Working in Real Estate: What are the basics?
Welcome to the first post in my blog series, speaking to you, as agents, about overcoming the struggles we all share.
If you’re here, chances are you’re either an established real estate agent, you’re just getting started, or perhaps you’re simply curious about what it takes to succeed in the crazy but oh-so lucrative world of property sales.
But first, let’s get the intros over with. I’m Samantha Gore and for the past 22 years, I’ve been all about selling property. Raised in London but NOT a fan of the “London fog” I started my career in Marbella, Spain, and have since worked my way through international markets including Brazil, UK and Barcelona, following cyclical booms, winning many good-looking awards and selling more properties than I can count.
Recently, I’ve taken on the role of coaching and mentoring real estate agents using all my knowledge and experience to help more agents thrive and not just survive in what can be a little bit of a ruthless sector (full disclosure here!). While my passion has always been helping clients close deals, these days I’m equally excited about helping agents like you do the same.
In this blog series, I’ll share everything from foundational real estate concepts to advanced sales strategies. But today, let’s start with the basics.
Breaking Down Real Estate Basics
Let’s start with some real estate lingo. Whether you’re brokering deals in Lisbon or negotiating a beachfront property in Cannes, there are a few terms you absolutely need to understand.These basics will both serve you well and help me out by making sure I don’t leave you scratching your head in confusion.
Property Types:
Properties aren’t all created equal! In real estate, we deal with several different types—mainly residential resale, residential new-build (off-plan), commercial and land. And yes, each one brings its own set of challenges. That said, whilst selling a cozy flat in the city centre requires use of a different practical skill set than selling a shopping mall, gaining a solid understanding of sales psychology will give you the ability to close any deal. So let’s talk properties.
Private Contracts:
The contract—where deals are made or broken. A private contract outlines the terms of the sale, such as the price, the amount due upon signature of said contract, the repercussions of withdrawing before completion, contingencies (those little “what if” clauses), and the closing date. It’s the paperwork that everyone loves to hate but absolutely has to understand. Whether you’re the buyer’s agent or seller’s and whether there are lawyers involved or just little ole you, getting to grips with contracts is essential if you want to sleep well at night (and keep your deals from falling apart!).
Ownership Types:
If you’ve ever wondered what freehold and leasehold mean, you’re not alone! Freehold means you own the property and the land it’s on outright. Leasehold, on the other hand, means you only own the property for a specific period—kind of like borrowing a very expensive toy. This varies from country to country, but knowing the ins and outs is crucial when advising clients.
Key Roles in the Industry:
Real estate isn’t a solo sport. You’ve got a whole cast of characters in every transaction—mortgage brokers, lawyers, valuers, notaries and sometimes even therapists (okay, maybe not officially, but it wouldn’t be a bad thing). Knowing how to coordinate with these professionals is like being the conductor of a chaotic orchestra.
Real Estate Cycles: The Ever-Changing Market
Now, onto one of the most important lessons in real estate: nothing stays the same. The market is a bit like the weather—sometimes sunny, sometimes stormy, and always keeping us on our toes. Here’s a quick overview of the real estate cycle:
Recovery: The market is just coming out of a slump. Things are quiet, but the savvy agents who’ve been able to survive are starting to sniff out deals. This is when patience and long-term vision pay off.
Expansion: The market starts to heat up. Prices rise, developments pop up, and suddenly everyone wants in - including a load of new real estate agents (help - more competition!). This is the sweet spot, where a well-placed listing and knowing what you’re doing can make all the difference.
Hyper Demand: Things get a little too hot, and suddenly there are more buyers than supply. Cue the panic! Well, maybe not panic, but definitely a slowdown in market share for huge amounts of agents fighting over too few listings. This is where only estate agents who’ve done the proper groundwork in the recovery phase are set to keep earning the big bucks.
Slowdown: Market overheated? Inflation too high? Cue interest rate rises, ill-thought out government policies and a general malaise. And lookout, here comes the dreaded slowdown. The doom-and-gloomers are having a field day, and the self fulfilling prophecy starts to take hold.
Recession: Prices drop, sales slow down, and it’s back to the drawing board. While this phase can feel like a grind, it’s also where some of the best long-term investments are made. Smart agents know this is where you buckle down, sharpen your skills, and prepare for the next cycle.
Understanding where the market is in this cycle and where it’s headed means you can advise your buyers and sellers well, plan for the next phase and get happy client Brownie points along the way.
So there you have it—the (very) basic building blocks of real estate. Understanding property types and navigating the market’s sometimes dizzying cycles can help you be the know-it-all in the room the next time someone is looking to buy or sell.
In the next post, we’ll go deeper into what makes a top-performing agent. Spoiler - it involves knowledge of sales psychology and negotiation techniques. I promise you, it’ll be worth the read.
Published December 10th 2024
