Find A Realtor
Although there may be some subtle differences in the definitions of the terms realtor, real estate agent and real estate broker, we will use these terms in this discussion interchangeably to denote, unless otherwise defined, the listing agents that sellers use to list and bring their properties in the marketplace.
Property investors seeking opportunities by location and/or property type/subtype can be more successful in their sourcing efforts if they find a realtor who is specialized in covering the particular locations and property types targeted. Realtors that provide solid due diligence on the property, as part of the services they provide, can also make the sourcing effort of the investor more effective and efficient. In the sourcing stage, a property investor may consider working also with a buyer agent. In the US, real estate agents, unless specifically disclosed otherwise, represent the seller in any transaction for the sale of a property listed with them. A buyer's agency, however, allows the Agent to represent the buyer/investor and to put his/her interests above all others. Some of the benefits of using a buyer's agent include the preparation of a Comparable Market Analysis, presenting information on the asking and selling prices of similar properties in the area under consideration; collection of information about the seller, which may include reasons for selling, potential concessions, or other information that may help in determining and negotiating an offer price; and information about property value trends in the targeted area. Buyer's agents are easier to find when buying a house but it is more difficult when dealing with commercial property. The most important consideration when sourcing property for investment it is not whether an agency is a regular agency or buyer's agency, but whether it is specialized in the targeted property type and location. A great resource when trying to find a realtor to act as a buyer's agent, investors should consider the Real Estate Buyer's Agents Council (REBAC) of the National Association of Realtors, which is the largest professional association of buyer's agents in the US. In the last ten years REBAC has grown exponentially and it is the largest of NAR’s Institutes, Societies, and Councils, numbering more than 50,000, active members. REBAC provides the Accredited Buyer’s Representative (ABR) designation, which requires completion of some courses and documentation of minimum experience of working with buyer clients.
Property investors need to also find a realtor or realtors when selling a property when they decide to exit their investments. In such a case, property investors need to have in mind that they can list their property with a realtor in three ways, as indicated by Wurtzebach and Miles (1994): • Open listing, in which case the owner notifies the broker(s) that the property is for sale at a particular price. In the case of open listings the owner can list with many brokers without any liability since a commission is paid only to the broker that brings a buyer. • Exclusive agency in which case the property owner contracts with only one broker who is given exclusivity on the property and is entitled of a commission even if the property is sold by another broker. An exclusive agent though, will not receive any commission, if the owner finds a buyer on his own without using any other intermediary. • Exclusive right to sell in which case the agent receives a commission in any event that the property is sold, even if the buyer is brought by the owner or another broker. All states in the US require that all real estate agents be licensed from state authorities before they receive any brokerage fees. The largest professional organization of real estate agents is the National Association of Realtors (NAR). NAR has affiliated Institutes established to develop high standards of professional practice and enhance the competence of their members in delivering services in specialized segments of the real estate market. In trying to find a realtor to implement their strategy, it is important for property investors to have in mind the different professional organizations of realtors that are specialized in a particular property type. An example of such organization is the NAR-affiliated Commercial-Investment Real Estate Institute. Members of this Institute have the CCIM (Certified Commercial-Investment Member) designation and are specialists in commercial property development and investment brokerage. Another organization of realtors specialized in commercial property, and specifically in office and industrial, is the Society of Industrial and Office Realtors (SIOR). This can be also a valuable resource to property investors when trying to find a realtor specialized in any of these two property types. The Realtor's Land Institute (RLI) has members that are specialized in land brokerage. RLI provides the Accredited Land Consultant (ALC) designation, which requires the completion of six Land University courses, a minimum of three years of experience as a real estate licensee, proof of completion of land transaction(s) worth $5,000,000 (sales, purchase, or lease) or a minimum of 25 separate land transactions, of which no more than 80 percent involve residential lot sales within the last 5 years. Candidates need to be approved by an ALC membership panel and finally by the RLI Board of Directors. Thus, realtors with ALC designation can provide a good source of competent agents specialized in brokering land investment opportunities.
The Council of Residential Specialists (CRS) provides the Certified Residential Specialist (CRS) Designation, which requires completion of 2-6 core course units depending on experience in residential transactions. Only about 4% of US realtors hold the CRS designation. Residential investors should keep in mind CRS, when trying to find a realtor specialized in residential property, as CRS designation holders provide a good source of competent agents specialized in brokering residential investment opportunities.
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