Top 5 Real Estate Myths
When we think of a real estate related matter whether it is buying or selling, we come across different misconceptions. This misconceptions or myth are constraints which hold a person to take a wise decision. People also practice taking advice from friends or relatives. If they are in this profession, it is fine, but if they are not, how can they give a proper advice. There are lots of myths, but some common myths are discussed below.
Myth 1: This is not the best time to buy or sell
It is always good time to make a good investment. To get the best time for buying or selling a property, many people lose time as well as money. Property owner think if he waits, the price may go up, but never calculate the interest of current price which may be higher if added to the price. Sometimes, a long wait may cause less value of the property as depreciation cost gets calculated. A buyer also sometime waits to get the best deal while buying a property. It is good to keep eye on the price for sometime but a long wait may cause the actual best deal out of hand. The best time is always now as it is a long term investment.
Myth 2: No need of hiring an agent for selling a property
The only reason for not hiring a professional agent or consultant is to save the agent commission. Those who have this myth that agent is not required to hire for selling a property, they are unaware of the service what they get from a professional agent. If an owner wants to sell a property by himself, it would be like, not hiring a professional photographer on marriage or not hiring a lawyer in the court. An owner cannot spend as much as an agent spends on advertising for the property without asking a penny from the owner before the deal. The commission is payable if the deal is done and after the deal is done. Is there any risk to hire a professional agent? This is the full time job of a real estate consultant, so, they are more experienced. An owner may want to sell one or two properties but, an agent is dealing with hundreds of properties. It surely makes a professional more experienced, doesn’t it? Click here to get more valid reasons why to hire a professional agent.
Myth 3: Can save money if purchase directly from developer or builder
This is the most ridiculous myth with the buyers. A developer has a fixed rate for a unit and the rate cannot be made higher by any marketer or agent. Some buyers presume or suspect a marketer if it is overpriced and want to go directly to developer. If a buyer buys a property from any channel or directly from developer, the price and rates would be the same. The only thing that happens is if a buyer buys property from developer, the commission remains with the developer and they can earn more, not the buyer.
Myth 4: It doesn’t require any specialized knowledge for property dealing
Every profession is based upon knowledge. It is very much wrong if someone thinks that a specialized knowledge is not required in real estate industry. This is not just buying and selling of a property. It also has some technical terms, rules and techniques. A person may be expert in his/her own profession, but it is often mistaken that the person will understand in and out of real estate too. So it is very much necessary to take advice from a professional consultant who has expertise in real estate. A buyer should keep in mind that a street broker may not have that much knowledge to provide service properly. A seller also to understand it requires expertise to sell a property in the market.
Myth 5: Commission or brokerage of a Real Estate Consultant is very high
It is mistaken by many people that the commission or brokerage of a real estate consultant is very high. It is also mistaken that a consultant’s job is just to introduce a buyer to seller, there is no expenditure involved. Does anyone calculate the cost of business expenses? Like any other businesses, the business of a realtor also got various expenses involved. Office running costs, staff salary, huge advertisement costs and Government tax are main costs to run a business. If anyone calculates, may understand the standard commission of 2% (in India) is not as lucrative as it looks like. An FMCG company can provide 10-30% of margin to the distributor and retailer. No one calculates the amount as it is low cost. But if anyone calculates the volume, will surely understand that the commission of a consultant is comparatively low.
Written by: Arnab Ray
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