Talking the talk - real estate jargon

Jargon, in essence, is industry specific terminology which is used by the members of a particular group or profession. As it’s so specific, it’s not normally understood or used by everyone. This can at times be annoying, when someone is using jargon and you don’t know what they’re talking about!

 You’ll often see jargon of the real estate variety scattered throughout property listings, which sometimes sound just like science fiction speak: ‘3BR Apt with BIRs and DLUG ‘ – (3 bedroom apartment with build in robes and double lock-up garage, for those yet acquainted!)

Sometimes I hear conversations between real estate salespeople and others in the industry such as conveyancers, mortgage brokers and tradespeople which are so jargon-filled, that to the untrained ear would sound much like a foreign language. However they really couldn’t operate in any other – as jargon is a series of shortcuts which speeds things up greatly. This industry speak does tend to lend a tone of professionalism and expertise to a conversation. People who are experienced in a specific profession naturally used jargon freely as it becomes the language of their business.

There is, however, a time and a place for jargon – which is usually amongst ones contemporaries; others who are speaking the same language. However there is also a time and a place not to use jargon - primarily when those you are speaking to do not understand the words you are using, because you don’t share a common background or profession.

At CENTURY 21, we train our salespeople in how to best communicate with people from all walks of life – and the most important part of communicating, even more important than people hearing what you are saying, is having people understand what you are saying – and you understanding them. Therefore, we teach our salespeople to avoid jargon where possible, and to use plain language when discussing property transactions with buyers and sellers. At CENTURY 21, we pride our people on being clear, accessible experts - communicating clearly and offering expert advice that is easily understood, regardless of how much or how little you know about real estate.

However in saying this, when you enter the real estate market for the first time, it does help to familiarize yourself with some commonly used real estate terms. It will make the transaction easier – and you will undoubtedly feel more comfortable if you are familiar with some of the terminology you might encounter. It does help to come armed with some knowledge.

Technology, in particular the internet is a blessing when it comes to understanding jargon. Back in my day, one had to engage in the arduous task of searching through great tomes known as ‘encyclopaedias’ or ‘dictionaries’ when one did not know the meaning of a word. These days, one merely needs to type the word into Google to get a pretty comprehensive understanding of it and how it should be used. See how easy you have it, Gen Y!?

If you would like a free copy of Your Guide to Real Estate, which explains real estate jargon in depth, and contains lots of other really useful information for buyers and sellers, simply email askmarketing@century21.com.au

The worst house in the best street

“Remember to look for the worst house in the best street, not the best house in the worst street” is an age-old real estate-ism that you will no doubt hear bandied about almost anytime anyone mentions buying a property. 

I thought it would be interesting to take a closer look at this old cliché, to see what truth can be found in it. From my own real estate experiences, buying the ‘worst house on the block’ is not a simple concept – and is not always going to be a straight out good decision. There are several factors which come in to play here…

 The worst house/best street phrase often refers to the overwhelming importance that most people place on location. Where a property is located generally is much more important that what a property looks like, as it’s something (unless your ‘house’ is the kind on wheels) that you just can’t change. Properties that are closer to public transport and infrastructure such as schools, shops and sports facilities tend to achieve a higher value than similar properties off the beaten track, due to factors of convenience and lifestyle. So in saying this, compromising cosmetic features for a better location is in most cases a wise decision.  For instance, a friend of mine who is a valuer has recently bought the ‘worst property’ in the ‘best street’. She studied values of properties in street adjacent to the Brisbane River, and although the property doesn’t have direct waterfront access, the property she bought benefits from being located in a street with a high medium price. 

It also depends whether or not you are buying a property to live in, or as an investment. If you’re going to be living in the property, then you need to consider whether you can live there whilst renovating. As an investment property, remember – every week that you don’t have a tenant installed is costing you money. Add this to renovation costs, and it can add up to a bad decision. However a clever cosmetic update (particularly bathrooms and kitchens, functional outdoor space) can greatly increase the value of a rental property.  

It’s important to be very realistic about the proverbial ‘worst’ house in the street, and know exactly what you’re getting yourself into in terms of repairs and renovations. How bad precisely is ‘worst’?  Are we talking about a highly offensive colour-scheme and a backyard that makes trekking the Kokoda trail seem like a walk in the park? Or are we talking other deeper, darker (and potentially very expensive) issues, such as structural damage, termites or drainage problems? Some problems are easy to fix – a new vanity here, a coat of paint there – you get the picture. Some are not, and can be a lot more trouble than they’re worth if you don’t have any practical skills in home renovation (as well as miles and miles of patience!) 

Timing is also a crucial element in deciding on the type of house you could manage to live in with regards to renovations, to what extent of work needs to be done. There may be some periods in life where a major renovation would be a fun adventure (ha!), and other times (i.e. if you’ve just given birth to octuplets) when extensive renovations may be somewhat ill-advised. So consider how much the renovation will affect the lives of everyone living in the house, and the costs of temporary accommodation if necessary. 

 It’s a good idea to hire a qualified building inspector and report on any property that you are seriously considering buying, as this could save you thousands if there are major problems uncovered. You should also be mindful of heritage/preservation restrictions in your area, before purchasing a house that requires major renovations, as this could place considerable restrictions on what you can actually change.  

There are bargains to be had by buying the ‘worst’ house in the ‘best’ street – especially if you are willing to put in the time and effort. But to reap the rewards, you’re going to need patience and a plan, because the phrase ‘renovators dream’ can often be an oxymoron!

How do you pick a good agent to sell your property?

In real estate, choosing the correct real estate agency and the representative of that agency is one of the key decisions affecting the price you will achieve for the sale of your property.

It is not easy to choose the right agent and agency for the job of selling a home. Because of this, many sellers tend to base their decision on which agency to choose on the “offer” they receive from the agency in terms of the suggested marketing price.

So if an agency representative said he or she could achieve a higher price than other agencies, you may be tempted to list with that agency as you have no other way to measure the success or otherwise of an agency.

Unfortunately, talk is cheap - some unethical agencies will inflate the price potential of a property even though they will not be buying the property themselves, so it doesn’t matter to them what price they place on your property, which may not be realistic.

Here are some suggestions for choosing the right real estate agency and the right representative of that agency to help you get the best price for your property.

Firstly some legal issues;-

All real estate agencies in Australia must be operated by an individual licensed real estate agent who must have a current licence issued by the appropriate State or Territory Government and hold Professional Indemnity Insurance so if the agent were to make a genuine mistake which cost a customer or client money, then the customers or clients loss would be covered by the insurance.

A salesperson working for a real estate agency must either hold a full real estate agents licence or be registered by the relevant State or Territory Government. A salesperson that holds a certificate of registration cannot imply that he or she is a licensed real estate agent.

A real estate agency has a duty of care to work in the best interests of their client – the person who is paying the agency commission which in most cases is the seller or though there are buyers agents who work for buyers to find the best properties at the best price for a fee.

Real estate agencies must obtain the best purchase price in the marketplace in the quickest possible time and they have to submit all offers from prospective purchasers except in some states where a property is being sold by auction.

When discussing price with a potential seller a real estate agent or a registered salesperson is not allowed to inflate the price potential of a property just to get a listing as this would be in breach of State, Territory and Federal Legislation.

In most States and Territories a real estate agency has to supply details of recent sales and listings of similar properties so the seller can gauge the correct price for listing the property.

By the same token, a real estate agent or a registered salesperson must not indicate to a potential buyer that he or she could obtain a property at less than the asking price as this would be considered misleading and against consumer laws.

Successful real estate agents and salespeople have the following traits and this is what you should look for when choosing an agency to represent you in the sale of your property:

EXPERIENCE: The combined experience of the agency team is very important, as whilst a new salesperson to the team can be a very effective and successful, as they would have just completed training and be full of enthusiasm and energy, they would need the experience of the team to guild them through “the ropes” – age doesn’t matter – its experience that counts.

ENTHUSIASM: You need an agency with enthusiastic sales staff that are motivated and on the ball.

REPUTATION: Check with your friends - which agency or salesperson has the best reputation for achieving results and who have they had a good experience with?

KNOWLEDGE: Local knowledge of the property market is very important for every seller and your agency should have knowledge of market conditions, finance, town planning laws and future developments.

CONSULTATIVE APPROACH: The best agents and salespersons work with sellers to achieve the best results – they do not bully buyers or sellers to do a deal. Don’t list with pushy salespeople, as you need to feel comfortable working with them.

MARKETING EXPERTISE: Your agent and salesperson should know the best way to market a property and have experience in marketing properties using a variety of tools, including traditional and non-traditional (social media and web 2.0) methods.

DATABASE OF BUYERS: You real estate agency should have a database of ready and willing buyers in your properties price range so you can obtain a quick sale.