Buyers and sellers need a common platform, to initiate a home purchase or sale. The same is true for landlords and tenants, who want to rent properties. The business of real estate brokerage came into being, to act as that common platform for all the parties mentioned above. Traditionally, individual realtors or agents helped the buyers and sellers (or landlords and tenants) to get in touch with each other. Later on, the business also saw the emergence of mega brokerage firms, as the Indian housing market started to see unprecedented growth from the 1990s, with the economic liberalization.
Today, there are a large number of real estate brokerage firms in India, including Housing.com, that cater to every need of buyers, sellers, landlords, and tenants in various residential and rental markets. These firms have, in fact, been instrumental in enabling home sales during the Coronavirus-induced phased lockdown period in India, when most transactions took place online.
However, in spite of the presence of mega brokerage firms in the country, a large part of the demand for the brokerage is still supplied by neighborhood brokerage services or individual agents.
Licensing and training for real estate brokerage in India
Unlike the west where the property brokerage business is highly evolved, the real estate brokerage market in India is still developing. This is why agents seldom opt for formal training, to enter into the brokerage business, which is a precondition in the west, where all brokers have to undergo training and pass a certificate program before they are allowed to liaison for a buyer or a seller client. Brokers in the US, for example, have to invest time and money to get a real estate license.
In India, you can get into this highly competitive field without any certification. However, achieving success here would prove to be a tough task, unless you have excellent communication skills and solid knowledge of the real estate market dynamics in the area you are operating.
Services offered by real estate brokerage firms and agents
There are a host of services that brokers and brokerage firms supply. These include:
- Property listings for sale or purchase
- Listings for renting
- Home sales and purchase
- Home renting
- Site visits
- Assistance with home loans
- Assistance with property registration, etc.
While full-stack brokerage firms like Housing.com provide all of these services using one platform, individual brokers focus on specific offerings, focusing on specific neighborhoods.
Brokerage commission in India versus the west
In the residential segment, brokerage firms and property agents typically ask for 2% of the transaction value as the brokerage charge. The charges are much higher in the commercial realty brokerage business.
It is worth mentioning here that when compared to the trends seen in more mature markets like the US, property brokerage charges are quite low in India. In the west, brokers typically ask for 6%-7% of the transaction value as the brokerage fee or commission.
SOURCE – https://housing.com/news/what-is-a-real-estate-brokerage/
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