Due Diligence in Real Estate: Helping you find the right home
What is required from a buyer’s agent? Is it due diligence? Work ethic or shear commitment? Are you giving all you have as a buyer’s agent? When it comes to buying a property (be it a house or some commercial building) turns into a crucial and sentimental decision. Dealing with commodities can be manageable but when it comes to real estate things sometimes get nasty as it usually involves high stakes both in terms of money and time. Due to this very reason one must be fully aware of his/her responsibilities as an agent. One needs to make sure that the property finalized by the client is sound to be bought; leaving no stones un-turned when it comes to information collection about the legal and other formalities.
Real estate due diligence guidelines
As an agent to the buyer you should know what to as your client’s representative. Do not rely on your client to ask questions, rather stay a step ahead and make sure you leave satisfied with the entire deal.
We have come up with a list of a few items that will help you make good buying decisions:
Authorities Involved in the buying area.
- Cross checking the deeds
- Past owners
- Market analysis
- Price of nearby units
- Construction or other restrictions
- Access
- Zoning
- Taxes
- Projects to happen in the neighborhood
Buyers might not always know exactly what they are looking for. Ask questions, explore your options and while you are at it, be sure that you never overlook due diligence.
Lastly, while making the decision of purchasing a property one might face limitations in terms of information availability. At this point a final thorough inspection of the property can be done for self-assurance, but these inspections can be costly, so make sure you tell your buyers before asking for the services. May be you can get some leverage due to missing information and gain a reduction in price?
Risk Reduction
Real Estate is a place which gave us great business people, while at the same time it has failed many. The main reason behind the ones who failed was that you nee to be really careful while pulling off real estate deals. Avoiding conflict and risk will not only help you with your repute but at i also make you a better choice for the plenty of potential clients out in your locality.
There are some simple ways to reduce risk to yourself and your client:
- Keeping in check with the local authorities
- Getting insured
“Moving on”
Imagine yourself driving for hours and meeting new people who are willing to sell their house. And every time you go see a new prospect you wonder “is this house going to be the one I show to my clients?”, but when you turn up it is nothing close to your clients asked for in the first place. At this point you need to get going and see the next possible seller and keep doing this unless your clients decide on a house to buy.
You don’t know? No problem!
It does not require you to go to law school and pass the bar exam, become a licensed plumber, electrician, or surveyor, serve on a local planning board, or know how to identify lead paint, mold, asbestos, or the prior existence of a methamphetamine lab. You may have a sense about how safe a neighborhood is, or how highly regarded a school system may be, but these items change over time. It is often wise to direct consumers to sources of credible information, like a local police department, reputable websites, or government databases.
Once your buyers have found the ideal property, you have the opportunity to really show your worth as a licensee. Many buyers (and sellers) who try to go through a transaction without the assistance of a licensed real estate professional find themselves lost in the complications of contracts, inspections, legal procedures, and needed services. You are your clients’ tour guide through this complicated trip fraught with time limits, risk, and liabilities. Remember: Once they’ve signed the buyer agency agreement, your buyer clients are entitled to the full suite of fiduciary/statutory duties—including care, obedience, loyalty, disclosure, accounting, confidentiality, and of course due diligence