Four people you meet in real estate practice

You see them at malls manning exhibits of subdivision developments, say Filinvest Land Inc.‘s Corona del Mar or Commonwealth Estate Inc.’s Collinwood.

They entertain you during open houses of subdivision or condominium projects and show you around the house models or condo units that are for sale.

They take you “tripping”—the term used in the Philippine realty service to describe the practice of bringing prospective buyers to one or more properties so they can choose what best suits them.

They’re known as real estate brokers and because of the nature of their profession, they need to be a little bit of a PR person, lawyer, accountant, conciliator, geodetic engineer, says Trade and Industry Regulatory Division-Cebu Province chief Zaide C. Bation.

Negotiating the sale of real properties in behalf of the owner is just one of the many things real estate brokers do. Brokers can also look for property that a client can buy or lease, negotiate the exchange of properties between owners, or look for a property investor or developer that can enter into a joint venture agreement with a landowner.

In return, brokers get what is called a commission. The amount of commission that a broker gets is not legislated, rather it is dictated by current industry rates. The prevailing rate of commission for brokers for a single transaction is between 3 to 5 percent of the transaction cost.

Individuals and corporations may be licensed as brokers by the Department of Trade and Industry‘s Bureau of Trade Regulation and Consumer Protection (BTRCP). A corporation though has to designate in a board resolution the person who will represent it in real estate brokerage and he or she must be a licensed practitioner.

Helping brokers do their tasks are real estate salesmen. Salesmen do not need to take the licensure examination for brokers but they too must be licensed. A salesman’s license is an extension of that of his or her broker.

Salesmen take on the duties and responsibilities of real estate brokers and they get a “share” in the commission from the sale or transaction that they bring about.

Only natural persons can be real estate salesmen.

An appraiser is another important real estate practitioner. Appraisers can be individuals or corporations. Their job is to render an estimate of or offer expert advice on real estate values.

The purposes of appraising real estate values can be in line with purchase and sale, financing and credit, corporate affairs, partition of estate, or eminent domain.

Appraisers estimate a property’s fair market value and may use various means to do it. Among the more common methods used by appraisers are market data approach, cost approach, and income approach. More on this in later posts.

The fourth real estate practitioner is the consultant.

DTI’s Zaide Bation says this is where the money is in real estate practice. You need to have some serious experience though as broker and appraiser, from 5 to 10 years, and pass the BTRCP exam before you can be considered a real estate consultant.

Consultants can be natural persons or corporations. They provide professional advice and judgment to property developers.

Brokers, salesmen, appraisers, and consultants. They are the four prominent people in the realty service practice and if you’re thinking of buying or selling property, chances are you’ll run into any one or two of them.