Real Estate Auctions - the hottest trend in Real Estate
Thursday, November 29, 2012
for merchandise, consumers have embraced the live and online auction concept for real estate, too.
marketplace.
High demand properties include:
- Residences of virtually all kinds, including single family homes, condos, and townhouses.
- Investment and income-generating properties such as apartment buildings and motels.
- Bank-owned real estate (REO) in which the lender has possession of the property due to foreclosure.
Real Estate Deal- Bargain
Monday, November 26, 2012
There are few things better than a good bargain, more so if the object of purchase is as important as your dream house.
Steps
KNOW THE TREND
Knowledge about the local market will make you well-equipped to bring the developer to the negotiating table. You should find out the prices of similar properties in the area. You should also know the period for which the property has been up for sale. If houses in a residential project have remained unsold for long, its developer will be keen to strike a deal.
An analysis of prices is a must. Find out the launch price and compare it with the latest price. Enquire about the price trend from local brokers, who will be able to give an idea about how much discount you can expect on the quoted price. A person who has bought a house in the project is also likely to give you the real picture of the discount you can expect from the developer.
MAKING AN OFFER
Once you get an idea about the likely discount , make an offer. Talk to the developer's sales team and tell it that you want to buy quickly. A developer is more likely to give a discount if it knows that you are a serious buyer.
Spare a day or two and go on a result-oriented property hunt. A good strategy is to drive around the locality and get the best prices from a number of developers. Make a list of properties in which you are interested. Let each developer know that you are scouting for the best property at the most attractive price and that you wish to close the deal quickly. Tell developers that you will compare all the offers.
If sales in the area have been falling and there are a large number of unsold houses in the vicinity, point this out to the developer and use to your advantage. Selling quickly, even at low prices, often works for developers as they save the funding cost and get cash for new projects.
Once you have all the quotes, let the developers know your offer price. "Your initial offer can be up to 15% less than the quoted price, but you should be willing to settle for a discount of 7-8%,"
SHOW THE MONEY
Developers are interested in selling inventory as soon as possible. If you can make an upfront payment, you are more likely to get a good deal. You should keep cash ready for such a situation.
Developers are interested in selling inventory as soon as possible. If you can make an upfront payment, you are more likely to get a good deal. You should keep cash ready for such a situation.
"You should get a loan pre-approved from a bank or a housing financing company. The most important advantage a buyer can have is the cheque book and the proof of home-loan approval. These will indicate to the developer that the buyer is serious, making it more than willing to negotiate.
USING INTERMEDIARIES
The real estate market has two sales models. Some developers have own sales teams while some take help from brokers. Often, they use both. The brokers can help you find a property fast as they are aware of the market and the projects in the area. A reputed broker can get you a good deal as well, but you will have to pay him for the service. Going solo will work to your advantage if you have researched the market well enough to get a good deal.
You can also team up with other prospective buyers. "If there is a group of, say, three or more people, the negotiation is easier.
REALISTIC APPROACH
Whether you go out to buy alone or in a group, negotiate for what you estimate is a realistic price. While developers are willing to negotiate in todays market, they are averse to reducing the quoted price below a certain point. This is partially because they do not want to publicise the fact that some customers paid less than others. They are more likely to offer freebies or incentives.
Some developers might not agree to lower prices to your desired level due to various reasons such as high costs. In such a situation, let the developer know that you will analyse the offer before arriving at a decision. Analyse the offers that you have, but wait for a couple of weeks before going for the best deal. Do not be surprised if you hear from some developers willing to close the deal at your offered price or a mutually agreeable lower price.
What The New-Age Property Brokers Do Differently
Last year, my friend, 29, a flight dispatch manager with IndiGo Airlines, decided to buy an apartment. He was reluctant to approach the usual neighbourhood brokers, given their dubious reputation. So he searched online for an alternative and found www.xyz.com, one of a new breed of property agents who insist they are committed to clean, transparent deals. The company found him just the place he was looking for: a two-bedroom flat in a housing complex called Ridge Residency in Noida.He says "I was not sure whether to buy my flat in Faridabad or in Noida, but www. xyz.com advised me correctly," . "I am glad I chose Noida, as my property's price has already risen by 25 per cent."
Tales of shifty brokers shortchanging home buyers, promising the moon but delivering far less, preferring to deal extensively in cash rather than cheques, often working in league with dodgy developers, are legion. There are around 200,000 brokers in the country, and most of them inspire anything but trust. "One can become a property agent without any registration or certification.
"There is no accountability to either developer or customer.".....
Leading the pack are Investors Clinic and Better Option Propmart (BOP), which notched up revenues of Rs 148 crore and Rs 150 crore, respectively in 2011/12. The bulk of their earnings came from residential properties.
The former was started by brothers Sunny and Honey Katyal from Moradabad, Uttar Pradesh, in late 2006, when they sensed a big opportunity in the flurry of construction activity that had begun in the National Capital Region (NCR). "There was an opportunity to remove unethical practices and institutionalise the industry," says Nishant Singhal, Director, Strategy, Investors Clinic.
The former was started by brothers Sunny and Honey Katyal from Moradabad, Uttar Pradesh, in late 2006, when they sensed a big opportunity in the flurry of construction activity that had begun in the National Capital Region (NCR). "There was an opportunity to remove unethical practices and institutionalise the industry," says Nishant Singhal, Director, Strategy, Investors Clinic.
It was the same spur for Amit Mavi who set up BOP in early 2007. "Residential properties promise much more to investors, 15 to 18 per cent, while in commercial ones, the margin is seven to eight per cent," says Sumit Ghosh, Vice President, Marketing, BOP.
So what do these new-age brokers do differently? For one, they all prefer clean, cheque only deals. For another they have all set up portals to make the property buyer's search experience easier. The portals list every property the company is selling, along with its specifications.
These brokers also appraise developers carefully before starting to sell their properties.
"Do numerous meetings with the builders, get feedback from our sales people and even speak to the media for more details,"
Most of the salespersons traditional brokers employ are not on their payroll but are paid a commission for every property they sell. They are thus solely concerned with netting customers, often exaggerating the virtues of their properties; once the customer has paid up, they are rarely available. The sales force at most of the new broking firms, however, are all full-time employees, and thus much more accountable.
How To Deal With Tricks Real Estate Brokers Play
Sunday, November 25, 2012
Before you can call a place home, you have to tread a long road that involves detailed planning and years of savings. A good real estate agent is all it takes to make the journey smooth. For this, it is important that the selection is done carefully.
"Consumers tend to trust the advice of brokers at face value and subsequently realise that they have been misinformed. Consumers' choice about service and price options is restricted by informal anti-competitive practices that brokers indulge in."
How can you know that your broker is taking care of your interests and not playing tricks that will benefit only him?
PERSUASIVE PITCH
Brokers rely a lot on persuasive skills. A common strategy is to cite increase in value of other properties in the locality to create a fear of price rise so that you panic and take a quick decision.
Though it is difficult to know the actual prices, you can get a rough estimate in property portals and newspaper ads. Another option is to contact several brokers. You can also approach a person who has recently bought a similar property in the locality.
A broker may drop names of upcoming projects in the vicinity which may be just speculation.
QUALITY CONTROL
Brokers are often not transparent about the quality of construction. Two similar properties in a locality can be priced the same but one may give more value for money in terms of construction quality and amenities. Ask for a detailed such as whether the common areas are the same.
DISTANCE SALE
The dependence on the broker is higher when buyers and sellers are in different locations.
"The parties often don't get to meet face-to-face.In such cases, deals are rushed on brokers' insistence,"
Insist on meeting the other party to finalize the deal. If the broker wants to close the deal without the buyer and the seller getting to know each other, something may be a miss.
TRANSPARENT FEES
Brokers get a commission, which is usually a percentage of the deal value. You should ask the fee the broker is getting from the other party. If you do not get a clear answer, take it as a warning.
"It is imperative that the broker state his commission and give evidence that the property has a clear title,"
ONLINE ADS
Real estate websites are full of misleading listings by brokers. In the online space, free listings are more likely than others to make false claims.
"In online listings, agents often use wrong photos, false specifications and low prices to draw attention and generate leads. When people contact the agent, they are told that the listed property is not available and they can choose from other properties,"
BIG ADVANTAGE
According to estimates, there are around one million brokers in the country who are neither registered nor regulated. "Many of them are unqualified and inexperienced," says Sandhir.
Big brokerages have a reputation to keep and can be more professional. They are expected to make full disclosure to clients, quote the best price and ensure there are no nasty surprises at the last minute.
"If the broker is working as an individual with requisite experience, he may go the extra mile to service your requirements. There are, however, some distinct advantages such as depth of knowledge and lower risk with large brokerages,"
UNLICENSED BROKERS
More often than not, agents tend to drive their own agenda to earn higher commissions.
"A broker is just an intermediary. So, he is not answerable in case of overpricing or any other issue. If you have been overcharged, nothing much can be done," says Indiaproperty.com's Vasudevan.
Lack of adequate regulations and certifying bodies for real estate agents is one reason for unprofessionalism in the sector.
"Ideally, like in many parts of the world, the onus should fall on agents to act as a fair and honest mediator and should ensure that property transactions are transparent and swift,"
Haahhh...
At Last I say...
......Brokers are indispensable in the real estate sector. Until they are brought under a regulatory body, you will have to stay on the guard.
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