Slide 1
5 Questions You Should Ask When Buying Real Estate

1. How long have they been selling real estate? There is no shortcut to earning experience and knowledge. Only time and volume of transactions can forge the strength that is 100% necessary to bring to the table. It is important to understand that when you hire a brokerage company, you are not hiring the company so much as you are hiring the individual agent. The company is only as good as the agent you hire.

2. How many transactions have they personally completed? Don't get duped here. Many agents will say they have "worked on" many transactions - this usually means they have worked as an assistant without negotiation, decision making or applied contract experience. Ask them how many transactions they have closed where they were the primary agent in charge of the Buyer or Seller.

3. Do they cooperate with outside brokers and agents from outside companies from the first day they take the listing? Large companies have large overhead. In order to combat this, most large companies frown on their agents cooperating with agents from other companies. Why? Because the company wants to receive the revenue from both the buying and the selling side of the transaction. We believe that not cooperating with agents/companies is a severe breach of the agent's fiduciary responsibility to the client. By not sharing the property with outside brokers, the company/agent is severely limiting the Seller's ability to achieve top dollar. How can you know if a company cooperates with outside brokers? Ask to see a list of email addresses of outside brokers with whom they will share the property. Make sure they immediately submit the property to The MLS, Loopnet, Co-Star, Property Line. Don't let them tell you that "nobody uses The MLS" or that their pool of in-house buyers is the most effective way to sell the property. These are just excuses to sell the property in-house. The hard fact is that the wider the buyer pool the property is exposed to, the higher the selling price will be.

4. How much real estate do they own themselves? The truth is most brokers don't know much about owning real estate because (with the exception of their house), they don't invest in the product they sell. Before you hire a broker, make 100% sure that they own investment real estate themselves. This is vitally important because the agent needs to understand the sale equation from the Buyer, Seller and Broker's perspective. Without this knowledge, they cannot effectively represent you.

5. Do they continue their real estate education? Passing the real estate exam does not qualify an agent as a "real estate expert." Only experience and knowledge can make someone an expert. Most agents will take the exam, sell a couple of properties for family and friends, then consider themselves "seasoned." Advanced education is imperative if you truly want to call yourself an "expert." When you are interviewing an agent, ask them to explain to you the advanced concepts of NPV, IRR, Time Value of Money (TVM), Comparative Investment Analysis, Lease vs. Own, Buy vs. Build and leverage. These are the concepts that drive the real estate industry. If they don't understand them and how to use them, they are certainly not qualified to represent you.