All Forum Posts by: Robert Carmody

Since the agent is someone that you are already working with, give them a call or send an email with a little bit of insight on the services the client needs, where they are looking to buy or wanting to sell, and then just ask if this sounds like a customer that they'd like to work with, and on a referral basis with you. 25% is customary, so it shouldn't come as any surprise to them. Most of the time when an agent receives a referral from another agent, with a referral agreement attached, they are receiving a warm to hot lead that they most likely aren't competing with other agents for, and haven't spent a lot of time prospecting to find the lead, or money on marketing to bring the customer to them. Referrals from other agents often seem to be further into the process, or more committed to purchasing a new home, or need to sell the existing. So, there are some advantages in exchange for the 25% fee. 

What type of electrical and plumbing work do you need bids for? I can give you a few recommendations on each. Do you need any others or just electrician and plumber? 

Many of the big brand name brokerages are locally owned franchises, so on one hand, there is a more "corporate" element to those offices, and on the other hand, the owners might still be local, with local market expertise, operating as a locally owned business affiliated with a national or international brand. Ultimately, the decision probably depends on the direction you'd like to take your business, where you see your business coming from, whether or not you plan to eventually hire team members, and so on. I started selling real estate when I was brand new with a smaller company. About 18 months later, I moved to the largest brokerage in our market at the time, which was a Coldwell Banker brokerage. Today, I work for the top Re/Max office in our market, which is much smaller than Coldwell Banker. I have always found the brand name affiliation that a large brokerage offers to be valuable, and primary reasons being:

1) Brand Recognition: Most customers don't care what company you work for as long as you know what you are doing and take care of them. But, sometimes they do. As a newer agent, I was able to rely on the brand and reputation of the company that I worked for when I didn't have a lot of personal experience. And, during the market meltdown and crash and recession that started in late 2008, it was helpful in securing listings and retaining listings during a time when sellers were understandably expecting that every possible resource was being used to help sell their house. 

2) Streamlined Systems & Training/Coaching: Larger companies, especially the big real estate brands, have created systems and tools and access to things like marketing material, online lead tracking, personalized websites, and so on. The fees are relatively small and resources are branded to the company, and usually streamlined through one system. This allows a busy agent to run their business more efficiently without having to purchase each little app or service individually, and then having to organize and make sense of it all. For new agents, many of the large brokerages have training programs and training materials that are effective and useful. Compared to the smaller company that I started with, there is much less "reinventing the wheel", and it's a big time and money saver. When it comes to building teams or hiring support staff, larger companies are more likely to have experience in this department, and many times can help provide a road map and some guidance for expanding productively and without derailing your business in the process. Again, goes back to not having to reinvent the wheel. 

3) Referral Opportunities: Over the years, I have received numerous referrals from other agents around the country that have found me through the company referral directory, or that I've met at a company conference, and sending referrals to another agent has been easier also. In addition to traditional referrals, my affiliation with a national real estate brand has opened doors for other opportunities to partner with other service providers or cross market with organizations that require their business partners or affiliate is also an affiliate of one of the big real estate brands. This could include things like relocation companies, asset management companies, iBuyers, and so on. 

Those are the main reasons that I've found value in working for one of the big national brands, which wasn't really offered or available working for a mom-and-pop style, local brokerage. Good luck!

Hi Brandy,

Do you mind me asking where in NM the property is located? Condo conversions are more common in some areas of NM, while less so in others. Does each unit have its own property tax bill, and does each have its own legal description? Does your sales contract list each of the 3 units separately? Was the current owner the one that converted the property, and if not, were they aware that it had been converted? Is the zoning correct? A condo conversion should be disclosed, as it would be considered a material fact, with potential impact to the property value, taxes paid collectively with 3 different units compared to 1 multifamily property. In some cases, and depending on your long term plans with the property, the conversion can be a perk and gives you options that might make the future resale value higher and more profitable, if you resold the property as individual units compared to one investment property. It can also create some challenges because there are frequently financing limitations when purchasing units in a converted property. Condos, even those with only 2 or 3 units, usually require an HOA with rules, bylaws, and formal HOA documents that cover each owner's interest in the property, and insurance that works a little bit differently also.

Most properties have utility easements running along at least one side of the property. They are usually about 5 to 10 feet wide, from side to side, or front to back of the property. Do you know if the property has underground utilities or overhead lines? Is the driveway paved or dirt/gravel? Utility easements give the utility provider the right to access their lines for the purposes of repairs or infrastructure improvements, and grants them the right to access their lines, even if they have to damage or remove part of your property to do so. Property owners, or tenants, should not add anything permanent to the property in the easement. Permanent would mean things like pouring concrete, building a swimming pool, building an addition to the property, installing a toolshed that sits on a concrete slab, pouring concrete driveways, etc. If the lines are underground and need to be accessed, the utility company and their contractors may move or remove whatever is an obstruction or preventing them from safely accessing the lines, and they are not responsible for returning that part of the property to the way that it was. It also means that they can do things like trim trees that are growing into overhead power lines. If the lines are above ground and you have a paved driveway that covers part of the utility easement, it's probably not something you'll need to be that concerned with, unless there are plans to bury those lines underground, which is not likely. If the lines are underground and a paved driveway covers the easement, know that there is always a possibility that you might have a problem if there was ever a need for the underground lines to be accessed. Underground power lines are typically pretty reliable and aren't at risk of having trees falling on them, or being damaged by strong winds, long term exposure to the elements, vehicle accidents, etc. You wouldn't want the house or condo units to be built into the utility easement, and you should be aware that it exists when planning your own improvements to the property in the future, but it's not that unusual to find "permanent" additions to the property or landscaping that are within the easement. 

Did the driveway that has a street name used to be a shared alleyway with another property or properties? 

Are you working directly with the owner, or do you both have agents? 

Sorry to ask so many questions, but I can probably give you some more insight or point you in the right direction if there are other resources or professional opinion that might be beneficial. You are welcome to message me directly if you prefer.

Sandia Green Clean 
(505) 393-2065

The Cleaning Authority
(505) 384-7839

I've had several customers that have had good experiences with these two companies, both locally owned. 

Have you considered working for another agent/"rainmaker" or larger team that is already successful in your area?  Doing so might help provide a steadier pipeline of customers, along with having mentorship and support from the team leader and experienced team members. Your commission split is likely to be less than it is working on your own, but you may sell more houses and find that your income becomes more reliable and consistent. Also, depending on the team, some of your business expenses might be covered, such as the cost of signs, business cards, printed materials, online marketing, etc. 

@Bruce Lynn is correct. Lead with revenue, not debt. As an agent without an extensive and consistent income history, and especially if your credit isn't stellar, you'll have a tough time finding a creditor willing to lend you money to run your business with. Most likely you will be limited to whatever credit you already have available to you through personal credit cards, or credit lines and equity loans that are secured by other assets - like a house or vehicle. Using that type of credit is very expensive and doesn't guarantee that your problems are solved. The only thing that it does guarantee is that until it is repaid, you've got more expenses to worry about. Instead of borrowing money right now: 

1) Look carefully at all of your monthly expenses and identify recurring costs that can be eliminated or reduced. It's easy to sign up for services that we don't end up using but are automatically charged for each month. Minimize frivolous spending, and impulse purchases. 

2) There are many ways to cultivate new business that cost nothing or very little. Use as many of those as you can. Examples include: 

Hosting open houses (for other agents if you don't have active listings) every weekend, preferably the same areas and/or price ranges. 

Make calls to your sphere and find out who might be thinking of selling this spring. 

Use social media - facebook, nextdoor, and instagram are some popular ones that seem to yield good results for many agents.

Get involved in your neighborhood or community - neighborhood associations or interest groups or volunteer with community organizations. 

Network with other service providers connected to the real estate market - sometimes the busy carpet cleaner or painter in an area knows who is going to be selling before an agent is contacted to list the property. 

Find a need or service that is currently underserved and become the expert. One example might be networking with a reverse mortgage specialist if your area is popular for retired people and seniors. Many seniors can use reverse mortgages for home purchases, but most don't know that, and neither do agents all too often. If you are the one that knows all about them, and you build a good rapport with that lender, guess who they'll refer their pipeline of buyers to?

In addition to the commission splits and brokerage fees for personal transactions that you'll want to clarify and consider, you should also look into your Errors & Omission Insurance, and any restrictions or limitations of coverage you might have for representing yourself when selling investment property that you don't occupy as your primary residence. 

Many E&O policies exclude coverage for agents selling their own investment properties or properties that they do not occupy themselves. If there were to be an issue after closing, and you listed the property yourself, representing yourself, you have no E&O Insurance to cover legal fees and damages, which can be very costly. The brokerage is also at risk. The way around this issue is to have another agent from your office list the property on your behalf, including in the MLS, on other websites, signage, flyers, and so on. You can usually find a friend or someone in the office who won't charge you to do this. Check with your broker and review your E&O policy, as this may or may not be the same everywhere, but I know that it is here. This does not include selling your own home that you occupy as a primary residence.

Your E&O provider should be able to answer this for you, or brokerage might address in a Policies & Procedures book, or in your ICA or Compensation Agreement.

Figure out financing options first, since financing options or availability might be your greatest guide when staring out. Keep in mind that if you are in a rural part on NM, you may need to find alternative sources for borrowing,  as a conventional and conforming 30yr loan, backed by Freddie Mac or Fannie Mae, might not be an option that is available. In rural areas, homebuyers can obtain mortgages through the USDA, but only for a primary residence. You can also check with the NM Mortgage Finance Authority for any special programs they offer. https://housingnm.org/, and might look into opportunities for purchasing with a Real Estate Contract/Seller Financing, especially if buying manufactured homes.

If targeting new or newer agents, you are competing with other brokerages more on services offered and less on commission splits. You'll probably need to focus on having an effective training program, lead generating system, as well as an opportunity to be mentored or coached. You might want to compare the training offered with competitors and figure a way to put a unique spin on yours or know your value proposition. While new agents can be easier to recruit, especially those that are still in real estate or pre-licensing school, it costs more money to provide good training and to provide them with leads or lead generating systems. They most likely will not have near as much sales production as experienced agents. 

On the flip side, if you are wanting to hire experienced agents, they are harder to recruit and usually will be less dependent on the services you offer and more likely to be shopping brokerages based on monthly fees, more competitive commission splits, the opportunity to cap at 100%, fewer or no franchise fees. You might catch their attention by having an in-house transaction coordinator, sign & lockbox delivery for their listings, professional photography for their listings. Their ability to list and sell more houses in your area will help get your brokerages name in front of the market, so any effort or services that let them work more efficiently or that take some of the time-consuming tasks off of their plates can be mutually beneficial. But at the end of the day, you are largely competing on how much of their commission they keep by working with you compared to wherever they work currently.

Does the property have zoning for 2 residences on one lot? Whether site built or manufactured, there are usually restrictions for having 2 separate residences on one residential lot, and I don't think that one can be considered a guest house or casita on something like that. Refinancing might prove to be a challenge or not possible for the buyer. Is the property within the City of ABQ, or is it unincorporated (county only)?