Real Estate Commissions – You Charge HOW MUCH?

Real Estate Commissions – You Charge HOW MUCH?

  I often hear from consumers that they feel real estate commission are too high. I often hear from real estate agents that real estate commissions are too low. I guess it depends on what side you’re on!  I also train a lot of agents. In doing so, I am always struck by the same sentiment from all of them. “Wow, there is a lot more to this than I thought.” Yep, there sure is. I once had a client get his real estate license in hopes to save money since he bought multiple properties each year. He very quickly realized that not only was the time invested not worth the money saved, but that he really wasn’t saving anything after all the fees and taxes were paid. As Realtors, we own our own business which comes with several perks. It also comes with a lot of liability and a lot of expenses. There are tools we need to do a great job for our clients. We need equipment, so we can keep up with technology to service our clients. We are required to take continuing education that is a benefit to clients. We pay self-employment taxes. If we have any help with paperwork, such as an office assistant or a contract to close professional, we pay for that. Most hire professionals to do things like take photographs, videos and measure houses. That all comes out of our pocket. We have errors and omissions insurance and license fees. Marketing and advertising and gas to and from properties. We also pay our companies for the benefit of the experience and advice the Brokers give us and those are just hard costs. We’ve all heard the expression, “time is money.” Why are so many people so opposed to paying others for their time? Just like those new agents discover, there is a lot of time spent during the buying and selling process that most clients never see. Phone conversations with clients and agents, emails, text messages, drive time to appointments, scheduling and rescheduling showing appointments, inspections, appraisals, reviewing offers, drafting offers, negotiating, late nights and early mornings, coordinating closings with title companies to make sure that all the client needs to do is show up! Those are just a sample of things that Realtors spend their time doing behind the scenes, so their client doesn’t have to worry about anything but the move. Yes, time is money. Most of us think nothing of spending hundreds of dollars to go see our favorite entertainer or sports team but we balk at paying a professional Realtor handle the details of, quite possibly, the biggest investment we will make in our life. Before I...

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Nashville Investment Property

Nashville Investment Property

  Nashville is the “It” city. It has been ranked the #1 housing market in the nation. Depending on the day, we hear that 80-100 people move to Nashville every day. We were named the #1 Minor League Baseball city. We are in the Top 20 cities for tech jobs, #6 for young professionals and #7 for millennials. We are among the Top 10 cities in which to launch a career and Nashville has the third fastest growing large Metro economy. The list goes on and on. But, with all these accolades, does that mean that Nashville is a great place to buy investment property? Yes and no. With Nashville’s influx of residents, we have also had low inventory. Because a lot of those are millennials and young professionals, the demand for properties under $200,000 has increased significantly. Typically, this is where investors like to buy. They can get in a property for a decent price, rent it out for an attractive price, and still get a nice return on their investment every month. We were getting multiple calls a week for a while from people all across the country that wanted to invest in Nashville. Most used the word that investors dream about, “deal.” “I want to get a deal.” “I’m looking for a deal.” “Where can I find a deal?” and “If you find a deal, I’ll buy it.” Well, the truth of the matter is, there really aren’t many, if any, “deals” in Nashville right now. First time home buyers, young professionals, millennials and investors are all competing over the same property. Investors that have cash may be more attractive to sellers, however, cash is not always king and not all investors have cash. Some sellers don’t want to sell to an investor and will take an offer from an owner-occupant over an investor because they either want to help the “little man” or they don’t like the thought of renters living in the home they have loved for years. Another pitfall of investors is thinking that cash is king – no matter the offer. Sellers won’t necessarily take thousands less for their home just to have it close in two weeks. Some would rather wait another 2- 3 weeks and make more in the long run. If you plan on investing but you are getting a loan, you are in the same boat, for the most part, that owner-occupants are in and you will find the Nashville market a tough one to compete in. The best thing to do is to find the properties before they go on the market or at very least, the same day. Find a Realtor that diligently hunts for properties...

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