The Business of Being a Commercial Real Estate Agent

Working in commercial real estate is quite different from helping home buyers and sellers—you’re working with business owners and investors with a very different inventory.

A commercial transaction might deal with multi-family, mixed-use, retail, or office space. Therefore, successful commercial real estate agents must know about sales and leasing in a broad array of property types. There are different kinds of tenant negotiations that occur, and different types of marketing strategies. And a transaction could be for an owner occupied property or as a commercial real estate investment, adding additional factors to the transaction.

What do investors, buyers and tenants want from a commercial real estate professional

First off, commercial is a specialty, so it’s best that an agent gain experience and knowledge in this specific sector of the real estate field. Know (or learn) how to deal with commercial transactions—there are no uniform contracts or cookie cutter leases. That means sharpening your negotiation skills as well as understanding the leasing or commercial buying process.

Of course, just as with residential sales professionals, being proactive is important. Aside from canvassing the local market for properties and leads, research is key to commercial transactions.

  • Use your office’s systems and tools to research market rates for rentals
  • Become conversant in investment packages
  • Gain a full understanding of the different areas in your market. Do properties in certain areas attract certain kinds of businesses? Do the listing prices make sense for sale properties?
  • Can you provide a detailed and accurate financial analysis for commercial investors?

Aside from research, developing good relationships with area business owners can help create strong database and referral network. When that investor calls the office looking for help finding the right property, you’ll not only have the listings services as a resource, you’ll have local people to contact and potential space to visit because you’ve done your homework.

Speaking of referrals—remember that commercial real estate transactions often involve build outs and other improvements as part of the lease negotiations. Therefore, good power partners are architects, general contractors, and others involved in lease improvements.

More complicated investment deals may require partnering with others to make a successful transaction, so it’s important to know the players in your area or your office to create a winning team.

If you are working with tenants, it’s important that you show them you understand their businesses and that you are showing them space that makes sense for their needs. Whether it’s a restaurant, retailer, healthcare facility or law practice, every client has different needs in terms of square footage, utilities, parking and leasehold improvements.

When working with building owners, these clients want to know that you have a good performance record when it comes to finding strong tenants or solid buyers; your experience will speak for itself. They will also count on you to represent their interests to potential buyers or tenants, and that you can negotiate a strong deal on their behalf. Like the buyer or tenant, the seller or landlord will want to know that you have his/her best interests in mind throughout the transaction.

From any side of the transaction, building trust builds relationships that will in turn build business.

Build your book of business at Century 21 Cedarcrest Realty

Our office is growing—and we’re always looking for savvy commercial real estate agents to join our team. When you join our northern New Jersey office, you become part of one of the country’s most well-respected real estate organizations, with business-building tools and apps designed for commercial real estate agents. You can take advantage of commercial investment training that will position you for a broader range of transactions. Plus, you’ll benefit from our ongoing in-office training and development for agents at all stages of their careers—an important way we support our team, and why Century 21 Cedarcrest Realty consistently wins industry awards for sales volume and customer service—and accolades and awards from consumers as well.

Interested in learning more? Contact Susan Mazzetta at (973) 228-1050, ext. 126 for a confidential interview.

Getting Ready to List Your Home – Steps You Can Take to Add Value for Buyers

Getting your home prepared for a listing with a real estate agency is an exciting time. Of course, your agent will want to be excited about your listing and bring as many qualified prospects as possible. Is your real estate professional providing you with guidance about how to add value to your home? These home maintenance and repair tips will help you increase your chances of a sale more quickly.

De-clutter and organize. No one wants to step through clutter, look in rooms or closets that are overflowing with unnecessary items, or have to imagine what the space could look like without a homeowners personal effects clouding the “scenery.” Before you list your home for sale, start going through all the rooms, from attic to basement, and clean out and organize. You can create piles for discard, donate and store; once you’ve done the first two, it’s time to organize your storage needs. Closet storage systems will help you keep clothes organized and make a great presentation. Garage and basement storage solutions are also available to keep items off the floor and in a safe place.

Refresh rooms with paint. That first impression will be largely influenced by the look and feel of your rooms. After you’ve cleaned and cleared, a fresh coat of paint in neutral colors will help rooms look larger and make prospective buyers feel better about your space. Bright colors might be your style but not theirs so avoid making too much of a “statement” in your color choice.

Update bathroom fixtures. Swap out those tired old bathroom faucets and the old sink; install a new vanity or a shower head; or put on new toilet seats if necessary. You need not spend lots of money to do these simple updates and a little goes a long way. Remember, clean and new is better than tired and worn.

Update kitchen appliances and fixtures. If this is in your budget, it is well worth the expenditure on this end of the sales process. There’s no need for a full remodel but a face lift is well worth it for making a quicker sale. New cabinet doors and hardware or a new sink or new faucet with sprayer (a popular feature) are good investments. If you can swing it and your dishwasher or refrigerator are outdated, consider installing new models that prospective home buyers will appreciate.

Boost your curb appeal. Landscaping and driveway appearance are what prospective home buyers will see first—and will encourage or discourage them about coming inside for a closer look. Get your lawn in shape, plant your garden beds, prune your trees and shrubs. Outdoor lighting is also a benefit, from the front porch to the walkway or gardens. If the driveway is in poor shape, have it repaired.

Make necessary exterior repairs. In addition to the driveway, your front steps should be in good condition; your gutters should be in place and doing their jobs to prevent water damage to the home; missing roof shingles should be replaced; problems with paver or concrete walkways, your sidewalk, patio and deck (where applicable) should be remediated. Remember, you don’t want to give anyone a reason to walk away (and you wouldn’t want anyone to trip and get hurt).

Insulate for energy efficiency. One way to show prospective home buyers that your home is prepared for 21st century living is to add insulation in order to improve your energy efficiency and reduce heating and cooling costs. This is a also good time to look at your windows to see where you can seal any seams or cracks where air penetrates.

At Century 21 Cedarcrest Realty, we guide our clients to make sure their homes are in “ready for sale” condition, in order to make the sales process as stress-free as possible for everyone involved. As part of our client service, our real estate agents will go over what we feel your home needs to prepare it for a listing, and help you hash out the pros and cons of certain upgrades and repairs. Want to find out more about the best way to sell your home in Essex County or other northern New Jersey areas? Call Century 21 Cedarcrest at (973) 228-1050 or visit our website to get started.

The Advantages of Owning vs. Renting

If you’re currently renting your home and have always dreamed of buying, this might be the right time for you to make the choice to swap over to home ownership. Many people are worried about this step in life. They fear they are not ready yet, that they won’t get approved or that they won’t be able to afford buying a home. However, in many cases, buying your home can be more affordable than renting. Let’s take a look at some of the other advantages.

Here are some of the advantages of owning vs. renting your home:

  • Your monthly mortgage might be less than the rent you are already paying so buying could save you money and you’re building equity at the same time.
  • You have control of the creativity and flow of your home more when you own than most renters. You can redecorate, renovate and otherwise personalize your home. You usually cannot do this when you rent.
  • There are also tax deductions that come with owning your own home. You can deduct your mortgage interest as well as your property taxes and these are not benefits you get as a renter. There are also tax breaks on the sale of your home.
  • Your housing payments are also stable when you own vs. renting, where rent can go up. If you choose a fixed-rate mortgage, your principal and interest payments will be the same for the duration of the loan.
  • Your home is an investment. You will own it and whether you decide to live in it forever, resell it or rent it out, you are investing into something that you will own. This gives you more leverage with whatever you do decide to do with it in the future. You don’t have this power when you rent.

Of course there are also disadvantages to buying. You will be responsible for all of your maintenance fees, you could lose value in the home over time, you have to pay property taxes which could be very high depending on where you live, and it requires a cash investment.

Now that you know the advantages of owning vs. renting your home, you can make this decision for yourself. Only you can truly know if this is the right decision for you at this point in your life but there are people who can help you with the process. A credit counselor and your real estate agent or broker can help you determine if home ownership vs. renting is right for you.

House Flipping: Is It for You?

Maybe you’ve heard of house flipping or seen it on TV. It’s really grown as a method of making money and there are even reality TV shows about it. So how do you know if house flipping is for you? Really, no one else can make that decision except for you. You’re the only person who knows if you can afford it, if you can risk it, and if you will enjoy it.

Here are some situations where house flipping may not be right for you:

  • You don’t have the money – It takes money to invest in real estate and if you can’t afford it, you don’t want to risk it right now. Flipping houses can pay off big but you might also lose in some of your investments and if you don’t have the money to take the risk, you shouldn’t do it.
  • You don’t have the time – Flipping houses is going to take time. To really do this successfully, you’re going to need to invest time. You need to research houses, watch the market for quick sales and auctions and good deals, invest time in doing appraisals and also in putting time and money into fixing up the home. Then, you’re also going to need to invest time in reselling it. So if you don’t have the time, this is not for you.
  • You don’t have the knowledge – If you don’t know anything about real estate, the value of properties and the current market, this might not be right for you. If you don’t have the industry knowledge, you’re not going to know how to find good deals and make profits.

Here are some things that may make house flipping good for you:

  • Have a support network – If you have a good network of friends, family members and associates that can help you, this puts you in a good position for doing something like house flipping.
  • Have a feel for DIY and handyman stuff – If you enjoy DIY and other handyman work, you might enjoy house flipping because you can do a lot of this work hands-on for yourself. If you’re interested in it and passionate about it, then this could be a great choice for you.
  • Experience in real estate – If you already have experience in real estate, you’re going to have the upper hand in the world of house flipping.

With these ideas in mind, you can decide if house flipping is the right choice for you. If you have the money to invest and the time and you enjoy it, this can be a great part-time job or even a full time career for you.

How to Deal with Buyer’s Remorse in Real Estate

How to Deal with Buyer’s Remorse in Real Estate

 

Buyer’s remorse is not uncommon at all. Buying a house is a major decision and every person who has the mindset of an adult is going to question major decisions they make. They have fears concerning their finances and future, and that’s actually healthy. It prevents them from making decisions on the fly and considering all of the angles rather than making decisions based on things that aren’t really important. As a realtor, it’s your job to let them know how common this is and walk them through a few steps that will help them make the right decision in the end.

 

Explain Commonalities

 

Sometimes people need to know they aren’t alone. You can explain to the buyer that many people experience this same feeling. You might even relate this situation to a decision about getting married, though you might want to avoid this route if they are recently divorced. Explain that any life decision this big is bound to cause a bit of anxiety. That doesn’t mean that they are making a bad decision.

 

Go Back in Time

 

Talk about why they chose this house to begin with. Point out that those things still exist. If there are elements about the house that they don’t like, address how those might be dealt with. For example, if they don’t like the fact that there are stairs in a house, you can discuss how this is a commitment and a great buy, but that in the future, when the kids are grown and moved out, they might actually make a profit off the house when they sell it and buy something smaller with only one floor. Just be sure to return the focus to the things that they loved about the house and which caused them to claim it as their own.

 

Discuss Options

 

The buyer might still have the option of backing out. Talk with them about what might happen if they do back out and what they would look for in the next house. If possible, reveal some of the ways they might incorporate those elements into the house they are set to buy right now.

 

Sometimes it helps to write things out, so you might sit down with the client and list the pros and cons as they see it. Make a special note in any areas where the cons are going to be the same in any house they choose. Encourage them to take the list home and consider it before making any kind of decision to back out of their existing real estate transaction. Sometimes they just need a bit of time to calm themselves down and see all the potential that their new house has.

 

What Does the Chinese Market Mean to US Real Estate?

What Does the Chinese Market Mean to US Real Estate?

The global market has huge reach. A piece of political turmoil in one country, especially when it includes finance or banking, can have a ripple effect that spans the globe – shaking confidence, making people nervous about investments, altering interest rates, and more.

More recently, the world has had its eye on the Chinese stock market based in Shanghai. As the turbulent Chinese market changes and leaves investors feeling less secure about local real estate, Chinese investors are looking to the United States instead. In terms of real estate, a slump in the Chinese market means a boom in US real estate sales.

Go figure.

According to CNBC, “Chinese buyers have poured $28.6 billion into US real estate in the past year…” This is a huge number, and forecasters expect to see further increase. While California has always been a favorite for foreign investors, Florida and Texas are also favored because of educational and work opportunities.

Why real estate? The Chinese yuan and the US dollar have a very close relationship, so turmoil doesn’t necessarily mean a huge change in exchange rates, though some devaluation has been seen very recently. Real estate is considered a safe asset to have as part of an investment portfolio. The risk is considered low to moderate and the returns are generally pretty high, especially in the past several weeks.

The surge in Chinese purchases in the US started before August’s major stock exchange crash, but the impact of the crash has had a significant impact. According to Inman, “The Chinese stock market has lost 30 percent of its value and continues to see major swings,” and “More than half of Chinese citizens are considering buying foreign real estate.”

There are some analysts who wonder if the stock market crash will scare investors away from all avenues of investment, startling them into saving instead of making purchases anywhere – in China or overseas. Most seem to think that investors will continue spending in other countries, particularly in the West.

What does it mean right now? As a real estate agent, it means you need to embrace the opportunity to work with new clients. Focus on today and on your ability to appeal to a new, growing audience. We’ll keep an eye on the stock market and continue to be aware of day-to-day changes and their impacts on the global economy.

How to Entice Buyers to Look at a Vacant Home

How to Entice Buyers to Look at a Vacant Home

You had to move to your new home before your old one sold. No matter what the circumstances that forced your early move, the truth is that you now have a unique selling situation. You have a vacant home to show and sell. While that may seem like an ideal situation, it does present a number of challenges.

An Empty Home is a Boring Home

One of the first problems you’ll encounter is that the home is completely empty. Believe it or not, this actually makes it more difficult for a buyer to visualize himself living in the home. There is no frame of reference for how the rooms might look with furniture or décor. The upside is that this can be remedied in a few different ways.

The first is virtual staging, where an artist uses technology to add furniture and décor to the images of the home that will appear online. The images can be used as a supplement to the home showing. More ideal would be to rent furniture or buy someone on consignment to leave behind. The home will look a little more lived in, without the clutter of an actual family running in and out.

Regular Home Maintenance

A vacant home is an unmaintained home. Make sure you have someone doing outside yardwork on a routine basis to keep the outside looking well maintained and cared for. Depending on how long you’re out of the house, and how far away you are, you may want to hire a cleaning service to make sure the inside isn’t too dusty, that the windows are washed, and that there are no odors in the home.

Utilities Need to Be On

You need to make sure that there are utilities on within the home. While you may fear the cost, you’ll be spending significantly less than if someone was living in the house. Your real estate agent needs to be able to turn on lights, adjust the heat or air conditioning, show that the gas range works (if applicable) and show that the plumbing systems work. If the home sells, an inspector will need to be able to do the same. No one will want to tour a home they can’t see, or that feels awful compared to the outside temperature.

Don’t panic if you need to leave your home before it has sold. Your real estate agent is here to help and will guide you through the process, ensuring everything runs smoothly in your absence.

How Much is Too Much When Determining Your Maximum Buying Price?

How Much is Too Much When Determining Your Maximum Buying Price?

A lot of thought and planning goes into determining the price range a person should look in when buying a home. A lot of people set a range with a minimum and maximum – the minimum being a base for expectations and the maximum capping him financially. Even still, having a maximum buying price does not mean you have to push it to the limit.

Assessing Your Income

The general rule of thumb is to follow the industry-wide standard for payment-to-income ratio. The amount you spend on your home each month is the total sum of the actual mortgage payment, property taxes, homeowners insurance, and any other applicable fees like mortgage insurance or homeowner’s association fees. That total should not equal more than 25 – 33% of your total household income.

Your income isn’t the only thing you need to take into consideration, too. You need to seriously assess your outstanding debts as well. Outstanding debt will make it more difficult for you to qualify for a mortgage, and that’s even more reason to lean more towards the 25% (or less) than the 33%. You’ll want to make sure you have enough money for your housing and your debts, no matter what emergency situations may arise. A good mortgage lender will apply a debt-to-income ratio and will not allow you to have a housing payment that is higher than your debt obligations.

Assessing Stability

The highest possible limit for a mortgage represents what you can afford in the best of times. Life isn’t perfect, though, and surprises do come along. Think about whether or not you’d be able to make your mortgage payments if you were in an accident or if you lost your job. What if your mortgage and bills had to be paid on one income instead of two (if you’re married and sharing debts with a spouse)?

Use a Mortgage Calculator

There are dozens of great mortgage calculators online. Take advantage of one – or even more than one – to assess your financial situation. Use this information before, during, and after the loan approval process.

At the end of the day, everyone wants to see you in the nicest home you can afford – realistically afford, that is. Take your time, have a real conversation with your real estate agent about your wants and needs, and remain realistic about your ability to pay for your dream home.