RealtyCast Global Episode 1 - Purchasing Property in Portugal with Antonio Barbosa

RealtyCast Global #1: Purchasing Property in Portugal with Antonio Barbosa

Welcome to the premier of RealtyCast Global – a global connection to all things real estate, hosted by Hugh Gilliam, president of Global Property Pros. During this podcast feature, Hugh discusses the tips, tricks, and benefits of moving to Portugal with industry veteran Antonio Barbosa of Infinite Solutions. Whether you are a real estate agent with a client looking to purchase property in Portugal or a property buyer seeking advice on the steps to take, you don’t want to miss this discussion!

For real estate agents looking to expand their business internationally, expose existing listings to a global pool of buyers, and connect with new clients, check out Global Property Pros

For Property Buyers & Sellers seeking assistance in the international market, check out RealtyHive’s property marketing solutions.


About the guest – Antonio Barbosa:

António Barbosa is a REALTOR® living in Portugal and with more than 20 years of experience in Real Estate. He will tell you that he doesn’t sell homes; He fulfills lifestyle dreams. He’s a charming man with the most disarming smile who makes friends wherever he goes. If you are not his friend, it’s because he hasn’t met you yet!

He prides himself in being part of the decision of more than 500 families making Portugal their new home. In addition, He considers his biggest achievements in life the personal and business relationships he built, which led to long-lasting friendships not only with his esteemed clients but also amongst his distinguished colleagues!!!

He’s happiest helping people to find a home or wealth investment property in Portugal or worldwide. His company name is “Infinite Solutions”, and it’s a perfect name because he’s not problem-oriented, he’s all about solutions.  

He’s also a world traveler and foodie, so if you need a solution of where to go for dinner, on vacation, or where to buy your next lifestyle property, he’s your person! He speaks fluent Portuguese, English, and Spanish.

Antonio is a proud Member of FIABCI-USA as well as NAR® and holds the CRS® / CIPS® and ABR® designations.

About your host – Hugh Gilliam:

Hugh Gilliam co-owned a national transportation company, created a land development business, and worked as a general contractor in residential and commercial construction for over two decades. Hugh also co-founded an international distribution company and successfully negotiated and contracted with 135 sales representatives in the United States, Canada, France, Brazil, Japan, and the Netherlands.

Today, Mr. Gilliam is affiliated with RealtyHive, LLC where he serves as Director of International Real Estate and President of Global Property Pros. His duties include involvement in commercial and residential transactions, plus promoting marketing systems and lead generation platforms.

He is also co-founder of the luxury digital magazine, DOORWAYS INTERNATIONAL, powered by RealtyHive, which serves as a platform for Brokers and Buyers throughout 70 countries.

Hugh’s Designations Include:

  • Certified Luxury Home Marketing Specialist
  • Certified Distressed Property Export
  • Certified International Property Specialist
  • Certified International Investment & Immigration Specialist
  • Transnational Referral Certification

Hugh’s Memberships Include:

  • Georgia Association of REALTORS
  • National Association of REALTORS
  • International Real Estate Federation (FIABCI-USA)
  • Asian Real Estate Association of America

How to Sell a House as an Owner in Wisconsin?

Selling your home can be surprisingly time-consuming and emotionally challenging, especially when you are doing it for the first time, or without the assistance of a real estate agent.

That is because you have to put in a lot of extra effort to make up for going completely Realtor-free. This includes exploring everything by yourself – the legalities, the processes, and even the listing platforms.  

With the right insights, you can make the selling process a lot more fun and much less expensive. Want to know how? Here is a comprehensive guide on selling your house in Wisconsin.

For Sale By Owner Guide for Wisconsin

Step 1: The Basics of Selling a House in Wisconsin

Selling your house is so much more than putting a “for sale” sign on your lawn. It comes with a learning curve that requires you to address many legalities and information that can eventually help you avoid costly mistakes. 

However, before exploring them, let’s start with the basics and give you an overview of what selling a home looks like in Wisconsin.

So, let us start by assessing your situation and determining what works for you – selling FSBO or working with an agent.

a) Pros and Cons of going FSBO (For Sale By Owner):

Now that you have taken it upon yourself to sell your house, you should know what you are getting yourself into.

ProsCons
By listing your property as For Sale By Owner, you save yourself the commission you will otherwise have to pay an agent in Wisconsin, which is an average of 5.93%.By going 100 percent relator-free, you will potentially receive fewer offers. Plus, if your property is in a remote location, you may end up selling your home for a lot less in much longer of a timeframe.
As a seller, you will have complete control over the listing and marketing strategies. It means you get to decide where you will list, and how you will market.Marketing efforts require time, hard work, and money, which can be a little overwhelming for a lot of first-time buyers.
When you list as FSBO, you also have control over the showing schedule and open houses.Managing a listing can be painstaking. We mean, imagine answering calls, scheduling, showing, and coordinating open houses all at the same time!
You will be on your schedule and take out time to find the perfect buyerYou may still have to pay commission to the buyer’s agent as 88 percent of buyers in the United States purchase their home through a real estate agent or broker. Source

b) Pros and Cons of Working with an Agent:

ProsCons
An agent will handle all the legal matters for you, listing your property in the local Multiple Listing Service (MLS), signage & possibly some additional marketing.You will have to pay the Realtor a commission for their services. The commission can go as much as 5.81% of the total sale price in Wisconsin.
Hiring an agent will save you a lot of time and energy. They will handle the clients and schedule the showings as well.Listing with a Realtor means that you will have to work around your Realtor’s timeline, which could mean lag time from when an offer is presented to when you hear about it. Or, if your Realtor is eager to sell, he might pressure you to reduce the list price to something less than what you were hoping for so that he can make a sale.
You will save yourself a lot of time and energy by hiring a Realtor – be it in terms of handling clients or scheduling showings.

Are you wondering how you can avoid this long list of cons? Or at least alleviate some of them? Well, RealtyHive can surely help you with that. 

If you wish to sell FSBO and do not know where to begin with your marketing efforts, we can help and guide you to more offers and a successful sale.

Moreover, if you are working with an agent and feel that they are not doing enough or that you’d like to see more activity on your property for sale, we’ve got your back there as well. We can work with your agent towards getting more offers, and your property off the market as soon as possible. 

And, if this isn’t enough, we can even feature your property in one of our very successful Time-Limited Events. This range-style pricing creates a sense of urgency, triggering the buying impulse, hence, leading to more buyer interest, more offers, and a higher final sales price!

Plus, we even offer cashback through our Cashifyd feature to the buyer at closing, enticing them even more to place an offer! But, don’t worry; this is all paid for by the Buyer’s Agent. Sounds like a win-win situation to us; what about you? 

Click here to learn more about RealtyHive and our offerings.

c) Do you have to have an attorney or a real estate agent to sell your house in Wisconsin?

Technically speaking, the answer is no. Unlike in few other states, there aren’t any legal provisions in Wisconsin that emphasize or even mention the mandatory role of a real estate agent in selling a property. Likewise, there are no provisions provided by law for an attorney as well.

You don’t “need” a real estate agent to sell your home. You can do it yourself with exemplary dedication and the right action plan.

However, the same cannot be said for an attorney. During your home selling journey, there will be times when you will have to involve an attorney. That’s because an attorney is the only person if you aren’t working with a Real Estate agent that can:

  • review the buyer’s offer to purchase
  • draft your counter-offer or make amendments to existing offers
  • determine the closing cost
  • prepare a deed and other documents required at the time of closing
  • ensure that the buyer meets all their legal obligations
  • collect the agreed-upon money at the time of closing
  • assist you on all legal fronts – with conflicts and even questions

Reference: Link

d) What legal documents should you have before putting your house on the market?

Here are a few documents you should have before you sell your house. Having these documents readily available will not only help you list your home quickly in Wisconsin but will also help you dodge hiccups in the later stages.

  •  A plan or survey of your property
  • Either a deed or your mortgage agreement
  • The most recent real estate tax bill
  • Condominium documents, if your home is a condominium
  • Homeowner association rules and fee schedule (if applicable)
  • Real estate condition report

e) What are some disclosures that you need to make before putting your house on sale?

Disclosures are pretty crucial when selling a house. While you may be tempted to sell your home ‘as-is’ – without any disclosures, failing to report specific issues can have legal repercussions on you later. Plus, it may even derail your sale.

Reference: Link

In Wisconsin, all the disclosures must be presented before the buyer on what is known as a “real estate condition report.”

As the name suggests, this document reports your property’s condition, informs buyers about the existing problems, and may eventually decide your house’s market value.

So, in a nutshell, having an excellent real estate condition report is not only a mandatory provision but is crucial if you want to sell high in the state of Wisconsin.

Here are some disclosures that have to be on your report:

  1. Structural Defects: The seller must disclose the existing defects on the property’s significant elements; you can define significant elements as:
  • Something that can alter your property value
  •  Something that poses a health or safety risk to future inhabitants
  • Something that may shorten the lifespan of the listed property

Reference: Link

2. Legal Issues: You need to disclose the persisting legal issues of your property (if any) in the report. It can include but is not limited to property line disputes, shared well agreements, encumbrances, etc.

For more info, you can read this link.

Besides the disclosures mentioned above, here are some other disclosures necessary according to the state of Wisconsin’s: 

  • A disclosure that your house was constructed before 1978.
  • Disclosing whether or not there have been any incidents of lead-based paint hazards in your house in the past. If so, you will even have to provide the inspection report on the same as a disclosure in the report.

f) What are your rights as a seller in Wisconsin?

Now that we have talked about your legal obligations, let us also address your rights as a seller in Wisconsin.

  • As a seller, you are free to list, advertise, get your property inspected, and put a reasonable price on it.
  •  As a seller, you can set some parameters for potential buyers before they make a purchase.  For example, a seller can demand a certain deposit amount before closing a deal or before the buyer’s mortgage loan verification.
  • As a home seller, you have the right to either accept or reject an offer on legitimate grounds. These can be:
    • The offered price was low.
    •  The prospect has an unstable financial situation.
    • You changed your mind about selling your house.

Reference: Link

g) What are the costs involved in selling a home in Wisconsin?

It is a no-brainer that selling a home comes with considerable expenses. So you must be aware of these costs before listing your property on the market.

They are:

  1. Title Insurance:  This insurance is a document that protects buyers from claims against their ownership of the property. As per Wisconsin’s law, this insurance has to be handled by the home seller before the closing of a sale. This document protects buyers from ownership problems like fraud, court judgment, unpaid taxes, and forgery.
    Reference:
  2. Transfer Tax: The cost that the “grantor” or seller must bear for transferring the property title. The state of Wisconsin charges the transfer tax based on the sale price. They charge at a rate of $ 0.3 for every $100 (or fraction thereof) of the purchase price. Additionally, you may be responsible for local transfer taxes that are decided by the local authorities.
  3. Costs Associated with Survey Issues or Remedying Title: This cost is circumstantial. It incurs only when issues are surrounding the title or the survey of your property. It bears an attorney’s total cost (for advice plus resolution) if any such problem occurs. 
  4. Municipal/Local Government costs: These are the localized costs you need to pay when you successfully make a sale in Wisconsin. These may include but aren’t limited to stamp taxes, recording fees, or other fees imposed by the county, city, or town.
  5. Attorney fees: While you may want to dodge any extra costs associated with selling your house, attorney fees will be something you won’t be able to avoid. Even though you may not need an attorney during the whole selling process, they are essential for making deeds that close all your real estate interactions. 
  6. Fees associated with a Realtor/marketing platform/or auction website: If you want your Wisconsin home to be off the market quickly, these costs are somewhat inevitable.

But why do you have to pay?

Realtor: As a private seller, you will have to pay realtors on a few fronts, be it for their assistance in listing your property on an MLS or for their help at the closing. 

These fees are fair as they ensure a smooth selling process and a quick closing for your home.

Marketing platforms much like RealtyHive can help your property gain visibility and traction with their various campaigns and events. 

Investing in such marketing platforms can help you reach out to potential clients and get qualified leads. Thus, helping you land more offers. Auction Websites: With online auctions, and their time-bound approach, you can attract many buyers and shorten your sales timeline. And if things go well, you can even get an excellent price on your home!

Step 2: Making preliminary preparations

Now that you have a clearer picture of the legal considerations and the basics of selling a house in Wisconsin, it is time to strategize and get things done to get the best offers.

a. Deciding when to sell

There is no specific season that’s best for selling a house in Wisconsin – wrong!

If you look at the stats provided by WRA, you will understand that there are certain months during which Wisconsin’s real estate market booms both in terms of the number of sales and the median selling prices.

Understanding these Wisconsin local market trends and timing your home sale accordingly can make or break how quickly your house will sell. And sometimes, it can even pay dividends.

RegionThe month with the greatest number of salesThe month with the highest price
North Region

Ashland, Barron, Bayfield, Burnett, Douglas, Florence, Forest, Iron, Langlade, Lincoln, Oneida, Polk, Price, Rusk, Sawyer, Taylor, Vilas, and Washburn
AugustAugust
Central Region

Adams, Clark, Juneau, Marathon, Marquette, Portage, Waushara, and Wood
JuneAugust
North-East RegionJulyAugust
Brown, Calumet, Door, Fond du Lac, Green Lake, Kewaunee, Manitowoc, Marinette, Menominee, Oconto, Outagamie, Shawano, Waupaca, and Winnebago
South-Central Region

Columbia, Crawford, Dane, Dodge, Grant, Green, Iowa, Jefferson, Lafayette, Richland, Rock and Sauk
JuneJune
South-East Region

Kenosha, Milwaukee, Ozaukee, Racine, Sheboygan, Walworth, Washington, Waukesha
JuneJune
West Region

Buffalo, Chippewa, Dunn, Eau Claire, Jackson, La Crosse, Monroe, Pepin, Pierce, St. Croix, Trempealeau, Vernon
JuneJune

After evaluating the data of Wisconsin housing statistics, it is very evident that the best months for putting your house up for sale are May, June, and August.

You can even find information specifically on your county here if you want to study your real estate thoroughly. This link will fetch you all the relevant data and help you set a timeline for your sale.

b. Pricing your house

If you do not know what your house is worth in the real estate market, the chances of your success as a private seller are pretty slim. 

As important as it is to price your home correctly, it is not always the easiest.

Homes that are listed at far too high of a price often sit longer in the market. Due to this, sellers tend to lower the listed price multiple times to find a suitor. 

However, this doesn’t work well the other way round either. If you list your house below the market value, you won’t always make a profitable sale, even if you receive tons of offers.

So, what to do? Price your home correctly!

How? Well, usually, when real estate agents are in the picture, they are the ones that recommend your house’s value and its potential selling price. However, as a private seller, you do not have that luxury. So, in that case, you have two options:

Either you hire a surveyor to get an unbiased opinion on your property’s price, or you determine the price of your home with a “comparative market analysis.”

Comparative market research gauges your property’s value by comparing it with other properties that were on sale in the same neighbourhood in the last six months. Although essential, location isn’t the sole parameter of this analysis.

Here are five easy steps to do comparative market research for your Wisconsin property

  1. Location and time: Find the prices of properties that have been listed/sold in the last 6-months within a quarter to half a mile radius from yours. If you have no idea where you would find such information, you can always visit RealtyHive’s listings search tool to find properties in Wisconsin.
  2. Pay attention to details: Once done, shortlist properties in terms of location and screen homes that bear similarities to yours; this can be in terms of land size, age, interiors, etc.
  3. Do some digging:  For a more accurate comparison, screen houses that have been off the market for the past six months. Then, compare the original listing prices and selling prices of all these houses. Next, find any withdrawn or expired listings in your area (listing agreements that ran without a deal). Finally, if there have been any, find out the reason behind the withdrawal/expired listings. It will help you evaluate what not to do to sell your home.
  4. Analyze: Now that you have gathered all the relevant data, it is time to analyze it as per market conditions. Once you do that, you will know which listed property/properties are closest to yours.
  5. Price your home: Take a 10 percent variance and decide your optimum price. While doing so, always remember to leave room for negotiations.

    Reference: Link

c. Maximizing Your Home’s Value

To secure the best offer for your home, you will have to make it look presentable. Even though this part requires manual labour, it is the most rewarding part of the whole selling process. 

To make your home presentable, start by cleaning, decluttering, and then moving your belongings to storage. 

We also recommend considering cosmetic repairs so that your home looks more presentable to your potential buyers. 

Quick fixes also help to ace the aesthetic game. For this, we advise you to switch dim bulbs for brighter ones and replace old window treatments to make your house bright, airy, and open.

If you have the funds, you can even get the rooms in your house staged with rental furniture to attract more customers.

Apart from maximizing your property’s value, even get your pre-sale home inspection done during this time to shorten your selling timeline.

Note: Try avoiding heavy repairs and renovations as they are time-consuming. However, if such repairs add significant value to your home, you can get them done once you calibrate their feasibility from a financial standpoint.

d. Clicking Amazing Pictures of Your Property

As buyers are doing online research more than ever before, it’s imperative that your listing makes a lasting impact on anyone who comes across it.

And, needless to say, nothing makes a listing more attractive than multiple high-quality pictures. No, seriously, it has been observed that homes ($200,000 to $ 1 million range) that include high-quality photography sell for $3000-$11,000 more.

Plus, think about it, when you go online to buy something, you click on products that please the eye. So, it only makes sense to entice buyers with amazing pictures.

  •  Use only the latest smartphones with fantastic camera quality to click pictures. If you do not have the newest model or your phone camera is below par, stick to a professional camera. If you do not have one, borrow or rent one. If you have the budget, we highly recommend hiring an experienced real estate photographer as professional images can help you sell 39% closer to your original requested price.
  • Don’t forget to use wide-angle lenses to make your space look big and airy.
  • Post more photos on the listing websites. Homes with more photos sell faster. A home with one photo spends 70 days on the market; however, a home with 20 plus photos spends only 32 days on the market on an average. 
  • Click aerial pictures or get drone footage of your house. Houses that are listed with them sell 68 percent faster, and there is no doubt why.
  • Use well-lit recent photos without including yourself or your family in any of the pictures.
  • Edit your photos before you list them. Be cautious and do not go overboard while editing the images. Your potential clients won’t be happy if they learn that the online property was far from reality. So, do the usual lighting and contrast.

Reference: Link

Step 3: Listing your house

Now that you have equipped yourself with ample information on the subject. It is time to test the waters and select how you’d like to list your home for sale.

You can either follow the traditional way of listing (by putting up a “for sale” sign, distributing flyers, posting on newspapers, etc.) or list where the whole world is at – the internet.

Why should you list your property online?

Listing your house online can help you sell your property from the comfort of your home. 

It will screen out people that are actually interested in your property for you. Thus, saving you from unnecessary showings. 

Another good reason to list your home online is the limitless exposure of the internet that will help you attract a lot more buyers and grab even better offers.

Where can you list your home online?

Multiple Listing Website:

MLS or Multiple listing website is a property listing database used by licensed real estate agents and brokers to list homes or properties. If you are working with a Realtor, your home will be added to the MLS as part of the agreement.

Although the platform is for agents only, as an FSBO seller, you too can list your property to the local MLS by purchasing a “Flat-Fee MLS listing.”

A state-licensed real estate agent or broker will work as your access point to the MLS platform and provide you with an MLS entry-only service in a Flat-Fee MLS listing. You will still be the primary seller/point of contact and retain all the rights to sell it, except it won’t be 100 percent FSBO. This option will still get your property into the MLS without being as expensive as hiring a full-service real estate agent.

Social Media

With the world coming online, putting your home up on social media platforms is another excellent strategy to attract multiple potential buyers.

Take Facebook, for example; its robust ads can help you reach a larger audience depending on your willingness to spend. On Facebook, you can also find real estate groups to post about your property and attract interested clients.

Instagram can be equally valuable with its region-specific hashtags and ad campaigns that may attract buyers looking for houses in your locality.

Moreover, the advanced searches of Twitter and Linkedin can also help you get all the eyeballs on your listed house.

If you are still on edge with social media, look at this pros and cons list to decide.

ProsCons
Social media can help your property reach a larger audience.If you are selling solely through social media listing, there is no timeline on when you will make a successful sale.
It can give you a unique buyer pool.Paid for advertising on social media requires a lot of time, energy, and resources. In addition, you’ll have to be consistent and keep a close eye on all your accounts.
You will get instant feedback on how a vast audience takes your property. In addition, it will enable you to opt for various strategies.You may never know if your efforts will bear you the kind of results that you wish for.
It’s free to post on your page, marketplace, and in local groups.You may have to engage with many clients online, which can be overwhelming.

Auction or Time-Limited Event Listing

As the name suggests, an auction listing is where you can list your home online for an auction or Time-Limited Event. The bidding will take place online-only, and with RealtyHive, sellers can accept offers before the online auction occurs. As the seller, you have the option to select when you’d like the auction to take place and can consider offers prior to the event or wait to see bids come in during the online bidding event.

Real Estate auctions are an accelerated real estate marketing process that will help you increase the scope of your prospects. They also help you get more exposure and higher offers than your expectations due to the competitive bidding atmosphere.

While an auction listing provides instant market value to your home, it also enables you to put a minimum price on it so that whatever you earn is above your expectations.

References: 1, 2

ProsCons
Accelerate the process of sellingBidders can select what they’d be willing to pay (within the constraints of your set “minimum”)
Multiple Potential BiddersCost added with listing on these auctions
More exposure and creates a unique offering that stands out to buyers
Additional marketing options
Unique buyer pool – some buyers specifically look to purchase homes via auction.

With RealtyHive’s Time-Limited Events, you can list your home in an online real estate auction to get your property more activity and increase the likelihood of your home selling.

RealtyHive has over 30 years of experience in the real estate realm and is known for its track record of selling 1,000s of properties in the auction-style format.

Our time-Limited Events can help you sell your house in Wisconsin faster.

Click here to learn more about the company and its offerings.

In short, you want to get your home in front of buyers in every possible way as you never know who will be “the one” for your house.

Simple ways that can increase the prospects of selling your house:

  1. Write an engaging description of your home and add all the relevant details to it. Your listing should adequately define your property, condition, style, area, location, and everything.
  2. Ensure you only use good (preferably professional) pictures of your house while listing your home. Again, we have documented that above.
  3. Be consistent with your marketing efforts. And if you have the bandwidth, list your property on a Time-Limited Event or an Auction. Such events induce urgency, which is great to get any property off the market quickly. RealtyHive’s Time-Limited Events are best when it comes to such events. Try it yourself, and you will thank us later. 
  4. Reach out to your network and ask your friends and family to reshare your listings on their social networking website.
  5. Host open houses.
  6. Go live and host virtual tours on your social media to give buyers a realistic feel of the property.

Are you wondering how you will be able to manage all this? With RealtyHive’s Time-Limited Events, you can sit back and watch the interest come in on your home for sale.

Step 4: Marketing and Showing the Property

Listing your home is only half the battle. The most thorough and rigorous process is what comes after you list your property.

These two processes decide the fate of your listing. So, put your best foot forward while working on them.

Marketing

Take this time to sell your house aggressively on all the enlisted platforms to get more offers and eventually higher sales.

Do everything, whether it is online or offline – from ads to flyers to newspaper listings. We know it sounds intimidating, but you have to do what you have to do, right?

And, if we are talking about marketing, don’t forget the Time-Limited Events offered by RealtyHive. RealtyHive has successfully brought in more exposure and more offers for sellers in Wisconsin with this range-style pricing. We are known for creating the best market presence for a house, and that too in a few simple clicks. Where else will you get such a deal? 

Showing the property

Once you start receiving offers, what follows is the showing process. 

If you are selling as an FSBO, you will have to manage showings independently. Here are some things you can do to it successfully:

  • Be responsive to every text, call, and email you get.  Also note that, around 87 percent of buyers purchase homes via an agent, so there is a high chance that you will be contacted by one. Always remember that agents are busy people, so if you do not respond to them right away, you won’t even realise when you may miss out on a great opportunity.
  • Try being flexible with your showing schedule. Remember, the more showings you do, the better are your chances of making  a successful sale. We suggest you make your house available for showing from 9 am to 8 pm every day. This way more buyers will be interested in seeing your house. 

Note: If you are working with an agent, your showing schedule will be managed by him/her. Usually, agents give a  24-hour notice before bringing any client home. So, make sure your house is ready for a showing before that.

If you are selling with the help of an agent, your showings will be mostly taken care of by your Realtor. They will handle everything for you right from scheduling to show.

Things to do before your first showings: 

  • Make your house presentable.  For this, declutter and clean your house before every showing.
  • Keep your belongings safe and expensive items locked away.
  • Depersonalize your house by removing pictures so that the buyers can picture themselves in your property.

During showings:

  • Don’t let people who aren’t on your calendar inside your home. Not everyone has the best intention, so it is better to have your guard up with uninvited guests, 
  • Keep a record of who comes and goes.
  • Make sure your family, kids, and pets are not around during a showing. Also, if you are selling your home with a Realtor, make sure that you’re not around when the buyer arrives.

Step 5: Handling Offers and Negotiations

Suppose your marketing efforts and showings were a success. Now what?

Say hello to the stage of offers and negotiation.

Don’t know a thing about them? Well, here is what happens next.

  1. An Offer: When a buyer decides that he/she is interested in buying your property, he/she will make an offer on it. 
    This offer will be a written document that best describes the real estate being purchased.
    The document will include the details of the land, the building, and the fixtures. It can also consist of something that a buyer might want to have included in the purchase.
    Always note that the offer determines what is included in the deal and excluded from it. Also, as a part of this purchase offer, buyers will provide what is called “earnest money.” This earnest money is a deposit made against the offer as an escrow, which an escrow agent holds.
    Reference: Link
  2. Counteroffer: When you receive an offer from a potential buyer, you can either accept it, decline it, or make a counter-offer.
    A counteroffer is generally considered a great strategy that may help you earn even more on your home for sale. A counteroffer deals with negotiations, and it arises when the terms of the initial offer are not agreeable.
    Plus, it can be made before or after the deadline of the binding acceptance.
    A counteroffer helps you inform the buyer on what terms you can compromise and the potential “deal-breakers” for you. 
    If you are not working with a real estate agent, you can handle your counteroffer yourself or involve an attorney for the same. We would suggest you involve an attorney for legal assistance. If you are working with RealtyHive on this process, we will help you handle your counteroffers with our team’s expertise.
    Reference: Link
  3. Acceptance: When you and the buyer both agree to the offer/counter-offer, you sign it, and it is then deemed “accepted.” The date on which the last party (you or the buyer) signs the contract is the date of acceptance.
    Many deadlines in the contract which follows are from this acceptance date.
    Also, note that once you sign the offer, it becomes a binding contract.
    What follows this is the closing stage.

Step 6: Closing the deal

Closing is the stage where you formally transfer ownership of your house to the buyer. The closing can take place anywhere both parties agree to.

The closing process involves:

  • Title Search, which is searching public records for any document that impacts the title of the property sold. We have talked about this in the transfer tax part, so we hope that is clear.
  • Document Preparation: During this time, the necessary paperwork is being done for the transfer of title.
  • The Closing Date is set, which is feasible for both you and the buyer so that you have ample time to prepare for the transactions.
  • Calculating the amount that is due and paying all the overheads.
  • Reading and evaluating all the documents, which is very important for you as an owner.
  • And finally, signing documents.

For the closing stage, you need to have either an attorney or Realtor by your side to walk you through the process. 

Final thoughts:

We know that selling a home can be an emotional rollercoaster; it is, after all, one of the most significant transactions to take place during your lifetime. 

If you are considering selling your home in Wisconsin or it is already listed for sale, and you’d like to get even more exposure and interest on your home, make sure to check out RealtyHive’s marketing programs and Time-Limited Events.

Click here to market your property on the Realty Hive marketplace today!

Where is the Best Place to Get Started in Real Estate?

If you’ve been thinking of working in the real estate industry, you’re going to enjoy every moment. This field is exciting with flexible working hours and the opportunity to meet and interact with customers from different demographics. Statistics indicate that there are close to 1.2 million realtors currently working in the US. That’s a clear indication of how a career in real estate is a viable option.

Consider this example: The average sales price for houses in 2019 was $299,400. If you’re working on 6% commission, a single sale gains you $18,000. It’s not surprising that many professionals working in other spheres opt to show houses as a second job, eventually moving on to taking up the career full time. If this sounds like something you’d like to do, here’s how to get started.

Get Licensing to Work as a Realtor in Your State

The first step is to check your state real estate commission’s website where you can get detailed information about the licensing requirements applicable in your state. You’ll also find a list of accredited pre-licensing agencies that offer training in the mandatory courses. You have the option of taking the course online or in person. Expect to train in the legal aspects of the business along with gaining an understanding of real estate practices like how to assess a property’s value. You’ll also learn about terms like “encumbrance,” “lien,” and “escrow,” among others.

The required number of hours vary by jurisdiction and state. For instance, if you intend to get licensing in Oregon, the mandatory hours is 150, including 30 hours of Real Estate Law, 30 hours of Oregon Real Estate Practices, and 20 hours of Real Estate Brokerage. On the other hand, California realtor licensing requires a total of 135 hours of training, including 45 hours of Real Estate Practices and 45 hours of Real Estate Finance.

Having completed your training, you’ll take the state licensing exam for a fee of $100 to $300. Expect to answer 60 to 100 multiple-choice questions that test your knowledge of general real estate principles and both state and federal laws. The pass rate is typically 50%, so it helps to take preparation seriously. Take the California Real Estate license practice test as many time as you need to evaluate your competency and raise your chances of passing. Once you clear the exam, you’ll get the necessary licensing to work as a realtor.

The Real Estate Industry is Multi-Faceted and Interesting

Once you gain adequate experience working as a realtor, you can consider specializing in a particular area. If you’ve always thought that real estate was all about helping clients buy and sell property, that’s not exactly accurate. You can choose careers such as:

Property Management

If you also have a degree in finance, think about working as a property manager. Such professionals can work for a company or as a freelancer. Your job description includes taking care of property issues for owners who don’t have the time or expertise. For instance, overseeing maintenance and repair tasks, marketing the rentals, collecting rent on schedule, dealing with evictions, and responding to complaints and problems that the tenants may have.

Apartment and House Sales and Purchases

Many people approaching retirement like to move to locations where the weather is warmer. They often seek a lower cost of living, or they just to be closer to family and friends. Others prefer to move into smaller apartments that are more economical and easier to maintain. You could assist senior citizens moving to Eugene, Oregon, starting with finding a good buyer for large houses and purchasing compact apartments or assisted living facilities.

Retail Leasing

Realtors who specialize in retail leasing have an extensive database of prime properties that become available for leasing. You’ll find locations ideal for your retail company clients to set up their business. Helping with the legal requirements and preparing the necessary paperwork for renting the property are all a part of your job in retail leasing. Most such professionals work over the weekends and after hours to identify viable options that their clients might like.

Real Estate Appraisal

Since determining the value of a particular property is a part of your training as a realtor, you could find a job with a business broker in NJ. When finalizing deals for mergers and acquisitions, one of the key elements of the process of due diligence is conducting evaluations of the partnering companies’ assets. Your job involves checking for the validity of the lease or ownership deeds and whether it is necessary to retain the property for ongoing operations.

A real estate appraisal can be critical to the outcomes of the merger deal since its value can influence the status of the balance sheets. Accordingly, your expertise may also be needed to check for the site’s profitability if it is sold, leased out, or used as is.

Real Estate Development

As a realtor, you’ll find and identify properties that have the potential for bringing attractive ROI for their buyers. Such buildings may be run-down, empty, or obsolete. Your job is to evaluate the cost of repairing the structures to make them fit for living, leasing, or accommodating a running business.

If you’re planning to work as a specialist realtor, you might need to get additional training and licensing. Check for the regulations in your state when choosing the career that interests you most.

Things to Consider Before You Buy a House that Needs a Lot of Work

Most people want to make a few changes to a property when they buy it, to make it their own, and bring it to their particular standards. However, if you’re planning to buy a fixer-upper, be aware of what you might be getting yourself into.

While a renovator project is going to be less costly to buy upfront than an already refreshed place, you must do your due diligence to ensure you don’t bite off more than you can chew. Consider and research a variety of factors before you sign on any dotted lines.

Know What You Can Afford

Many people think that buying a fixer-upper for a lower price then doing a few renovation tasks will have them seeing profits in no time. However, in reality, remodel work tends to be both more time consuming and more expensive than expected. As a result, it’s easy to get into a situation where you’ve spent much more money than planned or perhaps can even afford. Sometimes buyers can’t even finish their project because they’ve run out of funds.

To avoid landing in this situation, get clear on exactly how much money, in total, you can afford to spend. Have a set allocated figure, and work back from there. Anytime you look at properties, you subtract the likely purchase price from your budget and see if you’ll have enough funds left over to renovate adequately.

When factoring in financial elements, try to allow for every cost that could arise. This means more than simply the purchase price of the home and laborer and material fees. Don’t forget things like realtor and legal fees, demolition and removal charges, insurance costs, home warranty to cover appliances and other home systems, inspection costs, and so on.

Be Clear on Goals and Expectations

Be clear on your goals for the project, too. That is, are you buying a house to do up to your personal specifications and live in for years? Or are you tackling the task to flip the home ASAP after you’ve renovated it? Perhaps, alternatively, you’re planning to refresh a property so you can rent it out for a top dollar? No matter what you plan to do with the home after its facelift, you need to know what you hope to achieve. Let this guide you when shortlisting properties.

Know your expectations, too. With so many home-renovation reality shows on television now, many people think the process is straight forward and always results in a profit. However, believing you’ll get the same outcomes as the people on TV who usually have years of experience and a vast support system behind them can set you up for failure. Try to have reasonable expectations and plans in place for how you’ll deal when things go wrong.

Organize Inspections

One of the top tips for buying a fixer-upper is to invest money in proper inspections conducted by licensed, experienced, and adequately trained contractors. Before you commit to purchasing a property, know what you’re getting. Some houses look fine on the surface, like they only need a few inexpensive cosmetic touches, but when you start to get into the renovation work, you discover all sorts of more significant problems.

Some of the checks to consider include roof certifications, pest inspections, engineering reports, sewer line inspections, and building reports. Be on the lookout for fundamental, structural, and costly issues that people bring to your attention, such as roof or gutter replacements, shoring up foundations, building garages or additions, and pouring concrete for new driveways.

Other expensive work includes complete kitchen or bathroom remodels and replacing electrical wiring, sewer lines, and plumbing systems. Plus, think hard about buying homes that require you to outlay money on installing replacement windows throughout the house, getting rid of asbestos, mold, and mildew, and replacing or installing HVAC systems.

A fixer-upper home is always going to need work, which takes time and money, but it’s vital to separate extensive rehab needs from more affordable cosmetic tasks. At the end of the day, though, the rehab you can afford and want to do comes down to your specific situation and preferences. Speak with builders and contractors to get quotes on work (and add extra for unforeseen costs), so you can work out if you have the potential to make enough of a return on investment or not.

Buying a rundown property and turning it into something fresh, appealing, and updated is both exciting and nerve-wracking. Give yourself the best chance of success by considering the factors listed above before you sign any purchase contracts.

how much does a real estate agent make

How much does a real estate agent make?

Much like real estate itself, the answer to how much a real estate agent makes in annual pay is largely based on location, location, location. Commission splits, brokerage fees, and average sales price all affect commission and vary by location. 

Where You Work Determines How Much You Make

The real estate industry is a much different career path than many other jobs. Real estate agents are typically considered private contractors meaning that they technically own their own business and can make their own rules. This is mostly true, but doesn’t tell the whole story. According to laws in every US state, real estate agents are required to work under a real estate broker unless they become a licensed broker themselves. 

Brokers provide agents with the experience needed to make good decisions in tricky situations, something that happens quite often in real estate. They also often provide some benefits to agents in the form of listing/closing departments, usable office space, and errors & omissions insurance. 

The fees brokerage charge agents, often referred to as “splits”,  vary by franchise and broker. Splits of 60/40 (agent gets 60% of their commission, broker gets 40%) aren’t unheard of, but there are also brokerages that offer 0 split arrangements. Many companies choose a hybrid model where the broker gets a part of the agent’s commission until the agent sells a certain volume of property, reaches a particular income threshold, or has worked for a certain amount of time. 

This is largely why the hiring process in real estate also seems completely backwards to non-industry folks. Typically a company hires a contractor, but in real estate, agents typically interview brokerages instead to choose where is the best fit for them. While brokerages can accept or reject agents as they choose, more agents typically means more money to the broker from commission splits so they’ll often accept or even recruit new agents. 

how much does a real estate agent make in your city

Geographic Area Affects Earning Potential

The majority of US real estate agents work on a commission structure meaning that what they make on any given transaction is based largely on the sale price of the property. Like the average cost of a property, the exact percent of the commission can vary by area or property. 

In the US, real estate commission fees vary from place to place, but average about 6 percent. This fee is then divided between the listing agent and selling agent, with the split often being fairly equal, although it’s not uncommon for the listing agent to receive a higher percentage. Both the listing and selling agents will then split their portion of the commission with their respective brokers. 
While commission splits are known from the get-go, the selling price is what really determines how much money an agent makes. At the end of 2019, the average US home was estimated to be valued at $241,000. If a real estate agent sold a house like that at a 3% commission,they would make $7230. However, if an agent sold a property in San Mateo County, California where the average estimated home value was $1,182,300, the agent would make $35,469. Now compare this to Desha County, Arkansas where the average home value was an estimated $65,526. An agent selling a home here could expect a payday of just $1965.78 before broker splits, desk fees, and property marketing.

Real Estate Opens Many Doors

Selling properties isn’t the only way that real estate agents make money. While many practicing agents work with buyers and sellers, others work as property managers, property flippers or landlords. A career in real estate comes with many benefits. Learn more by checking out our article how to become a real estate agent.

What House to Buy, Based On Your Zodiac Sign

Having trouble deciding what house to buy? Sometimes it’s best to let the cosmos take over. While astrology is incredibly complex and your sun sign (the sign based on the day you were born) is only one part of what makes you, you, it’s still fun to see what the stars have to say. Look at which house you should buy based on your zodiac sign! 

Aries: A ranch house with a nice yard.

Aries are passionate, competitive beings who *just* so happen to be named after the Greek god of war. We’re not saying they need lots of space for a battleground or anything… but Aries just need space to spread and expand. A ranch house offers just that, while a nice yard means plenty of potential for outdoor games to fuel that competitive nature.

But it doesn’t just have to end there — as we said, you rams are passionate beings! A nice yard provides space to dive into your passion projects, be it a garden or space for a shed/workroom. Even a deck or patio means more opportunities to entertain their loved ones (and yes, pets absolutely count). After all, relationships are where Aries tend to show their fire and love the most.

Taurus: A cabin that’s away from it all.

The homebodies, the nesters, the ones who are more than fine staying in or getting home early. Our bull brethren deserve the coziest of cabins, nestled in the woods, near a bubbling brook. Of course, it shouldn’t be too far from a town or city — Tauruses aren’t social hermits, they just want to come and go as they please!

Taurus, a nice cabin gives you the serenity and comforts of home you desire. You can stock it with warm blankets, your favorite scented candles, and hopefully, the largest claw-footed tub known to humankind. And of course, don’t forget about the gorgeous kitchen where you can cook sumptuous meals for their loved ones — the lucky ones allowed into their sanctuary.

Gemini: A modern split-level.

The twins of the zodiac, Gemini, sometimes get a bad rap for being “two-faced.” And their personality duality can look completely different in different social circumstances. But they’re witty, hilarious and often considered by some to be the most fun of the zodiac. That duality is best expressed in a split-level home, particularly in a modern or mid-century modern style. 

Gems, you’ll appreciate entertaining in different parts of the house (or just being able to scroll through social media in different locations — no shame, we all do it) and a house whose look can be restyled with relative ease. After all, you might find a new print at a flea market and then need to change their entire aesthetic — a modern split-level affords versatility.

Cancer: A house in the country.

OK now just to be clear — “a house in the country” and “a house that’s something right out of a country song” are two very different things (it needs to be said because Cancers are sometimes a bit finicky). Leave it to you lovely crabs to make your house in the country something with character, like an adorable bungalow or converting a 19th-century schoolhouse into a modern home.

Cancers have that magic to turn practically any space into a home (and one with the most on-brand aesthetic ever — Cancers 10000% know their brand). A house in the country gives you the space to fully flesh out you vision. Have no doubt that your home will make everyone feel welcome, while also showing up in architectural publications and inspired Insta pages.

Leo: A luxurious manor.

They’re royalty, lovers of the limelight and absolute showstoppers. They may occasionally burst into song for no reason, to the (valid) confusion of non-Leos. Our zodiac lions want glamor! Decadence! Incredible natural lighting! Gorgeous, massive windows! Luxury looks different for every Leo but make no mistake — they all want some version of it.

Leos, your dream house might come later in life because let’s be real — the manor or estate you really want is probably not your starter home (but congrats if it is). And that’s perfectly OK! You want lots of rooms, bathrooms fit for a king and queen, space for entertaining, heck, maybe even a pool + cabana combo. Essentially, a manor that makes your loved ones gush over (and don’t worry, you secretly relishing in their envy is on brand for your sign).

Virgo: Build, don’t buy.

Virgos, we have a lot of love for you. Without you, who would tell us our flaws, give us direction or set us up with a gorgeous online spreadsheet?

There could easily be a house out there for every Virgo to buy, but these taskmasters crave control. Whereas some signs might crack under the pressure of decision-making when building a house (cough cough LIBRAS ahem), Virgos thrive. Well, they’ll still be stressed out and take way too much on and it’ll be the only topic they bring up for the next year and a half, but for Virgos, that’s the thinking they’re thriving!

Libra: A standard two-story.

Standard two stories are balanced by nature and perfect for our Libra scales. Libras, you might get heat for your indecisiveness and occasional flightiness, but you’re some fierce aesthetic queens so it’s time to play to your strengths. Setting you up with a standard two-story gives you plenty of opportunity to make your house a home.

A house that’s too niche won’t fit as well with your balanced nature. Your focus is on having good times with loved ones and strangers alike, and a standard two-story, decked out to your liking, does just that.

Scorpio: A Victorian house.

Other signs see the old house down the street as creepy, Scorpio wants to go inside out of sheer curiosity. Not every Scorpio has an affinity for the macabre (but it’s close). Still, if someone in the zodiac would delight in the stories, secrets, history, and occasional mysterious creaks of a Victorian house, it’s Scorpio. 

Scorps are deeply passionate — when your love and trust is well-received and requited, the bonds you have are unbreakable. That bond applies exceptionally to an old Victorian house full of classic beauty and unmatched character. Your intrinsic curiosity will keep deepening the connection to our abode, giving us a whole house to pore over and tend to. Those mysterious creaks won’t scare us off — they’ll have you wanting to learn more. And maybe putting out an altar for whatever spirits reside there, but that’s another story.

Sagittarius: A vacation home.

Sag, you all are on the move and may or may not have some fears about being confined to one location. That’s why your home of choice should be a vacation destination! Instead of sticking with a traditional home in the burbs that you’re not ready for, find a vacation home (or at the very least, a house that makes you feel like you’re on vacation).

The huge advantage of a vacation home is that you can rent it out while you’re away. Plus, the limits for what makes something a vacation home don’t exist. Renovate an Airstream! Invest in a tiny home with some gorgeous mountain views! Finally, get that beach cabana! If you want to make it your actual home, by all means, keeping it as an escape (and maybe even investment property) is cool too.

Capricorn: A middle-of-the-action apartment or condo.

Caps are the grinders and hustlers of the zodiac. They know what they want and work tirelessly (do they even get tired??) to get it. But Capricorns want to enjoy the fruits of their labor, or at least, in theory, have that as an option because, tbh, you guys might overbook yourselves. 

A gorgeous apartment or condo that’s close to everything can give you goats the access you love with the luxury you worked for. Close to concerts, bars, public transport, events, gyms, trails and, most importantly (for you), work —  that’s the stuff of dreams for you. Pick out the apartment of your dreams, go for the penthouse if you desire because if anyone’s going to crush their goals, it’s you.

Aquarius: An eclectic or unusual home.

Oh Aquarius, our favorite aliens of the zodiac. You could make a barn, a yurt, or even a UFO your home; we love that for you. No matter what type of home you go for, it has to have some unique elements at the very least and be the most out-of-place house on the block at most. 

You love characters in homes (similar to Scorpios) and need a place with quirks that tell a story. Tiny homes, berm homes, shipping container houses, glasshouses in the middle of the desert — the sky (galaxy?) is the limit. Look for something as interesting and curious as you and you’ll never grow bored — but remember that if you move from it, selling a too-unique house can be tough.

Pisces: A house by the water.

Sweet, sensitive Pisces, it might seem generic to put you fishies by the water but you know you’d love it. A babbling brook, a lake, a beach — anything will do! No one would be surprised if you started calling the animals nearby your neighbors (and/or talking to them like a Disney character).

Water recharges you and gives you a sense of peace. When the outside world is overwhelming and you want to escape, it’s best to have that right at home. Hold out for a home near some water, but remember that dreaming about it alone won’t make it happen. For as much intuition and compassion and faith as you have in others, give yourself the same attention to make a house near the water a reality.

7 Common Electrical Problems Found in Home Inspections

When buying a house, one of the steps is to have a home inspection performed so key issues are noticed and can be addressed. During home inspections, electrical problems are usually detected, and this is important because a house’s electrical system plays a major role in keeping it safe by preventing fire risks, arcing, and electrical shocks. After having a home inspection performed, it is essential to make the necessary electrical fixes that the inspector addressed because you want your family’s house to be as safe as possible.

1- Exposed Wiring

During home inspections, one of the most common electrical problems found is exposed wiring, and this is a crucial problem to have repaired because exposed wiring is a major fire risk. Because of the high risk involved, exposed wiring is one of the repairs that should always be repaired by a professional electrician instead of DIY. Exposed wiring is not a complicated repair, but it is essential that wiring is properly covered to prevent the risk of fires or arcing.

electrical problems

2- Buried Wires Not Protected

Having buried wires is acceptable, but when buried wires are installed without a covering or protection, it becomes an issue. A covering or protection is crucial because it safeguards the wiring against natural elements, debris, and rodents. When a buried wire is compromised, it poses a safety risk to the house and stops functioning at peak efficiency.

3- Receptacles Not Properly Grounded

Especially in older or historic homes, ungrounded receptacles are a common electrical problem found during home inspections. Ungrounded outlets are outlets with only two holes for the plug and no hole for the ground wire, and without the ground wire, there is a risk of fires or arcing because electricity can travel until it finds a suitable conductor source. Similar to exposed wiring, ungrounded receptacles are not a complicated repair, but they should be fixed relatively soon because of the safety risk they pose to the house.

4- Lack of Outlets

In many homes, homeowners will find a lack of outlets because many homes were built before homes experienced a surge in the number of electronic devices per household. People need to charge their phones and tablets but also plug in their televisions and lamps, and running extension cords from room to room isn’t the answer. Homes need to have enough outlets in each room so everyone can function without a fire risk.

5- Openings in Electrical Panels

For electrical panels, one of their common problems found during home inspections is openings in the panel. No gaps should be visible in the electrical panel because it would allow debris or rodents the ability to get inside which would create a shock or fire. Openings in the electrical panel can easily be fixed by installing filler plates to place over the openings so nothing can get inside.

6- Faulty GFCI Outlets

In rooms where moisture is present (kitchen, bathroom, laundry room, etc.), GFCI outlets must be installed and properly functioning. A GFCI (Ground Fault Circuit Interrupter) outlet is an outlet that has a protective covering to prevent electric shocks, and it correlates the inflow current on the hot side to the outflow current on the neutral side. During the home inspection, the inspector will test the GFCI outlets to ensure they are working properly and if any adjustments need to be made. In areas where there is the chance of water or moisture, having GFCI outlets is necessary because of the danger that could ensure if water seeps into an outlet while it is in use.

7- Overused Circuit Breakers

Another common electrical problem found during home inspections is overused circuit breakers. Circuit breakers are intended to only have one wire connected to one circuit breaker in the electrical panel, and when two or more wires are plugged into the circuit breaker, it poses an immense safety risk. When multiple wires are connected to the same circuit breaker, it allows connections to become looser which leads to an increase in arcing and fires. Overused circuit breakers are easy to spot, and this common electrical problem can be solved by simply upgrading the electrical panel to allow for an increase in the number of circuit breakers.

From exposed wiring to not having the proper number of outlets, many electrical problems can be found during a home inspection. The most important thing is to choose professional services for both the home inspection and electrical repairs. It might save you money to try and repair the problems yourself instead of using a professional electrical company, but in the end, it is better to have the problems repaired by a professional so you are ensured of their quality and safety. Because electrical standards and codes are changing with new improvements and procedures, it is common to find electrical issues during home inspections, and no matter what the electrical problem is, the most important part is to have it fixed promptly by a licensed electrical company.

6 Misunderstood Things About Buying & Selling Houses

Surprises are fun for birthday parties, scratch-offs, and finding an extra mint Milano at the bottom of a Pepperidge Farms bag. They’re quite the opposite when it comes to buying or selling a house. We’ve compiled the weird, the bizarre, and the generally misunderstood real estate facts to hopefully reduce any surprises the next time you’re on the market.

#1 “Selling” vs. “listing” agent terminology is misleading.

In layman’s terms, it’s a mess. Full disclosure, this writer has written for RealtyHive for more than a year and still struggles to keep the two separate (but thankfully has a real estate grandmaster for an editor).

The listing agent works with the person who posts the listing (in other words, the seller). The selling agent works with the buyer — this role is also sometimes referred to as the buyer’s agent. Ideally, that jargon would just make a permanent switch.

Oh, and did we mention that sometimes the listing and selling/buyer’s agent are sometimes the same person? This is called dual agency.

#2 You can’t fire your Realtor just because they haven’t sold your house.

You can work to fire a Realtor who is unethical or irresponsible but minor issues (or even the lack of a house sale) is usually not grounds to terminate your contract. Even if you stop working with your Realtor, there’s a chance that they could still take commission on your property.

If issues come up with your Realtor, talk to them first, then follow up with their broker if you don’t feel like things are working. 

#3 Houses that have spent a long time on the market are often overpriced.

If you spot a house that seems overpriced and you can’t figure out why, chances are it’s been on the market for a while. This can serve as a good bargaining tool if you decide to make an offer — you can try going lower than the listing price. 

Otherwise, keep an eye on listings consistently, specifically for ones that stay up for several weeks. Even if the price doesn’t change, you could still leverage a lower offer.

#4 Hope for a low assessed value.

While you want a high appraisal value (because that tells how much your home is worth and helps for selling), you want a low assessed value because that determines your property taxes.

#5 When you’re looking to buy a house, never call the listing number. 

The “For Sale” sign might look enticing, but don’t call the phone number. That number belongs to the listing agent who, like we discussed earlier, works on behalf of the seller. Contact a selling/buyer’s agent when you see a property you like (and consider working through Cashifyd since you could get cashback at closing!).

#6 Real estate trusts and wills are different.

Wills are usually for smaller assets, trusts are typically for larger ones. Real estate trusts are also private and can eliminate court time while wills can lead to lengthy court stints to divvy things up.

Real estate is one of those areas in life where the more you learn, the less you know. Or at least, it can feel like that. But by researching, learning and staying up-to-date on real estate blogs, you’re actively closing the gap on any unintended surprises — and becoming a well-versed buyer or seller in the process.

5 Things to Know About 401K Real Estate Investing

“You need to save for retirement!” Most adults have heard this sentiment at least once. We know the importance of saving for retirement (and starting early). What a lot of people don’t know is that you can actually use a 401K retirement fund as a way to invest in real estate. 

Wondering if you should take your retirement fund in a new direction? Here are 5 things to know about 401K real estate investing.

#1: 401K real estate investing itself is illegal.

We say “401K real estate investing” but you can’t actually use your 401K by itself to invest in a property. However, you can open a self-directed IRA and move the funds from your 401K to that IRA, tax-free. By this method, you’re taking existing 401K funds and still using them for real estate investing, just not from the 401K itself.

#2: 401K real estate investing can massively grow your retirement funds.

One of the biggest reasons people move forward with 401K real estate investing is, quite simply, to grow their retirement funds at a faster rate. Consider this:

In a regular 401K…

  • Your max. contribution is $19,500 per year (as of 2020).

If you use a 401K to invest in a rental property…

  • A property that generates $1,000 per month in rental income will lead you to an additional $12,000 per year that can go towards retirement.

Over time, investing with your 401K/self-directed IRA can substantially help you grow your retirement portfolio in ways that the max. contribution alone cannot. One thing to note: the income you generate from a rental property has to go back into your IRA. But hey, that leaves you with more funds for even more rental properties!

#3: When done correctly, you’ll pay little to no taxes.

Another huge advantage to 401K real estate investing is that it’s extremely tax-friendly. You’ll need to find a self-directed IRA that allows real estate investing first, then you can move your 401K directly into that IRA without having to pay any taxes. 

#4: You can borrow money based on how much is in your IRA.

As SFGate mentions, “While you cannot borrow against an IRA, you can usually borrow half of the value of your 401(k) account, up to $50,000. However, if you purchase real estate with funds outside of your 401(k), you no longer have any tax advantages attached to your purchases.”

Often, the specific type of loan used for these transactions is called a non-recourse loan. These loans have special rules (for example, you generally can’t use a non-recourse loan to flip a property, and you can’t use it for a property that’s a primary residence) so study up on them carefully.

#5: You can’t manage the rental property yourself.

The only way you’ll get the full tax advantages of 401K real estate investing is by hiring a property management company. You can’t be the one managing your rental property when it’s purchased using your 401K/self-directed IRA. This differs from traditional rental property investing, though you can still purchase a vacation rental property (it doesn’t just have to be for long-term tenants).

Similarly, you cannot live in a 401K/IRA property. You can’t vacation in it, and you also can’t pay for renovations or other sweat-equity. Again, do some thorough research on the rules beforehand (or hire a tax advisor) because you could otherwise miss out on tax breaks.

*Bonus* #6 You can find your next investment property here at RealtyHive.

RealtyHive connects highly motivated sellers and buyers through our time-limited events with properties for sale worldwide! Whether you’re looking for a gorgeous condo to turn into an Airbnb in Thailand or want to rent apartments or houses for families, you can find real estate potential here. Look through our listings today!

The Key Players in Real Estate

The game’s about to begin, a real estate transaction is about to take place, and the starting lineup has just arrived. While the real estate agent might seem like the quarterback or point guard, there are plenty of other positions that play a vital role. These are the key players to know about — they help house sales go through and one day, will help your transaction as well.

Mortgage Lender

A mortgage lender is a financial institution (usually a bank) that provides financing (a loan) for a real estate transaction. Before buyers even start looking at houses, they need preapproval from a bank to show they’re serious — sellers often reject offers that don’t have preapproval.

Mortgage lenders also work with appraisers to ensure they approve the correct amount for a loan. If the value of the property doesn’t match the loan amount, this can make it more difficult to get a mortgage.

Home Inspector

People putting an offer in on a house often include a contingency for home inspections. In other words, if a home inspector finds some major problems and the offer is based on the results of an inspection, the potential buyers are protected from having to go through with the sale.

One thing to note is that not everyone opts for an inspection. Investors looking for flips or rental properties often put in offers that don’t require an offer so they can get the property faster and for a lower price. But if you’re looking for a home to live in, working with a home inspector is a really good idea.

Appraiser

Appraisals are different from home inspections because they assess the value of the home, not the condition. As mentioned, appraisers are usually sent out by banks to double check the value of the property.

Agents

There are two crucial agent roles you need to know:

  • Listing agent: Works with the seller (the one who’s posting the listing). Whenever you see a “For Sale” sign with a phone number on it, that’s the listing agent.
  • Selling/buyer’s agent: Works with the buyer (the one looking to buy the home).

To make matters more confusing, sometimes the listing agent and the selling/buyer’s agent can be the same person! Learn more about dual agency in our 5 Things Real Estate Agents Don’t Want You to Know blog.

Brokers

Brokers are legally responsible for the agents who work for them. They carry Errors & Omissions insurance, and if issues come up for (or with) a real estate agent, the broker is the one who can step in.

The listing broker is the listing agent’s boss and the selling or buyer’s broker is the boss of the buyer’s agent. It’s not often that either brokers interact with the buyers or sellers (unless there’s a problem with the agent).

Title Company Representative

Title company representatives do the actual closing of a property and serve as a neutral third party. These reps release funds from both sides and ensure that everyone has fulfilled their obligation.

Real Estate Lawyer

With all the documents that need signing in a real estate transaction, it’s no surprise that some people hire real estate lawyers to help them work through the paperwork. Sometimes people opt for a real estate lawyer to take the place of an agent and/or broker.

Transaction Coordinator

Transaction coordinators are the playmakers from behind the scenes. They iron out deadlines and details, communicate to all parties involved, enter listings into the MLS and check over closing documents, to name a few things. Essentially, they do everything except show houses! Not every brokerage or agent has a TC but many do.

You

Yes, you! As the buyer or seller, you are one of the biggest players in a real estate transaction. You are the reason every other role exists and why they’re coming together in the first place. But if looking at this list has you feeling about as overwhelmed as a soccer coach for 3-year-olds, fret not. 

You can work with RealtyHive, a one-stop-shop that makes the buying and selling process easier than ever. Find agents (and potentially get cashback at closing), list your property, or bid on your new home in one of our time-limited events, all in one place. In other words, play ball!