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Friday, 4 July 2014

How to start an estate agents - Starting a business advice and business ideas

How to start an estate agents - Starting a business advice and business ideas:

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How to start an estate agents

Cash in on the property boom with an estate agent business

Estage Agent for Sale Sign Resize

What is it?
An estate agent is actually a wide-ranging title applied to a number of specialisms. Some estate agents specialise in the residential market, but even then, individual homes vary from studio apartments to mansions with acres of land. Some agents specialise in dealing with commercial properties such as office blocks, factories, shops and licensed premises.
Others deal specifically with lettings and property management, which involves letting property and dealing with all aspects of the let – which includes in many cases the responsibility for the property on behalf of the property owner. In addition, some estate agents extend their service by offering the specialised knowledge and skills needed to carry out property auctions.
Residential Estate Agency
Estate agency is an almost unique form of selling. The estate agent is not selling something which belongs to them, but represents their client – the property owner. Agents act as a representative or intermediary between the owner and a possible buyer, using a mixture of skills to persuade customers to sell and buy.
One of the essential skills of an estate agent is good communication. Estate agency is a ‘people’ business – agents have to communicate with many different people – potential buyers and sellers, conveyancers and solicitors for example – and they have to be able to communicate effectively. A house sale and purchase is usually the largest single purchase that anyone undertakes and is consequently high on the list of the recognised ‘stressors’ in everyday life. Good communication on the part of the agent can reduce the stress enormously, can make a sale go through more quickly and efficiently and will ensure that customers come back to the agency with more business. This communication might be face-to-face, either in the office or in people’s homes – or it might be by telephone or by letter.
So, the main qualities needed in estate agency are good communication and interpersonal skills; and the ability to persevere when things are moving slowly or the market is not particularly favourable.
Owning an estate agency can be challenging and rewarding, but there are also times when you’ll find it frustrating even infuriating, but as this is a people business you’ll have to keep your fury to yourself. Long protracted delays can ensue just after you have done the bulk of your work and the process of legally transferring land and/or property starts. Sometimes cancellations can occur at a very late stage, about which little can be done, and so those to whom a career in ‘selling’ appeals may need to think twice about going into estate agency, as the final results can take some time to achieve
Qualifications and training
Whilst academic qualifications are always helpful and applicable, personal qualities and abilities are the most important aspect. You also need to be literate and numerate. Becoming increasingly significant is the number of professional estate agents who have gained qualifications in their field. The increasing legislation means that agents require a good knowledge of the relevant law.
Lettings and Property Management
Residential lettings and management involves letting property to a chosen tenant on behalf of the owner and dealing with all aspects of the let from then on, including the legal and financial implications. Management, as the word implies, means undertaking the ongoing responsibility for a property, again on behalf of the owner. As in residential estate agency, communication and organisational skills are vital.
Your role will involve selecting responsible and reliable tenants, maintaining ongoing communication with them, and handling any problems that arise with the property. This in turn will involve you in liasing with a wide range of people, such as solicitors, plumbers, cleaners, gardeners and builders.
If you find property interesting and enjoy dealing with people, a career in lettings and management can be very rewarding and building up good relationships with property owners, tenants and others all form walks of life is a very satisfying job.
Qualifications and training
A lettings agent needs to have more than just practical abilities. They must also keep up with any changes in legislation relevant to the lettings market and be thorough in the preparation of important documents such as tenancy agreements or inventories. The ability to communicate is a vital element of the job.
Problems do arise and usually you will be working under pressure. Consequently, it can be very challenging and is certainly not for those who want a predictable or sedentary business.
Academic qualifications are again helpful and useful, although communication skills are the most important. The ability to deal successfully with all sorts of people while handling someone else’s valuable asset is vital. You will also need to be numerate and literate, and, preferably, computer literate.

Commercial Agency
Commercial agents handle empty property used by businesses for a variety of purposes. Traditionally these include shops ranging from high street stores to village stores and retail parks, offices, warehouses and factories. They can also extend to building land, property for conversion to business use and specialised areas such as quarries, amusement parks and forests.
The opportunity for commercial agents is vast. Not only does an agent act for the owner who wants to sell or let the property but can act for the buyer or tenant. In addition, agents are employed to agree adjustments to the rental or terms for a new lease for an existing tenant.
Property is a major cost to businesses and they need to make sure that accommodation is of the right size and in a suitable place for their needs. Often an agent will be asked to provide advice on all aspects of a client’s property needs.
Commercial agents need a wide range of business skills to be able to understand the aims and objectives of a client. A thorough knowledge of Planning Law and Landlord and Tenant Law is needed to be able to guide clients successfully.
Business Transfer
Business Transfer is a specialised branch of estate agency that involves the sale of existing businesses. These cover a wide range of trades including high street shops, post offices, convenience stores, newsagents, public houses, restaurants and hotels. In addition, an agent may be called upon to handle the sale of much bigger businesses in engineering, manufacturing and wholesaling.
Visiting clients and seeing what goes on behind the scenes in a successful business makes the job very interesting. Every day an agent will learn something new.
The agent is responsible for arranging a sale of what could be the client’s income and home. The transfer can involve a wide range of factors and a client will need guidance on matters such as taxation, employment law and property law. A good working relationship can develop and the resulting sale allow an owner to retire or move on to another business.
Property Auctioneering
The sale by auction of property is an extension of the role of the estate agent. Many firms of estate agents do not undertake property auctions themselves, but in most regions there are firms who offer this specialised service to those wishing to sell.
For many the lasting impression of the auctioneer will have been formed by a fleeting visit to a general salesroom or a livestock market or from a clip on television. Those who have become auctioneers have discovered that the challenge of organising and masterminding an auction sale is not only highly rewarding for the auctioneer but also, and more importantly, for the vendor client.
A substantial and steadily increasing number of homes, commercial, industrial and investment lots are routinely sold by auction today.
As an auctioneer you will be asked to advise on the disposal of a wide range of property. The first task is to decide whether or not that particular lot is a suitable subject to offer under the gavel and at the same time to explain in detail to the seller the complete process of auction. This involves not only a detailed knowledge of the market place but also the law procedure and process.
Whatever type of estate agency you decide on starting the main skill you have is buckets of personality, followed by patience, doggedness and the ability to make a person or company see the potential of a property you’re selling.
The Internet – threat or strength?
Far from cutting them out of the property game, the internet is a tool that estate agents are using to strengthen their role.
In a survey of members, the NAEA, found that 84% of respondents said customers generally viewed the internet as a positive addition to traditional marketing techniques. Fewer than two per cent of estate agents surveyed felt they had lost any business to private property sites.
NAEA chief executive, Hugh Dunsmore-Hardy, said: ” Information is not knowledge and both in the UK and in America we are finding evidence that house buyers and sellers are recognising the difference. “While the internet is increasingly seen as an excellent marketing tool for widening potential audiences for homes, customers still want the interpretative skills, expert local advice and the negotiating expertise that only professional estate agents can provide on what are likely to be the largest transactions of their lives.
“Fears being expressed a few years or so ago that the internet revolution would sweep away estate agents appear to be unfounded. We are not mere order takers but remain the first point of contact for most sales because we understand the need to protect such transactions and to provide and interpret information for our clients.”
Many customers are now actively asking whether their home details would be available via internet sites.
Dunsmore-Hardy says: “The Internet, through sites like our own PropertyLive site, may open the door, but estate agents are there to greet buyers and sellers, adding value to the process like never before.”
How much will it cost?
Probably the most expensive part to setting up an estate agency is the office. As estate agents are happy to quote the three most important qualities of a good property are “location, location and location”. If you want to be a successful estate agent then you have to get as many people as possible to notice you exist.
So most estate agents pick busy – and therefore expensive – high-street locations. Jonathan Burnand, manager Wild & Lye, Bath suggest you “Get an office that’s as big as you can afford”, although he cautions that things maybe changing “I can see the day when you don’t need an office I can see the time when we do everything by phone and the net and that when we meet clients we meet them in the local café or hotel.”
The next biggest cost is publicity. An estate agent needs to advertise their houses, auctions or lets so pages of colour or black and white ads in the local property pages is a regular weekly expense — though many estate agents are turning away from the local papers.
Burnand says “Advertising is a few hundred a page – if you commit to 52 times a year” Burnand cautions “those that choose to do a half page one week, and two pages one week – because it eases the pain – are heading for trouble.
“Clients like to see the same size ads every week. Plus you have to advertise every week, you don’t sell houses off your advertising but it is the way you get new customers.”
Additional publicity costs are printing, mailings and phone costs. Mailing and printing of house details is a significant expense, although the use of digital photography and cheap fast colour printers has much reduced the costs of sending out and preparing colourful house details.
Mobile and land line phone bills will be high so shop around for a service, consider services that combine both mobile and landlines in one. You should also invest in a franking machine, a good database or contacts management package and a label printer to speed the time it takes to get your details out. In addition web sites and emails can also help reduce the cost of mailing details
Costs for a high street estate agents vary from town to town.
Cast about to determine the average rents of high street properties in the area. As well as calculating your annual rent, you will need to determine staff pay and your annual running costs. Don’t forget to include local paper advertising, costs for your web site, and for your colour printer, photocopier, toner/printer cartridges, phone bills, and franking machine postal charges
Tips for success
  • Good staff – Staff need to be enthusiastic and excited about what they do. We will always hire people who don’t ask about car and salary first.
  • Market – Identify the market you’re in, if it’s expensive properties then stick to that area. A good estate agent can’t straddle two camps.
  • Image – Make your company stand out – we use green throughout the company – the office is covered in plants, the adverts are green and our lorries are green.
  • Office location – Get a central location and make it as big as you can afford. Although a central location is not so important now that we have websites.
  • Diversification – You cant’ t just be an estate agent these days, we’re the only one in the district that does removals, plus we also do commercial property and we give advice on finance.
  • Co-operate – You have to talk to other estate agents, you can’t be a cuckoo in the nest. You will need your competitors at some point.

Useful Contacts
National Association of Estate Agents
The National Association of Estate Agents, which has in the region of 10,000 members, is the leading – and by far the largest – professional body in estate agency and is represented through its members in more than 60 per cent of estate agency offices in the UK. To start up an estate agent no qualifications are necessary. However setting up without qualifications would be exceedingly dangerous and it is to be strongly discouraged. You should approach the NAEA for more details of relevant qualifications.
Tel: 01926 496800
The Negotiator
Estate Agency News


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