2. A subset of that society is admittedly addicted to social media.
3. Not everything that you see on social media is real.
So, it's important that we stop comparing ourselves to people online because more than half of it is fake. So, go back to work. Focus on what makes you successful. Closing real estate transactions, helping clients, stacking cash and building a career. Forget what everybody else is doing online. You could spend your whole life on the sideline watching what other people are doing, or you can get in the game, play and win.
Love, Kartik
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How to Use Social Media to Get Real Estate Business
Social media is one of the most important ways to get business today. Most people are on their phones interacting in the digital world at least as
How to Use Social Media to Get Real Estate Business
Social media is one of the most important ways to get business today. Most people are on their phones interacting in the digital world at least as much as they are with the physical world. Nurturing relationships online through outlets like Facebook and Instagram can help build trust and brand recognition between you and a prospective client.
To better understand how people in the real estate business use social media I recently met with a good friend who works at a large mortgage company in Orange County. When I met with her for a recent interview she was working with an escrow company and helped build their business using the power of Instagram and Facebook. She was kind enough to share some insider tips on how she uses social media, specifically Instagram, to gain followers and new prospects.In this interview, I was able to find out three key things:
• What she posts
• When she posts
• How she decides what to post
Danielle Benevides has done a great job building this escrow company using Instagram. Here is the gist of our interview, which you can also watch in full here on my YouTube channel.The main takeaways from our interview are these strategies:
1. Merge your personal and professional accounts into one.
2. "Like" other people's posts and engage with them.
3. Reach out to your followers by sending them messages.
4. Post at times when people will be more engaged with social media, such as before work, during lunch, after work and before bed.
5. Post updates that present you as a productive and successful professional, such as you going to an open house, you meeting with clients, you selling a house and so on. Be personable and relatable through these posts.
6. Find an Instagram account in your field that you admire. What makes it so successful? Ask yourself are there models that you can copy before you start doing your own thing? It’s important to not blatantly rip off others and be authentic as you consider this strategy.
7. When you build a following, you can do more and gain an even bigger following. It’s easier to go from 15,000 followers to 20,000 followers than to go from 0 followers to 5,000. Scale is important.
How Danielle Benavides Uses Instagram to Gain Business
Danielle: "Basically, I'm very intentional with what I post on Instagram. I'm very intentional about who I add. It's all a very methodical process. Something I encourage agents to do is to merge their personal profile with their business one. So far, that's really worked to my benefit. By merging accounts, I'm exposing what I'm doing in my daily routine, such as being out with new clients, visiting an open house or doing anything related to business. I'm posting these things and people recognize it. I'm also liking other people's photos, which establishes an online relationship."
Kartik: "Some people think that the business page and personal page should be separate. You don't think so. Why?"
Danielle: "I think it should be all in one. It's time-consuming to go back and forth and log into different accounts ... I hear from agents that they don't even log into either their personal or business profile. When you're trying to juggle two accounts, you won't have the best results."
Kartik: "What about people who didn't grow up with technology or those who may think that social media isn't relevant to their business?"
Danielle: "I work with some clients who aren't really into social media. I encourage them to at least try it out because it is something that they should put into their business. Social media can be a huge part of their success."
Kartik: "What is a good engagement strategy for those who want to get started?"
Danielle: "What I have found myself doing is that I will purposely go on Instagram and start liking pictures of real estate agents that I follow. I even go into my search bar and find real estate agents I know. I seek them out and message them if I want to, like send a DM about my escrow services. You're not working that hard to send a message online. It cost me more gas and time to visit friends than to touch my phone and start sending messages."
Kartik: "A lot of people struggle about what content to post and when they should post it. What do you do?"
Danielle: "It's important to post at certain times of the day when people are more likely to look at their phones or check social media.
• Before 9 am: Lots people get to work between 7:30 and 9 am and check their social media with a cup of coffee.
• Noon during lunch.
• After 5 pm: Work is over and people have some downtime.
• Between 8 and 9 pm: The day is usually done and there's some wind-down time before bed.
Kartik: "What are your end goals with social media?"
Danielle: "My goal is to continue building my following and use it as a tool to get business. I also want to be a leader in my field. I want people to use me as an example, just like the people I look up to on Instagram. I try to follow their methods and implement them into my strategy."
Learn More About Real Estate and Social Media
Once you build an audience around yourself, you can monetize and build your brand even more. I'm so thankful to hear some expert tips from someone who has used Instagram for her business with real results.
If you’ve considered taking online real estate classes visit our website here. If you want to take real estate classes in Los Angeles or in Orange County we have you covered also! To learn more about using social media for real estate, subscribe to my YouTube channel here.
Love,
Kartik
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5 Things I Love About Home Ownership No matter what you’re selling a basic belief in it is critical. It’s hard to sell something that you yourself don’t see value in. I genuinely love real estate,
5 Things I Love About Home Ownership No matter what you’re selling a basic belief in it is critical. It’s hard to sell something that you yourself don’t see value in. I genuinely love real estate, and there are countless reasons why. Because of this, I have no problem talking about it with everyone I meet. However, for this blog, I’ll limit myself to just a few reasons.Here are five things I love about homeownership.1. Fixed PaymentsWhen you get a home loan with a fixed interest rate, you lock in your payment for the next 15 to 30 years. Your payment is locked – even if the world around you changes. This means your payment will stay the same even while the cost of living is guaranteed to increase over time. This predictable and stable payment will help you plan financially without the fear of increased living expenses.On the other hand, if you rent, your payments are virtually guaranteed to increase as demand and population increase.When you own your own home, your housing expenses are locked in, which only gives you more margin because you’re not continually paying more to live at the same property.2. Likely AppreciationOver time, the value of your home is likely going to increase. Just how much won’t be the same every year, but on average California real estate goes up 4 to 8 percent annually.In some years, values may rise more than 20 percent, and in bad years values can go down — but everything ultimately averages out to a steady rate of appreciation between 4 and 8 percent.Without any effort you’re going to get richer through appreciation.3. StabilityOwning a home gives you a measure of stability and certainty in your life. You also get more control over basic lifestyle decisions without having to ask a landlord for permission. Do you want to paint your walls? Go ahead! If you want a dog, you don’t need to ask your landlord or pay a pet deposit — after all, it’s your house.Also as I mentioned before, fixed payments provide a static housing expense that won’t go up with inflation. In an uncertain world, this is a good thing.4. Forced SavingsIt doesn’t matter if you’re frugal or not — owning a home forces an increase in net worth over time.Even if the value of the home never goes up, the mortgage balance is going down through the process of amortization. This forces you to build some level of net worth even if your property isn’t appreciating.In California, you’ll gain more equity by an ever-decreasing mortgage balance, which will give you access to funds in the future. If your home appreciates, so you’re getting richer on both ends — with both a decreasing balance and higher home value to give you more equity.
5. Your Home Is an AssetYour home and other real estate form part of your estate, which can be left behind for future generations. The fact that your house is passable to others helps leave behind a legacy and keep wealth within your family.As a renter you are getting value in that you have a place to live temporarily, but the big picture is that you are helping pay off your landlord’s mortgage with ever-increasing monthly payments.I understand that in some markets people have the position that it is cheaper on a monthly basis to pay rent compared to a mortgage and that (in theory) that difference could be reinvested elsewhere but the truth is that so few people actually do that. For most of us, if we have money in our pockets we tend to spend it.Learn How to Buy and Sell Homes in CaliforniaDo you want to take real estate classes and get into the exciting world of buying and selling homes? Are you ready to share the benefits of home ownership with others? Then find out more about real estate classes in Los Angeles or even online real estate school today!
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Chinese Investment in U.S. Real Estate Down
Some of the most significant players in the U.S. real estate market are Chinese investment groups. In fact, if you check out our Foreign Investment Study,
Chinese Investment in U.S. Real Estate Down
Some of the most significant players in the U.S. real estate market are Chinese investment groups. In fact, if you check out our Foreign Investment Study, you’ll find that 1 in 14 residential properties that sold for over a million dollars was sold to either someone from Hong Kong, mainland China or Taiwan. Chinese investments in U.S. real estate have long brought health and vitality to the U.S. real estate market.
That said, Mark Heschmeyer from CoStar reports in his article Already Down, Chinese Investment in U.S. Real Estate Evaporates in First Quarter that if you compare the first quarter of 2017 with the first quarter of 2018, Chinese investment in U.S. real estate has gone down a staggering 75 percent.
This is a significant piece of news for real estate investors and agents for a lot of reasons — one of them being that Chinese investors have long been stimulating the U.S. economy. When 85 to 90 percent of foreign investment in U.S. real estate slows down, so can development and job creation.
Mixed Signals and an Update
Just a disclaimer: Nobody knows for sure if this trend is likely to continue or if in a few quarters things will return to the way they were. In fact, recently Costar reported that the American arm of Wanxiang Group Cos. acquired the Prudential Plaza Office Complex in Chicago for a cool $680 million, exceeding all the investments made in the entire first quarter of this year. As you can see, this situation is still very much up in the air.
What’s Causing This Overall Decrease?
Heschmeyer suspects that one factor that may be causing Chinese investment in real estate to dwindle is that the Chinese government has enacted new legislation that has pushed a lot of Chinese investment toward Europe and other parts of Asia rather than here in the United States.
Selling Current Holdings
Another trend is that these groups are selling their current U.S. holdings – thereby increasing supply. Recently many large deals have involved Chinese investment groups acting as as sellers-disposing of their U.S. real estate assets.Right now these are just large investments. For example, in February 2018, a Chinese investment group sold New York’s 1180 Sixth Avenue for $305 million and 19 East 64th Street for $90 million. These are just a couple of the large U.S. holdings that Chinese investment groups have sold off.
What If You’re Investing on a Smaller Scale?
If you’re an investor in smaller properties, you may be watching this situation closely to see if it will eventually affect you. As an onlooker, here are some questions you may have:
1. Is this an ongoing trend? Are Chinese investors going to be continually pulling money out of the U.S., or is this just a short-term reaction to legislation and things will return to normal in a few quarters?
2. Will this start affecting smaller deals? Is this the catalyst of a trend that will eventually trickle down to smaller properties like a $500,000 home or a $2 million building? Will we lose out on these smaller investments that help our economy and development?
In reality, nobody has definitive answers to these questions at this time. The only thing that we can be sure of is that Chinese investment in U.S. real estate has dropped precipitously, but we’re not sure if it will stay this way.
Tell Me What You Think
Do you think that this trend will trickle down to smaller assets? Do you think this drop is only temporary and that it won’t affect smaller holdings? Is this a good thing or a bad thing? How do you think it will affect the overall economy?
Current Events and Real Estate
Great agents stay on top of what’s going not only locally but also internationally. This awareness helps them tailor their sales and marketing strategy. Starting your real estate education off on the right foot can make all the difference in the world.
Learn how great real estate agents operate in the landscape of constantly changing legislation, buyer behavior and marketing trends at ADHI Schools.
Love,
Kartik
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Are We in a Real Estate Bubble?
A topic of debate in our industry these days is whether or not we are in a real estate bubble. With supply still relatively low, housing starts that don’t keep pace
Are We in a Real Estate Bubble?
A topic of debate in our industry these days is whether or not we are in a real estate bubble. With supply still relatively low, housing starts that don’t keep pace with demand and prices inflated, my impression is yes.
What do you think?
First, I want to follow up on a video I recorded earlier this year. I reflected on a tour I did of some new construction where Lennar homes had built homes within homes – sort of like an in-law suite. I then discussed what I suspected to be a real estate bubble brewing, even back then.
Back to the Mini Homes
These mini houses were built because Lennar might have suspected that housing prices in California had become so unaffordable that buyers would actually need demised space inside their homes so buyers could have their parents, children or tenants rent out the smaller space to offset the mortgage payment. The builder might also have predicted that joint families are becoming more likely for a greater number of buyers.
I spoke of an affordable housing crisis that had to come to a head somehow. Read on for some California market statistics that have me concerned:
The Numbers Say It All
In San Francisco County, the median home price as of Feb 2018 was $1.73 million. There was a strong increase in appreciation in San Francisco county because in January 2018, the median home price was just $1.33 million.
I’m located in Southern California, so naturally, I was interested in local statistics too. As of March 2018, the median home price was $805,000, but in January 2018 the median price was $780,000.
Frankly, I’m a big believer that we are in a bubble. It’s no secret that many in the real estate business don’t want to admit that the economic environment for housing might be in bubble territory. But I’ve been saying that we’ve been in a bubble for the past year.
Why Are Prices Increasing?
Prices are always some interplay of supply and demand. Supply could be defined as the number of houses on the market at any given time and demand refers to the number of qualified buyers.
We have had constraint in supply for the last few years relative to demand. The number of houses on the market in most areas just isn’t enough to satisfy the demand. This has caused prices to increase and a reduction in marketing times. According to the California Association of Realtors the average time to sell a home in California has recently been as low as 18 days!
Low supply coupled with relatively high demand because of low interest rates and other factors have resulted in an extreme amount of appreciation. I believe that this isn’t sustainable and the market must balance out eventually.
Why the Correction Might Not Be as Extreme as the Previous Recession
Despite the fact that I am a believer in the law of entropy I’m fairly confident that the next real estate market correction is unlikely to be as pronounced as the 2008 crash. This is not to say that another correction might not be worse, but I predict that the upcoming one should be a softer landing. It’s no secret that underwriting standards are pretty conservative these days. People generally have to qualify for financing and submit a bunch of documents to prove their financial ability to repay. There aren’t as the same number of stated income and stated asset loans out there that precipitated the 2008/2009 crash.
What will happen and when? We can’t be sure. Maybe it will be an international geopolitical event, maybe a domestic event or something else significant that will cause the market correction. Maybe interest rates edging up will cause the market to shift.
I just know that these prices aren’t sustainable.
A Brief Update: July 2018
This blog was based on statistics I found in earlier in 2018. Current stats from the California Association of Realtors state that the median price for homes in San Francisco have decreased to $1,620,000 as of the time of this writing. However, this is still a 7.9 percent increase of what the median was in May 2017.
In Orange County, the median home price has risen to $838,000, which is a 5.4 percent increase from its value in May 2017.
In short, the numbers still support my theory that we’re in a bubble.
What Do You Think?
Leave a comment on my YouTube video on this topic here. I would love to know what you think. Do you think I’m right? Am I wrong? Do you think these prices are just the new normal?
If you are interested in real estate classes in Los Angeles or even an online real estate school, check out our website here.
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How to Choose a Real Estate School
I know that many of you who are considering our real estate school are also cross-shopping — as you should. During this decision process, you're going to look
How to Choose a Real Estate School
I know that many of you who are considering our real estate school are also cross-shopping — as you should. During this decision process, you're going to look at our program and stack it up against other real estate schools, community colleges and online schools. This makes sense, because smart shoppers do their homework.This is why I want to take a moment to explain why our program might be a good fit for you.
The Numbers Speak for Themselves
First off, you should compare our pass rate for the real estate exam with the current statewide statistics. In a recent month, there were 3,987 people who scheduled to take the real estate exam. Out of those scheduled, 3,494 showed up. Of the 3,494 that took the exam, only 46 percent passed that month.As a potential real estate agent, it’s very important to align yourself with an education program that has a proven system to give you the greatest chance of passing the exam - the first time!
Why Does Our Program Work?
I chalk it up the overall process of our entire program. We're going to provide you with excellent support, flexibility on when and how to take classes, a great faculty and solid course materials.
• Full-time support: Our knowledgeable and friendly staff is available five days a week, Monday to Friday. Our representatives are all professional and highly trained. Compare this with smaller real estate schools that simply don’t have the resources that we do.
• Flexible locations: We have many brick and mortar locations if you want to do the classes with a classroom component. This definitely plays into the convenience factor when you're trying to find a school near your home. Here's the best part about it: You get unlimited access to any of these locations' classrooms for twelve months! So, if you need a place close to your friend's house or dentist's office, we have your back. We also have online classes too if your schedule is more scattered.
• Great online real estate classes: No other online school in California has the amount of video that we do. These aren't amateur videos either, but instead are done with professional lighting and audio and great camerawork to ensure you have the most professional set of real estate materials available.
• High-quality instructors: Our faculty is simple the best out there. All of our instructors are extremely professional and knowledgeable. Some of our teachers have been presidents of large real estate organizations. One was even the VP of the global MLS. Another has done over 700 short sales and foreclosure transactions during his career. These are not isolated cases, each one of our instructors is screened for their teaching ability and personality before we hire them.
• The right course material: When you take classes with us, you'll get three tangible college-level textbooks, not just PDFs. You get that "real school" feel by having a solid book in your hands. These textbooks contain hundreds of practice questions to help prepare you for the real estate exam.
• Convenient (and affordable) crash courses: Start out with a bang! Our upper-tier packages also include an intense (and fun) two-day live crash course. This is going to give you the skills and knowledge needed to pass the real estate exam - the first time!
Try It Before You Buy
Naturally, you don't want to commit to something before you have a chance to try it out. That's why I'd like to offer you a free guest pass. With this pass, you can visit any location of ADHI schools at no cost or obligation.To sign up for a physical classroom guest pass, go to the main part of our website, scroll down and then enter your email in the information box. We will immediately send you a guest pass. Come hang out with us! We would be excited to have you in the classroom! If you can't come in person, you're welcome to try out one of our online classes. Sign up for a trial account of our online real estate school. Scroll to the bottom of the page and check it out!
Shop Smart
I highly encourage you to compare our programs side by side with other real estate schools that you might be considering. I'm confident that you'll find that we have much more to offer than the competition.At the end of the day, you need to make the right decision for you. However, I think you'll be very happy if you choose us. Check out ADHI Schools today!
- Kartik
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If you want to become a real estate agent in California you’ll need to get a real estate license -shocker! The requirements are pretty simple and straightforward. The most basic is that you have to be
If you want to become a real estate agent in California you’ll need to get a real estate license -shocker! The requirements are pretty simple and straightforward. The most basic is that you have to be at least 18 years old and must complete three college level courses in real estate.
Getting licensed is the first step - If you want to work in the real estate industry you will eventually have to place your license with a real estate broker who will act as your “responsible broker”.
Before you can start working, however, there are some additional requirements which include taking and passing the real estate license exam and obtaining your real estate license, and clearing criminal background. Once you complete these steps, you’re eligible to be licensed to work as a real estate agent in California. Depending on state processing timeframes this process can take approximately five to six months from start to finish.
As a student in our real estate license school, you should understand there are some fees associated with obtaining your license. The good news is you don’t have to pay them allat once as the costs can be spread out over the course of several months. Here’s a quick rundown:
1. 135-hour pre-license course [3 college level classes in real estate]
In order to take the real estate exam, you’ll have to complete three college level courses in real estate. The classes are Real Estate Principles, Real Estate Practice, and an elective that you would choose from a list of possible courses. ADHI Schools offers a variety of choices from Real Estate Appraisal, Property Management and Escrows among others.
While these courses could be completed at a community college my recommendation is that you complete these at a private real estate school like ADHI Schools. The classes can generally be finished faster and our textbooks are included with one low price. How you choose a real estate school is an important decision that should be taken seriously.
We also offer optional-to-attend study sessions over Zoom and in-person real estate crash courses to prep you for the actual state board exam. Our programs also offer hundredsof practice questions so you are ready on test day! Our premiere package including the crash course is just $499.
2. State exam fee
The fee for the sales license exam is $100 and is payable directly to the state. There are small fees paid to the state if you need to reschedule your test.
3. Livescan fee
Everyone seeking to operate as a California real estate agent must submit their fingerprints through DOJ's Live Scan Program. If you are a California resident, you’ll pay a $49 fingerprint processing fee, along with a $30 fee if you have ADHI Schools perform the Livescan.
Once the fingerprint scan is submitted and fee is paid, your fingerprints are sent to the U.S. Department of Justice and the Federal Bureau of Investigation. The DRE will review the background and issue your license or reach out to you for more information.
4. License application fee
Once the above steps are completed, all that’s left is the license application fee, which is $350 in California to obtain a real estate salesperson license. The DRE requires a license to be renewed every four years, which costs $350.
5. Future expenses
Accompanying the $350 fee due every four years for renewal, the DRE requires licensees to complete 45 hours of approved continuing education courses This includes courses that cover Ethics, Agency, Fair Housing, Trust Fund Handling, Risk Management, and Management and Supervision. Licensees must also take approved courses related to consumer protection. Continuing education must be done prior to renewal. These costs are trivial and the class are also super affordable.
This breakdown should help you factor these and future costs associated with your decision to enter our great real estate industry. Essentially, your startup costs to become a licensed real estate agent in California will only be a few hundred dollars making this a very affordable career choice - especially considering you can immediately get to work without having to go through years of college.
If you are interested in learning more about getting your real estate license, reach out to us by phone at 888 768 5285 or visit our website here.
One word of caution - please make sure that you are reviewing the DRE and our own website for the latest exam and license fees.
Love,
Kartik
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Ways to Market in the Real Estate Business
It's impossible to build a successful real estate business without developing and maintaining a healthy sales pipeline. One obvious way to drive
Ways to Market in the Real Estate Business
It's impossible to build a successful real estate business without developing and maintaining a healthy sales pipeline. One obvious way to drive sales is to have a deliberate marketing effort, but with so many ways to market yourself as an agent, it can be daunting having to choose between so many marketing channels.
In this post, I’ll go over a few of the most effective to help build your marketing roadmap.
As always if, you are interested in online real estate classes or a live real estate school, visit adhischools.com.
Networking
One of the easiest and least expensive ways to market and raise awareness about you and your business is to start networking. In the physical world, this could be something as simple as handing out your real estate business card to people you meet and letting them know what you do. Although the person to whom you gave your card many not have an immediate real estate need, consistent networking can lead to a long line of referrals. The best part: This word-of-mouth promotion is free, and you never know who they will meet with real estate needs.You can also participate in local community events, particularly if you are in residential real estate. Whether you hang out at the farmers market or have a booth at a street festival, being involved in the area in which you sell will make people more inclined to work with you. Set a goal to recognize as a resource for local real estate.But what about networking in the digital world? This could mean maintaining social media accounts on popular platforms like Instagram, Twitter and Facebook. There are different ways to reach people once you're signed in. Don’t forget to post helpful and interesting content (like I do with our blog *cough* *cough*) adding friends, liking other people's posts, sending direct messages and more. After you meet someone in person, don’t be shy about asking to connect on Facebook, or following one another on Instagram. Make a conscious effort to reach out online, especially after making a personal contact.
Setting a Marketing Budget
While not a law, realtor.com says that you should be spending 10 percent of your commission income on marketing. Overall, have your spending match the caliber of what you're trying to sell. Compare the marketing associated with a starter home and a luxury mansion - they are totally different. If you’re interested in learning more about the luxury real estate market, check out my YouTube video.In most real estate markets nationally, the starter home is going to get plenty of interest solely based on price, so you may just need to create a listing in the MLS to get interest and have a few nice photos up. The luxury market, however, can be more competitive and particular, so save your money for extravagant and decadent open houses, professional photography/videography and promotions you will do throughout the listing period.
Paid Promotions
While on the subject of a marketing budget, there are plenty of ways to promote yourself that are worth the investment. Here are just a few ways to use your marketing budget to the max.
Boost your SEO
According to the National Association of Realtors, 90 percent of people searched for their home online. Increase your online search rankings in a local home search.
◦ Consider pay-per-click Google Ads to get your page higher in the paid search results.
◦ Hire someone with SEO knowledge to make your website organically rank higher.
◦ Increase your presence online by paying for premium memberships on listing sites like Zillow and Realtor.com. You can gain more visibility as potential buyers browse what's available because your profile will be featured while they are swiping through.
• Pay to boost your social media posts to reach people outside of your normal friends list on platforms like Facebook.
• When it comes to direct mail, utilize the services of a professional postcard marketing company like www.farming.cards to get your name and message into the homes of potential customers.
Be Memorable
Great marketing that is consistent will keep you fresh in the minds of your leads and contacts. When you are out there promoting your business and winning the trust of your sales pipeline, guess who your contacts are going to call when they have real estate needs?
Don’t Neglect the Direct Sales Approach Also
Marketing is great, but don’t forget direct sales. Work the phones, door knock and directly engage your customer. All of the aforementioned are totally F-R-E-E. =)
Learn More at ADHI Schools
Effective marketing is key to becoming a successful real estate agent. At our real estate school, we'll teach you strategies for becoming an excellent self-promoter and a real estate powerhouse! Register for ADHI Schools today!
- Kartik
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How to Dominate a Farm in Real Estate
You've finished your real estate classes and passed all the tests. It's official: You're now a licensed real estate agent. All those sleepless nights
How to Dominate a Farm in Real Estate
You've finished your real estate classes and passed all the tests. It's official: You're now a licensed real estate agent. All those sleepless nights filled with studying alluvium soil and the laws of the land have added up and paid off. After you put the blast the good news on Instagram, the question hits you: What next?
Starting off in real estate is at once the most exhilarating and scary times you'll find yourself in. After all, real estate agents aren’t in short supply, especially if you’re in Los Angeles or Orange County. The question becomes how do you pick a specific market area and get the majority market share in that community?
Breaking into high-end, luxury real estate isn't for the faint of heart nor for those who are off put by the idea of getting their hands dirty. This market is especially challenging for those with no prior experience, connections or repertoire. However, this doesn't mean there isn't a way to to get the job done. I’m warning you: It's will take work. (But hey, nothing worth having comes free — or in this case, without immense effort on foot.)
In order to get your name out there for those in your target market, your first step is to farm that area.
What Is Farming in Real Estate?
Farming a market is when you select a geographic or demographic area to focus on in hopes of growing your brand and ultimately your market share in that area. As time passes, you consistently nurture the market you've selected to farm through various marketing tactics that, over time, allow you to be seen as a trusted member in the community. Though geographic farming (as opposed to demographic farming) is generally thought of as the more common of the two forms of farming, both can lead to big breaks for newcomers to the realty world.
Consistency Is Key
To successfully break into your target market by farming, you need to be consistent. Farming is a long-term investment — not just financially. It's all about building and maintaining relationships with those in the community, and that takes consistency on a regular basis.
While you strive to make your name a well-known one in your selected area, you can work on building trust and connections by means of consistent communications. You can keep members of your selected community up to date with any new trends or events in their neighborhood by sending biweekly postcards — appropriately branded.
Knowledge is King
It's now a basic job requirement to stay on top of any and all changes that may occur in the market you're farming. Know if there’s a new shopping center being built in the area. Understand any new zoning changes that might be taking place in the near future. Keeping up on these changing market dynamics can be critical in continuing to bring value to your farm area. For example, door knocking with the latest pumpkin pie recipe is great around Halloween, but what about communicating recent sales in the area? If prices have risen or fallen it would be valuable to share this with owners in your farm area.
People love talking real estate - especially if it directly impacts their community.
Plan For Return On Investment (ROI)
When you're first starting out, it can seem like you're constantly dodging bullets and climbing hills. Needless to say, things can seem pretty daunting with a minimal client pool and little experience. Hey, that's why you're farming, after all! There's nothing to be ashamed of about being the new agent in town, but that's no reason to remain stagnant.The great real estate agents know that having a plan and executing it properly is mission critical. Make a budget and set achievable ROI goals. While time, progresses and your year march on, you can alter your initial plan with the insights you've gained thanks to new connections within your farming area and a better understanding of the people within the market.It's also important to bear in mind that farming by definition is a long-term thing.
Awareness Is Key
Being seen as the go-to source of knowledge in the area you're farming is the end goal. It means you're trusted and respected within the community, and have proven to be a reliable source.
Once you've established your role as the neighborhood's professional real estate agent, you'll have direct lines to various homeowners in the area. By coming around consistently and sharing valuable neighborhood and household insights, you're raising awareness about you, your brand and the service you provide. Also possible - the more people you know the more referrals you are going to get.
Keep in mind the law of numbers is alive and well - especially in real estate sales.At times, your real estate journey may seem daunting, but with proper farming, you'll have a positive rapport in the community and numerous satisfied clients in your phone. Follow up with them with intent and determination.
The biggest lesson I’ve learned from nearly 20 years in this business is that consistency is king.
Want to take real estate classes? We offer online real estate education as well as live classroom real estate courses. Let us know how we can help. =)
-Kartik
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FOLLOW UP IN SALES
If you have ever sold anything, you know that it’s extremely rare that a sale is made on the first contact. Even for something as benign as a shirt or bag, the customer
FOLLOW UP IN SALES
If you have ever sold anything, you know that it’s extremely rare that a sale is made on the first contact. Even for something as benign as a shirt or bag, the customer may need to come back to the store or review the item online a few more times before committing to the purchase. Before you enroll in a real estate school, it's important to be aware that real estate sales is just that - sales. Follow up is probably the most important aspect of the sales business.
Much of the time, it will take at least 3-4 contacts before your customer signs. In the case of real estate sales, it might take even more contacts as the sales cycle can be longer given the transaction size.
Even though this is a fact of business, most sales people don’t follow up nearly enough or as hard as they should.Reaching out to customers after an initial contact makes several positive impressions at once.
Here are just a few of them.
Follow-up and follow-through show your client:
• You're trustworthy.
• You're available.
• You care about their experience.
• You think they're special.
Mastering the art of the follow-up helps you become a more successful salesperson.
• You learn what the customer expects or wants.
• You give a customer the chance to be heard.
• You can convert a contact into a lead.
• You make the contact more inclined to work with you over other agents.
• You stay fresh in the customer's mind. Even if they're not ready to buy/sell right now, they may be later.
With so many benefits, you should definitely pursue following up as a key prospecting strategy to help you nurture leads and build more business.
How Many Times?
Statistics about agents who followed up more frequently versus those who didn’t are staggering. A recent report shows that agents who follow up on their leads five or more times made at least $200,000 per year. Those who followed up less frequently, even three times, reported significantly less earnings.To many of you, three times seems like a lot already, but it looks like five times is the magic number. Real estate depends on many tenacious sales tactics like this one. If you need to overcome the fear of prospecting, remember that the sale is made in the follow through, not in the initial contact.
The Nature of an Effective Follow-Up
If you're not following up with customers, you're setting yourself up to fail. The real estate game is all about gaining new prospects and leads. As such, you must constantly build your sphere of influence, your pipeline and ultimately gain the trust of new people.But before you pick up the phone or hop on the computer, you should take some time to review the best practices of a follow-up. It's more than just randomly calling people you meet. You need to contact people intentionally.
• First, have the right attitude. Sit up straight and exude confidence in your body language and voice. Your customers can sense if you're not sure about what you're selling.
• Follow up with hot leads first. These are the people who are most likely to become clients. You will get a higher success rate when you prioritize hot leads. Plus it’s easier to build your confidence with warm and hot leads rather than “leads” that are unlikely to buy.
◦ Segmenting your contacts is a valuable habit that will help you determine which contacts are more likely to lead to a sale — and therefore more worth your prospecting hours. Try cutting your prospects into groups of “hot” “warm” and “cold”. You must define what “hot” “warm” and “cold” mean. To me, a hot lead is one that will sign a contract in the next five to seven days.
◦ Follow up with a new lead within the first day.
◦ A hot lead should be reached every day
◦ Contact cold leads on a less frequent basis, between monthly and annually, depending on the nature of their real estate needs.
Hit multiple channels
Some people prefer one kind of contact method over the other, so being present on multiple channels can do wonders in reaching them. Here are a few to try:
◦ Phone calls
◦ Emails
◦ Text messages
◦ Social media DMs
◦ Event invites
◦ Direct mail postcards (check farming.cards as a valuable tool).
Vary your approach
You can make direct calls some days or use softer marketing techniques at other times. Sometimes offering informational content reaches leads without seeming too "salesy," such as sharing home-buying tips on a blog or advice on HVAC repair in a video.
Learn Real Estate Marketing and More at ADHI Schools
This is just the tip of the iceberg when it comes to a great real estate marketing strategy. When you take our online real estate classes, you'll learn the ins and outs about becoming a great agent who can nurture great client relationships. Follow up is a critical part of that.
-Kartik
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I recently received an email from a former student who asked me a question that every agent is bound to ask after getting busy. Whether you are taking real estate classes in Los Angeles or going to our
I recently received an email from a former student who asked me a question that every agent is bound to ask after getting busy. Whether you are taking real estate classes in Los Angeles or going to our real estate school in Orange County the below is applicable.
The email goes like this:
"Dear Kartik, I'm doing well in real estate and I think it's time to hire my first assistant. How do I go about finding someone, and when did you hire your first assistant?"
I'll answer his questions here.
How Do You Go About Finding an Assistant?
Overall, to hire someone, you need to take the following steps:
• Create a job description of the tasks you need performed.
• Properly screen candidates. Don't make impulse hires! There’s a great saying “Be slow to hire and quick to fire!” Good advice.
• Offer them a fair wage to reduce turnover.
After you hire someone, you should ...
• Train them well.
• Stay on the same page with your goals.
• Run your business by the rules created at the beginning but be willing to bend.
My Experience
To fully answer my student's question, I'll also explain my first hiring experience. I hired my first assistant four years after starting real estate, mainly because I had a lot of plates in the air at once. I was running my real estate brokerage business and working at the real estate school at the same time. Naturally, I was feeling overwhelmed.I actually feel like I got lucky with my first assistant. In fact, she's still working with us as the manager of our real estate school. I never screened an applicant before hiring her, but just ended up with a great assistant who stuck with me for the years to come.However, after gaining some experience in hiring more employees, I can now give you some real pointers.
Write It Out
The first thing I'd advise you to do is write out the job's description. What do you personally feel overwhelmed with? Do you need a personal assistant who can get your car washed one time a week and pick up your dry cleaning? Or, do you need a real estate assistant who can organize your files, input your listings into the MLS or oversee photographers and videographers? Hire someone who has experience doing these tasks or get someone who is willing to learn them well.
Properly Screen Candidates
In reality, hiring someone is always a little bit of a crapshoot. You’re going to do all you can to examine resumes and make applicants take personality tests, but there's always an element of luck in the hiring process. However, properly screening your candidates can reduce the chances of making hiring mistakes.
Here are some basic rules to follow:
• Don't randomly hire. Too many agents hire friends or friends or a spouse who was laid off, and then five months later they wonder why it didn't work.
• Avoid impulsive hires, even if you're in a rush.
• Check out their resume and make sure they have a background in the tasks you are giving them or are a good fit to learn.
• Use personality tests and other assessments, but don't let the scores define their destiny. I've seen someone who was told he didn't fit the agent personality profile become a successful broker and start his own company!
Prevent Frequent Turnover
Good talent usually sticks around with good pay, so offer a fair wage to eliminate turnover. After all, who will stick around if you offer just minimum wage? I've had people stay with me for five years, 10 years, even 14 years. Why? It's because I always think about how I can put more money in their pocket.I ask myself how I can make them more money ... because when they're making more money, I'm making more money, and the company's making more money. Pay your employees a fair wage and they'll not only work hard for you — they'll stick around.
Train Them and Have Accountability
After you hire someone, you'll need to do some degree of training. You should also hold them accountable for staying on task. Many agents like to have periodic meetings or phone calls to set goals and objectives because being on the same page is important. Whatever frequency you feel you need to communicate is up to you. I have some members of my sales team that I literally call three or more times per day. This might be a bit much for some of my readers, but it is what it takes when you are getting something off the ground from scratch.
Play By The Rules
Now that you're a boss, you need to make sure that you have all your legal ducks in a row. Have worker's compensation insurance for your assistant and withhold the right amount of taxes. Make sure the people you hire are properly classified as either independent contractors or employees.
Learn From the Best
Congratulations on getting to a point where you can hire your first assistant! I wish you the best of luck in the hiring process and hope you find the right person to join your growing business.If you are looking for the right real estate school, check out our website for real estate classes, or call us at 888-768-5285.
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Lots of people ask me how I find time to write as much content as I do and record as much video content as I have over the last many years. A lot of people have viewed our YouTube channel at my real
Lots of people ask me how I find time to write as much content as I do and record as much video content as I have over the last many years. A lot of people have viewed our YouTube channel at my real estate education company and want tips on how to create video content and podcasts. I decided to write an article about this from the perspective of the real estate salesperson. Since the vast majority of people reading my blog or watching my videos aren't really looking to start an education company, rather they are looking to get into the real estate brokerage business.
It's important to remember that real estate sales is just that - it’s sales! The more customers and clients you have the more money you’ll ultimately make. But how many potential clients can you reach a day by cold calling and door knocking? No matter your answer, podcasts can increase that number exponentially and expand your reach.
Consider the facts:
• Over a quarter of Americans listen to a Podcast monthly.
• In 2018, over 50 billion episodes were downloaded and/or streamed.
• Podcast listeners are wealthy, educated and loyal.
• The average podcast listener tunes in to seven episodes per week.
• California has the highest number of podcast subscribers of any U.S. state.
Recording a branded podcast is a distinctive and effective way to tap into this potential market — even more than paid advertising. Your podcast will put your voice and message in the homes and cars of potential clients in a way no other tool can. Podcasts position you as an expert in a given field.
Choose Your Topic and Message
You have something unique to offer listeners: your real estate experience and expertise. Buying and selling a home or building can be stressful, and most people see high-end real estate as daunting, too difficult to manage or something "other people" do. Your podcast can bring transparency to the process and clients to your doorstep.Choose a topic for your show that is specific to you and sounds great. A narrative or talk-show format can work well. It should be something you can discuss for 100+ episodes. Once your podcast becomes popular, you can broaden your topic. To get started, however, a frame to work within will help you stay focused.Your topic should also support the underlying message you are trying to convey. Always ask yourself what you want your listeners to leave your show knowing or wanting.
Find Your Voice
There are lots of different styles of podcasting. Choose one that aligns with you. Will you interview guests on your show? Maybe interview past clients or your broker? Converse with your co-host about real estate trends? Take your audience on audio tours of designer homes? Talk about investing in real estate? Regardless of what you decide to go with, it should sound natural and practiced.
Give It a Name
Listeners will decide whether to listen (or not!) by your name. It should be something that captures the topic as well as the message you are trying to send. A clever or witty name will grab your audience's attention. Is there a word or phrase that captures your mission? A regional phrase that is recognizable to potential local clients?Avoid names that are too specific. Instead, select something that is memorable, searchable and available as a domain. Your listeners will want to engage in your content across platforms. Your Podcast can drive your listeners to your YouTube channel, your Instagram or other platforms. If you don’t have these created - do it now! These will provide additional ways for you to attract clients and listeners and give you more credibility and provide additional ways for your audience to connect with you.
Respect your audience
Podcasts convey your message directly to your subscriber. They are intimate and create a connection between listener and host. Treat this relationship as though each listener is a client. Hopefully they will be! Practice, practice, practice. Just hitting record isn't enough to make your show worth turning in to hear. You may find that writing a script gives structure to your recordings. Or, if a more informal style is what you are after, try to stay on topic.Your audience will expect consistency. If you are going to produce a weekly podcast, don't skip a week! Choose a format and schedule that works for you. On the ADHI Schools’ YouTube channel, sometimes I will record 3-6 videos per week and leave these stacked away in a Google drive. This way, I always have content to bring to the community.
Invest the Time and Money
Buy proper recording equipment. This doesn’t have to be a big expense, and it's worth it in the long run. Nobody wants to listen to a muddied recording. You will need to edit your podcast for long pauses, errors or content that isn't relevant. One of the affordable and easy to use software options on the market will help. I recorded a Podcast about the audio equipment we use, but your setup doesn’t have to be this elaborate.
Join the Community
The podcasting community is tight-knit and supportive. Listen to other podcasts. These shows aren't your competition — they're your biggest resource. Inviting guests from other podcasts onto your show can help you make connections to potential listeners or clients.
Take Real Estate Classes
If you are interested in taking real estate classes in Los Angeles click here. Our real estate class schedule can be found here. If you want to call the office, please do so at 888-768-5285.
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Zillow has recently announced that it's going to start buying and selling houses.
This is a surprising move because it feels like the website is jumping 2 to 3 steps ahead of what it's currently doing
Zillow has recently announced that it's going to start buying and selling houses.
This is a surprising move because it feels like the website is jumping 2 to 3 steps ahead of what it's currently doing with the "Make Me Move" offer system, which is merely a seller's way to gauge what the interest would be for their home if they listed at a certain price.
What are the details of this new development with Zillow? How will this affect buyers, sellers, and real estate agents?
Zillow Instant Offers
This is a concept that Zillow is currently testing only in the Phoenix and Las Vegas area. The company is basically acting as the principal in real estate transactions.
Zillow is launching their Instant Offers concept in these specific markets to offer homeowners "greater control over the selling process" and a "more predictable time frame" for the sale.
This program bears some similarity to the way Opendoor or OfferPad work, offering convenient and quick sales at the expense of the best sales price. Speed is the name of the game.
What It Looks Like on the Seller's Side
A homeowner in the area who wants to sell their home can give Zillow their address and answer an online questionnaire about the home. Zillow will then make an offer on it. If the seller agrees to the price, then there will be a home inspection. Then, a Premier Agent will be chosen as the listing agent to close on the deal.
The Buyer Side
If a private buyer is interested in a property that's for sale in those areas, he or she can send an email to Zillow and tell them they want to buy it. If the numbers make sense to the company, then they'll then wire the money over to the owner. The buyer gets the house, and the seller gets to move. It's all meant to be a quick and seamless process.
What about Real Estate Agents?
In short, Zillow intends to keep agents in the selling process, but the program will benefit a select pool of agents. However, the company is confident that they're giving agents highly motivated leads, saving them time and hassle.
If Zillow buys the home, the company will pay a real estate commission to a premier agent that they'll select as the property's listing agent. This means that ordinary agents who haven't paid to be promoted on the website will be excluded.
Zillow explicitly states that the program will benefit only "pre-selected partner Premier Agents and brokers" at this time. As you know, it costs money to get into this inner circle, so it will be up to the individual agent to determine whether this investment will be worth it.
Another detail is that Zillow will be teaming up with Berkshire Hathaway HomeServices Arizona. As we find out more about this partnership, we'll let you know about it.
What happens to the home if Zillow buys it?
If Zillow buys the house instead of a private buyer, then the company will fix up the property and resell it. According to the Las Vegas Review Journal, the company aims to buy the houses below market value in order to flip them for a profit. This naturally means that the seller might not profit as much as she could have if she sold her home in a more traditional way.
If Zillow's offer is turned down by the seller, then the homeowner is free to sell the home through an agent on the open market.
The company's Chief Marketing Officer Jeremy Wacksman expresses the modern homeowner's need for a quick sale at the expense of not selling for top dollar,"[Homeowners] want help, and while most prefer to sell their home on the open market with an agent, some value convenience and time over price.”
Tell us what you Think
What's your take on Zillow's latest move? As a homeowner, would you sacrifice profits for convenience? In today's fast-paced world, there are always going to be attempts to make the process of selling a home become quicker.
The Value of an Agent
Though selling in the open market with an agent from the get-go may take longer, homeowners get the peace of mind that they are going to sell for the highest price possible and have access to expert real estate advice throughout the whole process- not just the closing phase.
If you have any comments, please post below. Don’t forget to check out our YouTube channel for all the latest news and information on the real estate market. I recorded a YouTube video on this Zillow development. You can check that out here.
If you are interested in becoming a real estate agent and taking real estate classes through our company, please visit www.adhischools.com or call us at 888-768-5285.
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I get this question a lot: "How did you start teaching these real estate classes? What's the story behind your school?"You can listen to my podcast about it here, or read on. Long story short — it
I get this question a lot: "How did you start teaching these real estate classes? What's the story behind your school?"You can listen to my podcast about it here, or read on. Long story short — it happened by chance.ADHI Schools is a brainchild of my passion, education and past experiences. Ultimately, I combined my love for real estate and teaching and turned it into a real estate school.
It Started With a Love for Teaching
When I was going through college in the late '90s and early 2000s, I taught the SATs to disadvantaged high school students. Back then, parents of means could pay for SAT prep classes for their kids, but kids without money didn't have the same advantage.This disparity meant that average students couldn't prep as well as those who had access to the premium classes that cost thousands of dollars. To make matters worse, they didn't have the internet to help them. Today, people with tenacity and focus can learn just about anything on the internet — however, back then, there was no YouTube or online schools to give them a leg up.During this time I spent teaching the SATs, I developed a love for showing others how to thrive and be successful through education. It was exciting to empower people and level the playing field in the age of little to no internet.
I Saw the Sign
After I finished college and got my real estate license, I joined a brokerage. There was a sign behind this office that advertised a real estate school. I was just starting out and didn't sell anything for about three weeks. Although this is not a long time to not sell anything in real estate, I was particularly over-caffeinated and impatient, so I decided to try to pick up a side hustle.I called the 800 number on the flier and a man picked up. I asked him if he needed help teaching these classes. I also asked him out of curiosity how much it paid. When I heard that the pay was $60/hour, I called that man twice a day for a month until he finally relented and gave me a chance. He offered me a spot in Norco. I reviewed the material and taught the class, giving my best effort.The next day, the owner of the school called me and asked me how I thought things went. I told him that I thought things went pretty well. He responded, "Well, actually, all of them called simultaneously and asked for a refund, but I like you. If you're willing to try, there's another class you can take over once a week ... BUT, you can never go back to Norco.I agreed. Soon one class turned into three to four classes a week. After I gained experience and confidence, I started my own real estate school in October 2003. The rest is history. We're now in our 15th year in business.
Serendipity and Success
If I hadn't gone into that real estate office and sat in that seat and seen that sandwich sign, perhaps ADHI Schools wouldn't exist now. The real estate school sign was situated right behind my desk at the real estate office I chose to join. If I had chosen to work anywhere else, I might not have had that opportunity to initially teach - and our real estate school might not exit.Though it all happened through a series of accidental events, the result feels meant to be. I have worked with the same group of people for years, and they feel like family. We have a bunch of instructors, assistants and managers who all work together to make our school the powerhouse it is today.My real estate teacher was my mentor. I learned so much from watching how he taught real estate classes. He had lots of experience teaching classes to big-name brokerages since the '70s and '80s. I carry a lot of what I learned from him still today, because before you can branch out, you need to first imitate people who are successful in what you want to do.
So that's the story. Now I also have a brokerage, real estate school and marketing company. I stay busy, and I like it that way!
Make Your Own Story
Feeling fired up? Ready to start your own success story? Find out more about our real estate courses by calling the office at 888-768-5285. We would be happy to help get you enrolled in California Real Estate License courses!
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Over the past 15+ years, I have taught literally thousands of people real estate at ADHI Schools. This has amounted to over 11,000 hours of real estate classes in a classroom setting.
In short, I’ve
Over the past 15+ years, I have taught literally thousands of people real estate at ADHI Schools. This has amounted to over 11,000 hours of real estate classes in a classroom setting.
In short, I’ve seen it all. I’ve seen people join the business during deep recessions and also in the best of markets. I’ve witnessed many people start out in different circumstances and have noticed three common reasons may fail to launch their careers once they leave our classes. This is true whether students take real estate classes in Los Angeles or otherwise.
Understanding these pitfalls can help you avoid them and ultimately succeed. My deepest wish is for you to be successful in your endeavors, and a large part of success is avoiding common mistakes.
I recently recorded a YouTube video onthree reasons I think some people fail in the real estate business if they’re not careful:
1. They Fail to Treat It Like a Business
When people get into our industry, they often don’t manage their time well. The flexible hours that real estate provides can shock a former 9-to-5 salary worker in terms of the level of freedom they suddenly have in their schedule.
The change in routine feels nice. It’s tempting to get lazy. Instead of jolting awake to the alarm clock at 5:30 am, they realize they can sleep in if they want to. This also means they can stay out a little later. This often starts a cycle of time mismanagement.
They’ll start to go to bed a little later and then sleep in. When they had a 9-to-5, they would hit the gym at 6 am, be out by 7 am and be in the office by 8:30. But in real estate, agents can wake up when they want because they don’t need to be in the office at any set time. Their new flex hours, which could potentially be an asset, are now a stumbling block.
On the other hand, those who treat real estate like a real job maintain structure. They show up at their office in the morning and are ready to work. They don’t leave whenever they feel like it or treat it like a part-time gig. If you want full-time success, you need to be prospecting like a full-time job. You also need to constantly improve on your know-how and build upon your expertise.
Think about this analogy: You have a restaurant that opens at 11. Do you show up right at 11? No! You arrive a couple of hours early to do kitchen prep so when the doors open at 11, you offer great food and service to your customers.
The same goes for real estate. You need to apply the same discipline to your time as you did when external forces were dictating when you showed up and worked.
2. They Fail to Remember It’s a Sales Job
Your real estate job comprises two basic components: lead cultivation and closing. A lot of people float along hoping to stumble into deals handed to them by friends and family. Sure, you can probably survive the first six to ten months with deals from friends and family, but what happens when you sell the houses of everyone you know? What if you don’t have a big sphere of influence? Are you actively prospecting? Do you use social media to reach out to new prospects? Are you actively promoting yourself online and with everyone you meet?
This is a sales job! A lot of people aren’t naturally comfortable with the idea of being a salesperson. As a salesperson, you need tenacity and passion. Reaching out to new prospects and leads may initially feel uncomfortable but eventually you’ll get more comfortable with selling. You need to constantly be looking for new leads even when you are busy, so that you never have a time when you’re not.
3. They Run Out of Money
When you start the business, you’ll need to pass your real estate exam and pay license fees and association of Realtor dues. These can all add up quickly, especially if you’re using your own money to market and promote your listings.
Because escrows are often lengthly, it’s important to understand that it takes time to close on properties. During this time you’re not getting paid, so the first six to ten months can be rocky financially. I see some people return to the 9-to-5 job because they run out of money — however, this whole situation can be avoided with some preparation.
Before you start making enough to go full time, it will take time to build up a pipeline in the first year. Have some savings set aside or a spouse to support you until you make enough to sustain yourself again. Overall, a financial safety net increases your chance of success during an agent’s first year.
Learn What It Takes to Succeed
Are you interested in learning more about the exciting real estate business? Do you want to take real estate classes online or do you want to attend real estate school in Orange County? Take our classes to get a leg up in the California real estate market.
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It's nice to get a piece of a pie, whatever the size. But let's be honest: Would you prefer 3 percent of a $300,000 listing or of an $18 million mansion? The luxury real estate market is where you can
It's nice to get a piece of a pie, whatever the size. But let's be honest: Would you prefer 3 percent of a $300,000 listing or of an $18 million mansion? The luxury real estate market is where you can earn the big bucks — but breaking into it isn't easy.
Fortunately, one of my former students Jason Peteler recently sat down with me and discussed how he got into this lucrative market. Newer real estate agents can successfully transition into the luxury business by embracing these four points:
Be good at marketing.
Be good with people.
Know your area.
Don't start out alone!
1. Master the Art of Marketing:
Your image is everything in the high-end market. That's why marketing is the key to putting your best foot forward and spreading awareness about your brand.
You need to be where your potential clients are looking. The current trends are overwhelmingly in mobile and social media. If you're not on Facebook and Instagram yet, you need to create accounts today. If your website isn't mobile optimized, get some help to update it ASAP.
Every time you post, you should present yourself in a way your clients want to see you. Do you want to look negative and unmotivated? Of course not! Instead, post about your current successes and create the image of a confident and competent professional.
Get creative and post infographics, pictures and videos. You can even go "live" for a behind-the-scenes tour of a new listing!
2. Remember It's All About People!
Peteler briefly touched on being a "therapist" in his interview, and he's spot on. Imagine the stress buyers experience when buying or selling average-priced homes. Now multiply the commitment and risk by 10, and you have a client who's parting with or purchasing a high-end property.
Great real estate agents can help their clients cope with the stress and pressure involved with one of the biggest financial moves of their life. This interpersonal skill can make or break a transaction, because maintaining a good agent-client relationship keeps the ball rolling.
3. Know Your Area!
Who wants to work with an agent who doesn't know anything about the local area? When high-end clients approach an agent, they're looking for expertise. When you know the area well, you can sell the listing well.
Acquaint yourself with the area by spending time there: Eat at the local restaurants, talk to residents, walk around and soak in the sights and mood of the district. The more you know about the area, the more your clients will trust you.
4. Don't Start Out Alone!
Real estate agents who have successfully broken into the luxury market virtually agree on one point: Don't try to do it alone. You'll need to learn the ropes from agents who have real experience in the high-end market.
This can mean co-listing with another agent, being part of a team or even becoming someone's "apprentice." In fact, Peteler says that you should first follow a template: Copy what you see has worked for someone, and later you can expand upon it and innovate.
5. Get in Touch!
Another indispensable quality a luxury real estate agent needs is a solid education. To find out more about our real estate courses, contact me today. You can call the office at 888-768-5285 and we would be happy to help get you enrolled in California real estate license courses!
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Recent foreclosure data published by CoreLogic details a lengthy trend of declining completed foreclosures and mortgages at risk for foreclosure. Take a closer look at a few key figures that show some
Recent foreclosure data published by CoreLogic details a lengthy trend of declining completed foreclosures and mortgages at risk for foreclosure. Take a closer look at a few key figures that show some good news about 2016’s housing market.
Nationwide there were just 30,000 completed foreclosures in October 2016—that’s down from 40,000 in October 2015 and 3.6% fewer than September 2016 (a significant decline). The number of mortgages in serious delinquency, and thus at greatest risk for future foreclosure, fell below 1,000,000 to 997,000. What does that do to the overall foreclosure picture? Well, as of October only 0.8% of homes nationwide were in foreclosure—and that number is falling.
November showed even more progress in this area. The number of completed foreclosures fell further to 26,000, down 30.0% from November of 2015. This is a 14.1% drop from October. Better yet, this means that the number of completed foreclosures year-over-year (2015 to 2016) is down 25.9% with 61 consecutive months of year-over-year (e.g. November 2015 vs November 2016) declines in foreclosure inventory.
CoreLogic also published a promising figure on housing prices—year-over-year housing prices are up 7.1% through November, with projections of 4.7% increases by November 2017.
December finished out the year in similar fashion. There were just 21,000 completed foreclosures in December 2016, 29.5% fewer than December of 2015. This leaves just 0.8% of all homes with a mortgage in the foreclosure inventory, the same percentage as October.
These numbers are clearly great for homeowners right now and are encouraging to many in the industry. A healthy housing market is great for the economy and the consumer, promoting further engagement with the housing market. This is part of the reason that real estate professionals are encouraging people to buy and sell—they are witnessing a strong housing market.
There are those that point out that the national foreclosure rate was very low before the housing crisis that kicked off the Great Recession. We would be remiss to ignore this data. The housing market is one of the most important markets in the U.S. economy, but the economy itself is of course complicated and never invulnerable to decline. Housing affordability and rent affordability issues are legitimate and contribute to analysts’ long-term worries for the housing market.
Adhi always recommends that our readers obtain as much information about the housing market as possible in order to assess different housing markets. The market conditions in Los Angeles may vary from the market conditions in New York City. These foreclosure and price numbers are, for now, a sign of a healthy market with improving conditions for a great many Americans.
What does this mean for your market? Have you seen these stats reflected in your market? Are foreclosures down, or are they up or stable? Any signs of upcoming changes? Let us know, we would love to hear more about your market conditions!
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Find here a summary of important legislative updates affecting California real estate professionals.
Assembly Bill 1650—Disclosure Requirements on Solicitations
New legislation has been signed
Find here a summary of important legislative updates affecting California real estate professionals.
Assembly Bill 1650—Disclosure Requirements on Solicitations
New legislation has been signed into law by the governor that affects disclosure requirements on real estate solicitation materials.
A.B. 1650 is concerned with real estate licensees disclosing when they are performing a task that requires a license if it is intended as a first point of contact with a consumer. Thus any publishing or distributing of materials that advertise a product or service that requires a license must state that a license is required for that activity. For example, if a REALTOR® wants to advertise his or her listing services, their distributed material must make it clear that listing a property requires a real estate license.
All of these “first point of contact” materials are also required to include the licensees license identification number and apply to mortgage loan originators as well, not just real estate salespersons or brokers.
The new law provides examples of materials that will require this disclosure. It specifically states that covered materials “includes business cards, stationery, advertising flyers, and other materials designed to solicit the creation of a professional relationship between the licensee and a consumer”. Note that this is not an all-inclusive list and any other material intended as a first point of contact with consumers would be subject to the same requirements. The real estate commissioner has the power to define the list further.
This law’s reach does not extend, however, to “an advertisement in print or electronic media” or to for sale signs.
SB 710 Clarifies Team Name Laws
Current California law requires the listing of the company name and responsible broker’s license number on all team advertising materials, which was not the intent of legislators when they originally wrote the law.
Enter Senate Bill 710, which, effective immediately, changes the requirement from both the “name under which the responsible broker is currently licensed by the bureau and conducts business in general or is a substantial division of the real estate firm” and the associated license identification number, to that name or that name and the license identification number.
Those wishing to refrain from listing the broker’s identification number on advertising materials may now do so. Again, this law is effective immediately.
For any further information, the text of the legislation can be found here
AB 2330 Updates Broker Associates Searchable Information and Broker Notification Requirements
The California legislature has unanimously passed and Gov. Brown has signed into law AB 2330 and goes into effect January 1st, 2018. This new law requires brokers to “immediately notify the Commissioner in writing” when a new real estate salesperson hangs their license under the broker or is terminated by the broker. “Willful or knowing” violation of this provision is punishable as a misdemeanor.
Brokers must also report to CalBRE if a licensee is an “associate licensee” and if so, which broker the licensee is contractually associated with. CalBRE will be required to publish this information as well.
AB 197, SB 32: Greenhouse Gas Legislation
A seemingly unusual law for inclusion in a real estate-centered legislative update, but this law actually has the potential to be quite important.
This law requires the State Air Resources Board to “approve a statewide greenhouse gas emissions limit equivalent to the statewide greenhouse gas emissions level in 1990” to be achieved by 2020. By 2030 greenhouse gas emissions are to be reduced to 40% below 1990 levels. The board is also required to “protect the state’s most impacted and disadvantaged communities” while creating these regulations.
This means that more steps will be taken to lower emissions—steps that have not yet been decided. The economic impacts are not yet known. Housing is clearly an issue that disadvantaged communities are concerned with, perhaps lending strength to the argument that policies that would directly affect the housing market will not be included. Yet, there is not yet any such guarantee. Real estate professionals should watch this law and its impacts as they assess their markets. Adhi encourages our students and readers to pay attention to politics and the state of the economy as our industry is dependent upon consumer confidence and a healthy economy.
AB 73: Clarifications Upon Disclosures of Death, HIV
This law, which took effect on September 25th, 2016, updates the wording of the law to clarify required disclosures. One such clarification is the confirmation that owners and agents are not required to disclose an occupant’s death or cause of death on the property if it occurred more than three years prior “to the date the transferee offers to purchase, lease, or rent the property”. Previously the law only stated that failure to disclose under these circumstances provided no cause of action.
This law also clarifies the disclosures surrounding HIV/AIDS. Owners and agents are not required to disclose that “an occupant of the property was living with human immunodeficiency virus (HIV) or died from AIDS-related complications” at any point.
It is of crucial importance that California real estate professionals fully understand these disclosure requirements in order to fulfill their duties to their client and not violate the law.
AB 2406, AB 2299, and SB 1069: “Accessory Dwelling Units”
These laws change some requirements for the zoning and creation of “Accessory Dwelling Units” (ABUs), formerly referred to as “Second Units”.
AB 2406 permits a “local [housing] agency” to “provide by ordinance” for the creation of ABUs in single-family or multifamily residential areas. This includes “Junior” ABUs within a single-family home. Any proposed ordinance to permit these ABUs must include “among other things”, building standards for the creation of said ABUs, “required deed restrictions, and occupancy requirements”. Additional parking requirements for the unit are prohibited by this law.
AB 2299 and SB 1069 work together to change the term “Second Unit” to “Accessory Dwelling Unit” as well as establish guidelines for ADU permit review processes and restrictions with the declared hope of increasing housing supply in the state. Cities and counties are permitted to identify and/or evaluate potential sites for the creation of ABUs. Cities and counties will be able to substitute ABUs for up to 25% of “the community’s obligation to identify sites for any income category” (meaning that communities that invest in housing may include ABUs as part of said investment, with further requirements.)
The laws also mandate that local agencies approve or disapprove applications “ministerially without discretionary review” unless they have adopted their own ordinance in accordance with this law—incentivizing local agency cooperation. Local agencies can adopt certain restrictions to accommodate other zoning laws.
For specific requirements and details of these laws, visit them here: AB 2406, AB 2299, SB 1069
We welcome feedback and commentary from our readers on these important new laws. Do you foresee important market impacts? Will any of these laws affect your business in any way? Let us know in the comments. And as always, for any questions or clarifications feel free to reach out to cody@adhischools.com
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Many real estate professionals use their knowledge and expertise to invest in real estate. They know a good deal when they see it, know the laws they need to navigate, and likely have contacts in property
Many real estate professionals use their knowledge and expertise to invest in real estate. They know a good deal when they see it, know the laws they need to navigate, and likely have contacts in property management or are confident in their ability to manage a rental property. Rental losses are also potentially deductible, insulating investors from some risk. But how does this deduction work? In Gragg v. United States of America; Internal Revenue Service a real estate professional was found to not be eligible for a tax deduction that they felt they were entitled to, shedding light on the details of the law—real estate agents who invest in rental properties should not necessarily expect these tax deductions unless they can prove that their investment involves material participation.
Gragg v. United States has provided us with a clarification on the Internal Revenue Code’s definition of material participation in rental activities. If a real estate professional materially participates in their rental activities, losses may be deducted. Passive activity in a rental investment, on the other hand, is not grounds for a tax deduction. The court case cites Section 469 of the Internal Revenue Code (I.R.C.), which defines material participation as activity in which the “taxpayer is involved in the operations of the activity on a basis which is—(a) regular, (b) continuous, and (c) substantial.” Rental activity is typically classified as “per se passive” and not eligible for any deductions under the material participation rule. Yet Section 469 (c)(7) of the I.R.C. has established that for “taxpayers who qualify as real estate professionals, the per se rental bar” does not apply, meaning real estate professionals have a greater ability to deduct losses on rental investments because real estate is their profession.
So how do these two sections of code work together? Since Gragg is a real estate professional, she should have been able to claim a deduction, right? Yet the court sided with the IRS and found Gragg ineligible for the deduction. How does this work?
The explanation lies in the interaction of the two sections of code. The court states that the effect of the real estate professional exception to the law is to remove the automatic classification of rental activity as passive—it does nothing to the general rule that material participation is necessary for exemption. Thus without proof of material participation, a real estate professional invested in a rental property cannot deduct losses.
Essentially there is a two step process to earn a tax deduction. First, one must be a real estate professional. Step two is to demonstrate material participation, something Gragg was incapable of proving. Two pages of undated notes were offered, but as those notes had not been present for previous court proceedings the court in this case declined to address them as a new argument.
The lesson for the real estate professional with rental investment properties—document your material participation. Prove activity in property management. Without this proof your deductions will be rejected by the IRS and you will find yourself paying more in taxes than you would have needed to if you had documented your material participation properly.
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Current California law requires the listing of the company name AND responsible broker’s license number on all team advertising materials, which was not the intent of legislators when they originally
Current California law requires the listing of the company name AND responsible broker’s license number on all team advertising materials, which was not the intent of legislators when they originally wrote the law. If you are thinking about taking real estate classes in Los Angeles and joining a real estate team continue reading.
Enter Senate Bill 710, which changes the requirement from both the “name under which the responsible broker is currently licensed by the bureau” AND the associated license identification number, to the name of the broker OR that name and the license identification number.
Those wishing to refrain from listing the broker’s identification number on advertising materials may now do so but must still include the name of the broker at a minimum. Again, this law is effective immediately.
Even still, it is important that real estate professionals follow the law and make all necessary disclosures. For any further information, the text of the legislation can be found here, or contact the author of this piece at cody@adhischools.com for any questions or clarifications.
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Your intuition can probably tell you that married couples are the largest home-buying demographic. It makes sense: between family and financial goals and the purchasing power of two people, married couples
Your intuition can probably tell you that married couples are the largest home-buying demographic. It makes sense: between family and financial goals and the purchasing power of two people, married couples have both the incentive and the means to purchase real estate. But married couples aren’t the only buyers. Single women make up the second largest buying demographic, ahead of single men and unmarried couples.
According to the National Association of REALTORS® 2016 Home Buyer and Seller Generational Trends report, 15% of recent buyers were single women. This number may not appear to be that large to some readers, but considering 67% of buyers were married couples and the next largest buyer demographic—single males—only accounted for 9% of buyers, it is quite evident that single women make up a huge part of the home buying population.
The highest percentage of single female buyers falls in the 51-60 year-old age range, where they actually make up 20% of buyers. 19% of buyers aged 61 to 69 are single females. Thus this single female buyer demographic is on average a bit older than the typical buyer. This is not to suggest, however, that younger single women are not also buying homes—they make up 13% of buyers in both the under-35 and 36-50 age groups.
There are a few other statistics to keep in mind to contextualize what we know now:
First time home buyers made up 32% of buyers
The typical buyer was 44 years old—younger than the average single female buyer
77% of sellers were married couples—singles and unmarried couples thus account for the other 23% of sellers
So what’s the takeaway for real estate professionals? How does this impact your business? We encourage you to keep an open mind as you take our real estate classes and forget any preconceived notions about who the average buyer is. Married couples might make up the majority of buyers, but there are other demographics—most notably single women—that are also active.
Think about ways to expand your network to better utilize this knowledge. You know your niche, ask yourself how to better utilize it. Share this information and find those people willing to dive into real estate.
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For those of you taking our Los Angeles real estate school, you might already know that the iconic Playboy Mansion has recently been sold for a staggering $100 million, half the original asking price,
For those of you taking our Los Angeles real estate school, you might already know that the iconic Playboy Mansion has recently been sold for a staggering $100 million, half the original asking price, to Daren Metropoulos—son of billionaire investor C. Dean Metropoulos. But Hugh Hefner won’t leave just yet—the 90-year-old will pay $1 million per year to continue residing at the estate and has the right to do so until he passes away.
We’ve all seen photos and heard stories of the property, but what else should we know? The iconic Gothic Tudor was built in 1927, considered one of the greatest works of famed architect Arthur R. Kelly. The house is approximately 20,000 square feet with twelve bedrooms (including the two-floor master suite), chef’s and catering kitchens, and a screening room with a built-in pipe organ. The grounds also house a gym, a tennis court, an orchard, a four-bedroom guest house, and the famous—or infamous—pool and grotto. All together the estate is five acres of prime west Los Angeles real estate.
So what are Metropoulos’ plans for the property? Well, he already lives next door and his long term plans are to merge the two estates into one larger property. He views it as his “private residence for years to come”. Metropoulos has described the Playboy Mansion as a “one-of-a-kind piece of history and art” that he intends to renovate and restore.
The deal itself? Mauricio Umansky of The Agency, many of our students work there already - with Gary Gold and Drew Fenton of Hilton & Hyland were the agents to hold the listing. Jade Mills of Coldwell Banker Residential Brokerage represented Metropoulos. Is this type of success enough motivation to work harder as a real estate agent and get your real estate license in California? We think so! =)
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Earlier this morning the California Association of Realtors sent out a “red alert” regarding Assembly Bill 1381. The frenzy was caused by a last minute change that would exempt some outdoor advertising
Earlier this morning the California Association of Realtors sent out a “red alert” regarding Assembly Bill 1381. The frenzy was caused by a last minute change that would exempt some outdoor advertising companies from needing a real estate license. This could harm many Realtor’s businesses as this is an area of specialization for some.
If this bill were to pass, two problems are created:
First, while real estate licensees have a fiduciary duty toward their client, it isn’t immediately clear whether or not these outdoor advertising companies would have the same duty to the landowner or advertiser.
Another potential pitfall is this bill could have the effect of reducing a revenue stream for Realtors by allowing those negotiating outdoor advertising space to act in that capacity without a license.
The California Association of Realtors and ADHI Schools, LLC are opposed to this or any legislation that would allow companies or individuals to act in a real estate license capacity without a license.
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Homelessness is a serious problem. Despite efforts to curb it—from government housing programs to charitable organizations and shelters—it persists. A recent federal House bill (with bipartisan cosponsorship)
Homelessness is a serious problem. Despite efforts to curb it—from government housing programs to charitable organizations and shelters—it persists. A recent federal House bill (with bipartisan cosponsorship) has been written that aims to help homeless and formerly homeless students and student veterans attain housing.
H.R. 5290 would amend the Internal Revenue Code to “qualify low-income building units that provide housing for homeless students and veterans who are full-time students for the low-income housing tax credit.” The full-time student must have been a homeless child or youth during any portion of the seven years prior to occupation of the housing unit in order to be eligible. Veterans are eligible if they have been homeless at any point in the previous five years and are full-time students.
So what is the low income housing tax credit (LIHTC) and how would this bill impact affordable housing? The LIHTC frees up funding for the development costs of low-income housing. Investors receive a dollar-for-dollar tax credit that directly lowers owed income tax. These investors propose a project to the state housing finance agency. A certain percentage of units in the development are committed to being both rent restricted and occupied by individuals under a certain income threshold compared to the median gross income in the area.
This commitment includes a number of years (typically 30) that the rent restrictions and availability will exist, meaning that landlords cannot take advantage of a tax credit, then remove rent restrictions. The specific scenarios are outlined here. These projects can be new construction or acquisition and/or rehabilitation of existing housing developments. Once the state housing finance agency approves the project, the credits are claimed over a ten year period.
To summarize: a landlord-investor set aside a certain number of units that have lowered rent to be made available to renters with low income. H.R. 5290 would automatically qualify students that were homeless children or youths within the last seven years and veterans that have been homeless within the last five years as eligible tenants for the rent-restricted units.
If H.R. 5290 is passed and signed into law there would be more incentive for landlords and developers to subsidize housing for formerly homeless veterans and youths while they are in college. This makes it easier for those who have escaped homelessness to stay out—a very real problem, especially in more expensive areas of the country. It is difficult to succeed in higher education while earning enough money to support oneself. It also provides a pathway out for those currently homeless. If they can become a full-time student, they can gain access to cheaper housing.
Will it pass? No way to tell yet, but bipartisan cosponsorship is always a good sign. In an increasingly divided legislature and an election year, cooperation is not something we hear about too often. Because this bill has Democratic and Republican support it may have a better chance of being passed. But the Senate is not currently in session, so any movement by the House will not be matched in the Senate until at least September. We will be certain to keep our readers updated as this legislation progresses or falters.
For questions about the legislation, programs described, or other real estate topics feel free to reach out to the author at cody@adhischools.com. If you feel strongly one way or another about this proposed legislation, we encourage you to contact your elected representatives. Anyone looking to obtain their real estate license needs to keep an eye on these important legislative updates.
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Sellers marketing their homes are often concerned about what goes on inside their house when they’re not there. This has led to the installation of surveillance equipment in many homes for sale. Maybe
Sellers marketing their homes are often concerned about what goes on inside their house when they’re not there. This has led to the installation of surveillance equipment in many homes for sale. Maybe the seller has a security concern: who is coming into my home and what are they doing? Are they stealing? Or maybe their interests are purely professional. What are potential buyers saying about my new floors? Is my agent working hard for me? Regardless of the motive, this is something real estate professionals must be aware of, particularly when the seller is not present.
These days it’s easy for a homeowner to keep their home under surveillance and find out what’s happening in their absence. From openly visible security cameras to so-called “nanny cams” (hidden cameras designed to innocuously keep an eye on caretakers that are often adopted for other purposes), there are lots of ways to keep watch.
You may be asking, is this legal? The answer is yes, for video recording - more on audio in a moment. Unless a person being recorded is somewhere they can reasonably expect privacy (e.g. a bathroom, changing room, etc.), video surveillance is legal. Considering a real estate agent is inside of someone else’s home, it is unlikely that court proceedings would determine that they could have reasonably expected privacy in the event they are recorded.
If you are listing agent and see cameras, you need to get on the same page as the seller if at all possible. Ask if the cameras are on when you are showing the home and what the purpose is. You will probably be asked about the cameras by potential buyers and agents and you should be prepared for that question.
It’s also possible that you may not know about the presence of cameras in your listings, particularly if they are hidden. If you feel comfortable asking the question, you could simply ask your seller if any recording equipment is in the property. These days, it’s probably safest to assume that cameras exist inside the home. While this should not affect what you do on the property (as you should already have been following all legal and ethical requirements that coincide with holding a real estate license), a mindful outlook on the situation may prevent professional issues with your clients.
Audio recordings are another legal issue. Depending on the state it is illegal to record a conversation without the consent of all recorded parties. In California, the legal standard is that “confidential communication” cannot be recorded without two-party consent. “Confidential communication” is defined as any communication in circumstances as may “reasonably indicate that any party to the communication desires it to be confined to the parties thereto”, as long as the communication is not made in a “public gathering”, “in any legislative, judicial, executive or administrative proceeding open to the public”, or “in any other circumstance in which the parties to the communication may reasonably expect that the communication may be overheard or recorded”. This leaves a significant loophole. How do you define a reasonable expectation to be overheard?
According to the law offices of Stimmel, Stimmel, & Smith, answering this question will be left to the proceedings of each trial (and thus either the jury or judges). It is quite possible that a recording in someone’s home would not be considered a violation of privacy because the recorded persons are on someone else’s property, but there is not a guarantee. Real estate agents are invited into a home for business purposes and conversations are part of that standard business practice. It is entirely possible that a judge and jury would rule that privacy should not be expected.
Does all of this sound paranoid? Consider a few cases where that surveillance revealed some unpleasant facts. In 2013 an agent was caught stealing underwear from his female client. In 2014 two real estate agents were caught having sex on secret cameras in the home one of them was listing. And just last year a real estate agent was caught stealing prescription pain medication from a house she was showing. Obviously these happenings are rare, but it does prove that some homeowners had good reason to be suspicious.
So for our students preparing for the California real estate exam, know that obtaining a license is not an endorsement of character. Some sellers will be skeptical or nervous about the prospect of letting strangers into their home and real estate professionals should be prepared for how those clients try to protect themselves.
Do you have any experiences with recording equipment in a listed property? Comment below! As always, feel free to reach out to the writer, cody@adhischools.com , if you have any questions.
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With much of the Western United States experiencing extended droughts, some homeowners are turning to alternative landscaping methods to save resources.
Recently REALTOR® Magazine1 (pg 34-35) wrote
With much of the Western United States experiencing extended droughts, some homeowners are turning to alternative landscaping methods to save resources.
Recently REALTOR® Magazine1 (pg 34-35) wrote about owners who are “rethinking the traditional American landscape” by moving toward yards that require less water and maintenance. The “desert landscaping” method, popular in much of the Southwest, is probably what comes to mind when picturing drought-resistant landscaping, but depending upon your locale there are other options to save water without compromising the aesthetics of a property.
Besides aesthetics, cost can be a deterrent when re-landscaping. It takes money to tear out a lawn, buy new plants, or truck in gravel. While these upfront costs are cause for legitimate concern, a move towards drought-resistant landscaping has the potential to save a homeowner money over time. The overall savings will depend on water prices in a given area, but expert estimates claim up to 75% less water is needed and maintenance bills could be lowered by 50% in Southern California when desert landscaping is implemented.
It would be wise to investigate rebate opportunities from your city or county water authority in your area to help offset the upfront cost. There are opportunities throughout the western United States for rebates for everything from removing grass lawns and installing more efficient watering and irrigation systems to more general rebates for conversion to a drought-tolerant landscape. With hundreds of dollars in rebates oftentimes available, the investment can be manageable.
Houses with great curb appeal are easier to sell and it is never too soon to plan ahead. While the traditional, perfectly green yard will likely never go out of style, trends in design can impact prices. Landscape economist John Harris states that good landscaping can add up to 28% to home value. A Clemson University study says that taking landscaping from good to excellent “in terms of design, condition, and placement” can add 6-7% to a home’s value.
These statistics show that execution and design are important. If you choose to move away from a more traditional landscape design, but do it poorly, you may miss out on the opportunity for increased value or worse – even see your property value lowered. Choose the right layout, plants, and accessories, from gravel to a suitable gate to the backyard or courtyard. Seek professional landscaping help or gather the opinions of those you trust about what works. The U.S. Department of Agriculture also publishes information on “hardiness zones” that help people understand which plants can survive in which conditions. Remember, if your landscaping is already good, making it “excellent” could add 6-7% in value.
Some owners resist the thought of a drought resistant yard because they fear that their children won’t be able to play as much. One option is to maintain a lawn in the backyard for room to play, while the landscaping for the rest of the property reflects alternative design. Some choose to pursue this goal with artificial turf in the place of a genuine grass. The distance to a good, safe park can also be a factor here. A nearby park can reduce the amount of green space you personally need and many newer developments are built with parks in the neighborhood.
So if you’re a homeowner, consider a more efficient yard. It might just improve your curb appeal and the value of your home while saving you money on water and maintenance. Whether you’re taking real estate classes in Los Angeles or preparing for the real estate exam in California, make sure you know how to talk to your clients about landscaping. It may not be your job to convince them that alternative landscaping design is right for them, but it is your job to make sure they understand the reasons behind these designs and the community resources that may make up for lost green space.
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As we predicted on July 20th, H.R. 3700/ S. 3083, the bipartisan housing legislation that passed through Congress without receiving a single “no” vote, was signed into law by President Obama on Friday,
As we predicted on July 20th, H.R. 3700/ S. 3083, the bipartisan housing legislation that passed through Congress without receiving a single “no” vote, was signed into law by President Obama on Friday, July 29th.
The new law will reform HUD’s Section 8 housing voucher program (and any other family rental assistance programs) by requiring public housing agencies (PHAs) to develop new systems to properly review the incomes of families receiving assistance, to cease assisting families with assets exceeding $100,000, and a cap on project-based vouchers (those vouchers tied to the unit, not the tenant).
The FHA mortgage insurance eligibility requirements have also been changed. The FHA has now been instructed to make recertification of eligible condominiums less burdensome and to lower the required percentage of units occupied by owners in a development from 50% to 35% in order to qualify.
Loan approval authority for the USDA Rural Housing Service’s single family housing guaranteed loan program will now be made available to preferred lenders, streamlining this program.
As noted earlier, we predicted that this legislation would pass due to its broad bipartisan support and common sense reforms to important government policies and programs. We supported the legislation, as did the National Association of REALTORS®, California Association of REALTORS®, California Association of Mortgage Professionals, and other professional organizations. The reforms to FHA condominium approval processes are particularly promising and have the opportunity to open up more affordable housing opportunities for Americans while incentivizing the development of more housing, something we desperately need.
The full text (with summary) of the law can be found here. Or view our previous article summarizing some of the key impacts. For any questions or comments, reply below or reach out to the writer at cody@adhischools.com
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According to the U.S. Census Bureau, owner-occupied households fell to 62.9% of total households in the second quarter of 2016, the lowest rate of homeownership in the U.S. since 1965. This statistic raises
According to the U.S. Census Bureau, owner-occupied households fell to 62.9% of total households in the second quarter of 2016, the lowest rate of homeownership in the U.S. since 1965. This statistic raises concerns about the future of home ownership and housing affordability in the United States.
Before potential causes of this decline are assessed, the numbers must be put in historical context. Census Bureau statistics show that after a low point in 1965, the homeownership rate climbed (fairly consistently, but with many small dips) to a peak from 1979 through 1981, fluctuating between 65.5 and 65.8%. A dip followed and the 1980s and first quarter of the 1990s consistently had lower homeownership rates than the 1970s. A brief climb occurred before a dip to 63.8% homeownership in the first two quarters of 1994 (a very low point over the last 50 years). Yet from that low point there was a near continuous climb to the peak: 2004, when Q2 and Q4 hit 69.2% owner-occupied households. The next few years displayed rates near the peak, before the drop in 2007. Since 2007 there has been near continuous decline, with only a handful of tiny upward movements as the last nine years mirrored the upward climb of the 90s and 2000s.
The under-35 years old and 35-44 years old demographics are the two that are below the national homeownership rate, pulling the rate down. As of the second quarter of 2016, only 34.1% of under 35 households are owner-occupied, the lowest that number has been since 1994 (the most recent historically bad year). Only 58.3% of 35-44 households are owner-occupied. 45-54 years old is at 69.1%, 55-64 years old is at 74.7%, and 65+ is at 77.9%, proving that older, more established adults are much more likely to own their housing.
The high cost of housing has led to more renting. When a Housing Affordability Index is examined the home ownership rate makes a little bit more sense. According to the California Association of REALTORS®, through the first quarter of 2016 only 60% of U.S. households can afford to purchase the median priced home in the state, a number that shows that our owner-occupied rate could feasibly be even lower. Some states, like California, have significantly lower ratings (in California only 34% of households could afford a single family home and only 41% could afford a condo or townhouse).
Meanwhile, the rental market is very strong. Renter-occupied housing units jumped 967,000 units from same period last year. The Wall Street Journal states that “moving into a rental unit has been entirely responsible for rising household formation since the recession began”. While home ownership is down, renting is up and is the sector where more new households are represented. Ralph McLaughlin, chief economist at Trulia, agrees with this assertion and adds that the decline in home ownership is more likely “due to a large increase in the number of renter households than any real decline in the number of homeowner households”.
That means that in this last quarter we didn't see a drop in the gross number of owner-occupied housing units, we saw an increase in rental housing. That is a very significant fact that should calm those that fear this is currently a crisis. Housing affordability is a very real concern and there are arguments to be made that these issues will permanently suppress the percentage of those owning homes. Bottom line: the number of new households that are renting is outpacing the number of new households that are buying—decreasing homeownership rates.
Why is housing so unaffordable? The answer is complicated, but it boils down to supply and demand. Demand is high for the available supply, which is great for property values and long-term investment in property. But it has consequences with affordability and when people cannot afford to make a downpayment and buy a property, they rent or find another arrangement (living at home with parents, for example.)
As the rental market becomes more competitive, prices increase (a logical end of supply and demand). This incentivizes homeownership, in theory alleviating some of the pressure and providing equilibrium in the market. But if rental prices are high enough that saving for a downpayment becomes difficult, renters find themselves stuck renting. This is not just a hypothetical either—a quick glance at a list of homeownership rates by country shows that many well-developed nations have similar or worse rates—Switzerland, Germany, Austria, South Korea, Hong Kong, and Japan all had lower homeownership rates as of 2014. This is a long-term phenomenon that can occur.
The supply of new construction is a contributing factor in some places. In California alone 70,000-110,000 more units of housing would have been required per year from 1980 to 2010 to maintain affordability pacing with the rest of the country. Instead, California has some of the most expensive housing in the country and housing affordability index scores to prove it. In March of this year Business Insider published an article highlighting supply issues in the overall U.S. housing market that suggested that the market has “been under built following the crisis and is ill prepared to handle the coming wave of millennial households that will be formed over the next several decades.” The impacts of not building enough housing have the potential to be felt for a long, long time as prices rise. We are seeing impacts now in the homeownership rate.
Some things to consider for the future: are we comfortable with permanently lower home ownership rates? what are we going to do about housing supply? what will happen to this rate if we have another recession and see foreclosure rates increase again?
Hopefully some pending legislation, like H.R. 3700/ S. 3083 that passed through Congress and will likely be signed into law by President Obama, will help. That bill would ease FHA loan eligibility restrictions and make recertification easier for condominium developments, which could incentivize more homeownership. But the issue of housing supply is much greater than a single piece of legislation and without more construction is unlikely to be eased.
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Legislation with a significant impact on the function of Department of Housing and Urban Development (HUD) rental assistance and public housing programs, Federal Housing Administration (FHA) requirements
Legislation with a significant impact on the function of Department of Housing and Urban Development (HUD) rental assistance and public housing programs, Federal Housing Administration (FHA) requirements for condominium mortgage insurance, and Department of Agriculture (USDA) single family housing guaranteed loan programs passed the Senate on Friday. H.R. 3700 passed through the House of Representatives on February 2nd, so the legislation will be moving to the President’s desk for approval or veto. It passed both houses with broad bipartisan support—it received zero “No” votes. The legislation has been supported by the National Association of REALTORS® (NAR), the California Association of Mortgage Professionals (CAMP), and other professional organizations involved with the real estate industry.
Below we have highlighted the key impacts this legislation will have if the president signs it into law (the full text and summary of the impacts of the bill can be found here).
What Could Change with HUD
As may be expected, HUD’s Section 8 housing voucher program (and any other family rental assistance programs) is subject to change. Public housing agencies (PHAs) that administer the program would have new expectations to develop systems to review the incomes of families receiving assistance. This includes annual review or any time income and deductions are expected to increase by 10%. Tenancy must be terminated or the greater of “fair market rent or the amount of the government subsidy for the unit” in the event a tenant’s income is “greater than 120% of the area median income for two consecutive years”.
PHAs are also prohibited from renting a dwelling to or assisting a family with “net family assets exceeding $100,000 (adjusted for inflation) or an ownership interest in property that is suitable for occupancy”. The exception is “victims of domestic violence, individuals using housing assistance for homeownership opportunities, or family that is offering a property for sale”.
PHAs are also prevented from using more than 20% of their authorized units for project-based vouchers (PBVs; meaning assistance tied to the housing unit not the tenant, like a Section 8 voucher). The exception is an additional 10% for PBVs targeting the homeless, veterans, the elderly, disabled, or for “units in areas where vouchers are difficult to use due to market conditions”.
There are many more changes to the technical functioning of these programs that affect the business of some real estate professionals, but for the sake of brevity we will not summarize the rest of these potential modification here.
What Could Change with FHA
H.R. 3700 would require the FHA to “make recertification substantially less burdensome than original certifications” for condominium mortgage insurance.
The FHA would also have to issue guidance “regarding the percentage of units the must be occupied by the owners…in order for a condominium to be eligible for FHA mortgage insurance”. If the FHA does not issue this guidance within 90 days of the bill being signed into law, the default eligibility requirements would be 35% or more of all family units occupied by the owners or sold to owners who intend to see the occupancy requirements, down from 50%. The FHA would be allowed to adjust afterwards to consider “factors relating to the economy” of the area.
What Could Change with USDA
The Housing Act of 1949 would be amended to permit the USDA to grant preferred lenders its “loan approval authority for the Rural Housing Service’s single family housing guaranteed loan program”. The USDA will be allowed to charge lenders a fee of up to $50 per loan to use the USA’s automated underwriting systems for the program.
Industry Opinions
The legislation was supported by the National Association of REALTORS®, California Association of REALTORS®, California Association of Mortgage Professionals (CAMP), and more. In an email sent on July14th, CAMP states that the legislation “provides significant benefits to taxpayers, homebuyers and the real estate market” through removing a “burdensome and expensive FHA Condo approval process” and reducing “FHA restrictions on the number of condos available to homebuyers.” They also describe the impact on the Rural Housing Loan Service processing as “permanently streamlining”. Tom Salomone, president of NAR, states that “This legislation will put homeownership in reach for more families” and NAR asserts that condominiums “are among the most affordable homeownership potions for first-time homebuyers, as well as lower income borrowers”. This condominium affordability is important, especially when juxtaposed with the assertion of the California Association of REALTORS® that only “10 percent of condominiums nationwide have made it through the burdensome, time-consuming, and expensive FHA-approval process”.
Adhi Schools, LLC Stance
We are dedicated to education and policies that lead to a healthy real estate industry and the general well-being of those seeking housing. This bipartisan bill is a rare chance to make the industry more efficient and open up more housing opportunities to more people. The impacts on the FHA condominium approval process are particularly promising. Broader access to these units incentivizes new housing developments that are necessary to combat the increasingly high cost of housing throughout California and the United States.
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In today’s global economy, real estate is far more than a series of local markets whose prices are determined by local buyers—it is an interconnected, international market where the economic conditions
In today’s global economy, real estate is far more than a series of local markets whose prices are determined by local buyers—it is an interconnected, international market where the economic conditions in one nation can affect real estate values thousands of miles away. Foreign investment in U.S. real estate is now commonplace and has significant impacts on both commercial and residential market conditions.
Hearing this, a number of questions come to mind: Where is the money coming from and how much is there? Why do foreign nationals and companies want to invest in the United States? How does this investment work? What are the impacts on our economy and different real estate markets? What will happen if this investment slows down?
How much foreign investment is currently in U.S. real estate?
The overall percentage of real estate controlled by foreign buyers depends on whether you are talking about the commercial or residential business.
In 2015, foreign buyers accounted for at least 17% of commercial real estate acquisition by dollar amount (NAIOP, Source 1). The National Association of REALTORS® states that international buyers purchased 4% of existing U.S. homes sold April 2014 through March2015, but those sales added up to 8% of the dollar value (NAR, Source 2). This indicates that high dollar homes are often scooped up by foreign buyers.
Foreign investment in commercial real estate in 2015 totaled $94.3 billion. Foreign investment in residential real estate acquisition in 2015 totaled $104 billion--totalling more than $198 billion in foreign real estate acquisition in the U.S. last year (Asia Society, Source 3).
So who is investing all of this money?
Until very recently Canada was the number one source of residential real estate investment in the U.S., but last year China spent much more than our neighbor to the north in this sector with $28.6 billion to Canada’s $11.2 billion. India was third in residential real estate investment, with investors pouring $7.9 billion into acquisitions.
Commercial real estate acquisitions are still dominated by Canadian investors with $24.6 billion spent last year. Singapore was next with $14.6 billion in acquisitions. China and Norway tied at third with $8.5 billion each spent in commercial real estate acquisitions.
There is a common perception that China is dominating investment and buying everything in America, but these figures show that this is not at all the case, especially in the commercial markets. Canada is spending almost three times as much in commercial real estate investment. Singapore outspent China by $6 billion in U.S. commercial real estate acquisitions despite having a GDP 2.7% the size of China’s (World Bank, 4).
This is not to suggest that China’s purchasing power should be considered miniscule (realistically China will outdistance Canada, Singapore, and Norway in real estate investment before long); rather, it is important to recognize just how many foreign investors from around the world view the United States as a premier investment destination.
There are many reasons people want to invest in U.S. real estate.
The most obvious reason for foreign investment in U.S. real estate is financial gain. Real estate investors, wherever they are located, would like to profit and the U.S. has the world’s largest economy with the world’s largest real estate market that is recovering and growing. For example, Norway’s surprisingly enormous amount of money spent on commercial real estate is the action of the state-run Government Pension Fund of Norway--the largest sovereign wealth fund in the world. The fund spent $7.6 billion on property globally last year in what it describes as an attempt to attain “the highest possible return with a moderate risk level” as a “long-term investor” (WSJ, 5). The focus isn’t necessarily on profiting in the near-term on the income the property provides. One such purchase was a 45% stake in the 40-story tower at 11 Times Square in Manhattan in February 2015 for $401.9 million. The fund also purchased a 49.9% stake of the Foundry Square II property in San Francisco for $139.7 million (Norges Bank, 6).
The United States became the preferred investment destination for these funds because of perceived long-term stability and near-guaranteed long-run appreciation in trophy markets like New York City and San Francisco. The famed Waldorf Astoria Hotel in New York sold for $1.95 billion to a Chinese investment group in 2014. That same group bought Strategic Resorts and Hotels, which has luxury hospitality locations across the U.S. in major markets like Silicon Valley and New York, for $6.5 billion this year (NY Times, 7). For an example closer to home for our Southern California readers, think of the Korean Air Wilshire Grand development. Korean Air and its parent company, Hanjin Group, owned the old Wilshire Grand, tore it down, and is in the midst of building what will soon be the tallest building west of the Mississippi to house a new hotel, retail space, and office space at the cost of more than a billion dollars (Curbed, 8). From coast to coast, America’s big markets are attracting billions in real estate investment.
Insecurities and political issues in other markets drive some investors to purchase U.S. real estate as much for stability and security as profit. Many Chinese investors in U.S. real estate were motivated to move money away from a faltering stock market and slowing domestic growth.
According to some experts, others around the world want to protect their assets and get their funds out of their own country. Basically, the U.S. real estate market can act a bit like an offshore bank. From an investor’s perspective, sure the U.S. government taxes your money; but, your investment will never be seized by the state and will likely appreciate over time (US News, 9).
There are of course more reasons to invest in U.S. real estate. Some families have a child attending school in the United States and want to buy a house here. The U.S. can also act as a tax haven (depending on the nationality of the foreign investor), especially considering taxes will not be paid until the property is sold or earns income.
So how does this foreign investment work?
Unlike some other countries, the United States has almost no barriers to to foreign ownership of real estate. Investors are generally taxed on their property’s income or sale just like domestic investors (although some treaties with particular nations can ease this burden). However, recent revision of the Foreign Investment in Real Property Tax Act (FIRPTA) has actually removed some of this tax barrier. FIRPTA guarantees that foreign investors are taxed on their sale of U.S. real estate. The new reforms (which went into effect December 18th, 2015) add more exemptions for foreign pension funds, increases the ownership threshold on the amount of publicly traded real estate investment trust (REIT) stock that foreigners can own before being subject to FIRPTA taxation upon sale of said stock from 5% to 10%, and reforms the rules to determine if REIT is domestically controlled. A strong majority of foreign investors interviewed by the Association of Foreign Investors in Real Estate have said that this reform will lead them to invest more heavily in U.S. real estate (Skadden, 10).
Aside from taxation, unless the foreign buyer is subject to U.S. sanctions (for reasons such as being a war criminal in another nation; it is incredibly uncommon for the U.S. to place sanctions on an individual), there are no restrictions preventing U.S. citizens and organizations doing business with foreign nationals.
As for the actual funding, many international buyers come with cash (including 71% of Chinese buyers 2013-2015). But there are financing options available for these investments. Chinese banks alone have issued $8.5 billion in loans for commercial acquisitions. These same banks make residential loans as well, which are of obvious need for Chinese investors, since they invest more money in residential than commercial real estate acquisitions (Asia Society, 1). However, the Asia Society describes these loans as “limited, but growing”. Those needing lending for residential mortgages are thus more likely to connect with a domestic lending institution for their loan needs. This process is mentioned below.
Foreign buyers can also purchase a first property with cash, then take out a home-equity loan to make funds available for other purchases. With funds in U.S. bank accounts investors can begin to obtain credit and establish a credit history that will enable further investment.
There are also domestic lenders that have targeted foreign real estate investment. Some of these operate nationwide while others only grant these types of loans for specific states. There is a great deal of variance in products offered as well: minimum and maximum loans, LTV, credit reports (or lack thereof), property types, etc.
East West Bank is one of the best examples. Specializing in Chinese commercial investment, East West Bank grants loans (typically between $3 million and $30 million) to investors that might otherwise not be able to attain financing. This bank has chosen to be selective, rejecting some applicants, while employing a strong connection to Chinese culture to remain competitive and a noted voice in this type of investment (Commercial Observer, 11). As of 2013 East-West had an average LTV of 55% across their commercial real estate loan portfolio (we could not find a more recent stat on their LTV rates), making them a fairly conservative lender (East West Bank, 12). Note that this is not a set policy where all investors receive the same terms. East West is selective and adapts to their situation.
BofI Federal Bank is another major player that offers portfolio loans to foreign national borrowers (minimum $300,000, maximum $10 million) at up to 50% LTV. Borrowers have to come in with a large amount of cash, but credit scores are also not required for evaluation.
A&D Mortgage lends to foreign investors, but operates only in south Florida. They will lend up to 70% LTV on up to a $15 million loan on single family, condo, and condo-hotel property types (Scotsman Guide, 13).
The takeaway is that foreign ownership of real estate is a big business and lenders are carving out niches to capitalize on the opportunity. Some are willing to assume more risk than others with higher LTV ratios or proof of credit in their underwriting standards, but overall there are opportunities for foreign buyers to obtain the financing they need.
There are potential hurdles to investment in the form of capital controls in foreign nations. China, for example, typically only allows one of its citizens to take $50,000 out of the country in a given year (Bloomberg, 14). Exceptions for investment and pooling of money allow the substantial investment in real estate we see, but these types of regulations do inhibit some investment
So what are the affects of this foreign investment on U.S. real estate markets?
This external boost to domestic real estate markets can contribute to increasing prices in some cities, which makes sense. Healthy, competitive markets can create price inflation. Buyers may not appreciate the costs of these strong markets, but sellers obviously benefit.
This effect is more noticeable in some cities than others. Very expensive cities like San Francisco and New York see a substantial percentage of real estate transactions involving foreign investors. Chinese investors, for example, spent $9.56 billion on commercial acquisitions in New York City alone between 2010 and 2015 (Asia Society, 1). And while Chinese purchases still make up a small proportion of sales in the overall U.S., Chinese buyers do buy 1 in 14 homes sold for $1 million or more and Chinese buyers pay on average $831,000 for their homes in the U.S. as of last fall (more than three times as much as the median home price in the U.S., $239,700)(NY Times, 15; NAR, 16). It follows that these buyers are concentrating themselves in metropolitan areas like New York, Los Angeles, San Francisco, Seattle, Chicago, Los Angeles, and Miami (The Guardian, 17).
A consequence of this foreign demand is that housing becomes less affordable for domestic buyers. According to the California Association of REALTORS®, as of the the fourth quarter of 2015, only 30% of households in California could afford to purchase the median priced home (39% the median priced condo or townhouse), compared to the 58% U.S. average (CAR, 18). While foreign buyers are obviously far from the only factor creating such a competitive housing market, they do play a role.
This influence is actually most visible in the highest end of real estate. Although housing affordability issues impact lower and middle income individuals the most, the immediate impact of a drop in funding for foreign investment is most visible in expensive markets like Silicon Valley. Despite still having some of the lowest average days on market (DOM) stats in the country, a recent slowdown in investment from China is visible. With China’s faltering stock market and new controls on capital leaving the country coinciding with a 20% decrease in venture capital investments in Silicon Valley in the first quarter of 2016 from Q1 2015, the high end market slowed significantly (WSJ, 19). In April 2016 the average DOM was 16 days, compared to 11 in 2015 and 10 in 2014. The average DOM rose to 30 days in May (Bloomberg, 20). While still a fast market, that is an enormous proportional increase in DOM.
While this is a small market where a handful of lingering properties can impact the statistics, the example is there: high end markets have become more dependent on foreign investment than other markets. Other high end markets could be susceptible to similar problems.
Another impact is on cap rates in commercial real estate. The steep competition that foreign investment is contributing to has “kept cap rates suppressed” between five and six percent on average as foreign investors continue to perceive retail assets as “long-term stability” investments. (Globest, 21) As demand for investment real estate increases and prices keep getting pushed up, cap rates will continue to decrease.
Cap rates are staying low because expensive buildings--even with expensive leases and high operating income--are not seeing rents increase quickly enough to raise cap rates. Part of this is investors buying buildings that already have tenants with set leases. Until the lease is up the investor cannot negotiate higher rent to increase cap rates.
Demand is another significant factor. Investors are willing to pay a high price for a property with long-term appreciation in mind. This means paying higher prices than one would pay if they were solely using income to evaluate the investment. Consider the example of the Government Pension Fund of Norway from earlier. Their focus is so much on income - it was purchased at a 2.9% cap rate. But that return provides some short-term benefit while the overall value of the property provides the long-term investment incentive.
While some of these effects seem negative, consider a few benefits. Foreign investment helped the housing market recover after the crash as valuable dollars continued to flow into the market. It may not have been a comfort to those losing their homes, but it was beneficial to the economy. And foreign investment also generates tax revenue. While this may not be a benefit that many people think of, a strong real estate market does provide valuable tax revenues (with benefits such as funding public schools).
So what happens if the foreign investment dries up?
If foreign investment in real estate has become a significant factor in the strength of the market, it follows that there should be concern about the longevity of this investment.
First, there is little reason to fear foreign investment ceasing. Even with China’s increased internal controls on capital leaving the country, there is enormous demand for American real estate. This demand is created in a number of ways (mostly explained above). As long as the U.S. is a major economic player on the global stage (which is inevitable for the foreseeable future), there will be demand. Abundant coastline and large metropolitan cities that create high prices for domestic buyers also draw foreign buyers.
If there are fluctuations in this foreign demand they should act just as a fluctuation in domestic demand. Days on market could increase and thus draw down prices, but as foreign investment is still far from a majority of investment, this effect should not be as strong as when domestic demand falters. In some cities there could be less effect as domestic buyers find they can afford homes when competition is slightly decreased.
Take Away
At the end of the day there will always be people concerned about foreign outsiders buying their cities or driving up prices for the local population. Calls for higher taxes on foreign investment and other restrictions will never cease. But it is our position that barriers to the influx of foreign dollars into real estate markets other is not a sound decision. Without foreign investment the last recession and housing market crash would have dragged on longer, harming the same people that investment controls would allegedly protect. Strong real estate markets do create affordability issues in some cases, but also the potential for job creation with new construction and the subsequent affected industries and buying power of employed workers. And while some may not approve of this influence, it is a difficult position to tell property owners that they should receive lower selling prices when they sell their property because international buyers are not investing in the market.
The U.S. real estate market is not completely dependent upon foreign investment, but it is significantly influenced by it (in some local markets much more than others). It is unlikely that this will change in an increasingly globalized economy.
Sources
1) http://www.naiop.org/en/Magazine/2016/Spring-2016/Finance/Cross-border-Investment-in-US-Commercial--Real-Estate.aspx
2) http://www.realtor.org/sites/default/files/reports/2015/2015-profile-of-international-home-buying-activity-2015-06-18.pdf
3) http://asiasociety.org/files/uploads/66files/Asia%20Society%20Breaking%20Ground%20Complete%20Final.pdf
4) http://databank.worldbank.org/data/download/GDP.pdf
5) http://www.wsj.com/articles/norway-fund-bulks-up-on-real-estate-1424795145
6) https://www.nbim.no/en/transparency/news-list/2014/fund-makes-new-investment-in-san-francisco/
7) http://www.nytimes.com/2016/03/14/business/dealbook/chinese-owner-of-waldorf-astoria-bets-big-on-more-us-hotels.html
8) http://la.curbed.com/2015/7/13/9941028/wilshire-grand-construction
9) http://realestate.usnews.com/real-estate/articles/how-international-issues-affect-foreign-investment-in-us-real-estate/
10) https://www.skadden.com/insights/firpta-reform-impacts-investment-opportunities-us-real-estate
11) https://commercialobserver.com/2014/10/east-west-bank-poised-profit-chinese-investors-us-real-estate/
12) https://www.scotsmanguide.com/pages/niche-lenders/foreign-national-and-itin-mortgage-loans
13) https://www.bloomberg.com/tosv2.html?vid=&uuid=133b14a0-4ea9-11ea-9274-c31866829c8f&url=L25ld3MvYXJ0aWNsZXMvMjAxNC0wNy0xNC9zZWNyZXQtc
GF0aC1yZXZlYWxlZC1mb3ItY2hpbmVzZS1iaWxsaW9ucy1vdmVyc2Vhcw==
14) http://www.nytimes.com/2015/11/29/business/international/chinese-cash-floods-us-real-estate-market.html?_r=0
15) https://ycharts.com/indicators/us_existing_home_median_sales_price
16) https://www.theguardian.com/business/2016/may/16/chinese-pour-110bn-into-us-real-estate-says-study
17) http://www.car.org/marketdata/data/haitraditional/
18) http://www.wsj.com/articles/china-boosts-efforts-to-keep-money-at-home-1441120882
19) http://www.bloomberg.com/news/articles/2016-05-17/silicon-valley-mansions-linger-on-market-in-real-estate-slowdown
20) http://www.globest.com/sites/geofferymetz/2016/05/23/retail-at-a-glance-whats-driving-foreign-investment/?slreturn=20160502123659
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As the lending industry evolves, changes are made to credit reporting. The newest of these changes is the emergence of a concept known as “trended credit data”. Equifax, one of the three major credit
As the lending industry evolves, changes are made to credit reporting. The newest of these changes is the emergence of a concept known as “trended credit data”. Equifax, one of the three major credit bureaus, has called it “the most important tool developed by the credit reporting agencies since the advent of the credit score” (CAMP source). Fannie Mae will be implementing trended data (TD) into its Desktop Underwriter risk assessment and automated loan underwriting software on September 24th, with the launch of DU 10.0.
Currently credit scores provide a picture of consumer behavior at a moment in time—a snapshot of sorts—and do not necessarily demonstrate how a borrower has managed credit over a period of time. The trended credit data provides information over time, attempting to more thoroughly tell the story behind a credit score. There are many questions and concerns with this new system, so we have tried to address many of them here.
How does trended credit data work?
Trended data will typically go back 24 months. Right now trended data just means data on the use, balance, and payment history of revolving credit cards. Other information will likely eventually be incorporated and examined over time, but for now it is essentially an examination of credit utilization and actual payment amounts on these accounts.
What exactly does this mean? With trended data, a viewer of a report will be able to view the way someone manages their credit card accounts in aggregate. Has their balance been slowly decreasing? Do they always pay off their card in full at the end of the month? Does the cardholder spend more seasonally (think summer vacations and holiday shopping)? What does their credit utilization rate (CUR) typically look like?
This information is very useful for two groups of hypothetical loan applicants. First, consider three applicants for a loan. They all have the same credit score—720. Just looking at that number, it would be difficult to determine any difference in risk in lending (if other traditional factors like down payment and income are appropriate for their application). But logically we know those people could have different levels of risk (debt, late or missed payments, etc.). Now let’s say trended data shows us that one of those applicants has an increasing aggregate balance across their cards, one has stayed roughly even and is making payments, and the other is demonstrably lowering aggregate credit card debt over time. Obviously the applicant with rising debt is more risky than the others. Along the same line of thought, the applicant lowering debt is likely the safest—they already have a good credit score, but are following debt management practices that suggest that in the future their score would be even better.
The other group of hypotheticals is the applicant that has good credit, a good application, but shows a high credit utilization rate. This means that their aggregate credit card debt is near their overall credit limit. This is a factor that can lower credit scores and is typically a red flag for approving an application (in the event the credit score is still in an acceptable range). Trended data can show how this debt has been accumulating and what the applicant’s debt management usually looks like. If the applicant is a seasonal credit utilizer that always pays off the debt the next month, then there is far less concern. In this case trended data may help someone get approved that normally would not have at that time.
DU 10.0 will allow underwriting for borrowers without credit scores. Currently this requires manual underwriting, and manual underwriting for these people will continue in some cases. To underwrite, a three-in-file merged credit report and evidence of at least 2 trade lines that stretch back at least 12 months will be required. One of these trade lines must be housing (rent payments), but the other can be anything, such as payments on a cell phone bill. There are more hoops to jump through as far as qualifications (proof of income, bank statements, loan-to-value ratio limits, etc.), but any applicant with no credit score should not expect a traditional process.
What does this mean for consumers trying to qualify for a mortgage?
Applicants with good scores but increasing aggregate balances across their cards are going to have more problems qualifying for loans than they did in the past. Upward trends in this debt indicate measurable, substantial increase in risk. According to the California Association of Mortgage Professionals (via TransUnion), these borrowers are 33-55% riskier (CAMP source) than similar borrowers who pay off their accounts in full every month.
People with decreasing aggregate balances on credit cards are going to fare better in the application process than in the past. These people are considered relatively lower risk and the process of trended credit will help these borrowers prove creditworthiness.
Under this system it is likely that rapid credit fixes (like paying off a credit card) will have an impact on score and likelihood of receiving a loan, albeit a smaller impact than before due to the fact that trended data will be able to determine overall riskiness of debt management, not just focusing on one or two good recent decisions.
While Fannie Mae is changing the way it looks at credit and underwriting, it does not actually anticipate a substantial change in the percentage of approvals. Through better risk assessment they anticipate more accurate approval, but this does not necessarily mean that the number of qualified applicants is lower. It just means that the number of those who would have been approved in the past, but will not now, is roughly equal to the number that would not have been approved in the past, but will now.
Who is NOT Affected by TD?
Other popular sources will not yet be impacted by TD. Freddie Mac will not (yet) be using trended data. FHA and VA applications to DU will not be impacted yet by trended data either. It is quite possible that these programs will all be impacted by TD soon, but at least for now TD is just relevant to Fannie Mae products.
FICO credit scores and VantageScores will also not include trended data in their calculation.
There will also be the same vehicle for borrowers to dispute data as currently exists. Likewise, Adverse Actions and the required disclosures will also be the same.
SOURCES
https://www.fanniemae.com/content/fact_sheet/desktop-underwriter-trended-data.pdf
https://www.corelogic.com/downloadable-docs/trended-data-faq_external.pdf
“Trended Credit Data and DU 10.0”, a webinar presentation, California Association of Mortgage Professionals (CAMP)
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We wrote recently about potential updates to Section 8 housing law in California. S.B. 1053, sponsored by Sen. Mark Leno (D-San Francisco) would have made it illegal for a landlord to deny a housing applicant
We wrote recently about potential updates to Section 8 housing law in California. S.B. 1053, sponsored by Sen. Mark Leno (D-San Francisco) would have made it illegal for a landlord to deny a housing applicant because they receive Section 8 assistance. This bill failed to move out of the Appropriations Committee, ending the possibility of the bill passing and becoming law.
The California Apartment Association (CAA) had opposed the proposed legislation for a few reasons. Owners and operators working with Section 8 have to abide by a different set of regulations than those strictly governed by state and local law, so CAA thought this regulatory burden should remain voluntary. These landlords must also cooperate with the local housing agency to receive their payment and many landlords believe this complex system (coupled with accusations of government inefficiency in payment) decrease the economic viability of their properties. Lastly, the cost of insurance for Section 8 voucher properties can be higher (as much as 20% higher, according to the CAA).
These concerns prompted the CAA to oppose the legislation. For now, Section 8 policies are unchanged in California.
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A couple of months ago I wrote about the restrictions on the use of drones (also referred to as UAS) for commercial purposes. Some real estate professionals had become interested in aerial photography
A couple of months ago I wrote about the restrictions on the use of drones (also referred to as UAS) for commercial purposes. Some real estate professionals had become interested in aerial photography and videos for their listings, but without a pilot’s license and a waiver from the Federal Aviation Administration (FAA) any commercial use was illegal. The FAA has now announced finalized rules on commercial use of drones that make operation more accessible. If you are interested in using drones in a real estate business, here is what you need to know:
The pilot’s license requirement is gone. The drone operator must be at least 16 years old and have a “remote pilot certificate with a small UAS rating, or be directly supervised by someone with such a certificate.” This certificate comes with a passed aeronautical knowledge test at an FAA-approved testing center or a Part 61 pilot certificate with a UAS online training course provided by the FAA. This new rule is much less stringent than the old rule, but still requires commercial drone operators to understand the rules of air traffic and and pass a TSA security background check. A real estate professional cannot just buy a drone, attach a camera, and start flying it for commercial purposes or pay someone else to do it unless they also have passed the requisite tests.
There are assorted safety rulesin place—the industry is not being entirely deregulated. Operators of drones must keep them within their line of sight, below 400 feet altitude or within 400 feet of a structure, and at or below 100 mph groundspeed.
UAS may not be operated over any persons “not directly participating in the operation” unless they are under a covered structure or inside a covered, stationary vehicle
Operation is permitted during daylight hours and during civil twilight (30 minutes before official sunrise and 30 minutes after official sunset) with appropriate anti-collision lighting
There is little word on any updates to the fines of violation of this policy. We know from the past that the FAA will fine those that unlawfully use drones for commercial purposes. SkyPan was fined $1.9 million dollars and industry experts expected fines to typically fall in the $1,000-$10,000 range before this rule. There will be a new fine of at least $500 if an operator causes serious injury or property damage with the UAS and does not report the incident to the FAA.
The FAA believes these changes are important to safely “spur job growth, advance critical scientific research and save lives” with impacts ranging from our real estate industry to the ability to “deploy disaster relief”. The FAA cites industry experts who believe the rule could generate more than 100,000 jobs and $82 billion for the economy over the next 10 years.
The next potential regulations will deal with privacy and data collection issues. The FAA does not currently regulate how UAS gather data, instead deferring to local and state privacy laws. It is possible that commercial use regulations will be created to address these concerns.
What do you think about the use of drones in the real estate industry? Is this a fad or will it become more common? Comment below or reach out to me at cody@adhischools.com for any questions or clarifications.
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In what should be exciting news to any Veterans looking to pursue a career in real estate, effective July 1st the initial licensure processing for all honorably discharged Veterans will be expedited.
S.B.
In what should be exciting news to any Veterans looking to pursue a career in real estate, effective July 1st the initial licensure processing for all honorably discharged Veterans will be expedited.
S.B. 1226 added Section 115.4 to the Business and Professions Code (BPC) and requires that all boards within the jurisdiction of the Department of Consumer Affairs “expedite, and may assist, the initial licensure process” for any applicant that can prove honorable discharge from the U.S. Armed Forces. This includes the licensure process under the California Bureau of Real Estate. The Salesperson Exam/ License Application also provides the details for this expedited process. There is no word yet on how expedited the process will be, but considering the process can currently take several weeks this should be a valuable perk for Veterans.
We at Adhi Schools would like to thank all Veterans for their service and remind our readers that Veterans receive a 25% discount from our live packages if they choose Adhi for their real estate education. We are proud to say that we have many Veteran students who have completed our programs and we always provide the highest quality real estate education to those who have served our country.
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Like any professional license, a real estate licensee can have his or her license suspended or revoked for various reasons. Criminal conduct is one of those, which makes sense considering the responsibilities
Like any professional license, a real estate licensee can have his or her license suspended or revoked for various reasons. Criminal conduct is one of those, which makes sense considering the responsibilities of a real estate agent. Few people would want to be represented by someone they do not trust while relying on that person for financial advice, showing their home, and handling the paperwork to buy or sell property.
Passing the California real estate exam does not equal an endorsement of one’s character and there are a lot of reasons why trust in your real estate agent is important. The good news is that in California, if a real estate licensee breaks the law there is a possibility that they will have their license suspended or revoked, protecting potential clients.
The California Bureau of Real Estate (CalBRE) runs background checks before granting licenses and reserves the right to deny them if an applicant has been convicted of a “substantially related crime”. Sections 480 and 490 of the Business and Professions Code define this as an act that may be deemed substantially related to the qualifications, functions, or duties of a real estate licensee, with more specific details of applicable conduct available here. Because the background check process involves fingerprinting, CalBRE is notified by the Department of Justice and the Bureau immediately begins an investigation to determine if the crime is substantially related. Disciplinary action can then be taken, including suspension or revocation of the license.
While this seems to be conveniently outlined by the law, below are a few cases that show how broad the phrase “substantially related crime” is. We have pulled real examples of disciplinary action from the CalBRE “Verify a License” section on their website, but have chosen to leave the individuals at the center of these cases relatively anonymous out of professional courtesy and good taste.
Case #1 is relatively straightforward—a real estate broker failed to properly oversee trust funds in his control and negligently allowed a shortage of $111,828.27 to occur. It was determined to not be a case of intentional mismanagement. and the broker license was revoked with a right to a Restricted license. The broker went on (a few years later) to regain a non-restricted broker’s license.
In Case #2 a real estate salesperson was convicted of two misdemeanor counts of cruelty to a child in connection with public intoxication. CalBRE believed that the cruelty to a child convictions were serious enough to revoke the salesperson license because of the threat of substantial injury to the children. Although CalBRE offered a path to a Restricted license, it doesn’t appear that the licensee performed the required steps to obtain this.
In Case #3 a real estate salesperson was convicted of felony assault and his license was revoked as the crime was substantially related to the qualifications, function, and duties of a real estate licensee. In this case there has been no action to restore the license or grant a restricted license to the offender.
What these three cases illustrate is CalBRE’s commitment to maintaining the standards of the real estate profession. The system in place recognizes, assesses, and meets a crime with appropriate disciplinary action. Few would argue that Case #1 and Case #3 should be met with identical punishment and they were not. While there is always the possibility for poor judgment or an appeals court overturning a CalBRE decision (which has happened), the system is in place for a reason and often functions well.
On top of the potential for a loss of license, if an agent or broker is a REALTOR® and is found to be in violation of the REALTOR® Code of Ethics, disciplinary action from the local REALTOR® association can include fines and suspension of REALTOR® membership. Many crimes would result in a violation of this code, so criminal offenses can be met with considerable consequences even if CalBRE or the courts decide that a license will not be suspended or revoked.
As always, for questions or clarifications just leave a message in the comment section or reach out to cody@adhischools.com . We welcome your opinions.
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Illegal immigrants, undocumented workers, illegal aliens—whatever the chosen vocabulary, there are millions of people residing in the United States and California that fall into this category. Illegal
Illegal immigrants, undocumented workers, illegal aliens—whatever the chosen vocabulary, there are millions of people residing in the United States and California that fall into this category. Illegal immigrants live somewhere and with California’s notoriously high prices, renting is the only option for many. This raises questions for the landlord. Can you ask about immigration status? Do you have to rent to an illegal immigrant if you do not wish to? Are illegal immigrants reliable renters?
California law prohibits a “landlord or any agent of the landlord” from inquiring about the immigration or citizenship status (or compelling a statement about immigration or citizenship status) of a “tenant, prospective tenant, occupant, or prospective occupant of residential rental property”. That same section of code does allow the landlord to request information or documents in order to verify an applicant’s identity and/or financial qualifications.
Remember, illegal immigrants can receive driver’s licenses in California and it is illegal to discriminate in employment or housing because of the nature of a driver’s license. Asking for identification documents might turn up one of these driver’s licenses. The person will not have a Social Security number, making it more difficult to verify information and financial capability. However, credit screening companies can run a credit report without a Social Security number if they have information such as the Individual Tax Identification Number. Because of this the California Apartment Association (CAA) recommends not rejecting applications because they do not have a Social Security number. Rather, they recommend a credit report and allowing the applicant to submit other evidence of financial stability, such as payment history on monthly bills like utilities. If at this point the applicant does not demonstrate adequate financial qualifications, there is significantly less risk in denying the application (as opposed to immediately rejecting the application when it becomes evident the applicant is not a legal resident of the country).
Whatever your screening process for tenancy applicants, put it in writing and follow it consistently. If someone is turned away—whether they are a legal resident of the country or not—and evidence suggests that another person was not turned away despite similar qualifications or lack thereof, it could be viewed as unlawful discrimination. As we discussed in our article about renting to convicted criminals, it is lawful to conduct an “individualized assessment” to determine if an applicant will be accepted for tenancy; what is not permitted is using this process to circumvent policy in a discriminatory manner. To put it into context for this article, if strict financial standards are put in place to rent (which can have legitimate purpose), it would be risky to specifically use individualized assessments to allow only citizens or legal residents of the United States to rent from you in order to weed out illegal immigrant applicants.
The bottom line is if an individual meets all other requirements to rent from you, it is risky to turn them away. If the applicant does not provide a form of identification along with evidence of financial qualifications, they can be rejected without risk (after all, it does not matter where someone is from, if they cannot prove who they are then those financial qualifications only prove someone is qualified to rent). Without a genuine reason (think finances, certain types of criminal record, etc.), however, discriminating against illegal immigrants in the State of California is not an advisable practice.
As always, for questions or clarifications just leave a message in the comment section or reach out to cody@adhischools.com . We welcome your opinions.
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Medical marijuana, the controversial practice that flies in the face of federal legal classifications of the drug, has been a troublesome topic for landlords for some time. While California landlords have
Medical marijuana, the controversial practice that flies in the face of federal legal classifications of the drug, has been a troublesome topic for landlords for some time. While California landlords have had the right to prevent tenants from smoking in their residences under existing smoking laws, the law lacked the clarity needed to assure landlords of the legality of medical marijuana smoking bans. A new bill working its way through the state legislature would clarify the law.
California Assembly Bill 2300 is authored by Assemblyman Jim Wood (D-Healdsburg) and is sponsored by the California Apartment Association (CAA) and supported by the California Association of Realtors. It specifically states that individuals permitted to smoke medical marijuana may not in “any location at which smoking is prohibited by law or prohibited by a landlord”. Marijuana is essentially being treated much more like tobacco.
This will not give landlords the legal ability to prevent individuals with a medical cannabis card from consumption of marijuana in any noncombustible form, including the use of edibles, oils, pills, patches, or vaporizers. The language of the bill specifically states smoking is prohibited with no language addressing these methods.
AB 2300 passed through the assembly floor on May 5th with broad bipartisan support—of the 80 potential votes, 77 votes yes and 3 were either absent or abstained. It is currently at the first reading stage in the state senate, meaning a vote should occur in the near future. If it passes—which looks probable given its bipartisan success in the assembly—it will move to the governor’s desk to be signed into law or be vetoed.
If a landlord chooses to exercise this right, clear, specific lease agreements are crucial. Just like any other provision of tenancy, landlords should make it clear that they are renting with conditions in mind. If this bill becomes law and landlords can treat marijuana like tobacco, it would still be wise—if for no other reason than convenience down the road—to clearly explain this policy and present it in a leasing agreement. Clear communication is a safe practice.
We will be sure to update our readers as this process unfolds. As always, for questions or clarifications simply comment below or reach out to cody@adhischools.com
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You’re a landlord and you receive an application for one of your vacant units. You get excited, looking forward to the income, but then you learn that the applicant has a criminal record. What do you
You’re a landlord and you receive an application for one of your vacant units. You get excited, looking forward to the income, but then you learn that the applicant has a criminal record. What do you do?
Maybe it matters what the crime is. You might feel comfortable renting to a nonviolent offender convicted twenty years ago. Maybe mental illness was involved and the convicted individual has demonstrably undergone successful treatment.
But what about a sex offender or someone recently convicted of running a meth lab in their last residence? Obviously the type of crime and amount of time since the conviction will impact your perception of risk. So what do you do? You want to protect your property and other tenants.
Landlords must be careful to ensure that their reaction to these situations is not perceived as unlawfully discriminatory. While no state or federal law prevents discrimination that solely targets criminal offenders, it is illegal for the practice to discriminate against protected groups such as racial minorities, regardless of intent.
On April 4th, 2016 the U.S. Office of Housing and Urban Development (HUD) announced that their interpretation of the Fair Housing Act is that any policy or practice that is “facially neutral” but has a “disparate impact on individuals of a particular race, national origin, or other protected class” is “unlawful”, unless the policy or practice is “necessary to achieve a substantial, legitimate, nondiscriminatory interest”. This is where the type of offense and the period of time since the conviction come into play. While refusing to rent to an arsonist who burned down his last apartment building can be considered legitimate, discriminating against someone with a petty theft conviction may be more difficult to justify. Especially if it turns out that you are turning away members of an otherwise protected class and you don't have uniform standards.
The last requirement is an evaluation of potential, less discriminatory, alternatives. In the event a policy is challenged and upheld as lawful, HUD or the rejected tenant can examine alternatives. The landlord does not need to search for alternatives to their legal policy—this burden falls on HUD (or the potential tenant to recommend a HUD-approved policy). But change could be prompted if HUD finds the necessary interest of the policy “could be served by another practice that has a less discriminatory effect”. This could be a mandate to include an “individualized assessment” that allows the potential tenant to prove good tenant history since the conviction, evidence of rehabilitation, etc. This may not change the decision for the individual appealing the rejection of their application, but in theory it would make the policy less discriminatory over time. And in October of last year HUD allocated $38 million to more than 100 groups to fight housing discrimination. Legal challenges to these policies should be anticipated.
So, unless you end up rejecting candidates in proportions that match your population, you could wind up on the wrong end of allegations of illegal discrimination. Thus, it is important to have a well thought out, comprehensive, consistent standard for these situations. And, if in doubt, contact legal counsel specializing in these issues.
In summary, here are the rules to keep in mind to best protect yourself:
Consider the nature of the crime
Consider how long it has been since the conviction
Apply your standard consistently—exceptions are risky!
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The Section 8 housing voucher program is at the center of recent debates in the California legislature and in the Appellate Division of the Sacramento Superior Court. Section 8 is designed to provide housing
The Section 8 housing voucher program is at the center of recent debates in the California legislature and in the Appellate Division of the Sacramento Superior Court. Section 8 is designed to provide housing for very low income families, the elderly, and the disabled: the federal government provides the funding and local housing agencies distribute vouchers that essentially guarantee a portion of the rent to a landlord. The Section 8 recipient pays a portion of the rent and the housing agency sends a check for the remainder. Landlords have long chosen whether or not they would participate in Section 8. Federal law does not require landlords to participate, so states typically follow those guidelines. Now, however, arguments are being made that landlords should not be able to reject applications to rent for the reason that their income is from a Section 8 voucher.
The court case of Sacramento Manor v. Morris was of particular importance in this debate. Court proceedings began when Sacramento Manor ended its participation in the program, eventually evicting any remaining Section 8 tenants. The Sacramento Manor cites difficulties receiving payment on time as a significant reason for their intended exit from the program (an issue they blame on government administration of the Section 8 program, not the tenants). A tenant, Dorothy Morris, was sued for eviction and in her appeal claims elderly tenants and Section 8 tenants should be considered protected classes under the Unruh Civil Rights Act.
In February the California Apartment Association (CAA) filed a court brief arguing that participation in the Section 8 Housing voucher program should remain optional for landlords. The CAA claims “a myriad of valid business and policy reasons why owners should not be forced in to the program and why it should remain voluntary as intended under federal law”. In the brief the CAA also argues that the voluntary nature of the program is designed to incentivize people to join the program and that landlords should not be forced into permanent arrangements. Last week the plaintiff chose to drop the Section 8 protected class argument (for which the CAA claims credit), ending the threat to landlords—for now. Without the legal precedent of a court ruling, another person could bring a similar suit to court with a chance of success.
Meanwhile, State Senator Mark Leno (D, Senate District 11) has authored SB 1053, which ,if passed and signed into law, would classify those receiving Section 8 vouchers as a protected class under the Unruh Civil Rights Act, meaning discriminating based on a potential tenant receiving Section 8 vouchers would become illegal.According to Senator Leno, “All tenants should have a fair opportunity to apply for housing, regardless of whether they receive a housing voucher”, receiving support from housing-specific advocacy groups such as Housing California.
This would also mean that the recent developments in the Sacramento Manor v. Morris court case would become irrelevant as the legislature (and subsequently, the governor) settles the issue itself. California’s legislature has a strong Democratic majority and the state also has a blue governor, so it is quite possible that this Democrat-sponsored bill will in fact become law. The bill is currently placed on Appropriations Suspension file, meaning it is waiting to advance to the floor for voting.
Real estate professionals should keep an eye on these proceedings as they could greatly impact the renter’s market in California. There is also the obvious need to understand any and all protected classes in order to avoid discriminatory behavior in your business practices. We will be sure to update our readers as soon as possible when there is a development.
For questions or clarifications, start a discussion in the comments or write to the author at: cody@adhischools.com
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Anyone involved in the real estate industry knows that interest rates are currently near historic lows, which makes sense—the government does not want to slow down spending in a sluggish economy. There
Anyone involved in the real estate industry knows that interest rates are currently near historic lows, which makes sense—the government does not want to slow down spending in a sluggish economy. There has been speculation for months that the Fed would raise rates (it has to happen eventually) based upon the health of different sectors of the economy. This speculative waiting was put to rest (at least for a moment) on Wednesday (4/27/16) when the Fed announced that it would not be raising its benchmark rate yet. The Fed wants its monetary policy to remain “accommodative, thereby supporting further improvement in labor market conditions”, providing continuing hope for the recovering housing market.
Although the Fed has not changed its rates, Freddie Mac’s Mortgage Rate Survey showed a jump from 3.59% to 3.66% from last week for the average 30-year fixed-rate mortgage. This is a climb from all of April, but no need for alarm. March had higher rates and February spent most of the time right around the 3.66% figure. Last year at this time the average rate on these loans was 3.68%. So disregard any alarmist articles or discussion about the significance of this rate jump.
So what does all of this rate talk mean for the housing market? Well, lower rates tend to free up investment. Some analysts have praised the Fed’s decision, noting that unemployment figures are not yet ideal and the low rate policies have been working. And although mortgage rates have climbed over the last week, they are far from high. We will keep an eye on this situation and report back with any updates, but for now rates do not appear to threaten the housing market.
For questions or clarifications, start a discussion in the comments section or contact the author at: cody@adhischools.com
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If you’re reading this, you’re probably interested in the real estate industry. Maybe you are considering getting your license or you’re a veteran REALTOR® pondering change. No matter the situation,
If you’re reading this, you’re probably interested in the real estate industry. Maybe you are considering getting your license or you’re a veteran REALTOR® pondering change. No matter the situation, anyone in the industry wants to know what competition and opportunity looks like in their area or an area they’re interested in operating in.
Most REALTORS® probably have a pretty good idea of where other REALTORS® work. Large states with large populations like California, Texas, Florida, and New York obviously have more REALTORS®—common sense. Some states (like Florida, again) also have a reputation for having a lot of REALTORS® compared to the overall population. We decided to look up some figures to see which states had the most REALTORS® per capita.
Check out the Top 10 rankings! States are ranked by the number of people per REALTOR® (so since Florida’s number is 133.74, there is one REALTOR® for every 133.74 people).
Florida— 133.74
Arizona— 161.31
Hawaii— 162.14
Nevada— 191.96
New Jersey— 205.53
Utah— 221.66
Idaho— 226.05
California— 229.44
Connecticut— 232.27
Colorado— 237.84
No surprise with the top 3 states—they were the top 3 in 2012 as well. But there are a few significant changes in rankings. Washington, D.C. was 4th in per capita REALTORS® in 2012, but now sits at 12th. Utah is a newcomer to the top 10, sitting at 6th. Idaho made the biggest jump in rankings within the top 10 since 2012, moving from 10th to 7th as the number of REALTORS® per capita there grew faster than Colorado, California, and Connecticut. And although some states did not make a big rankings jump, 8 of 10 states in the top 10 (all except for New Jersey and Connecticut) now have more REALTORS® per capita than they did in 2012.
Of the “Western” states, only New Mexico and Washington fell outside of the top half and 7 of the Top 10 are Western states: becoming a REALTOR® is clearly a more common career path in this part of the country than others.
These numbers can be viewed in a number of ways. Some states with dense REALTOR® populations may look like a difficult place to make a living as a REALTOR®, but that state may have a very active housing market that is drawing people to the industry. While there is no guarantee of success, California, for example, has a strong housing market with rising prices—a good REALTOR® can capitalize on the situation. Likewise, a state with very few REALTORS® per capita may represent a golden opportunity. Just consider New York: it is the only state that is in the top ten for total REALTORS® while being in the bottom half for density (ranked 34th, while having the 4th highest population in the U.S.). With a huge population and a relatively sparse REALTOR® population, it is easy to see why one would seek financial success and choose to become a REALTOR® in the state.
Any REALTOR® reading this knows that these statistics show how competitive or open a market is, not a guarantee of success or failure. At the end of the day these stats should serve as motivation to perform better, not as a deterrent from entering a great field.
For complete rankings, questions about methodology, etc. contact Cody at cody@adhischools.com
Sources:
https://theamericangenius.com/housing-news/report-density-of-realtors-in-each-u-s-state/
http://www.realtor.org/sites/default/files/reports/2016/membership/03-2016.pdf
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On the surface, solar panels appear to be a great selling feature for a home. The prospect of lower utility costs are appealing to everyone and many buyers love the idea of “going green”. Because solar
On the surface, solar panels appear to be a great selling feature for a home. The prospect of lower utility costs are appealing to everyone and many buyers love the idea of “going green”. Because solar panels are increasingly common in residential real estate, the professional REALTOR should be properly informed as to the impact these panels can have on a transaction. According to the Solar Energy Industries Association the number of homes and businesses with solar panels has exceeded 748,000 in the United States and growth is expected to continue, so this topic will only become more relevant.
Especially if you are taking real estate classes in Los Angeles you’re going to be dealing with houses with solar panels frequently and it’s important to know a few things once you are licensed.
It's important to note that the installation of solar panels on homes does not automatically equal an increase in value. In some instances solar panels can actually lower property value, even in areas that have high utility costs. The desirability of the panels is often determined by whether the panels are owned or leased. If the homeowner purchased the panels, there is evidence to suggest that the home could gain value (sometimes more than $15,000), because long-term utility bills are predictably lower and solar power is viewed as a property improvement.
However, solar leases are often viewed as less desirable. No-money-down solar lease offers have enticed some homeowners to agree to long term leases—sometimes upwards of 15 years. With the lowered bills and no upfront costs, this seems like a fiscally sound choice—and it very well may be for the original owner.
Yet problems can arise when the homeowner tries to sell their home with the leased panels. Potential buyers find themselves signing up for a solar lease with steep credit qualifications that could act as a deterrent. Although solar companies such as Clean Power Finance claim that 95% of the time the buyer either assumes the lease or the owner pays it off, that still leaves 5% of potential transactions where the looming costs or credit qualification issues break a deal. Many people simply do not want to assume the responsibilities of a deal they did not negotiate and may struggle to qualify for, particularly if they have an agent that views the lease as a poorly negotiated deal.
The result can be that a potential buyer may back out of a contract or demand that the seller pay off the lease before they leave. Homeowners with a time constraint like a job relocation may be forced to pay off a $15,000+ lease so they can close a sale and move on. These problems don’t arise on every property with leased panels, but it can happen to a substantial number of homeowners who initially thought they were improving their property. These owners optimistically invest in their homes, but when they decide to sell they find themselves in a position to lose money on their investment.
This is in no way an attempt to dissuade anyone from buying or leasing solar panels or agreeing to represent a seller in this situation. It is simply something to keep in mind: not every dollar spent is a dollar gained.
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Drones - also known as Unmanned Aircraft Systems (UAS) by the FAA - are being increasingly used for commercial purposes. Real estate professionals often want to use drones to improve their photography
Drones - also known as Unmanned Aircraft Systems (UAS) by the FAA - are being increasingly used for commercial purposes. Real estate professionals often want to use drones to improve their photography and videography - it’s undeniably sexy. Drones offer amazing visual perspective on property that would basically be impossible any other way.
I know many of our real estate school students see videos on YouTube of listings and wonder how they can get cool aerial shots like this on their listings.
It's important to remember that it is currently not legal to operate a UAS for commercial purposes without a Section 333 Waiver from the FAA. Here is what you need to know about these waivers and the concept of using drones for your business.
A pilot’s license is necessary for a Section 333. A broker can’t just buy a drone and fill out a form to get permission for commercial use.
You are allowed to hire someone with a Section 333 to operate a UAS for commercial purposes for you. If you really want aerial pictures of your listing, but do not want to go through the process of getting your own pilot’s license, just hire someone who already has permission from the FAA.
You can take steps to protect yourself. UAS operators can get insurance for their aircraft to limit liability. If you choose to contract a UAS operator, ask for proof of insurance. The National Association of Realtors also points out that you can also request that the operator “indemnify you against any actions, suits, damages, losses, costs and expenses” from the operation of the UAS. If the operator crashes the drone into someone’s house (or worse, into someone), you don’t want to be liable.
Penalties
Nearly all drones must be registered now, whether they will be used for recreational or commercial purposes. There are already steep fines in place if a drone is not registered.
The repercussions become much more serious when commercial usage is involved. Consider this case, where a company was fined $1,900,000 by the FAA for flying unregistered drones without permission in an allegedly unsafe manner. The implication is that the penalties will vary (unauthorized UAS usage in big cities with crowded air traffic will result in bigger fines than flying in a small suburb) but the FAA is serious about enforcement. Some in the commercial drone industry expect fines to typically fall in the $1,000-$10,000 range, which is significantly less than $1,900,000 but still a lot of money. The FAA website asks citizens to report crashed or suspicious drones to local law enforcement and there is no reason to believe threats of enforcing these laws are empty.
The bottom line for the real estate professional is to hire a company that can legally fly UAS for commercial purposes. If you don’t know what you're doing and fly illegally you could potentially hurt someone or damage property. Even if neither of these occur you could still be in serious trouble with the FAA. It just isn’t worth it.
New rules have been proposed and will likely come into effect soon. Follow the link if you intend on operating a UAS and want to see the potential changes coming.
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For tax, compensation and work hour requirements real estate salespeople have long been classified as independent contractors, not employees. It isn’t hard to see why brokers prefer this - they aren't
For tax, compensation and work hour requirements real estate salespeople have long been classified as independent contractors, not employees. It isn’t hard to see why brokers prefer this - they aren't required to reimburse for business expenses, provide health care benefits or pay the employer share of payroll taxes. It would cost brokers a great deal of money and completely change the real estate profession if agents weren’t contractors.
In a recent class-action lawsuit Bararsani v. Coldwell Banker (2015), the plaintiffs alleged they were misclassified as contractors when they should have been employees. Part of the rationale was that the broker exerted so much control over their day-to-day activities that they could not be contractors.
The case eventually settled outside of court in January, with the $4.5 million settlement to be split by approximately the 5,600 members of the suit. Before plaintiffs see any money the court awarded $1.5 million to the attorneys.
It’s important to remember that a settlement is not an admission of guilt or wrongdoing. Coldwell Banker maintains that they have done nothing wrong and will continue their business practices as before. This means no new employee classification for agents and no new benefits.
This challenge to current business practices is not just occurring in California. A similar case (Monell v. Boston Pads, LLC) was dismissed in Massachusetts and the real estate agents were confirmed to be contractors.
The Massachusetts Association of Realtors considered the Monell case to be a significant win for the real estate industry because brokers were not forced to change their business practices. Plus now they have a strong court ruling to support them. The Bararsani case is not as definitive a victory for those wishing to keep agents classified as independent contractors as a settlement was reached.
The overall issue of independent contractors vs employees is not going away. Uber Technologies, Inc. has found itself in numerous federal lawsuits over the issue (with an interesting emphasis on employment being determined by amount of control the employer exerts over the subordinate) that could end up impacting the real estate industry indirectly. Uber will eventually go through a jury trial to decide the classification of its drivers and if they are determined to be employees in a federal court, independent contractors all across the nation could find themselves in a stronger position to sue for employee status.
The Bararsani v. Coldwell Banker settlement may not be the last of this issue.
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I got my license in 2002 and have seen many real estate partnerships flourish and work well. I’ve also seen partnerships end in bitterness and hatred due to missed expectations and disappointment. One
I got my license in 2002 and have seen many real estate partnerships flourish and work well. I’ve also seen partnerships end in bitterness and hatred due to missed expectations and disappointment. One mentor of mine famously said “If partnerships were good God would have had one.”
With that being said, your chances of being successful can (not will) increase if you find the right partner or get on the right team. Everyone has heard the saying “two is better than one” and if you want to succeed, a team can help you in areas that you are naturally weak.
Part of the temptation associated with starting or joining a team is the perception that it is the path of least resistance. For the rookie agent, starting out on a team may mean that they will be fed with leads so they won’t have to prospect as hard. For the “rain-maker” or team owner, the allure is that they can somehow take themselves “out" of the business and everyone else will do the work for them. One person will handle all the CMA’s while another will show property for you while another will act as a transaction coordinator for your files.
I saw a YouTube video recently where a prominent real estate “coach” was speaking to a group of real estate agents about building a business. In the video he talked about having members of your staff all aspects of your business while you can be “in Mexico sipping a margarita on your phone saying keep up the good work team!”
This dangerous “get rich but do nothing” philosophy is a large part of why it has become so en vogue to form teams in the real estate business. It’s tempting to think about because it makes the real estate agent think that they can somehow delegate all of the heavy lifting to someone else and avoid working. This rarely works and is a recipe for disaster.
I would highly recommend that before you start or join a team you have very clear expectations of your role and the roles of other team members. Sometimes things are a lot easier to get into than get out of.
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Good REALTORS® are used to thinking about the Code of Ethics. Beyond the ethical guidance it provides, it is also a professional obligation. But what about the application of the Code of Ethics as it
Good REALTORS® are used to thinking about the Code of Ethics. Beyond the ethical guidance it provides, it is also a professional obligation. But what about the application of the Code of Ethics as it relates to social media? While the Code is typically very clear, it's application to social media can be ambiguous.
Between “private” accounts, character limits, and inexperience applying the code to online behavior, it is easy to forget the Code of Ethics or overlook some of its provisions. This could result in an ethics hearing or even a lawsuit. Keep the following rules in mind to avoid finding yourself in trouble over an easily preventable situation.
Assume everything you post is public.
It isn’t just the content you publicly post—whether it be to your Facebook wall, as a Tweet, or a comment on someone else’s public post—that you should be concerned about. Even private messages on a social media platform can come back to bite you, particularly if you choose to say something disparaging about another real estate professional or a client. Messages you meant to be private can be saved and shared with anyone. A quick screenshot of an old Facebook message can be a serious problem.
Give credit where credit is due—clearly.
Let’s say your close friend is also a real estate professional. You attend a broker's open and you decide to share it on social media. No biggie - you think it is an amazing opportunity and include the address. Maybe you post a picture of the property. You think nothing of it—you aren’t trying to steal the listing. A week later you receive notice of an ethics complaint, alleging you violated Article 12 of the Code of Conduct. Someone (perhaps your friend’s employer?) objected to you posting about the property without making it absolutely clear that you were not the listing agent and obtaining consent to advertise the property. While you may think you are being unnecessarily attacked for helping your friend, you cannot assume everyone will feel the same way. There are case interpretations of Article 12 at realtor.org covering similar situations. The simplest way to avoid this situation is to not make posts like this. But if you choose to, make it very clear who is listing the property and that you are not associated with the listing.
Don’t complain on social media either.
While it might be possible to find yourself in hot water over social media posts made with good intentions, it is definitely possible to run into trouble over negative or disparaging posts. Consider another hypothetical. You had a listing on a property that expired. The next day, your clients sign with a new agent. You have suspicions the new agent had solicited his or her services to your clients while your agreement was still active, but you have no way to prove it. Your former clients refuse to speak about the subject. Lacking evidence of an ethical violation you choose to not file a complaint . Instead you post a vague message on your personal Facebook page about the frustrations of your job and stolen clients. Maybe a friend or family member comments, asking if this is about the house you had not been able to sell. Perhaps another person comments about one of their experiences with a shady real estate agent. Your former client’s new agent finds out about this post from a friend (a realistic possibility, I’m sure you could think of a handful of potential common connections in a few seconds), obtains a screenshot, and files a complaint with the Professional Standards Committee alleging a violation of Article 15 of the NAR Code of Ethics. The agent claims that you are knowingly and recklessly making unsubstantiated false and misleading statements. The moral of the story: don’t complain about business on social media. Between clients, employers, and rival agents, someone can and will find something to be offended by. A perceived breach in contract or code of ethics could result in the loss of a client or even a job.
Cover your bases with personal accounts.
It is common knowledge that REALTORS® are required by the Code of Ethics to disclose their status as a REALTOR® when carrying out business. But what about on a personal social media account? If you keep your personal and professional accounts separate, you shouldn’t have any problems. But separation is key. If your friend shares a listing for their house that is on the market, “sharing” it further might be kind and helpful. But, as a real estate professional, you would then be required to make it clear that you are a REALTOR®, that you are employed by Employer X, and that this is not your listing. This might seem unnecessary (particularly if you have a relatively small number of friends on social media and aren’t operating a prominent account), but it is a far better option than a formal complaint when someone decides that you misrepresented yourself.
Keep private information private.
It is easy to let information slip in conversation. You tell a friend about a commission or a client that was trying to downsize after losing a job. While this might constitute a violation of the Code of Ethics, you are also unlikely to find yourself on the receiving end of a formal complaint. Talking about these topics on social media—regardless of whether or not you’re doing this in a private message, a public post, or a private group of some sort—is not just a violation: it’s a paper trail. You’re best off not violating the Code of Ethics (it’s in place for a reason). But you’re worst off leaving evidence of violation that you committed without malice or the desire to damage the reputation of another person. Leave private information out of social media.
Be smart—even if you come out of a Code of Ethics hearing unscathed, you will still have wasted your time and possibly damaged your reputation - your most important asset.
The few hypothetical situations in this post are realistic and just scratch the surface of what can be done on social media. Good intentions won’t prevent an ethics hearing. It’s common these days to reach for our phones and rant. Just remember - someone is always listening.
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I received this email from the Bureau of Real Estate and I wanted to share it with all of our stakeholders.
This is to inform you that all individuals who submit an application for a real estate license
I received this email from the Bureau of Real Estate and I wanted to share it with all of our stakeholders.
This is to inform you that all individuals who submit an application for a real estate license received on or after January 1, 2016 will no longer need to submit proof of legal presence in the United States.
On September 28, 2014, the Governor signed Senate Bill 1159 (Lara, Chapter 752, Statutes of 2014), which adds Section 135.5 to the Business & Professions Code (BPC), changing the legal presence requirements to obtain a real estate license. Current law requires an individual to provide proof of legal presence (proof of U.S. citizenship or legal alien status), in the United States in order to obtain a real estate license. SB 1159, which becomes effective on January 1, 2016, will remove the legal presence requirement from the application process. Applicants will still be required to provide a social security number or an individual taxpayer identification number for licensure. Please make appropriate changes to your materials and inform your students of the changes to the requirements for licensure.
What this will likely lead to is the elimination of the RE 205 form as well as the need to show either US Citizenship or the possession of a Alien Registration Card “Green Card”. We will update our processes as this date comes closer.
This isn’t the forum to discuss the politics of this, but I wanted to let you know of the upcoming change.
Best regards,
Kartik Subramaniam
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Time for a serious discussion for all you new agents out there. Starting a career in real estate is not like starting a business. A career in real estate sales is starting a business.
If this sounds
Time for a serious discussion for all you new agents out there. Starting a career in real estate is not like starting a business. A career in real estate sales is starting a business.
If this sounds daunting to you, don't worry. Upon close examination, you will see that the revenue that a real estate agent can make relative to the amount of investment necessary is amazing.
For a moment, let's compare real estate sales with other businesses like restaurants, clothing stores or most other businesses that you might think of.
Imagine how hard it is to own and operate a restaurant, for example. You have to purchase supplies, hire staff and deal with dozens of customers on a daily basis. Don't forget rent each and every month. You're also going to need a phone line and probably Internet access. Additionally, you don't get to take time off randomly like you would as a Realtor. You don't get to create your own schedule. You have to be there six to seven days a week from open to close.
Man... THAT'S HARD WORK.
Compare this with real estate sales:
You don't have to carry any inventory. Our inventory is out there ripe for us to sell! We have zero carrying costs and don't have to pay for the inventory (listings) that we have.
You don't have payroll to make until you can afford it. If you owned a restaurant, bar, clothing store, coffee shop or almost any other business, you would have payroll obligations from day one. In real estate sales, you hire an assistant when you can afford to.
You don't pay for an extra phone line or Internet access, your broker pays for this. Don’t kid yourself about how expensive business class telecommunications can be. Many businesses have a phone and Internet bill of several hundred dollars per month or even more!
You only deal with a small number of select clients unlike the volume game played by most other businesses. Think of something as simple as a coffee shop. How many customers does a coffee shop have to deal with each and every day? Potentially dozens or maybe even hundreds. Every single customer has to leave happy. In our real estate business a successful Realtor might only have to deal with 20-30 clients over the course of an entire year. Yes, this means that each deal comes with more pressure, but you don't have the constant pressure you would have in a higher volume business.
There are a ton of people who get into our business that come to the sad realization that buyers and sellers aren't going to beat down the doors of the newly licensed agent. This causes them to second guess the real estate sales business and dismiss it as "too difficult". They then start to blame the market.. "Hey nobody is buying anyway"... "Haven't you read the news lately? The market sucks..."
The truth is that as Realtors, we don't know how good we have it in our business. Even as a new agent, over 50% of the gross revenue generated is ours to keep. Strong, experienced Realtors often get to keep over 80-85% of the gross revenue.
Think of attorneys as a point of comparison. Attorneys typically bill out at $275-$450 per hour. Do you think that and average attorney working at a firm gets to keep that high of a percentage? Even half of it? No way. An associate at a law firm might be making $40-$50 per hour against the $250+ that they are billing.
Yes the market might be down and prices are lower than they were in many parts of the country but real estate sales can be one of the most most rewarding business out there. This is true from an economic perspective as well as the inner feelings of fulfillment that comes from helping clients navigate the complex world of real estate.
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I love the Internet. Who doesn’t?
However, ask yourself this question: Is the Internet a suitable substitute for an actual mentor?
Listening to our competitors, you would think so. They try to
I love the Internet. Who doesn’t?
However, ask yourself this question: Is the Internet a suitable substitute for an actual mentor?
Listening to our competitors, you would think so. They try to sell students on the idea that online classes are more effective in teaching than live classes. We completely disagree.
The Bureau of Real Estate requires that a student take 3 classes in order to qualify for a sales person license and 8 for a broker license. Each one of those courses has 45 hours of credit. The Bureau of Real Estate requires that for a home study course there be 10 pages per course hour in each textbook used by a real estate school. Each textbook, by statute, must be at least 450 pages. (45 hours x 10 pages = 450 pages) Now, ask yourself this: If you were to receive three (You need Real Estate Principles, Real Estate Practice, and an Elective course, remember?) 450 page books in the mail, would you have the patience and discipline to read each and every page line-by-line, absorb the material, take the exams online, and subsequently pass the state exam? Even if you made it through each book, how much do you think you would really learn from reading 1500 pages worth of course materials on your own? Taking an online course does not compare to the knowledge and guidance we have to offer through our live real estate program.
Why then are so many other real estate schools online only?
The answer to this question is probably a combination of several factors. First of all, from a business perspective live real estate courses are much more costly to run than a strictly online model. High quality instructors must be compensated for teaching and classroom space must be procured. These costs create a strong incentive for education companies to keep overhead to a minimum and do “online” only.
All of our instructors are licensed and active real estate agents, and most are brokers. Isn't this the caliber of educator you would prefer in helping you begin a new career in real estate?
Our program gives you the greatest chance at success. With the proper guidance and enough determination, every student can ultimately achieve their ambitions of becoming a licensed and successful real estate agent.
Call us at 888 768 5285 or visit us online at www.adhischools.com for more information.
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In this month’s Real Estate Magazine, the official publication of the California Association of Realtors, an article was published about the size of most real estate companies in California. To my surprise,
In this month’s Real Estate Magazine, the official publication of the California Association of Realtors, an article was published about the size of most real estate companies in California. To my surprise, over 86% of all real estate brokerages comprise four or fewer agents.
How does this statistic affect a new agent?
My recommendation has always been to affix your license to a market leader. In most cases, the market leader is going to be a large organization with fifty or more agents. Most of these larger firms have a systematic training program and scale built up.
This is especially important for a new licensee with very little to no real estate experience. When sitting across the negotiating table with a seller, it’s comforting to be able to lean on what your firm has done to help fill in some of the holes in your own experience.
Besides being able to lean on the accomplishments of your office, it’s also helpful to be in a large office if you can develop synergies within the organization. If you want to to pick up buyer leads by holding a property open, for example, it’s easier to do that when you have 100 agents to approach and hundreds of listing to choose from. Also, being in a large office allows you to learn from the mistakes and failures of colleagues that have been in your shoes before.
Check out this video of veteran Realtor, David Hurtado, talking about how he chose an office to work with when he was a new agent. Also, this video might help you decide on what office to work for.
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Just got this email from CAR. Glad our industry is keeping an eye on things.
UNDISCLOSED SHORT SALE PAYMENTS MAY BE ILLEGAL
Undisclosed payments in short sale transactions, especially those paid
Just got this email from CAR. Glad our industry is keeping an eye on things.
UNDISCLOSED SHORT SALE PAYMENTS MAY BE ILLEGAL
Undisclosed payments in short sale transactions, especially those paid outside of escrow, may violate the law, including RESPA, laws against loan fraud, and licensing laws. Short sale agents have increasingly reported to C.A.R. about requests for agents and their clients to pay junior lienholders and others, oftentimes outside of escrow.
One common scenario is when a short sale seller's senior lender authorizes a payment of $3,000, for example, to extinguish a junior lien, but the junior lender demands that the buyer pays an additional $9,000 outside of escrow. Not only would it be risky for a buyer to pay outside of escrow, but concealing this additional payment from a federally-insured senior lender may constitute loan fraud, which is a crime punishable by 30 years imprisonment plus a $1 million fine (18 U.S.C. section 1014). Furthermore, omitting from the HUD-1 Statement any charges paid at settlement by either a buyer or seller may violate the Real Estate Settlement Procedures Act (RESPA) (Appendix A to 24 C.F.R. Part 3500). Depending on the specific circumstances, carrying out these payment requests may also violate other laws and regulations, and an agent's participation in the scheme may be subject to license revocation by the Bureau of Real Estate or other disciplinary action.
Agents and their clients are encouraged to file any complaints regarding fraudulent activities to the proper authorities, including the following agencies:
Attorney General's Office
California Department of Justice
800-952-5225 Phone
http://ag.ca.gov/consumers/mailform.htm
Department of Housing and Urban Development (HUD)
HUD Office of Inspector General Hotline (GFI)
800-347-3735 Phone
http://www.hud.gov/offices/oig/hotline
Federal Bureau of Investigation (FBI)
202-324-3000 Phone
https://tips.fbi.gov
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I was reading the Los Angeles Times this morning and came across an interesting article entitled “How to keep your job during layoffs”The article advises that the following be done:1. Anticipate what
I was reading the Los Angeles Times this morning and came across an interesting article entitled “How to keep your job during layoffs”The article advises that the following be done:1. Anticipate what your company needs.2. Keep up your skills.3. Stay positiveI started to think that the above also applies to life as a real estate salesperson.Anticipating what your company needs is important to stay relevant as an employee. How does this apply to life as a real estate agent? What about anticipating what your clients need? This is very important. What if a new listing comes on near one of your listings that is less than yours? Price reduction anyone? What about a new listing that comes on the market for one of your buyers? Staying relevant and timely is important no matter what you do.Keeping up your skills is also important. When was the last time you took a class or went to a seminar? Many local associations give free classes for short sales and REO properties these days. Take advantage of these and keep learning. My mom always used to say ‘In order to earn more you have to LEARN more.’Finally, staying positive always helps no matter what you are doing. Click here for one of my favorite videos about this.
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A recent article I read in the Wall Street Journal talks about a common problem homeowners face when attempting to refinance their homes.Today, bankrate.com shows an average 30 year mortgage rate of 5.03%.
A recent article I read in the Wall Street Journal talks about a common problem homeowners face when attempting to refinance their homes.Today, bankrate.com shows an average 30 year mortgage rate of 5.03%. Pretty killer deal, right? This is likely much lower than the current rate on your home loan and you may be tempted to refinance.The issue that at least a quarter of all homeowners will have in attempting to refinance is a lack of equity due to declining home values. This isn't such a big surprise - everyone knows real estate values have dropped and many owe more on their homes than they are worth.But what I liked about this article is that it shed light on the fact that if people were actually able to refinance it would have a positive impact on the economy. The following is the chain of logic I had while I was reading this article.If people can refinance their home, it becomes more affordable.If more people can afford their homes, there are less foreclosures.If there are less foreclosures property values will stabilize.If property values stabilize, this could stabilize other facets of our economy.If other facets of our economy stabilize, our country may recover faster.This is kind of a chicken-and-the-egg scenario. You can't refinance because your home value has dropped, but if banks refinanced borrowers this may stabilize home values.Of course, the problem of declining home values isn't something that appeared out of thin air. It's a purge of the gluttony that the real estate industry partook in from 2003-2006. The Wall Street Journal article closed by reporting that the Obama administration is looking into whether or not FHA can help refinance homeowners that don't meet the traditional loan-to-value requirements necessary to refinance.
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One of the nice things about being in real estate is we are generally treated as independent contractors for tax purposes and work hour requirements.
Legally, of course, the California Bureau of Real
One of the nice things about being in real estate is we are generally treated as independent contractors for tax purposes and work hour requirements.
Legally, of course, the California Bureau of Real Estate always treats us as employees of the broker. From 30,000 feet this means that the broker must reasonably supervise any salespeople working for the broker and the broker is generally responsible for a wrong done by the salesperson while the salesperson is acting under the scope and course of employment.
However, for tax purposes and work hour requirements - what I am attempting to talk about in this article - salespersons can be treated as independent contractors not employees. This generally means:
1. Salespersons are independently licensed.
2. Compensation is based on sales made, not hours worked.
3. There is a written contract that states that the salesperson will be treated as an employee for tax purposes.
Recently, due to the California budget crisis, there was a proposal to have real estate brokers withhold 3% from commissions paid to salespeople.
Yesterday, we got word from CAR that this is not going to be the case.
Real estate agents that are taxed as independent contractors get to keep all the commissions due them and the brokers are not required to withhold this 3%!
The world is once again in balance!
PS: Check out our YouTube video of this here
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One of the nice things about being in real estate in that we are generally treated as independent contractors for tax purposes and work hour requirements. Notice I said
Of course, legally, the California
One of the nice things about being in real estate in that we are generally treated as independent contractors for tax purposes and work hour requirements. Notice I said
Of course, legally, the California Bureau of Real Estate always treats us as employees of the broker. From 30,000 feet this means that the broker must reasonably supervise any salespeople working for the broker and the broker is generally responsible for a wrong done by the salesperson while the salesperson is acting under the scope and course of employment.
However, for tax purposes and work hour requirements, salespersons can be treated as independent contractors. This generally means:
1. Salespersons are independently licensed.
2. Compensation is based on sales made, not hours worked.
3. There is a written contract that states that the salesperson will be treated as an employee for tax purposes.
Recently, due to the California budget crisis, there was a proposal to have real estate brokers withhold 3% from sales commissions.
Yesterday, we got word that
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I just got this email from our Government Affairs Director. Subject: IMPORTANT Message from NAR President Charles McMillan From: NAR_xxxxx_xxxxxxxx@realtors.org Date: Tue, 27 Oct 2009 12:24:19 -0400 TO:
I just got this email from our Government Affairs Director. Subject: IMPORTANT Message from NAR President Charles McMillan From: NAR_xxxxx_xxxxxxxx@realtors.org Date: Tue, 27 Oct 2009 12:24:19 -0400 TO: State and Local Association Presidents, Executive Officers, Government Affairs Directors, Communications Directors FROM: NAR President Charles McMillan, NAR Government Affairs Senior Vice President Jerry Giovaniello DATE: 27 October 2009 RE: Tax Credit Extension and Expansion The United States Senate is expected to vote, later today, on a bill to extend Unemployment Insurance benefits. This bill will contain the Dodd - Lieberman - Isakson Amendment to Extend and Expand the $8,000 First Time Homebuyer Tax Credit. The Extended and Expanded Tax Credit will contain the following provisions: Amount: $8,000 Eligibility: ALL HOME BUYERS (Step-up buyers will have to have lived in their current home for SEVEN* years to be eligible) Income Limits: $125,000 for single filers/$225,000 for joint filers Time Frame: December 1, 2009 to April 30, 2010 plus 60 Day extension if binding contract is in place by April 30, 2010 *The 7 year ownership requirement is designed to lower the "score" or cost of the tax credit. This is still open to change. The Congressional Budget Office is going to "score" the cost of 3 year and 5 year requirements. We are continuing to push for step-up buyers to be required be in their current home for three year period. NAR will be monitoring the progress and any potential changes to the bill. NAR will send out a notice when the legislation is voted on tonight--regardless of how late into the night or early into the morning the debate continues.********************Let's keep our fingers crossed that this passes! Would definitely help!
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I received an email from a student today asking if I thought he should work on a team as he starts his real estate career. This is an individual decision and is one that should not be taken lightly.One
I received an email from a student today asking if I thought he should work on a team as he starts his real estate career. This is an individual decision and is one that should not be taken lightly.One of our instructors, Chris Montague, started in the business and worked on a team with a top producer. He says that he learned sales skills and discipline that he would not have learned if he started on his own. I have uploaded his mentor Robert Adams' interview with us to YouTube. You can check it out hereI am blogging about this because I suspect that some of you may be considering working on a team as well. Before you make this decision, I would recommend reading this article that does a good job of pointing out the pros and cons of the team model.
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Owning a home is a big piece of the puzzle known as the American Dream. Despite this, there is a group of people who believe that owning a home is a bad decision no matter what the market is doing or
Owning a home is a big piece of the puzzle known as the American Dream. Despite this, there is a group of people who believe that owning a home is a bad decision no matter what the market is doing or no matter who you are.I had an agent that I used to work with that was consistently making over $300,000 per year and - rumor had it - didn't own a single piece of real estate. Not even his principal residence.People that maintain this position typically point to the fact that renters don't have to make repairs to a home and are free to move whenever they want. They also note that the responsibilty for paying for utilities, property taxes and insurance rests with the owner not the tenant.All this would be fine except for one fundamental point - control. When I first got into the real estate business my broker gave me an article about a woman that had been living in Newport Beach for years. Her rent started at $400.00 per month or thereabout. Over the years she found herself in a position where her rent had jumped up so much that she could no longer afford to live there. She was forced to move out of an area that she had planted roots in for much of her life. The irony of this story is that if she would have just bought the property - my recollection about this story is that she was in a position to do so at some point during her tenancy - it would have been completely paid off. Life changing decisions like "Should I rent or buy?" should not be taken lightly. I get that. I also understand that there is no one size fits all solution to anything.I just think it's tragic when we get in our own way.
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Jeff Davi is the current Real Estate Commissioner for the California Bureau of Real Estate. He is a licensed real estate broker and a graduate of St. Mary's College in Moraga.
The Real Estate Commissioner
Jeff Davi is the current Real Estate Commissioner for the California Bureau of Real Estate. He is a licensed real estate broker and a graduate of St. Mary's College in Moraga.
The Real Estate Commissioner is the head of the Bureau of Real Estate.
The DRE adds "Commissioner Davi previously served as a Director for the California Association of Realtors and President of the Monterey County Association of Realtors. He also served as president of the Economic Development Corporation of Monterey County, was co-founder of the Affordable Housing Steering Council of Monterey County and was on the founding board of directors of the Monterey County Visitor and Convention Bureau."
He was appointed on October 6, 2004.
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As part of our new website I had the good fortune of interviewing three groups of people recently. The first group was comprised of current Adhi students.The second group was a group of students who had
As part of our new website I had the good fortune of interviewing three groups of people recently. The first group was comprised of current Adhi students.The second group was a group of students who had taken classes with Adhi Schools and passed thie state exam within the last one to six weeks.The last group was comprised of industry veterans. A common theme in nearly all the interviews was that people taking the classes and in the real estate industry want to take control of their own destiny and put their future in their own hands.Stay tuned for the videos.
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Applying for Your Real Estate License: Easy Steps to Get Started
If you're gearing up to take your state exam or planning to schedule it soon, here's a quick guide to streamline your application process.
Applying for Your Real Estate License: Easy Steps to Get Started
If you're gearing up to take your state exam or planning to schedule it soon, here's a quick guide to streamline your application process. Let's make this easy and straightforward!
Quick Tip: Opt for eLicensing to apply—it's faster and less cumbersome than mailing forms and sending checks.
Here's How to Do It:
Set Up Your eLicensing Account:
Go to the eLicensing website.
Enter your Social Security number and date of birth to create your account.
Prepare for Success:
Make sure you have an account at Crash Course Online to ensure you pass the test on your first try.
Fill Out Your Application Online:
Just follow the online prompts and enter your details.
You'll need to upload these documents in PDF format:
Three certificates from our school.
Your completed RE237 fingerprint form.
Pay Your Fees:
Exam fee: $100
License fee: $350
Handy tip: Pay both fees at once during your application to speed up the process from passing your exam to getting your license.
Questions or Need Help?
Don't hesitate to call us at 888-768-5285 with any questions or if you need assistance!
This guide should help you navigate the application process smoothly and get you one step closer to your real estate license. Good luck!
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In order to get a real estate license, you have to take classes. We all know that. In order to get a brokers license, you could use a college degree to waive the two-year experience requirement. We
In order to get a real estate license, you have to take classes. We all know that. In order to get a brokers license, you could use a college degree to waive the two-year experience requirement. We also know that. What about if you have taken classes at a University overseas? The Department of Real Estate requires:"Courses must be completed at an institution of higher learning accredited by the Western Association of Schools and Colleges or by a comparable regional accrediting agency recognized by the United States Department of Education, or by a private real estate school which has had its courses approved by the California Real Estate Commissioner."If you have taken a course or have a degree from overseas the courses "completed through foreign institutions of higher learning must be evaluated by a foreign credentials evaluation service approved by the Department of Real Estate."Check out the form to use to submit the foreign transcripts here.Let me know if you have any questions!
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As a student of Adhi Schools, you are most likely getting your license for one of three reasons.1. You want to sell real estate full-time.2. You want to buy/sell your own property and want a commission
As a student of Adhi Schools, you are most likely getting your license for one of three reasons.1. You want to sell real estate full-time.2. You want to buy/sell your own property and want a commission for doing so.3. You want a part-time career option. With the economy being the way it is and unemployment numbers up you might be hesitant about your decision to enter our great business. Remember - greatness cannot grow where there is doubt! I wanted to share a few thoughts with you about what a down market actually means.For buyers of real estate:Buyers have more choices because of increased inventory.Sellers are more flexible on price and terms.For agents:Sellers are more realistic about where their properties need to be priced in order to bring a buyer.Commissions tend to be higher in percentage terms.For a new agent:Competition tends to be less as fewer new agents are getting into the business.Existing agents are dropping out of the business.Listings are easier to obtain as more owners are putting their properties on the market.Remember, treat this like a regular job and you will succeed. Questions or comments are welcome!
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I just got back from lunch with Brian Weide. Brian is with GEM Mortgage in Ontario, California and has been in the mortgage industry since October of 1978. He was branch manager of a Bristol Home Loans
I just got back from lunch with Brian Weide. Brian is with GEM Mortgage in Ontario, California and has been in the mortgage industry since October of 1978. He was branch manager of a Bristol Home Loans location for years and had his own mortgage company which he successfully operated. For the two years immediately preceding his entry into the mortgage industry Brian was a real estate agent. Brian says that the switch was made after he realized that he liked the "more direct, structured and numerical" aspect of originating loans.He explained to me the difference between refi clients and purchase clients. "Purchase clients tend to be more motivated to close than refi ones. They are making a large change in life - hopefully for the better. Sometimes, clients that are refinancing tend to be shopping around, there's not quite the motivation factor that there is with a purchase."I asked him if he had any advice for someone just starting out in the mortgage industry. "Be a social type person - Go to broker caravans. I go to Realtor meetings weekly and pass out cards. Don't abuse the freedom you are given. You have to work. Finally, determine your sphere of influence early. When you start out, this is likely where you will get loans."Remember that a real estate license in California also allows you to operate as a loan officer. I know many of you out there are looking to get into residential sales, but loan origination can also be very lucrative.
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The following is from the California Department of Real Estate's publication entitled "Guide to Unlicensed Assistants". This is valuable information as many of you may be considering working for an experienced
The following is from the California Department of Real Estate's publication entitled "Guide to Unlicensed Assistants". This is valuable information as many of you may be considering working for an experienced real estate salesperson as an apprentice or assistant prior to you actually obtaining a license.Here is an excerpt from the section on "Open Houses""With the principal’s consent, assisting licensees at an open house intended for the public by placing signs, greeting the public, providing factual information from or handing out preprinted materials prepared by or reviewed and approved for use by the licensee, or arranging appointments with the licensee. During the holding of an open house, only a licensee may engage in the following: show or exhibit the property, discuss terms and conditions of a possible sale, discuss other features of the property, such as its location, neighborhood or schools, or engage in any other conduct which is used, designed or structured for solicitation purposes with respect to the property."
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Robert Adams is a broker associate with Prudential California Realty. He previously was the broker/owner of a boutique real estate company "Adams and Associates" in Rancho Cucamonga, California. Adhi
Robert Adams is a broker associate with Prudential California Realty. He previously was the broker/owner of a boutique real estate company "Adams and Associates" in Rancho Cucamonga, California. Adhi Schools operating a real estate school location there from 2005-2006. Adams and Associates eventually merged into Prudential California Realty and Mr. Adams served as manager and broker of record there.Robert brings not only a unique ability to inspire and motivate - he's never left the trenches. I asked him five questions, and his responses are below.Q: How long have you been in real estate?A: 20 yearsQ: What attracted you to the business?A: I was working at a credit reporting company primarily looking at mortgage applications. I noticed that many of the applications showed real estate owned with values of $150,000 and balances of only $50,000 for example. This was a sign to me that owning or being around real estate was a great way to make money.Q: What is the maximum number of deals you have done in one year?A: 63Q: What does that translate into in terms of income?A: Probably somewhere around $500kQ: Any tips for a new agent?A: Before you get in stop and think about what you want out of the business. Do not sell yourself short, you can make as much as you like, be very committed. Don’t go in halfway, commit to it and you'll find it might be the best way of life you could have imagined!
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My sister was born with cerebral palsy, I am intimately familiar with those affected by physical disabilities. The Department of Real Estate has a form that you can use, if needed, to request special
My sister was born with cerebral palsy, I am intimately familiar with those affected by physical disabilities. The Department of Real Estate has a form that you can use, if needed, to request special accommodations during your state exam.Here is an excerpt from the form""In compliance with the Americans with Disabilities Act (ADA), Public Law 101-336, the Department of Real Estate (DRE) provides “reasonable accommodations” for examination applicants with disabilities. It is the applicant’s responsibility to notify DRE of alternative arrangements needed. DRE will provide special accommodations once your accommodation needs are documented. The information requested below and any documentation regarding your disability will be considered strictly confidential and will not be shared with any outside source without your express written permission."In 2006, I brought this to the attention of the California Department of Real Estate at an open forum and DRE executive Barbara Bigby assured me that the DRE is committed to providing examinees with accommodations in compliance with the Americans With Disabilities Act.ADHI Schools is committed to providing a world-class learning experience. Please let me know if we can help in any way!
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There are basically two ways to work for someone. You could be an independent contractor or an employee. When you are acting as an employee, the employer is generally liable for whatever you do while acting
There are basically two ways to work for someone. You could be an independent contractor or an employee. When you are acting as an employee, the employer is generally liable for whatever you do while acting in the scope and course of employment. This is known as the doctrine of respondent superior or, "let the master answer".In real estate, while typically treated as an independent contractor for tax and compensation purposes, salespeople are employees of the broker in the eyes of the law and Department of Real Estate.Therefore, if you are showing property and are involved in an accident, you (as well as the broker under respondent superior) would be liable if at fault. Again, this is because at the time of the accident you were acting in the scope and course of employment as a real estate agent employed by that broker.This is why the broker is listed on your car insurance policy as an "additional insured" also covered against claims made against the insurance up to the purchased limits.I wanted to blog about this because many of you are going to go on to great careers in the industry and I don't want you to think that a broker is being unreasonable by asking to be added as an additional insured on your car insurance. It is legitimate - and now you have the back story! In fact, the third page of the most recent California Association of Realtors Independent Contractor agreement says this explicitly. It even dictates the amount of coverage you must have. Many brokers require $100,000/$300,000.Any questions, give us a call or email!
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The following is an interview with Sophia Lopez, the administrative manager of ADHI Schools. She is a licensed real estate salesperson and has been with the company since 2005. Q: How did you end up working
The following is an interview with Sophia Lopez, the administrative manager of ADHI Schools. She is a licensed real estate salesperson and has been with the company since 2005. Q: How did you end up working with the school?A: I was working with another real estate company that was downsizing. Kartik taught a class there and ended up hiring me right away!Q: What do you think sets our school apart from others?A: Accessibility to our staff and the live element of our courses. Come check out one of our classes!Q: You have seen hundreds and hundreds of students come through our doors. What do you think separates successful students from unsuccessful ones?A: Determination and students that are persistent and eager to learn. Asking questions is a must.Q: Do you have any advice for those applying for the exam?A: Go to one of our crash courses and do questions and answers over and over again.Q: As an assistant to Kartik Subramaniam, you have seen real estate agents that succeed and those that are less successful. Any advice for new agents?A: Don't get discouraged and stay focused. Come to the office everyday. Something will pop up! Treat this business like a regular job.Sophia can be contacted at sophia@adhischools.com
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In order to obtain a real estate license in California, you must prove that you have legal presence in the United States. This basically means that you must be here legally. There are a few different
In order to obtain a real estate license in California, you must prove that you have legal presence in the United States. This basically means that you must be here legally. There are a few different ways to establish this. If you are a citizen, the most common ways are with either a birth certificate or a passport.If you are a legal alien, you would most likely establish this by providing a copy (front and back) of a "green card".There are a few more obscure ways of fulfilling this Department of Real Estate requirement. You can find them here:LinkPlease give us a call if you have any other questions!Good luck!
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These are as of September 2008 from the Department of Real Estate website
September 2008
This month
Last month
12 months ago
24 months ago
Licensee Population:
Brokers
152,832
152,854
149,189
139,822
Salespersons
384,753
386,510
394,005
374,462
Total Licensees
537,585
539,364
543,194
514,284
Real Estate Licenses Issued:
Original Broker
Original Broker
571
728
749
514,284
Original Salesperson
1,160
1,240
2,940
Examinations:
Broker Administered
999
914
842
Salesperson Administered
1,590
1,855
14,918
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According to the Department of Real Estate, the salespersons examination consists of the following topics with the following distribution of questions in percentage terms:Property Ownership and Land Use
According to the Department of Real Estate, the salespersons examination consists of the following topics with the following distribution of questions in percentage terms:Property Ownership and Land Use Controls and Regulations (approximately 18% of exam)Laws of Agency (approximately 12% of exam)Valuation and Market Analysis (approximately 12% of exam)Financing (approximately 13% of exam)Transfer of Property (approximately 9% of exam)Practice of Real Estate and Mandated Disclosures (approximately 24% of exam)Contracts (approximately 12% of exam)Notice that the "practice" section of the exam consists of about one-quarter of the test! (About 40 questions!)Study hard!
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Livescan fingerprinting is an electronic method of capturing and distributing fingerprints. The Department of Real Estate requires that all applicants for a salesperson or broker license have a Livescan
Livescan fingerprinting is an electronic method of capturing and distributing fingerprints. The Department of Real Estate requires that all applicants for a salesperson or broker license have a Livescan done and pass a background check by the Department of Justice and the FBI. In a previous blog, I talked about criminal history and a real estate license. Just a quick reminder that you have to have a Livescan done to get a license. The form that you would use to get this can be found hereAlso, a list of Livescan service providers can be found hereIt is my experience that a lot of the centers on that list have moved or are no longer in business, so I would call ahead and talk to someone before you go. Some of the centers require an appointment, so be sure to check them out before you drive out. As always, I am here to help. Contact me with any questions!Good luck!
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The Prudential Legend award is given to Prudential real estate agents that have achieved Chairman's Circle at least 5 times. Currently, Chairman's Circle is at least $300,000 in income or 70 residential
The Prudential Legend award is given to Prudential real estate agents that have achieved Chairman's Circle at least 5 times. Currently, Chairman's Circle is at least $300,000 in income or 70 residential units sold in one year. I had the opportunity of having breakfast with a Legend inductee Daniel Bryant, broker/owner of Prudential California Realty in Sierra Madre. Bryant has had offices in Monrovia, Pasadena and Sierra Madre. Formerly he has held senior positions at Bank of America and Cushman and Wakefield.On a recent Sunday morning I met Mr. Bryant for breakfast at the San Gabriel Country Club where he is a member. We talked about the state of the real estate market and what it takes to be successful.To paraphrase our conversation:Dan echoed something that I head often from brokers and managers about the business: "Treat this like a job. Show up at a certain time every day and go to work. You will get business."Send handwritten notes every day. These really make an impression.Market to people that you have existing relationships with. They know, trust and like you already. This is a great place for new agents to start looking to get business.Real estate is all local. Certain markets will get hit harder than others. Know yours - your clients are counting on you.Dan Bryant is always looking for new salespeople. He can be reached at danielbryant@earthlink.net.
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Ughh. The age old question. Real estate is all about image and flash, isn't it? I say hell no! As long as your car has the following you should be fine:Air conditioningHeatingKEPT CLEAN AT ALL TIMESThere
Ughh. The age old question. Real estate is all about image and flash, isn't it? I say hell no! As long as your car has the following you should be fine:Air conditioningHeatingKEPT CLEAN AT ALL TIMESThere is no need to put yourself in debt as you start this career. Some managers say "Go out and buy yourself that new car. The payment will make you work harder!" Is your manager/broker going to make your car payment for you until your deals close? Why put that undue pressure on yourself, especially in this soft market. Wear clean, well-pressed clothes. Pick up your phone. Return calls. Have a clean car. Most of all - DO YOUR JOB.
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Well, the short answer to this is - it depends. First of all, I am not the Department of Real Estate and have no idea whether or not the DRE will approve or deny YOUR specific circumstance. However,
Well, the short answer to this is - it depends. First of all, I am not the Department of Real Estate and have no idea whether or not the DRE will approve or deny YOUR specific circumstance. However, there are a few hard and fast rules that reign true:1. DISCLOSE, DISCLOSE, DISCLOSE! The DRE will find out out of you have omitted some portion of your background. This may be construed as attempting to obtain a license by fraud and could result in your license application being denied.2. If the DRE does grant you a license, they may require your supervising broker to sign something stating that they are aware of your past. 3. From the DRE Guide to Obtaining and Maintaining a license"In the event you have one or more offenses to report, please take extra care to disclose all actions and convictions regardless of how long ago they occurred, or whether or not a conviction has been expunged under Penal Code Section 1203.4, or a similar statute. The failure to disclose charges/convictions will result in substantial delays in the processing of your application and may also result in denial of the license application."So even things that were expunged from your record must be disclosed to the DRE.Bottom line: When in doubt, disclose!
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As some of you may know, I don't just teach the real estate courses. I am a real estate broker that has actively bought/sold/represented over the last 6+ years. The president of a large real estate company
As some of you may know, I don't just teach the real estate courses. I am a real estate broker that has actively bought/sold/represented over the last 6+ years. The president of a large real estate company called me up about 6 weeks ago with the following situation:"I have access to an REO portfolio with the opportunity to buy properties directly from asset managers. I need to know what price I should pay to make money and insulate myself from further market fluctuations."He gave me a list of properties and asked for my opinion on pricing. I told him what I thought and he ended up buying one of the properties at the recommended price and I relisted it for him. The property ended up selling within two days for almost full price! I went there today to see if the utilities were on and I found fifteen cards there from real estate agents! FIFTEEN people came and saw the property either with their buyers or previewed them for their buyer. It is in escrow now for 98% of list price and the buyer is putting 50% down! There is hope yet!
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Let's face it. Being on commission can be tough. Having the support of your family can be key as you start your career in real estate. Explain to them WHY you are choosing this career path and what you
Let's face it. Being on commission can be tough. Having the support of your family can be key as you start your career in real estate. Explain to them WHY you are choosing this career path and what you plan on doing so that you don't fail.Get as much training as you can in the beginning. Finally, most businesses fail because they don't have enough customers. What are you going to do to make sure you don't fall in this category?
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Upon finishing the real estate course at ADHI Schools, LLC many of our students ask, "How do I pick a real estate office to work for?" Definitely a complicated question.
The main thing to remember as
Upon finishing the real estate course at ADHI Schools, LLC many of our students ask, "How do I pick a real estate office to work for?" Definitely a complicated question.
The main thing to remember as a new agent is to pick an office that has a structured and scheduled training program. Don't be enticed by high commission splits (easier said than done - I know!) or empty promises. Learn the basics like how to fill out a contract, how to get clients and service them right.
Give it time - The money will show up if you stick with it and do a good job! When interviewing brokers be sure to ask for a copy of the WRITTEN training schedule. If the office doesn't have a WRITTEN program and structure chances are they are just "winging it" and you should beware.Give it time - The money will show up if you stick with it and do a good job! When interviewing brokers be sure to ask for a copy of the WRITTEN training schedule. If the office doesn't have a WRITTEN program and structure chances are they are just "winging it" and you should beware.
Also be advised that some offices do have desk fees. Technically desk fees are calculated by taking the total expenses of an office and dividing by the number of salespeople. As an example, if an office has total expenses of $20,000/mo and 100 agents, each agent may be required to pay $200 to offset the hard costs of running the office. This is a watered down example of how desk fees are calculated, but each broker has their own policy in terms of what is charged to the agent and when these fees are paid. Typically, you may expect to receive a slightly higher commission in this type of office because you are paying in each month, but again every office is different.
Brokers that are affiliated with a national franchise may also have something called an "off-the-top" fee. This ranges from 4-8 percent and is calculated before your commission split. As an example, if you were on a 60-40 commission split and there was a 5 percent off-the-top fee, 5 percent would be deducted from the gross commission prior to calculating your 60%.
Example: $10,000 gross commission.
- 500 (off-the-top/franchise fee)
-4,000 (40% to broker)
________
$5,500 (agent take home)
Check out this YouTube video explaining how real estate commissions are paid.
Got questions about a certain office or what they are offering? Call our office today at 888 768 5285. We'll walk you through it. Or better yet, call us for recommendations. We'll lead you in the right direction!
Love,
Kartik
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If you are a licensed attorney in California you are exempt from the college-level course requirements in order to obtain a real estate salesperson or California brokers license.
In other words, you
If you are a licensed attorney in California you are exempt from the college-level course requirements in order to obtain a real estate salesperson or California brokers license.
In other words, you can pop right into the sales license exam without needing to complete Real Estate Principles, Real Estate Practice, or the elective classes that are normally required. Evidence of admission to practice Law in California must be furnished, such as a photocopy of both sides of a California State Bar membership card.
However, the requirements for an attorney to qualify to take the broker exam are different. If you are a licensed attorney in California, you must have two years full-time licensed sales experience within the last five years or have at least two years real estate related experience within the last five years related to your law practice. Before applying for the broker exam, licensed attorneys will need to submit a RE 227 Equivalent Experience Verification document form outlying this experience along with their brokerexam or broker exam/license combination application.
ADHI Schools has had many licensed attorneys in California take our program and obtain either a sales or broker license.
By the way, nothing waives the requirements for either real estate exam itself. All real estate license applicants regardless of experience or education must pass the state exam for either license.
One last tip - you can't have both the sales and broker license at the same time in California - it's one or the other.
Got questions? Call ADHI Schools, LLC at 888 768 5285 or visit adhischools.com for more information!
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