The real estate industry is an important part of our society. Real estate is a key industry in our society. People must buy and sell properties, and experts are needed to guide them through the process.
Software and websites have made the traditional real-estate process easier over the past
decade. Regardless of technological advances, the agent will always be the real estate
Why? Real estate is so important to our society that it’s still a mystery to many consumers.
There are many laws, paperwork, best practices, and other factors that go into selling and
This guide was created to assist consumers in understanding the real estate process. It also
helps real estate agents market their businesses more effectively. To learn more about a
particular topic, you can use the links below. Continue reading to learn more information
about real estate.
What is real estate?
The property and buildings that are located on a particular piece of land are called real estate.
It also includes underground and air rights above and below the land. Real estate refers to real
or physical property.
These are the Four Types of Real Estate
Real estate can be described as a physical entity and includes four types of property:
residential (commercial), industrial (industrial), and land.
Residential can be new construction or resale. Most people associate residential real estate
with single-family homes. This category includes condos, townhouses and duplexes as well
as vacation homes.
Places of business are the most common type of commercial real estate. This includes strip
malls, shopping centers, hospitals, colleges and hotels as well as offices. Because they
generate income for their owners, apartment buildings are often considered commercial even
though they are technically residential.
Industries include manufacturing buildings and warehouses that are used for research,
production and storage as well as product distribution.
Land can also refer to working farms or ranches. It can also be used to refer to undeveloped
land or land where homes or buildings are being constructed.
Understanding the differences between real estate types is important because they can make a
difference in the sale or purchase of the property. Other processes, such as construction,
zoning, and appraisal, are also handled separately.
Real estate agents often specialize in one type of these types and the rules and regulations that
go with them. We’ll be discussing real estate agencies next.
Who’s Who in Real Estate
Real estate is a complex industry. Each transaction involves a lot of work. There are many
people involved in the real estate process. You’re likely to have worked with at least one of
these specialists if you’ve ever sold or bought the property.
Different types of real estate agents:
There are many types of agents involved in residential real estate sales and purchases. Below,
we’ll discuss each.
The Real Estate Agent
A real estate agent is a link between sellers or buyers and the industry. They are responsible
for finding property and listing it, as well as negotiating the prices. Although some agents can
work with both buyers or sellers, many specialize in one area. Because each agent has
different responsibilities, this is why it’s important to distinguish between them.
The Listing Agent of the Seller
A seller’s agent is a person who works exclusively with real estate sellers, such as those
selling a house or office building. A listing agent is also known as a “listing agent” because
they list property under their brokerage name for others to see. (We’ll discuss the listing
A variety of tasks are performed by listing agents:
Assisting in determining the selling price
Marketing the property and listing it
Management of open houses and showings
Answering potential buyers’ questions
Assisting in the negotiation of the sale price
Coordinating the closing and sale process
Listing agents are typically paid 3% of the gross sales price for residential sales. Buyer’s
agents pay another percentage. Listing contracts are typically written for X% and offered to
the cooperating agents at X%.
The Buyer’s Agent
The buyer’s agent, on the other hand works with those who are looking to purchase real
estate. They are responsible for finding the right property and organizing walkthroughs and
Buyer clients don’t usually pay anything for the services of a buyer’s representative. Buyer’s
agents are paid 3% of the gross sales price if they organize a successful real estate
Real Estate License
A real estate license must be issued by the state where the property is located in order to
allow a member the public to assist with the purchase, lease, or sale of realty. Each state has
its own requirements to obtain a real estate license. These include the hours required for
education, licensing fees, and testing requirements.
A real estate broker is one step above an agent. A broker is considered one step above an
agent. While the laws vary from one state to another, most brokers have more education and
licensing that agents. Brokers can create their own brokerage and employ agents to sell real
The Mortgage Lender
A mortgage lender is a financial institution that lends money to you for your mortgage loan.
It is a good idea to be preapproved for a loan prior to purchasing real estate. Before looking at
properties or homes, real estate buyers will likely work closely to a mortgage lender.
To determine the property’s value, the appraiser is independent of the selling and buying
party. Mortgage lenders often choose an appraiser because they want to determine the true
value of a property or home. To grant a loan, the property must be appraised at the agreed-
upon sales price.
The appraiser is responsible for most of the job, including a walk-through of a room and
assessing the exterior and interior conditions.
Lenders hire appraisers to assess the property’s monetary value. Potential buyers hire
inspectors to inspect the home for safety and structural defects. It is a long process. Inspectors
must review hundreds of items as they inspect a building.
The Closing Attorney
A closing or transactional real estate attorney is an attorney who specializes in real-estate
law. Sometimes, he or she is called a “closing attorney” because this is when most buyers and
sellers meet them — at closing. We will cover the closing process in the next section.
Real estate lawyers help buyers and sellers to understand the legal documents that are
presented during the real estate transaction.
Each one of these people is an integral part of the real-estate process. We’ll next see the
process in action, step-by-step.
The Real Estate Process
The steps involved in a real estate transaction may vary depending on the property or the
people involved. Most transactions are the same.
We’ll use a residential transaction as our example to show the real estate process for
continuity and simplicity. Although industrial and commercial transactions are similar, the
residential process is more relatable to consumers.
Below, we’ll discuss both the buyer’s and seller’s perspectives.
The process of selling real estate
- Employ an agent
If someone is looking to sell their house, they might hire a listing agent.
Clients have always found their agents via personal recommendations, flyers or local
advertisements in newspapers. Today, many sellers are able to find their agents online
through social media, online ads, and sites such as Trulia or Zillow. In the next section, we
will discuss some of these methods.
A listing presentation is usually given by agents. The pitch will highlight their pricing and
marketing strategies, as well as the commission structure and other competitive advantages.
This will help clients choose the right agent.
If someone is looking to purchase a home, they might choose to either hire a buyer’s
representative to help them find and shop for property or to start searching for it themselves.
There is no right or wrong way to hire a buyer’s representative. However, an agent may be
able to introduce you to properties that you might not have otherwise discovered. It can be
more rewarding to interview and secure a buyer’s representative at the beginning of the
process than letting the listing agent handle everything. Representation can also be beneficial
- View/Listen to the property
The next step for a seller is to list your property so that potential buyers can find it. These are
the steps to listing and viewing your property.
The process of listing your property in real estate This can be done by your agent using
information such as the location of your home, its condition, upgrades and amenities, and
similar properties’ prices. To help you understand why and how your home is priced, agents
will prepare a comparative market analysis.
You can enter your home to the Internet Data Exchange (IDX). Your real estate agent can
access the IDX platform. It allows you to search for real estate listings all across the country.
It allows members of multiple listing services (MLS), to market and shares their properties
with other agents and potential buyers.
Marketing your home. These marketing strategies will help increase exposure for your
property to potential buyers and agents, regardless of whether they choose traditional
methods or post it on other websites.
Open houses and showings are a great way to meet potential buyers. Open houses and
showings allow potential buyers to see your home first hand. Buyers can also ask questions
and voice concerns in person, which saves both time and energy. Agents may also create
virtual staging and real estate videos for your home.
Sellers may choose to sell their home themselves. This is called For Sale by Owner (FSBO).
FSBOs can theoretically save sellers commissions (since both buyer’s and seller’s agents pay
the listing fee), but they do not have access to CMAs, the IDX or any marketing or agent
knowledge. In certain cases, FSBO sellers might pay a cooperating fee to the buyer’s agents
who work with them in buying their home.
This step is for buyers. Sites like Trulia or Zillow can help you find homes that fit your
budget. Others rely on an agent to help you locate properties and schedule showings.
Open houses are a great way for buyers to see the property, its condition, location, and
amenities. They will then schedule dedicated showings with either their agent or the listing
agent, where they’ll tour the property and answer any questions they may have.
Remember how we said that buyers must be pre-approved before they can search for homes.
It could take several weeks for someone to view a property and then apply for a loan pre-
approval. If they have offers, no seller would hesitate to offer.
- Close to the property.
Let’s suppose you are selling your house and someone is interested in buying it. What then?
First, a potential buyer will make an offer on your house. Depending on the competition in
the market and the speed you want to close, the offer might be at the asking price or lower.
You’ll then consider the offer and consult your agent (if one is available), before deciding
whether to accept or decline. You could have some back-and-forth, or you could agree
immediately and sign a contract.
(If you, the seller, had entered into an agreement with a right-of-first-refusal clause, you’d
have to let that potentially interested party view and make an offer on your property before
any other parties. Right-of-first-refusal clauses are typically written into contracts between
family members, tenants, landlords, and in the case of a homeowners association.)
The next steps are not directly related to you as the seller. The buyer will then submit their
earnest money and order an inspection of the home. They will work with their mortgage
lender in order to obtain an appraisal and establish their mortgage. While you might need to
address some concerns or questions, the majority of the time, you can just relax and wait.
Closer will be the next time you meet buyers. The home closing is essentially a formal term
that refers to when the property title is transferred and the down payment is made. It also
involves having the names of the buyer and seller signed several times. You’d then hand the
keys over and go on your way, albeit thousands more richer.
Let’s change the script. Now, let’s say that you are buying a house. (Congratulations!)
We know that you have made an offer and it has been accepted. You also signed a contract.
What now? What happens now?
You’d first submit your earnest cash. This shows the seller that you are serious about buying.
The buyer is credited with the earnest money. It is held up until closing. You would then
order an inspection to determine if any repairs should be made before closing. The parties
responsible for repairs are to be agreed upon between buyers and sellers. You would also
notify your lender that you are under contract. Then, you would begin paperwork to secure
After the inspection is completed, you and your lender will order an appraiser to verify that
the property’s value matches your offer. The next step is to order your home insurance, which
lenders often require, and to schedule your utilities and closing. You will need to bring
documentation to prove your mortgage and home insurance.
Voila! Voila! Your home is yours!
Real Estate Marketing Strategies
We’ve now covered the entire real estate process from both the buyer and the seller’s
perspective. But what about the agent? We are here to help agents and future agents. This
section is about marketing your home and your real estate business.
Being a real estate agent can be likened to owning your own business. Although you may be
representing a larger brokerage, it is not necessary to present yourself as an agent, broker,
negotiator or marketer. You will be a trusted advisor to your clients for one of the most
important transactions of their lives, both financially and emotionally. They will regard you
as the best.
Even better, you will inherently market your homes and properties if you are more successful
at marketing yourself. It’s a win/win situation!
When it comes to creating a marketing strategy, real estate is an unusual industry. While
some industries and businesses are focused on digital marketing, others focus on traditional
methods like billboards and postcards.
You’ll probably do all of the above in real estate. Most agents don’t have a defined target
audience. They simply want buyers and clients. The larger the network, the more clients they
will attract and the more homes they will sell.
(Note: This target audience strategy may not be typical for all businesses. Marketing is best
done by identifying a targeted buyer persona.
Let’s now talk about how you market yourself as a real-estate agent. This will be broken
down by type of marketing, and we’ll discuss both outbound and inbound methods.
- Digital Marketing
Digital marketing has many possibilities. Do you think this means that every opportunity in
digital marketing should be pursued? This is not the case, especially for new agents. These
strategies can be used to start out, and you can expand your business as your commission
Your website helps you build awareness about your brand as an agent, and it also markets the
properties you are selling. Online buyers and sellers are more prevalent than ever, so if your
website isn’t online, you could be missing out on potential clients and revenue.
A professional online presence as an agent is a sign of your credibility and your commitment
to your profession. It should contain information about you (including a bio and contact
details) as well as any properties you are currently selling.
A blog can be a great way to get clients, build trust and show your real estate expertise. You
can also use the complexity and mystery of the industry to your advantage. Your clients and
visitors will undoubtedly have questions. Your real estate blog can answer them.
Make your blog a part of your website. This will help you market yourself as an agent and
keep your visitors on-site. You can post as many times as you like, but make sure to keep
your posts consistent. Looking for ideas? You might blog about the home you are selling or
pay attention to what your clients ask.
Did you know that 74% of agents use LinkedIn and Facebook to market their business?
Social media is a must-have in the real estate industry. There are many ways you can
leverage social media to your advantage. You can connect with potential clients through
Facebook, market your properties, and share blog content. An Instagram account allows you
to share high-quality photos of real estate.
It’s also an excellent way to get in touch with clients via social media. In order to market
yourself, it is important to make personal connections with clients in order to gain business.
Clients need to trust you when selling or buying a house.
Email marketing is another great way of reaching clients regardless of their age or where they
are in their buying (or selling) journey. Email can be a great way to stay in touch with clients,
whether they are actively searching for a home or just have their email addresses via an
An email newsletter is a great way to achieve this. Newsletters allow you to be creative while
still using a templated approach. You can include information about current properties for
sale, testimonials from clients, personal facts and details about local events in your
Advertising about your property or real estate business has its pros and cons. You should
ensure that you target the right geographical areas if you decide to pay for ads such as banner
ads, social media ads, and native ads. Clients may not live hundreds of miles from you. You
might consider advertising on local blogs or interior design websites that are family-oriented,
or on your personal real estate blog. This will allow you to know if your ads are being seen
by relevant audiences.
- Traditional Marketing
Traditional marketing techniques are still very relevant in the real estate industry. Here
are a few reasons why.
First, real estate is heavily location-based. It might not be a good idea for an e-commerce
company to advertise in local magazines and on bus benches. However, this would make it
logical for local agents who want to help people in the area. Second, traditional marketing
methods are more cost-effective and can produce a higher ROI, particularly when local
marketing is involved.
Try a few of these methods to find the one that works for you.
Postcards and Business Cards
Real estate agents should have business cards as a non-negotiable. Open houses, local events,
and just running into people on the streets will all require a business card with your email
address and phone number. You can also use real estate business cards to showcase your
personality and keep in touch with potential clients.
Postcards are a great way to market homes for sale. There is plenty of space for photos and
text. Real estate postcards are easy to distribute, inexpensive to mail, and very quick to read.
Although direct mailers might seem outdated, they are very effective in the real estate
industry. Direct mail open rates could reach 90% by 2021.
Direct mailers can be used to reach specific areas or neighborhoods in your city, whether you
send personal flyers, postcards, newsletters, or other content. This tried-and-true strategy can
be used alone or in conjunction with other strategies.
There are many ways to advertise locally. Local advertisements can be paid for in local
magazines, newsletters, and bus benches. You can also leave your business cards and
postcards in your targeted area or work with businesses that will help you advertise.
You might also consider writing a column or contributing to local magazines. It follows the
same inbound strategy as guest posting and blogging, but it targets local clients and
neighbors. This gives you the opportunity to build trust and rapport with potential clients and
Door-knocking is another method to market and builds awareness in your locality. Door-
knocking can be another proven method to generate leads and market your property for sale.
- Word-of-Mouth Marketing
Word-of-mouth (WOM) marketing can be the most powerful tactic for real estates agents.
This is why we have created a separate section. It is important to collect testimonials from
clients in the past.
How do you get solid reviews? Be a great real estate agent. It’s that simple. You can provide
outstanding service and do your best work. This will make a lasting impression on clients.
You can make your clients remember you by giving them a gift at the end.
Real estate is an excellent example of how past and current customers can be your best
marketers. Referring clients to you with outstanding service will ensure that they return for
more in the future.