The COVID19 pandemic impacted all industries, including global real estate. In the pandemic’s early days, the world’s leading real estate agencies entered “panic mode.” Property prices were dropping across the board. Thankfully, since then, the industry has rebounded very strongly.
According to a recent Forbes report, 80% of the world’s top 31 real estate agencies recorded major profits in 2021. These real estate agencies are continuing their success in 2022 in different sectors of the market.
According to Price Waterhouse Coopers –
- Demand for logistics-related properties (distribution centres, warehouses, etc.) has skyrocketed since the pandemic due to the rise of eCommerce.
- Residential properties have also provided a steady income to real estate agencies across the globe. Major real estate investors in the US and Europe will continue to invest in affordable housing in 2022 and beyond.
- The commercial real estate sector (especially the office sector) is currently not as appealing to investors. Remote working has eroded the appeal of expensive office spaces.
Now’s a good time for aspiring real estate investors to enter the market. But, to do so, they need the assistance of top-quality real estate agencies. Let’s explore how these agencies function and, more importantly, how they help investors.
Understanding Real Estate Agencies
Real estate agencies either serve as brokerages, property management companies, or both. Property management agencies buy large properties and convert them into smaller apartments or real estate spaces.
Their work entails more than just buying or selling properties. Conversely, real estate agencies that serve as brokerage firms focus more on helping investors buy or sell properties.
Agents at these organizations have access to the brokerage’s resources which makes their jobs easier. A real estate brokerage agency will have special legal teams to oversee the backend, technical aspects of property acquisitions/sales.
Real estate agencies can also be categorized on the basis of how they operate –
- Single Agencies: In these agencies, real estate agents represent only one side of the party – either the buyer/seller. They can’t represent both. Real estate agents at single agencies have strict fiduciary responsibilities to their clients.
- Designated Agencies: In these agencies, two real estate agents from the same brokerage represent both buyers and sellers in transactions. Let’s say you’re buying a property. You and your seller can give written consent to a designated agency and ask their agents to oversee the sale. One agent will represent you, the other your seller. The agents don’t disclose any confidential information to either party until the transaction is complete.
- Dual Agencies: In these agencies, one agent represents both the buyer/seller in the transaction. Real estate agents in dual agencies have legal and fiduciary responsibilities to both parties involved in the same transaction. In real estate transactions involving dual agencies, there’s always the risk of conflicting interests. After all, there’s only one agent mediating the deal between the buyer and the seller. So, unless both parties come to an equal agreement, working with a dual agency is impossible.
How Real Estate Agents Help Buyers and Sellers
The main function of any real estate agency is to ensure their clients receive the best possible deals. When it comes to property sellers, real estate agencies can help them by –
- Stage the property before open house events.
- Take photos of the house’s interior and exterior regions and share them in listings for advertisement.
- List the property in all major listing services.
- Determine the fair value of the properties on sale.
- Use their marketing and negotiation skills to find better deals for the sellers.
Here are some ways real estate agencies help property buyers –
- Understand the long and short-term real estate investment strategies of the buyers.
- Find high-quality properties in specific locations by researching all major listing services.
- Make sure the deal goes through as per the buyer’s schedule.
The COVID19 pandemic has triggered widespread interest in real estate investing. Real estate agencies will play key roles in converting this interest into lucrative deals for sellers and buyers!