If you’re looking into real estate you might hear a lot of different terms. What’s the difference between a realtor and a broker? Are listing agents different than buyers’ agents?
If you need clear definitions for these terms you’re in the right place. Whether you’re buying your first house or considering the real estate field, this post will help you out.
Defining 3 Different Titles
A lot of people use ‘real estate agent’ and ‘realtor’ and ‘broker’ interchangeably. However, there are distinctions.
Let’s explain these 3 different titles: real estate agent, realtor, and broker.
1. Real Estate Agent
A real estate agent is someone who represents a buyer or seller of real estate. And real estate is land, buildings, and ‘immovable’ property such as crops.
This is the broadest term in our listing. Realtors and brokers are two kinds of real estate agents.
A realtor is a real estate agent who is a member of the National Association of REALTORS®. In America, this is the largest trade group.
Realtors are licensed with this group and must hold to a code of ethics. They are obligated to look out for a client’s best interests.
Not all real estate agents are realtors, but the majority of them are.
A broker is typically a manager. They’ve completed more education than the average real estate agent.
There’s a licensing exam for a broker to pass. Each state has its own requirements, so the laws may look a little different state to state.
Brokers have taken on more responsibility than agents since they run their own firms.
4 Types of Real Estate Agents
Now that we’ve cleared up those 3 titles, let’s take a look at the 4 most common types of real estate agents:
1. Seller’s Agent (Listing Agent)
A seller’s agent is the agent representing the seller. They’re also called listing agents.
If you want to sell your house, you go to a seller’s agent. Then the seller’s agent lists your home on the market, which is called a listing. Hence the term ‘listing agent.’
They’re familiar with the real estate market and try to properly price your house. They’ll also be responsible for identifying your house’s selling points.
A seller’s agent can also assist with leasing property.
2. Buyer’s Agent
On the other side, a buyer’s agent is the agent representing the buyer. They help with the process of purchasing real estate.
Buyers’ agents are familiar with local areas, pricing trends, and many properties. They assist a homebuyer by finding a house that’s suitable for their finances and desires.
They negotiate for the best possible price and terms for the house. Afterward, they help the client through the legal process of acquiring the home.
3. Dual Agent
A dual agent does both jobs of a buyer’s agent and seller’s agent. They act on behalf of the buyer and the seller of a home.
Many point out the flaw in this type of real estate agent. The dual agent must act in the best interests of both parties simultaneously.
They have to sell and buy the home at the best price for both clients. Therefore, some argue dual agents always have a conflict of interest.
4. Transaction Coordinator
Transaction coordinators help with the more technical work in real estate transactions. They help with the closing of escrow, filling out paperwork, and keeping deadlines.
Sometimes even agents and brokers hire transaction coordinators.
Distinctions that Matter
Keeping your terms straight will help avoid confusion and give you clarity.
If you’re looking to buy a house, don’t go to a listing agent. If you’re looking for an agent who’s more experienced and educated, look for a broker who’s managing a firm.
Be careful using dual agents. There may be a time and place to use them, but remember they can have conflicts of interest.
Are you thinking about using or becoming a real estate agent?
The Next Generation of Sin Stocks to Ride Out a Bear Market
While the recent stock market rally has technically pushed the Dow Jones Industrial Average out of a bear market, many investors aren’t convinced it will last.
They expect that once the euphoria surrounding the $2 trillion stimulus plan wears off, the market will resume its slide downward as the economic impact of the coronavirus takes hold in the next few quarters.
Sin stocks, so named because they are things that we should go without but can’t seem to part ways with, are historically a great investment during downturns.
The added stress and uncertainty means an uptick in business for the companies producing these sinful indulgences.
Things like alcohol, cigarettes, weapons and gambling all fall under the umbrella of sin stocks, so companies like Altria (NYSE:MO), Diageo (NYSE:DEO), Sturm Ruger (NYSE:RGR) and MGM Resorts (NYSE:MGM) are all widely considered to be sin stocks.
And while they can make great investments during times of uncertainty, there’s a new breed of sin stocks that could generate even larger returns over the coming months as Americans turn to their (new) favorite vices.
Here’s a short list of “next gen” sin stocks that we expect to do very well.
While this is by no means a “new” vice, it is only in the last few years that it’s been possible to directly invest in companies that produce and sell marijuana. That wasn’t possible during the 2008 financial crisis, so it will be interesting to see how the major players do during their first economic downturn.
Just like smoking, we expect demand to hold up very well, if not increase, during times of turmoil.
Consider the larger companies like Canopy Growth (NYSE:CGC), GW Pharmaceuticals (Nasdaq:GWPH) and Cronos Group (Nasdaq:CRON).
Being a “gamer” is a lifestyle now, with livestreaming on YouTube and Twitch and professional Esports leagues formed around the most popular titles like Call of Duty and Overwatch.
Video games are big money now, and the larger production studios will continue to generate massive revenues as the culture grows in the years ahead.
Look at the big studios with strong franchises like Activision Blizzard (Nasdaq:ATVI) which has the Call of Duty and Overwatch franchises and Electronic Arts (Nasdaq:EA) which has the Madden, Battlefield and FIFA franchises.
Social Media Platforms
If you have a child or grandchild under the age of 30, you are probably very aware of the effort it takes to get their attention away from their phones and all the social media apps or platforms that they are using.
Tik-Tok, Twitter, Facebook, and Instagram are all designed to keep users engaged and spending as much time as possible on their platforms. The publicly traded ones are Twitter (NYSE:TWTR) and Facebook, which also owns Instagram (Nasdaq:FB)
While there are no guarantees when it comes to investing, as the coronavirus causes more people to spend time at home, they’ll be spending more time using the products and services of these next generation sin stocks, and that should translate to more revenues and higher profits for the companies.
How to Become a Real Estate Agent
Real estate is a promising industry. There’s a huge earning potential and it’s relatively easy to get started.
Agents and brokers made an average of $50,300 in 2018, according to The Bureau of Labor Statistics. They also estimate employment will grow by 6% from 2016 to 2026.
4 Essential Steps to Becoming an Agent
On the same page, the bureau also states entry-level education is a high school diploma or equivalent. Just about anyone can get into the real estate business.
But where do you begin? If you’re serious about getting into real estate, you need a plan of action. You need a list of steps that take you from start to finish.
That’s what the post is all about. Let’s take a look at the milestones in the process of becoming a real estate agent.
1. Research State Laws
Like getting into most industries, real estate all begins with research. Each state has different requirements, so it’s important to research your specific state.
Almost every state requires you to be at least 18 years old. Many states require hours of pre-license education or credits.
Some states, like Colorado and Texas, have more higher standards to meet. Colorado requires 162 hours of credit classes and you must pass a background check. Texas requires 210 hours of education before you can take the state exam.
Some states like Pennsylvania permit you to take the state exam if you have a college degree related to real estate.
For a list of requirements in every state, check out this list.
Kaplan.com provides examinations and resources to prepare you for your state test.
Another great resource is Realestateexpress.com. Here you can research your state’s requirements and prepare for examinations.
2. Meet Legal Requirements for Licensing
Now that you know your state’s requirements, it’s time to meet them.
If you’re too young, sorry. You’re just going to have to wait. If you need to pay for pre-licensing fees, set aside some money. If you need to complete education requirements, take the appropriate classes.
Remember, in most cases, you need a high school diploma. If you don’t, you’ll need to acquire one or an equivalent.
You’ll need to take a wide range of pre-licensing courses. They may cover topics such as:
• closing transactions
• property management
• title transfers
• and more
In some states, you’ll need to pass a background check and even get fingerprinted.
3. Pass Licensing Examination
Finally, you have to pass your state exam.
After studying and working hard, now it’s time to make an appointment to take the state test. It can be nerve-racking but don’t psych yourself out. Remember, you can use the websites mentioned earlier to prepare yourself.
Recheck the list of requirements. Make sure you have all the appropriate documents. And of course, study up.
Generally speaking, state tests range from 60 to 100 questions. They often require a fee and can be as high as $300.
4. Join a Brokerage
As a new real estate agent you must work with a brokerage after acquiring your license. In some cases, you must work with a brokerage before getting your license.
There are two common reactions to this: 1. You’re relieved that someone will supervise you, or 2. You’re bummed you can’t be on your own yet.
Working for a brokerage is a good and necessary experience. They’ll make sure everything you’re doing is within legal guidelines. You’ll have a team and mentor who can answer your questions.
You’ll get a feel for the local market and real estate practices. Plus, you’ll be able to do a ton of networking.
This is a great season of training and experience. Get a few years under your belt, then consider furthering your education to become a broker.
You might experience setbacks and delays, but don’t get discouraged. Remember, you can do this.
Global Real Estate: How to Spot Up-and-Coming Cities
If you have a high-risk tolerance and an international mindset, an investment in global real estate is a fantastic way to generate income and travel to foreign parts. In this article, we’ll explore some of the key factors to keep in mind when investigating global real estate investments.
Global Real Estate Investments are High Risk, High Reward
Westerners are priced out of their own housing markets in the world’s most popular cities – Paris, London, New York – and have to look further afield for attractive property investments. Global real estate is one alternative, boosted by excellent exchange rates, the possibility for double-digit returns, and the promise of a foreign getaway for vacation and retirement.
When hunting for global real estate, however, investors have to look carefully at not just the location, but also the currency exchange, economic outlook, and political situation.
Look for Excellent Exchange Rates and Stable, Emerging Economies
The currency exchange rate is the biggest advantage that property investors from developed countries have over the population in emerging markets.
Established global currencies like the Pound, the Dollar, and the Euro can be converted to lavish sums of the Rupee, the Rand, and the Ruble (to pick a few examples). This translates into much lower prices for goods, services, and property in emerging markets.
But these exchanges rates won’t last forever. As a foreign property investor, one of the best decisions you can make is to find an undervalued currency that has a good chance of rising in the future. This will make your purchase cheap in the here-and-now and bolster your ROI over time.
The absolute best place to buy property – if you have a high-risk tolerance – is in a country undergoing economic collapse that has driven the currency to all-time lows. If you’d bought property in downtown Moscow, Russia in the early 1990s or Buenos Aires, Argentina in the early 2000s, it would have cost you pennies on the dollar and you’d be sitting on a goldmine right now.
Yet, you needn’t only look for places in distress. If a country is opening up to the world for the first time in many years and the fundamentals look good, now might be the time to find an apartment in the capital city.
Seek High Human Capital, Infrastructure, and Strong Institutions
The world is getting more and more prosperous as free-market policies are adopted in the far-flung corners of the globe. The relative stability of the world these days makes it hard to pick a bad country to invest in.
Even so, you still you want to avoid countries that appear to be headed for war, social upheaval, and revolution and focus on countries that are likely to be more economically successful than others.
The best predictor of a country’s future success is probably the human capital that it possesses. A good way to determine this is looking at the Education Index, PISA test scores, and other determiners of education and innovativeness. On the flip side, you may want to avoid regions of the world that score high on the Fragile States Index.
Don’t overlook infrastructure and institutions either. The Soviet Union was a horror show, but it left behind a sizeable industrial infrastructure and a long history of science and education. Likewise, colonialism had its dark side, but many of the places colonized by the British – Singapore, Hong Kong, Barbados – inherited Britain’s classical liberal institutions, and have gone on to do well as a result.
Don’t Ignore Appeal of Weather, Architecture, Arts, and Scenery
Global real estate investment isn’t just about crunching economic numbers and looking at demographic statistics. These things matter, but tourism is just as important, especially if you plan to visit your property on a regular basis.
You want to find a place that the young and hip will one day gravitate toward – and those places tend to have great weather, pre-modernist architecture, an active art scene, and beautiful natural surroundings.
In our small, interconnected world where every street can be seen on Google Maps, it is hard to find the next tourist hotspot waiting to be discovered. Chances are, the investors and hipsters have arrived long before you.
Nevertheless, if you can find at least one or two major tourist attractions – and the city’s fundamentals are good overall – then the city is still a good pick for long-term global real estate investment. When in doubt, try to stick to coastlines and places that you personally would want to visit.
Learn from Past Global Real Estate Investments
It pays to learn from history. Look at the cities that exploded in property values over the last few decades and try to anticipate which ones will be next.
Taipei, Taiwan and Warsaw, Poland stand out as success stories that are off the beaten path. Had you purchased property in either during the 1990s, you would have made a fortune. That’s because these are places with high human capital, some history and tourist attractions, and economies that are quickly catching up with the developed world.
What are some possibilities for the future? Some parts of Vietnam, Turkey, Brazil, and Ukraine are incredibly cheap and have a lot local appeal in their own unique ways. Some of these currencies and economies are also beaten down and could be ripe for new growth. They’re not without their risks, though, which is part of the reason why they’re cheap.
Laws and Location are Keys to Global Real Estate Investment
Purchasing a foreign property in a high-risk country is not for the faint of heart, but if you want to get rich you have to take risks.
Before making the leap to purchase global real estate, make sure you know the country’s laws regarding property purchases. Hire a local lawyer who speaks both languages to help you out.
Visit the place several times before making a decision and make sure you know someone in the country who can check in the property from time to time. And don’t underestimate the importance of finding a good neighborhood. Just like in America and Europe, location is everything – right down to the street level.
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