Chapter 26

OLD CAR

"O" stands for Obedience "L" stands for Loyalty "D" stands for Disclosure "C" stands for Confidentiality "A" stands for Accounting ...and "R" stands for Reasonable care

Accounting

"account for", or answer for, any property or money that your client has entrusted to you. This includes money, deeds, and any other documents given to you that relate to real estate transactions in which you represent them.

what year house and under does a lead based paint disclosure need to be signed?

1978

seller has how many days after signing listing agreement to sign property disclosure statement?

3 days

Comparative Market Analysis (CMA)

A comparison of the prices of recently sold homes that are similar to a listing seller's home in terms of location, style, and amenities.

exclusive ageny agreement

A listing agreement employing a broker as the sole agent for the seller of real property under the terms of which the broker is entitled to a commission if the property is sold through any other broker, but not if a sale is negotiated by the owner without the services of an agent.

unilateral contract

A unilateral contract specifies the conditions under which one person pays the other to perform a certain duty. If and when the duty is fulfilled, funds are exchanged. In the case of real estate, this means that the listing broker who secures the buyer gets paid, but that no listing broker is obligated to secure a buyer.

Confidentiality

An agent is obligated to safeguard his/her principal's lawful confidences and secrets. Therefore, a real estate broker must keep confidential any information that may weaken a principal's bargaining position. The duty of confidentiality precludes a broker who represents a seller from disclosing to a buyer that the seller can, or must, sell a property below the listed price. Conversely, a broker who represents a buyer is prohibited from disclosing to a seller that the buyer can, or will, pay more than what has been offered for a property.

loyalty

An agent's duty to place the client's interest above those of all others, including the agent's own self-interest.

MLS

An association of real estate agents providing for a pooling of listings and the sharing of commissions on a specified basis.

open listing

An authorization given by a property owner to a real estate agent wherein said agent is given the nonexclusive right to secure a purchaser; open listings may be given to any number of agents without liability to compensate any except the one who first secures a buyer ready, willing, and able to meet the terms of the listing, or secures the acceptance by the seller of a satisfactory offer.

Difference between Exclusive Right to Sell and Exclusive Agency

An exclusive right-to-sell agreement offers the listing firm commission if a sale occurs, and it doesn't matter whether the broker, the seller or someone else procured the sales, the listing broker gets paid in all cases. On the other hand, an exclusive agency agreement stipulates that the seller only pays the commission if the listing firm or another real estate firm finds the buyer.

disclosure

As an agent, you must tell your client everything that pertains to the transaction that impacts them as part of the agency relationship. This includes facts that impact property value or marketability. It also includes knowledge gained regarding the other party's bargaining position, presenting all offers on the home, information about a buyer's willingness to make a better offer and intentions to divide or sell the property for a higher profit.

using bedrooms for figure CMA

Homes that have the same number of bathrooms and bedrooms are good comparisons since such a high value is placed on these assets. However, it is also possible to estimate the value of an extra bedroom or bathroom when preparing the CMA, if you feel like a home is one of better choices. Homes with square footage within 300 of the listing property. For example, if your home is 2,300 square feet, the range for comparable properties will be 2,000 to 2,600 square feet. Because the number of "bedrooms" listed for a home. Generally, more bedrooms equal a higher listing price. Be aware of how the local coding agency defines a bedroom. In some cases, living rooms, dining rooms and sun rooms can be considered officially as "bedroom."

examples of clauses for cancellation of agreement

One clause prevents the seller from canceling a listing agreement without the real estate agent's written agreement. Another termination clause states that if an agent has brought a buyer who is willing and able to the closing table, she has earned her commission at that time. So, if the seller unreasonably turns down an offer, they could be liable to pay the commission anyway. clause that is good to include in your listing agreement places constraints on the sale of the home to anyone the listing agent has shown it to. The seller will not be able to sell the home to these prospects within 6 months to one year after the contract ends.

property data form for the MLS

Property class (single-family, residential, commercial, condo, etc.) Listing price Listing expiration date (typically 30, 60 or 90 days) Commission offered to another broker (the commission varies by area but typically between 2 to 3.5%) Other required information (number of bedrooms, number of bathrooms, patio, garage, pool and other major features)

determining neighborhood for comparison

Select homes in the same school district as your listing. Especially in areas with a demographic of young families, the quality of the schools will be of paramount interest to interested buyers. If there aren't enough sales in the same school district, be familiar enough with the surrounding school districts, to be able to select from homes in similar school districts. In larger cities, school districts right next to each other can have dramatically different ratings. This usually has a sizable impact on property values.

sales commission

The commission is always negotiable between the principal and broker. If the commission rate is too low, a listing broker may fail to push the house in all effective advertising channels. The selling broker may concentrate on other prospects with a higher commission potential.

Duration of the Listing Contract.

The length of the contract can be three months, six months, a year, or any other period you choose. The seller will want to keep this as short as possible in order to be able to terminate the relationship if no sale occurs. The broker will need to ensure the period is long enough to cover the time and effort as well as the expense of marketing the home.

exceptions to commission

This absolves the seller in whole or part from paying commission if they find a buyer themselves. Generally, if the seller finds their own buyer, they had to have listed them in the listing agreement as a potential buyer.

obedience

This fiduciary relationship obligates the agent to act in good faith at all times, obeying the client's instructions in accordance with the contract.

Sale Price

This is the desired price of the seller, which should reflect a realistic amount a buyer would be willing to pay.

determine $ per sq footage

You use this average price per square foot multiplied by the exact square footage of the listing home.

commonly adjusted items for CMA

add or subtract for acreage size Does the property have additional bedrooms and bathrooms? Does the home have a garage? If so, how many cars can fit in the garage? Has the kitchen been upgraded? Look for any special financing that could have impacted the sales price. Motivated cash buyers may have been willing to pay more for a quick sale, for example. Was the sale of the comparable property arm's length? Meaning, were there any special circumstances that would impact the sale, such as selling to a relative? Do not include short share or distressed properties in the comparison as these sales will not reflect true market value.

once an agent fills out a listing agreement who must sign it?

broker

exclusive right to sell

broker agrees to act as agent for the seller of real property, where under the terms of the agreement, the broker is entitled to a commission if the property is sold during the time the agreement is in effect. This includes any buyers brought in by the seller or another broker with or without the services of an agent.

general conditions to look for in home before listing

condition, upgrades, ill side walks or appearance

using home sales for CMA

consider all homes listed in the past six months, including homes that have sold, have sales pending or are expired. Sold listings are the primary tool for determining the value of your listing. Meanwhile, expired listings tell at what price the market will not respond to a listing. Pending listings can help you understand what similar homes are going for in the current moment.

Reasonable Care and Diligence

expected and required to use reasonable care and diligence in pursuing your client's goals. The standard of care assumes that, as a licensed real estate broker, you are a competent professional, knowledgeable in your field. By holding a real estate license, you are considered to have expertise above a non-licensed person.

homes with similar amenities

fences, pool, mountain or ocean views

Listing

is also called a listing agreement and it acts as a contract between a real estate broker and a seller who is the owner of real property. The listing contract gives the broker the authority to act on behalf of the seller as an agent in the sale of real property included in the agreement.

size and age of home comparisons

larger lots do add to the value of a property. A home on a full acre lot will be worth much more than a similar home on a quarter acre. Unless you live in a historical home that has a heritage that will increase the property value, older homes are going to be worth less than newer ones. new construction is available in the area, it will command a much higher sales price or may drive down the value of your listing.

what is the desired price of the seller that a willing buyer would pay?

listing price

non exclusive contract

means two parties are entering agreement that services will be performed, but more than one party may be contracted to perform the same services.

what is the listing price of a CMA based on?

reconciled price

Fiduciary duty

refer to the legal and ethical responsibilities an agent owes to their principal.

net listing

the seller tells the real estate agent what price they want to get out of the listing. The agent then adds their desired commission to the net price. Net listings are fraught with peril and are illegal in some states.

digital platforms for marketing

zillow, trulia, redfin