Professional definition of a real estate agent
The primary objective of the estate agent is to broker properties of all kinds between potential buyers and interested parties as well as the owners. This can involve privately used properties as well as commercially used business premises. The individual estate agents have the opportunity to specialise depending on their field of work and customer requirements and thus build up a specific customer base. In doing so, the real estate agent must place particular emphasis on the execution of his service and his presence, because a real estate agent lives from his reputation, as this is the only way he is able to obtain new orders and broker further properties. Estate agents often use the buildings and premises they broker as advertising space or have their own internet presence to attract additional customers. The estate agent's salary is an additional commission that the buyer or future tenant of a building has to pay on top of the actual price. This rate is usually calculated as a percentage, so it almost always varies. An estate agent can therefore be very successful if he has many and above all business clients who buy/rent expensive buildings, or less successful if he has no large clients but only lands a few smaller contracts. The salary is therefore completely dependent on the estate agent's client base.
WORKING METHODS OF THE ESTATE AGENT
Once the real estate agent has successfully advertised or made contact with the first premises that he is to bring to new tenants or buyers, he has to advertise this property. As a rule, the first step is to estimate the value of the property together with the seller in order to calculate a realistic purchase price and a realistic salary for himself. This involves finding out about the land prices or room prices of the property, which usually depend on the location and quality. Once this has been done, the estate agent must calculate a total price including his wages. However, this total price must be calculated in such a way that there is a little room for manoeuvre for the estate agent, the buyer and also the seller, as the potential buyer will certainly try to push the price down through negotiations.
There are various models for contracts with estate agents, all of which have different advantages and disadvantages, which can be particularly relevant in terms of security and the resulting costs.
The simplest model is that of a normal estate agent mandate. This is an order for the estate agent to sell the property. However, this mandate does not put the estate agent in a situation where he has to actually advertise the property. The estate agent can decide for himself how active he becomes and how he looks after the property. The highlight of this contract is that the agent is only paid if the property is successfully brokered. If the property is sold through another channel without the estate agent taking action, the estate agent also receives no commission and receives nothing.
EXPENSES OF THE ESTATE AGENT
The estate agent's expenses are primarily incurred through adverts and advertisements. In addition, an enormous amount of time is spent on designing these adverts and taking photos of the property, as well as obtaining further information about the property and its condition and, of course, the surrounding area, infrastructure and other things. Each property has different advantages and it is precisely these that a good estate agent must emphasise, so that each property must be described and advertised in a different way, which is not always quick and easy.
CONTRACT MODELS
If the complete price offer including all additional costs is now available, the estate agent must also advertise it accordingly. The longer the estate agent has been in the business, the higher the level of awareness, the customer base and the references. A successful estate agent starts by putting up advertising signs in the property itself with the information that this building is available for sale/rent. In addition, contact options are offered, such as a telephone number, a homepage or an e-mail address, via which the estate agent can be reached by interested parties and can provide further information. After advertising the property itself, the estate agent must also take photos of the property in order to advertise it on the Internet. This primarily includes an appearance on the estate agent's website, as well as advertisements in various online forums and on other property websites. Many interested parties search for property on websites and generally via the Internet, so that a large market has emerged for those looking and those bidding. Once these adverts have been placed, the estate agent must also place adverts for the property in regional newspapers to inform customers. Once this has been done, there is another option, which is by no means available to all estate agents, but only to those who have an established customer base. In this case, the estate agent can also fall back on people who have contacted him as property seekers and whose idea of the property to be sold fits.
The situation is different in the case of an exclusive mandate for a specific estate agent. In this case, the estate agent must take action and is also guaranteed to be the only estate agent authorised to do so for this advertised property. The contract also stipulates that the estate agent is entitled to his commission even if someone else sells the property. In most cases, this type of contract is concluded for a certain period of time and the salary for this period of work is fixed and, in the event of a sale, increased by the agent's commission as a percentage of the seller's profit. There is an extension to this contract which states that only the estate agent has the sole right to carry out the sale of the property and secure clients. This means that the estate agent secures the sales commission as well as the commission for his services. Anyone concluding a contract with their estate agent should always do so in writing. In this contract, all commissions as well as the broker's commission claims must be precisely regulated so that the broker and the seller can really be sure in which case which sum is to be paid to whom. The contract should also stipulate exactly what the estate agent has to do to ensure that the property is actually sold successfully and does not remain vacant for a long period of time.
