The deal about real estate is matching a prospect and a purchaser with a property. It is a matchmaking business. We pair the right buyers and sellers together, and the right landlords and tenants together. Sometimes, a mismatch happens to begin with. We’ve a property or listing but no purchaser. On the other hand, we’ve a purchaser or prospect but no listing! How then do we match them together? We co-broke or co-agency.
Co-broke and co-agency are used intermittently. The professional term is co-agency. From this point on, in this article, we’ll be using the term co-agency. Co-agency means 2 or more real estate agents working together to close a deal. There’s also partnership. Co-agency and partnership take on different roles in different contexts. A partnership normally involves only 2 real estate agents working together for the long term. In any deal, whether for rental or sale, they partner together to share the professional fees.
Notwithstanding any existing partnership, a co-agency is usually meant for separate real estate agents who have no prior working relationships. Real estate agents can co-agency internally and externally. To co-agency internally means real estate agents from within the same agency working together to close a deal. Whereas, an external co-agency means agents from different agencies working together to close a deal. Real estate agent from R agency and real estate agent from H agency co-agency to close a deal for a property.
How do real estate agents come about to a co-agency for starters. A real estate agent has a client who has the following requirements:
- Location: Petaling Jaya
- Property type: Condominium
- Furnishing: Partially or fully furnished
The real estate agent do have other condominium listings but they are above the client’s budget. The real estate agent also has single-storey terrace listings which are within the client’s budget but they are not interested in them.
Now without any suitable listings in hand, the real estate agent has to co-agency. He’ll first check with his colleagues internally, be it in the same branch or a different branch. Ask around, post in Whatsapp group(s), and scour the internet for listings to co-agency.
He can post in Whatsapp group(s). Colleagues will then contact him to propose their listings. Some will call to find out more information about the client before giving the property details. Others will SMS or Whatsapp directly the property details.
Alternatively, he can search the internet for his colleagues’ property portals – Iproperty, Propertyguru, Mudah.my, TheEdgeProperty, Propsocial, Propwall, etc. Typing in the keywords – house, location, for sale, agency name, property portal name – yields fast results. If he finds a match, he can contact them to find out more information about the advertisement and make arrangements to co-agency.
Vice versa, if his colleagues have a client (tenant or purchaser), and he has a matching property, he’ll propose it to them.
Prior to a viewing being confirmed, a co-agency letter will be sent to the listing agent. It is a contract stating the property’s details, and terms and conditions to be followed in the event of a successful co-agency.
If searching internally yields no fruitful results, he’ll have to source externally. Similar to internal co-agency, he’ll post in Whatsapp group(s), Facebook groups, and other social media platforms. Agents or negotiators from other agencies, who have suitable listings will contact him to co-agency.
A more pro-active approach will be to surf online property portals and the internet for listings. View the pictures and read the listing’s descriptions to understand if the property meets the requirements. Narrow down from the location to the price to the listing’s descriptions.
When reading the descriptions, he’ll have a better understanding of the property before the viewing. Some additional information from descriptions are the view and direction of the unit, and the floor level of the unit. Then, contact the listing agent to find out more information about the unit, co-agency, and make arrangements for a viewing.
Prior to the viewing being confirmed, a co-agency letter will be sent to the listing agent. It is a contract stating the property’s details, and terms and conditions to be followed in the event of a successful co-agency.
At the viewing, the real estate agents will first exchange business cards. The purchasers and the vendors, and the landlords and tenants should not exchange contacts until the whole transaction has been concluded. This is in the best interest of all parties involved and to avoid conflict of interests.
The listing agent will then conduct the viewing; showing and briefing the property to the purchaser or tenant.
There is lesser conflict of interest, as there is a real estate agent representing the purchasers or the tenants on one side, and a real estate agent representing the vendors or landlords on the other side. The question of conflict of interest rarely arises as the boundaries are clearly drawn.
On the other hand, if there is only one real estate agent in the transaction representing both parties; then the question of positioning arises. The real estate agent is sitting on the fence and is a fence-sitter. He or she has to maintain the best interests of both parties. He or she has to navigate through the negotiations tactfully.
A co-agency may mean lesser profits as both the co-agent and the listing agent have to share the professional fees. However, it speeds up the transaction and gets the work done faster. You’ve a satisfied purchaser and vendor, or tenant and landlord.
Internal & External Co-Agency
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