What is a Real Estate & How Real Estate Agent Work?

A real estate company is a company dedicated to the purchase and sale of properties, such as houses, apartments, offices, premises, among others. Generally, a buyer and a seller contact them to enter into the corresponding negotiations. The company, in that sense, acts as a mediator between the two. If the sale is specified, the real estate receives a commission. The real estate companies are dedicated to developing projects determined according to the geographical, demographic space and the facilities for the growth of the location. They are responsible for the concept and sale of each of these properties. This service is very useful, since the real estate company is dedicated to the different procedures related to the operations of purchase and sale, actions that a person may not know how to do. Another of its functions is to advise on the technical conditions of the property and the various circumstances that are related to it, such as, for example, the services of an area, the topography, and the changes related to the climate, among others.

Some of these companies are also responsible for the construction of the real estate projects they run. These companies call themselves "constructor and real estate". These companies do not sell foreign real estate, that is, they cannot act as intermediaries between a civil seller and a buyer; but they are dedicated to the work from before its conception. Therefore, they evaluate the land, make the plans, choose the materials and build the work from its foundations. The construction and real estate companies know their work better than anyone, which is the total sale of all their properties.

Types of Real Estate

Factory of cities (Many smaller scale projects)

If we used the business theory of the great schools of the twentieth century, we would surely fall into a model like this. Under the premise of process standardization, we can create a city factory that constantly searches for similar projects. For this model it is key that a developer has identified several relevant market niches and created a winning product that has also been validated in different geographies. The fear of geographic growth must be lost and much work must be done to create an orderly, efficient organization capable of replicating proven models in different markets. The organization will scale thanks to:
  • The knowledge economies associated with a market segment. Replicating a product that solves a specific need of a segment allows having constant lessons learned.
  • Standardizing processes and products allows creating an organized with a focus on efficiency and search for savings.
  • The experience allows predicting growth and therefore anticipates demand for land to create adequate reserves to the projections.

Main risks of the model:

Land finding and creation of territorial reserves -small or too many-, exhaustion of the commercial effectiveness of the replicable product, escalation in cost structures by size of organization, corporate costs, lack of validation and obtaining local knowledge.

Titanshunters (Many large-scale projects):

Perhaps the most complex model of all, that which aims to multiply the number of projects without considering the scale of them. He is a developer that creates cities that challenges conventions and the possibilities of their own markets. It is accompanied by the most sophisticated management teams and has a deep financial support to create medium and long-term projects. Public financing is undoubtedly required to achieve this growth model.

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