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Real-estate broker agent residential buying and selling houses

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ain't like buying and selling belly button rings in the mall or old video [Girls browsing for belly button rings]

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games or that amazing sculpture of the Empire State Building you made out of

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toothpicks you can't really do it on your own you need help from a

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professional you know the ones with the nicely pressed pantsuits firm handshake [Woman wearing pantsuit]

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professionally whitened teeth, a mercedes in the garage or two but why do

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we really need these people and why would anyone want to be one of them [Woman praying to framed picture of real-estate agent]

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well for starters why is buying a house different from buying a sub sandwich

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from salami shack well you've eaten your share of sub sandwiches in your lifetime

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you know when the lettuce is wilted you're aware if the cheese has turned it

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won't get past you if they try sneaking you any of that gluten-free garbage [Man puts sub sandwich in the trash]

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because you've probably purchased hundreds if not thousands of sub

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sandwiches in your life by contrast the average person buys a home only once

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every 7 or so years maybe just five or six times in their life and it's a big

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purchase you don't want to mess this one up you want someone who knows the

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business inside and out to be kind of holding your hand well if you're buying

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you want someone you actually trust who will know if the listing agent is trying [Hand pulls rug beneath man]

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to pull a fast one on you someone who can refer you to a good home inspector

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who in turn will be able to tell you whether a house's foundation is suspect

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or if those four bodies buried in the woodshed might affect the home's

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value so yeah that's where a real estate broker comes in they've studied their [Home estate broker appears]

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butts off in real estate classes by the way no college necessary so when

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everything there is to know about the listing negotiating buying and selling

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of real estate in some states they've gone to law school and then pass the bar

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and that might be enough to get licensed but you know they make you study for [Boy studying at library]

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that thing so real estate brokers will take their cut in the form of a

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commission based on the final sales price but for a home buyer it's well

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worth shelling out a few percent of the cash made from a sale because for the

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same price you want to end up in one of these and not in one of these all right

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first thing to understand is that there's a difference between a real

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estate broker and a real estate agent a broker can own and run a real estate [Definition of a real estate broker appears on a sign]

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agency they typically got a lot more skin in the game than an agent who can

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just quit their job at that brokerage and leave to go be an agent for another

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brokerage across the street at any moment a broker needs to get heavily

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licensed, registered with their state and so on but while a broker will make less

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money off each sale than an agent does they generally make more money overall [A stash of gold bars appear]

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thanks to volume i.e taken a cut off of every agents sale and those add

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up and note that when they clear 20 grand on a home it's not like they get [Woman with pile of cash on a bed]

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to take all of that Commission cash home with them and sleep with it under below

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much as that sounds kind of fun the broker is responsible for marketing the

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real estate agency paying fees complying with legal guidelines establishing a [Responsibilities of a broker appear]

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physical location and so on there's a heck of a lot more responsibility in

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being a broker versus being just an agent all right so let's talk about the

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real estate agents well they make less money but they're kind of freer if an [Woman agent flying on a bald eagle]

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agent doesn't like his or her situation well he or she can find a better gig

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elsewhere if you're truly desirable as an agent you may even get brokers [Brokers fighting each other]

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fighting each other to get you on their team most agency costs are passed on to

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the agent through desk fees errors and omissions insurance and

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marketing fees agents will have to pay board membership dues if they want to be

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able to refer to themselves as a Realtor and it's actually a registered term

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denoting someone who's registered with the National Association of Realtors and

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MLS memberships and everything you have to get so they can search and find

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information on all this is so they can officially be part of triple-a awesome [Woman holding AAA business card]

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real estate brokerage LLC and be able to put that name on their business cards

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plus they typically have to pay for their own advertising and this cost can be huge to

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the agents if an agent wants their mug on that billboard overlooking the [Billboard of real estate agent appears]

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Pacific Coast Highway it's going to cost them a pretty penny or three or

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million so how does the process of a sale work? well a brokerage or agency is

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going to have a bunch of listings i.e a select offering of available homes that

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if sold the agency will collect the commision on...[List of houses for sale appear]

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for any sale there's both the selling and the buying agent in normal polite

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company among Realtors the selling agent is actually called the listing agent at

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times both agents might work for the same brokerage meaning the broker makes

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twice as much money when the property sells okay so here's the map we have a

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million-dollar sprawling one-bedroom ranch house sold in Silicon Valley you [Ranch house in Silicon Valley appears]

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know that's about all you get for a million bucks here and the commission on

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the sale is 6% of that or 60 grand well the listing and buying agents take

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their split in halfsies, so about 30 grand each then each agent takes his gross

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commission to their broker that's the total 30 grand before their support team

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starts dipping fingers into the winnings save the listing agent has a 64-36 split

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with his broker the one who owns the place ie runs the brokerage and footed

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the original bills in this case the agent would take home 19,200 and the

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broker would clear 10,800, the buying agent does the same

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with whatever split they've worked out with their broker so you're an agent and

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you've secured a listing on a cookie cutter house in the burbs it's listed at [Woman appears by a listed house]

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500K and here's where you've got a massive conflict of interest if offers

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are coming in at well below the listing price say 450 grand you've got two

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options hold out for a better offer but the market is telling you that you

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overpriced the home and likely promised the person who trusted you with the [Hold out hot air balloon appears beside a estate agent]

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listing that they'd get way more money for their home than they actually will

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or you've got choice two; persuade the owners of the property

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that they should lower their standards and their hopes and their prices and

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sell let's think about this for a second if you're making your 1.5% on a $500,000

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sale you're making seventy five hundred bucks if the house sells for 450 grand

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well you make sixty seven fifty so less but not that much less and per hour of

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additional time you'd need to sell and all the other ads you'd have to pay for [Woman working at laptop and house ad's fall on her]

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as well as grief for dealing with whiners yeah is it really worth all the pain and

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heartache and possibly weeks or months more on the market just to squeeze out [Tumbleweed breezes past property]

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an extra seven hundred fifty bucks well no and this is where things get

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ethically tricky because while the seller would love to make max

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cash for their home you kind of just want to churn and burn the thing over and

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move on to the next house why would you hold out well the Realtors

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reputation is everything you may only be making a sale for a particular client [Man spray paints on a womans face]

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once every seven years but clients talk if you royally screwed someone out of a

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hundred grand that they could have made if you hadn't been quite so eager to

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grab a quick commission well they likely tell their friends at the Country Club

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and those friends might tell their friends at the spa and those friends

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might tell their friends who are guest judging the annual dog show or you know [Dog appears on a table beside judges]

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whatever circles they run in you rub one person the wrongway or give them reason to

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think you're putting your own interests ahead of theres then you might never work

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in that town again it's not like you're a neurosurgeon that's sought after from

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halfway around the globe for your unique incredible head slicing skills well some

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real estate agents might be more talented than others but they're [Real estate agents on a conveyor belt]

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basically all about the same in a local area so it's a balancing act

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you want to make sales and quickly but you also want to serve their clients and

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keep them happy ish now we mentioned that brokers take on more risk than

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agents that's true but that isn't the whole story an agent has to do whatever

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they can to sell the properties they've got listed that means marketing it like

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maybe taking out an ad in the local paper well maybe that's too pricey so [Newspaper appears of desperate estate agent]

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instead they have flyers printed up by themselves on their own time and they

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have to go door-to-door jamming them into people's mailboxes advertising for

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and running the open houses and staging the properties ie filling them with [Estate agent places open house sign on property]

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sleek modern furniture and knickknacks basically turning every home into a

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Pottery Barn that's all on you the agent so keep in mind even if you make 10

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grand off a home sale that's not really your profit until you factor in your

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staging cost advertising and so on if you put in a few grand trying to make a

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home all pretty and lavish but you're not able to sell within a few months and [Estate agent standing in a home and items sparkle]

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you're exclusive right to sell contract expires well say goodbye to that

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investment you go the agent route that's your risk..what makes someone a good

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realtor well you have to have one very important skill you got to be able to

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you know kiss the tutee you know get those lips way up there everything your [Lipstick kiss mark appears on a butt]

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client says is amazing or brilliant or hysterical...

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Every thought they have about their dream house is absolutely inspired they

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tell you to jump off a cliff you ask them which way to the nearest precipice [Agent jumps off a wall]

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why well because you want to make your client feel as if they are in complete

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control and well they kind of are the second they start to suspect you may

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only be in it for your selfish self of course you are well they're going to

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start shopping around for the next best brown-noser in line so if you want to

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make sales pucker up and hold your nose that said you have a moral obligation [Woman leans into to kiss a statues butt]

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not to flat-out lie to your client so flatter them nod your head and laugh

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at their jokes sure but if there's difficult news to deliver it's up to you

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to deliver it they won't be able to afford payments on their budget the

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offer they want to make will be considered insulting and will be

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rejected they can do better than that house with a front lawn that's littered

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with porcelain fountains all up to you to set them straight they are after all [Woman laughing at a man]

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relying on you for your expertise..That's the gist it can be a grind you might go

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weeks or even months without selling a property or even getting much of a bite

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but when you get rolling and especially if you start selling 7 and 8-figure [Woman rolls dice]

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residences well you can make some serious bank 2% doesn't seem like a lot

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of commission to take home but those numbers on a hundred million dollars

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worth of sales is definitely doable in a lot of parts of the country these days

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you can buy a lot of personalized pens with two million dollars [Pens raining down on woman estate agent]

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you

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