What Business am I Really in?

Misconception

From the outside looking in, most aspiring real estate agents see the nice cars and luxury homes, they’ve watched HGTV and enter into the real estate industry a bit blinded.

If you would’ve asked me 2 years ago what industry I’m in, I likely would’ve replied, "Real estate is a service based business, lead with contribution.” While leading with contribution is never bad advice, I would have to disagree with real estate business being “service based”.

What Business am I Really In?

Agents provide countless services to clients, yes. However on the backend, the chaos that goes on behind the scenes to keep the pipeline consistently filled is vital sales work.

All of the tactics to cultivate new leads from sites like realtor.com, to probate lists, expired listings, and for-sale-by-owners— I’d argue that we exist in a competitive sales industry.

The Boutique vs The Wolf

Take your thinking from a small boutique to The Wolf of Wall Street. (If you haven’t seen the Wolf of Wall Street as a salesperson, you’re missing out) The small boutique takes great care of anyone who walks into the store. The customer purchases their items and then leaves, and may never return.

In real estate, this is the agent who keeps their business a secret, they sell to their SOI once or twice a year and is probably looking for a part time job. Not to pick on this hypothetical real estate agent, we’ve all been there. But for a lasting career you may want to shift to Wolf-like thinking.

The Way of the Wolf

The Wolf of Wall Street cold calls, uses strategies to move the call along and most importantly the wolf, Jordan Belfort is aggressive.

Minus the craziness of the storyline, he was a relentless salesman. He consistently grew his skill set and thus grew his business. He was able to teach his team his straight-line sales method, and drastically increase their sales.

So my advice is to not only work on your service to clients, but for your business’ sake become aggressive this year with making calls and spreading the word about real estate.

What I Want you to Take From This

Get on social media, create a yelp page, update your Google business presence. All of these things are free by the way.

Be proactive. And watch The Wolf of Wall Street if you’re into inappropriate yet professionally prevailing movies. You’ll learn a thing or two and laugh simultaneously.

Also, check out Jordan Belfort’s book Way of the Wolf. He goes deep into his sales methods, tonality, body language and other beneficial sales skills to work on if you’re in the business of working with other people.

Thanks for reading!

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What is Earnest Money?

Earnest Money Deposits

In a real estate transaction, you can expect some out of pocket expenses to take care. These are the expenses that are usually paid prior to closing. The list is long so I will cover that subject in another blog. -The main expense I want to cover is earnest money. 

What is earnest money?

Earnest money is a good faith deposit that shows the seller you are serious about the purchase of their home. This is a negotiable deposit (buyers have the freedom to offer the amount they want). But in my experience, it typically varies between 1-3% of the price of the home. I urge my buyers to arm themselves with a generous EMD offer IF the home is exactly what they are looking for. The higher the EMD, the better the chances of you locking that contract in.

I do believe buyers often forget that the home belongs to the seller. By taking the home off of the market, the seller is risking the opportunity of getting their home sold if the buyer isn’t serious. EMDs balance out that risk and makes the offer competitive. 

Is it required?

Offering an earnest money deposit is completely up to the buyer. The amount of money offered is also up to the buyer, however you want to do this with strategy. Schedule a call with me and let’s talk about how to position yourself as the obvious choice by offering the seller earnest money and other nuances that will win you the home of your dreams!

What are the benefits of Earnest Money?

Buyers:

• Backing your offer with cash shows the seller that you are serious and you have liquidity

• It gives you “skin in the game” or equity

• It helps you beat out the other buyers who are not prepared to offer earnest money

Sellers:

• Accepting earnest money will protect you against any time lost and damages or fees associated with a deal that went wrong (It happens)

• It solidifies your buyer; You can definitely count on your buyer to show up to the closing table with skin in the game

• It goes without saying but, you’re getting paid! This deposit goes straight into escrow, but at the point of accepting an EMD, if everything goes right, you only have until closing to reap the reward of getting your home sold and everything that comes with it.

Closing

I know that in Real Estate there are so many terms with so many similar meanings that it can be confusing. Earnest money is one of the real estate vocabulary words you will definitely run into when purchasing a home so I hope this helps you get a better understanding of what earnest money is and how it works!

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Home Inspections

What are they and is it necessary?

When entering into a purchase agreement to buy a home, it’s in your best interest to book a home inspection. Homes are like us in a way; we never really know exactly what is wrong with our health until we see a physician. Well, the same goes for homes. Like us, homes have a past of their own and whether or not the owner is aware, homes age. They require an inspection every so often, so as a new home buyer you want to be sure to make the inspection a priority. 

What is a home inspection? 

A home inspection is a visual examination, performed by a certified professional that focuses on the physical structure and systems of the home starting  from the roof down to the foundation.

Inspectors examine:

• Installation

• Maintenance

• Safety

• Performance

What are the defects?

The list of items that inspectors examine is never-ending and falls into multiple categories so I will not name them all here. But the items to be inspected will be categorized by its level of defect. These levels include:

1. Acceptable

2. Material Defect

3. Major Defect

4. Minor Defect

5. Safety Hazards

6. Not Inspected

7. Cosmetic Imperfection

8. Not present

Keep your eyes open for major defects, safety hazards and not present. 

When do I need to have an inspection?

There’s no wrong time to do an inspection. If you are a homeowner, you should consider an inspection every 3-7 years in my opinion, because certain appliances (with a shorter life expectancy) may need maintenance within that time frame. 

Still, consult with your inspector about this to get a sure answer for your home specifically. Also sellers, if you are looking to sell your home, this is a great time to have an inspection because you want to know what to expect when your offers start rolling in. If something needs repairing, will your buyer want compensation of some sort? Are you willing to make repairs to sell at top dollar? There is a lot to think about here. 

Next buyers, you will typically have your inspection after signing an agreement to purchase. You may agree to purchase the home with a contingency for inspection. That means, within the bounds of your agreement, you could potentially back out of the purchase if the inspection comes back unfavorable to you. 

Bad Inspections

In real estate, sometimes the inspection ACTUALLY DOES come back unfavorable. A client of mine experienced this and ended up passing on a home with major plumbing issues on an investment property. It was painful, but thank God for the inspection or he would have been stuck in a bad deal. 

Bad Inspection, Now what!?

There are a few things you can do if your inspection has major defects. You can,

1. Cancel your contract, like I mentioned earlier. As long as you are within the bounds of your contract, you should be able to exit without penalty, and with retained earnest money  

2. Request sellers make repairs prior to closing. This is an option but keep in mind that the seller is likely to “repair” the home at the lowest possible cost to them 

3. Negotiate the price down, figure out how much each repair costs and deduct the cost of repairs from your offer price

4. Negotiate closing costs, have your seller contribute the total cost of repairs (or a percentage, however you structure your contract) to your closing costs credit

5. Buy the home, repair it on your own dime. It depends on whether or not it's worth it to you.

Closing

In the state of Georgia, home inspections are not required by law; however, most mortgage lenders require an inspection. If you choose to use cash, I cannot stress how much I recommend having the inspection regardless. You never know what home has underlying issues until you inspect it.

Contact Brittany

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