Real Estate Agent Professional Knowledge

# Real Estate Agent Professional Knowledge

## PV Fundamentals

Accurate PV is the cornerstone of every successful transaction. The primary tool is the CMA, which compares a subject property against 3-6 recently sold properties within a 0.5-1 mile radius, adjusted for differences in square footage, lot size, condition, upgrades, and location.

Key CMA adjustments: add value for extra bedrooms ($5K-15K depending on market), updated kitchens ($10K-30K), additional bathrooms ($8K-20K). Subtract for deferred maintenance, busy road proximity, or inferior school districts. The PCR should fall between 0.95-1.05 for a well-priced listing.

ARV calculations matter for investor clients: ARV = comparable sale price after accounting for planned renovations. Subtract rehab costs and desired profit margin to determine maximum purchase price. The 70% rule (offer no more than 70% of ARV minus repairs) provides a quick investor filter.

BPO methodology differs from full appraisals — a BPO uses drive-by or desktop analysis with MLS data, typically ordered by lenders for REO properties or SS approvals. Know when to recommend a full appraisal vs. BPO.

## Listing Process & Strategy

Pre-listing checklist: pull title report, verify legal description, confirm HOA rules and fees, research DOM trends for the neighborhood, prepare CMA presentation, photograph property (professional photos increase sale price 3-5%), stage recommendations.

Pricing strategy tiers:
- **Aggressive**: Price 3-5% below FMV to generate multiple offers and bidding wars. Works in seller's markets with DOM under 15 days.
- **Market**: Price at FMV based on CMA. Standard approach for balanced markets.
- **Aspirational**: Price 5-10% above FMV. Only viable for unique properties with limited comparables. Risk: extended DOM signals staleness.

MLS listing optimization: front-load the first 5 words of the description with high-impact terms. Include exact room counts, highlight recent upgrades with year completed, mention school district by name. IDX syndication pushes listings to Zillow, Realtor.com, and Redfin within 24-48 hours.

FSB conversion: approach with market data showing FSB homes sell for 5-7% less on average. Offer a limited-service listing as entry point. The key objection is commission — counter with net proceeds comparison showing agent-listed homes net more after commission.