The real estate laws may differ from one state to another so it is advised that prospective buyers or sellers consult a licensed real estate professional. The overall responsibilities of the real estate agents are as follows. He first needs to prepare comparative market analysis which is an estimate of the property value compared to others. This is different from the regular real estate appraisal. He should know to expose the property in the market to the prospective buyers.
The real estate agents are the ones who guide the buyer or seller through the process and facilitate a purchase or a sale respectively. The real estate agents need to prepare the FSBO document in case of his client being the seller. Sometimes the broker may be licensed as an appraiser and in that case prepares a full residential appraisal. He prepares contracts and lease but not all States permit that. He handles property management and he exchanges property by leasing for a percentage of the gross lease value.
Most real estate agents operate on a commission basis by charging a percentage of the sales price therefore they earn nothing if they fail to sell the property. But when successful they make quite a lot of money on a sale since they charge anything between one and three percent of the sales price for their efforts. A few real estate agents charge a flat fee whether they sell a property or not which is mostly undesirable as per the sellers.
There are few options when dealing with real estate agency and they are as follows.
- Sole agency agreement is an option where one agent is given the exclusive rights to sell the property for an agreed period.
- Joint Sole Agency agreement is another option where sole selling rights are given to two agents but split the commission among them or whoever sells the property. This is usually more expensive than a sole agency agreement.
- Multiple Agency Agreement where several agents have the property details. The one who sells the property gets the commission on sale. However this is the most expensive deal.
The reputable agents are members of the National Association of Estate Agents (NAEA), and also have to be signed up to the voluntary Estate Agents Ombudsman scheme, which regulates the members and levies fines or orders compensation to aggrieved clients.
Real estate agents have thorough knowledge of the property market in their communities. They are expected to be familiar with local zoning and tax laws and about mortgage brokers. Agents and mortgage brokers usually act as intermediaries in price negotiation between the buyers and sellers. In the process of selling the property the brokers arrange for the title searches. They arrange for meetings between the buyers and sellers to agree upon the details of the transactions following which new owners take possession of the house. The real estate agents arrange favorable financing from a mortgage lender for the prospective buyer. There are agents who combine other types of work, such as selling insurance or practicing law along with their real estate business.