"Salesmanship consists of transferring a conviction by a buyer to a seller."
Paul G. Hoffman, 1960

"People will buy anything that's one to a customer."
Sinclair Lewis, 1922.

The previous article described an exclusive listing agreement between buyer and seller for the purpose of marketing and selling real estate. This contract provides a framework of the scope of work for the listing agent and it describes obligations of the broker and the seller. The work of marketing, selling and closing on the property involves many steps.

Prior to listing the property, the listing agent should evaluate the comparable sales pertinent to the real estate he/she is proposing to market. Important considerations to help find a buyer for the property include analysis of: actual sales prices, asking prices, days on the market, condition of properties, the qualities of the neighborhood and the community where the real estate is located.

A marketing plan and budget should be developed prior to taking the listing. This marketing plan is a part of the listing presentation. The price and type of property affect the marketing strategy. A condominium has certain features different from an individual villa, and these differences should be emphasized.

Once the marketing plan and price have been established and an exclusive listing contract signed, the agent should obtain from the seller a copy of their legal paperwork defining their ownership of the property This will include, but not be limited to, the escritura (deed) which will be a fidecomiso or bank trust in the case of a foreigner, predial or tax statement, survey and plans, if available, condominium regime and related documents.

If the community has a homeowner's association, the legal documents will be similar to condominium documents. These papers describe the common ownership and responsibility of the owners to pay the maintenance fees to protect the value of the common areas and the individual property.

The nature and quality of the utility services is important to ascertain. Does the property have sewer or septic? Is there gas or only electricity? Is the water one main or an individual meter?

It is important to determine whether the structure of the villa or condo is adjacent to or into a federal zone.

The seller's documents of ownership should be reviewed by a professional such as an attorney and/or accountant, who can make sure the ownership of the property is in proper order.

The seller should disclose the condition of the property, so that steps can be taken to remedy a situation prior to marketing the property for sale. If the roof leaks or there is termite damage in a beam, get these repairs done before beginning the marketing.

While the ownership papers are being reviewed, the seller can also determine the nature and extent of his/her capital gains tax status. The seller may be asked to furnish personal information along with the property documents, so that the notary can determine if the seller will owe capital gains upon sale, and if so, how much.

Without all these pieces of information, a seller and his listing agent cannot have a plan, which will be successful in the sale of the real estate.

The exclusive listing agent should also have a complete inventory of what is being sold with the property.

It will not be a good investment of time or money spent on advertising, signage, or open houses, if the property is not ready to be sold. The objective of the listing contract is to find a qualified buyer and consummate a sale. The property has to be saleable, first.

When the groundwork is done in the beginning, a host of problems are avoided. A sale should not fail because of problems that could have been avoided in the beginning of the listing.

During the listing or marketing period, the public will see the property and form an opinion. A good listing agent will ask for feedback from the prospective buyer and the cooperating agents. These comments can be shared with the seller, who is partner in this marketing effort.

After this feedback, if any changes need to be made in how the property "shows", this should be done as soon as possible.

The number of showings should be a guide to the condition of the real estate market, and acceptance of the particular property and its price.

If there is a buyer's market, the sellers are in greater supply. In a seller's market, there are more buyers than sellers. If there is little activity, some forces are affecting the demand for the property. A good listing agent will be sensitive to these conditions and work to maximize the position of his property in order to find the most number of qualified buyers in his current market.

Many sellers say they never hear from their listing agent after the listing contract is signed. It is good business to create and maintain some type of regular reporting system to the seller.

If the marketing is successful and a buyer appears, the selling phase begins.

To create a sale, the buyer must be convinced of the value of the property, which he wants to purchase. He must also be encouraged to make a written offer. People react to different strategies. The professional real estate listing agent will pay attention to what is meaningful to the buyer, and show how the qualities of this property meet his needs and wants.

If a selling agent is working with the buyer, the listing agent should not divulge confidentialities about the seller to the buyer's representative. The exclusive listing agent should, however, give the selling agent pertinent information, which may help the buyer make a decision.

When the offer is written and presented to the seller, the exclusive listing agent takes on another job. The offer should be properly written, signed and presented to the seller as soon as possible. "Time is of the essence", and is an important rule to follow in the sale of real estate.

The listing agent can help the seller analyze the offer and he can make recommendations for the seller to consider. The listing agent should know of any recent sales that have occurred from the time that the listing was taken. The exclusive listing agent should find out what he can about the buyers, in order to give the seller a sense of the ability of the buyer to go through with the transaction.

If more than one written offers comes in, the listing agent should present all of them to the seller. The seller can then determine which offer he/she wants to respond to in writing first. The listing agent should guide the seller and make him aware of the procedures that should be followed in regard to the AMPI code of ethics.

If buyer and seller accept an offer, the listing agent will continue to see that the procedure of the sale is kept on track and that all timetables, deadlines, and document review is accomplished.

The listing agent will help the seller determine the costs of the sale. These costs can include a trust cancellation fee, sales commission plus iva, capital gains tax, employee liquidation, and notice to SECOFI of the change in ownership by a foreigner.

It is the exclusive listing agent's duty to not lose a sale because of poor management of the process of the sale. It is the duty of the exclusive listing agent to keep the seller's expenses to a minimum, while still making sure the expenses, which rightfully are the seller's, are paid.

It is the duty of the exclusive listing agent to help the seller turn over the condominium, villa or land, in clean, good condition to the buyer.

It is the duty of the exclusive listing agent to be sure that the purchase funds of the buyer will be safely kept for payment to the seller.

Properly managing an exclusive listing agreement is a demanding job. The seller and the listing agent have responsibilities to each other during the term of the contract between them. More successful agreements between the seller and his exclusive agent are accomplished when both parties understand and follow a system.

This article is based upon legal opinions, current practices and my personal experiences in the Puerto Vallarta-Bahia de Banderas areas. I recommend that each potential buyer or seller conduct his own due diligence and review.

Harriet Cochran Murray

This article is based upon legal opinions, current practices and my personal experiences in the Puerto Vallarta-Bahia de Banderas areas. I recommend that each potential buyer or seller conduct his own due diligence and review.