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"Salesmanship
consists of transferring
a conviction by a buyer to
a seller."
Paul G. Hoffman,
1960
"People
will buy anything that's
one to a customer."
Sinclair
Lewis, 1922.
 The previous article described
an exclusive listing agreement
between buyer and seller for
the purpose of marketing and
selling real estate. This contract
provides a framework of the
scope of work for the listing
agent and it describes obligations
of the broker and the seller.
The work of marketing, selling
and closing on the property
involves many steps.
Prior to listing the property,
the listing agent should evaluate
the comparable sales pertinent
to the real estate he/she is
proposing to market. Important
considerations to help find
a buyer for the property include
analysis of: actual sales prices,
asking prices, days on the
market, condition of properties,
the qualities of the neighborhood
and the community where the
real estate is located.
A marketing plan and budget
should be developed prior to
taking the listing. This marketing
plan is a part of the listing
presentation. The price and
type of property affect the
marketing strategy. A condominium
has certain features different
from an individual villa, and
these differences should be
emphasized.
Once the marketing plan and
price have been established
and an exclusive listing contract
signed, the agent should obtain
from the seller a copy of their
legal paperwork defining their
ownership of the property This
will include, but not be limited
to, the escritura (deed) which
will be a fidecomiso or bank
trust in the case of a foreigner,
predial or tax statement, survey
and plans, if available, condominium
regime and related documents.
If the community has a homeowner's
association, the legal documents
will be similar to condominium
documents. These papers describe
the common ownership and responsibility
of the owners to pay the maintenance
fees to protect the value of
the common areas and the individual
property.
The nature and quality of
the utility services is important
to ascertain. Does the property
have sewer or septic? Is there
gas or only electricity? Is
the water one main or an individual
meter?
It is important to determine
whether the structure of the
villa or condo is adjacent
to or into a federal zone.
The seller's documents of
ownership should be reviewed
by a professional such as an
attorney and/or accountant,
who can make sure the ownership
of the property is in proper
order.
The seller should disclose
the condition of the property,
so that steps can be taken
to remedy a situation prior
to marketing the property for
sale. If the roof leaks or
there is termite damage in
a beam, get these repairs done
before beginning the marketing.
While the ownership papers
are being reviewed, the seller
can also determine the nature
and extent of his/her capital
gains tax status. The seller
may be asked to furnish personal
information along with the
property documents, so that
the notary can determine if
the seller will owe capital
gains upon sale, and if so,
how much.
Without all these pieces of
information, a seller and his
listing agent cannot have a
plan, which will be successful
in the sale of the real estate.
The exclusive listing agent
should also have a complete
inventory of what is being
sold with the property.
It will not be a good investment
of time or money spent on advertising,
signage, or open houses, if
the property is not ready to
be sold. The objective of the
listing contract is to find
a qualified buyer and consummate
a sale. The property has to
be saleable, first.
When the groundwork is done
in the beginning, a host of
problems are avoided. A sale
should not fail because of
problems that could have been
avoided in the beginning of
the listing.
During the listing or marketing
period, the public will see
the property and form an opinion.
A good listing agent will ask
for feedback from the prospective
buyer and the cooperating agents.
These comments can be shared
with the seller, who is partner
in this marketing effort.
After
this feedback, if any changes
need to be made in how the
property "shows", this
should be done as soon as possible.
The number of showings should
be a guide to the condition
of the real estate market,
and acceptance of the particular
property and its price.
If there is a buyer's market,
the sellers are in greater
supply. In a seller's market,
there are more buyers than
sellers. If there is little
activity, some forces are affecting
the demand for the property.
A good listing agent will be
sensitive to these conditions
and work to maximize the position
of his property in order to
find the most number of qualified
buyers in his current market.
Many sellers say they never
hear from their listing agent
after the listing contract
is signed. It is good business
to create and maintain some
type of regular reporting system
to the seller.
If the marketing is successful
and a buyer appears, the selling
phase begins.
To create a sale, the buyer
must be convinced of the value
of the property, which he wants
to purchase. He must also be
encouraged to make a written
offer. People react to different
strategies. The professional
real estate listing agent will
pay attention to what is meaningful
to the buyer, and show how
the qualities of this property
meet his needs and wants.
If a selling agent is working
with the buyer, the listing
agent should not divulge confidentialities
about the seller to the buyer's
representative. The exclusive
listing agent should, however,
give the selling agent pertinent
information, which may help
the buyer make a decision.
When
the offer is written and
presented to the seller,
the exclusive listing agent
takes on another job. The offer
should be properly written,
signed and presented to the
seller as soon as possible. "Time
is of the essence", and is
an important rule to follow
in the sale of real estate.
The listing agent can help
the seller analyze the offer
and he can make recommendations
for the seller to consider.
The listing agent should know
of any recent sales that have
occurred from the time that
the listing was taken. The
exclusive listing agent should
find out what he can about
the buyers, in order to give
the seller a sense of the ability
of the buyer to go through
with the transaction.
If more than one written offers
comes in, the listing agent
should present all of them
to the seller. The seller can
then determine which offer
he/she wants to respond to
in writing first. The listing
agent should guide the seller
and make him aware of the procedures
that should be followed in
regard to the AMPI code of
ethics.
If buyer and seller accept
an offer, the listing agent
will continue to see that the
procedure of the sale is kept
on track and that all timetables,
deadlines, and document review
is accomplished.
The listing agent will help
the seller determine the costs
of the sale. These costs can
include a trust cancellation
fee, sales commission plus
iva, capital gains tax, employee
liquidation, and notice to
SECOFI of the change in ownership
by a foreigner.
It is the exclusive listing
agent's duty to not lose a
sale because of poor management
of the process of the sale.
It is the duty of the exclusive
listing agent to keep the seller's
expenses to a minimum, while
still making sure the expenses,
which rightfully are the seller's,
are paid.
It is the duty of the exclusive
listing agent to help the seller
turn over the condominium,
villa or land, in clean, good
condition to the buyer.
It is the duty of the exclusive
listing agent to be sure that
the purchase funds of the buyer
will be safely kept for payment
to the seller.
Properly managing an exclusive
listing agreement is a demanding
job. The seller and the listing
agent have responsibilities
to each other during the term
of the contract between them.
More successful agreements
between the seller and his
exclusive agent are accomplished
when both parties understand
and follow a system.
This article is based upon
legal opinions, current practices
and my personal experiences
in the Puerto Vallarta-Bahia
de Banderas areas. I recommend
that each potential buyer or
seller conduct his own due
diligence and review.
Harriet
Cochran Murray
For additional
information on properties,
for sale or lease within the
bay please visit Harriet
Murray website, call
or e-mail me at: harriet@casasandvillas.com
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