Real Estate Brokerage

The business of bringing buyers and sellers together in the marketplace is called brokerage. Buyers and sellers in many fields employ the services of brokers to facilitate complex business transactions. The term "broker" can be traced back to the Norman French word brocour meaning "wine dealer". At that time the local pub was the central meeting place of each village, and it was common practice to inform the wine dealer about items desired. The wine dealer would then pass this information on to other customers. If a sale was made, the brocour would receive a fee for his service.

In the real estate business, a broker is defined as any person who is licensed to buy, sell, exchange, or lease real property for others in exchange for a fee. Working on behalf of and licensed to represent the broker is the real estate salesperson.

The person who employs the broker is called a principal; the principal (client) may be a seller, a prospective buyer, an owner who wishes to lease his or her property, or a person who seeks property to rent. The real estate broker acts as an agent of the principal, who usually compensates the broker in the form of a commission, usually an agreed-upon percentage of the sales or rental price. The commission is contingent on the broker's successfully performing the service for which he or she was employed ? negotiating a transaction with a prospective purchaser, seller, lessor, or lessee who is ready, willing, and able to complete the contract.

In addition to bringing buyers and sellers together in a typical real estate transaction, brokers often engage in related specializations such as appraisal, property management, and insurance.

Appraisal is the process of estimating the value of a parcel of real estate. The appraiser must have sound judgment¹, experience and a detailed knowledge of the methods of valuation.

A real estate broker who operates an income-producing property on behalf of a principal is a property manager. The property manager is usually responsible for soliciting tenants, collecting rents, altering² or constructing new space for tenants, ordering repairs, and generally maintaining the property. The manager?s basic responsibility is to protect the owner?s investment and maximize the owner?s return on investment.

Among the major services of the real estate broker?s business, insurance is sometimes included. In many offices, the real estate broker is also an insurance broker, particularly if the broker performs property management service. Insurance brokerage, however, is a separate business that requires a separate license.

Notes: judgment¹ ? ??????, ??????; alter² ? ????????

Vocabulary Focus

Date: 2016-06-12; view: 397