Where the money is in real estate
February 27, 2016
Real estate is often simply a series of problems. They can be property related, people related, or having to do with regulatory entities.
Regardless, problems have an effect on buying and selling. A real estate Agent's job and value is in their ability to mitigate the problems. Problem-solving Agents make deals, save deals, and make things come out the way Buyers and Sellers want them to.
Problems can be "hurdles" or "brick walls," but if the transaction is stalled, problems must be addressed. Something as simple as needing an original signature from the East Coast for a closing tomorrow is easy for today's Agent with today's technologies and delivery services.
Finding proper documentation to have a smooth reconveyance of a loan that was paid off 30 years ago, but not re-conveyed properly, can be a challenge.
A good Agent will tell the Seller what is needed, what may suffice, and what the objective is, such that they can look in their records and find supporting documentation that will give the title company comfort in deciding to insure the title.
Some problems appear insurmountable. A landlocked parcel has lesser value than one that can be legally accessed. One way to make money in real estate is to "unlock" a landlocked property.
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There are ways to find or acquire legal access. Sometimes a physical characteristic appears to be a problem, i.e. a detention basin on the property.
If you create a terraced decorative wall you define the pond area and provide excellent landscaping and decorating opportunities with the terracing. Problem solved.
Some problems scare Buyers. Most Buyers don't have the ability to visualize solutions or their cost. Agents can help in both areas. Properties with such issues tend to have a price concession built in up front to offset the problem.
The Buyer capable of visualizing the resolution of the problem will make money by solving the problem. Zoning or neighborhood issues can impact a property and/or its use. Solving such problems can have a dramatic positive impact on value.
Some homes are just plain repugnant when you walk in them. Most Buyers walk away in disgust from such properties, but often they are the proverbial diamond in the rough. We see many "before and after" real property situations where someone steps up to buy and cure the visual blight of a neglected property.
Title or regulatory issues can be particularly satisfying to cure and profit from. All is not what it appears to be. When presented with a title, zoning, HOA, or other problem, look at it closely. Very closely. We've seen some magnificent resolutions to such problems by researching, reading and talking that were unthinkable when the problem was first encountered.
Our Advice: We have maintained for years about selling real estate, "If it was easy, everybody would do it." Agents would be without work if there are no problems in marketing and the ensuing transactions.
Everyone should stay calm, assess the problem and establish options. If everyone understands the problem, the impact of the problem, and potential resolutions, they can work together to resolve it to close a transaction, get a property ready to sell, or proceed with a purchase that otherwise wouldn't occur.
Solving the problem causes money to flow for all parties in real estate. Don't let a problem stop you, remember our mantra, "What's a hurdle to a hurdler?!" Keep moving down the track to the goal.
Solving problems is the essence of a real estate Agent's job. Your Agent should embrace problems for you as they arise. They can get you what you want and, depending on the problem in question, maybe solve an issue such that will greatly enhance your monetary gain in the transaction.
When it comes to choosing professionals to assist you with your real estate needs, remember that experience is priceless.
Lisa Wetzel & Jim Valentine, CDPE, SFR, work for RE/MAX Realty Affiliates in the Carson Valley. Visit carsonvalleyland.com or call 775-781-5472 for information.