Posts from December 2018

The Pre-Offer Work
First, let's review a little background about some of the many things that should have occurred prior to an offer being received. Hopefully, the seller began the process by hiring an Exceptional, Highly Effective Agent who specializes in Northern Virginia real estate. This type of agent is best positioned to reach the seller's desired outcome in the most efficient and professional manner possible. Prior to receiving an offer, the agent and seller have collaborated on all the vital steps to make sure the home is show-ready to achieve maximum buyer interest.

Click Here to Read More...

Understanding Seller Agency - Seller is Protected
When a seller in Northern Virginia desires to sell their home at the maximum price and in the shortest amount of time, their first step is usually to contact an exceptional real estate agent who specializes in this market.  The sale of a home begins with the seller hiring a real estate broker-agent through a written Listing Agreement.  The Listing Agreement establishes Seller Agency and outlines all of the contractual duties required by the Broker like what price to sell the property, how the property will be marketed, and how the Broker will act as a fiduciary for the seller and protect their best interests at all times.  The Broker then lists the property for sale and cooperates with other Broker-buyer agents to solicit offers from ready, willing and able buyers. 

Click Here to Read More...

What is Gross Rent Multiplier (GRM)?
In a recent blog post, I explained the use of Cap Rate by investors as a financial technique to estimate value when considering the buying or selling of a multi-family apartment building.  Another metric used in real estate is Gross Rent Multiplier (GRM).  Like Cap Rate, GRM is simply a gauge of value, but it can be used to quickly compare investment opportunities.  GRM accounts for the gross rents as measured against the selling price. It's calculated by taking the price and dividing it by the total annual gross rent.  For example, a price of $1 million divided by $100,000 in gross rent produces a GRM of 10.  Generally, GRM's in the Northern Virginia region vary widely between 6 and 16 based upon building location, rent level, age, and class.  Generally, the higher the GRM the better the building and lower the perceived risk.  Likewise, the higher the GRM the longer it will take an investor to recover their investment, meaning a lower ROI.

Click Here to Read More...