In the USA, the process is very different. In most cases, two agents are involved in every deal. These are the listing agent (also known as a seller’s agent), and the buyer’s agent.
When a buyer is ready to buy a home, he or she engages the services of a buyer’s agent. This agent’s role is to represent the buyer’s interests. His job is to advise the buyer on where to buy, how much to pay, and which repairs to negotiate. The buyer’s agent earns 3% of the purchase price as a commission.
Since buyers’ agents work exclusively for buyers, they play a major role in keeping prices in check. Buyers’ agents have a much better knowledge of the market than most buyers. As a result, sales agents know that if they list properties for unrealistic prices, buyers’ agents will not bring those properties to the attention of their clients.
On the other hand, the listing agent is appointed by the seller. Like the buyer’s agent, the sales agent also earns 3% commission on the sale price. His job is to market the property as widely as possible to buyers’ agents, and advise sellers on making their properties more saleable. It is not uncommon for them to arrange so-called “buyers caravans.” They invite buyers’ agents – at a specific time – to view a property as soon as it has been listed. Buyers’ agents are often tempted by food and drink – and sometimes even prizes.
Like in South Africa, estate agents in the States sometimes arrange show days (known as “open houses” in the US). However, these tend to be less popular than they are here.
These agents, together with their clients – the buyer and seller – negotiate the best possible deal for all parties involved.
How agents and home inspectors work together
Once an offer is accepted, a due diligence period kicks in. The buyer’s agent will recommend the services of a home inspector, whose job it is to find as many faults as he can.
A buyer’s agent needs to understand what matters to the buyer. They need a clear insight into what the buyer wants from a potential property, and how much they want the specific property in question. The agent then unpacks the report and, with the buyer, decides on which aspects need to be addressed for the sale to go through. The agent then creates an amendment to address concerns, which is presented to the seller.
Getting the Job Done
The repairs and improvements are negotiated until both parties are satisfied with the outcome. (If not, the deal could be cancelled.) The seller is typically required to effect repairs before the transfer of the property can go through. In some cases, a decrease in the purchase price can also be negotiated. The seller often needs to provide invoices to prove that the work has been done by registered tradesmen – and that it has been done “according to code”.
In some cases, the buyer will get the same inspector to inspect the work again. The buyer then has to decide whether he or she is satisfied with the work done, and whether or not to close the sale.
Don’t Get Caught
Understanding the process of property investment outside of South Africa can save a lot of confusion and frustration.
At YDL we have a powerful network of trusted agents, reliable home inspectors and excellent contractors who work with us to ensure a smooth process – and get the highest possible price for a flipped property. If you’re ready to invest in property in Atlanta and secure your capital offshore, call us on 011 465 7356, or email email@example.com