Process Model of a Real Estate Business- myassignmenthelp.com

Question: Discuss about theProcess Model of a Real Estate Business for Economics. Answer: Introduction The real estate business in Australia has been very dynamic over the past few years, with a lot of new innovations and changes in the market, as with the real estate agencies. The real estate agents in Australia generally have a very professional attitude and are updated in technological knowledge and general information about the local market, which enables them to present a clear picture to their clients while making a deal (Graff et.al, 1997). The particular feature about the Australian real estate market and the agencies is that there is a great variation in the land specifications owing to geography, and the prices related to that in the market (Bond et.al, 2003). It has been recently noted that prices for housing as well as properties in Australia were comparatively one of the highest while comparison with other parts of the world. The real estate market is very competitive and tough in Australia, with different factors influencing the market, like foreign investments and a high incidence of immigration from other countries (Crowe et.al, 2013). The general working structure of a real estate agency consist two main duties. One is to buy a property or a home, or to sell the same. Depending on the area, Australian real estate agencies trade in small homes, to mansions in exotic locations with extraneous luxury. The real estate agencies in Australia normally work as either a listing agent, who helps in selling the plot, or a buyers agent, who helps a prospective buyer select his home or plot of choice. The working procedure of a real estate agency is simple; the agency acts as a middleman, negotiating the price between the buyer and the seller and acts in favor of its client who could be either of the two (Wills, 2008). The agency charges a fee for their services, which is normally a percentage of the sum of money involved in the real estate deal. The As-Is Process Flow of purchasing a house There are mainly three major roles in the As-Is process flow. They are the Seller, the Realtor and the Buyer. The process flow shifts from the Seller to the Realtor to the Buyer in three transitions. Initially the seller plans to sell the property and passes on the request to the Realtor. A realtor is a person involved in the real estate business who is a licensed authority for buying and selling of a real estate property or a building. The Realtor in an As-Is setting, receives the request of the sale from the buyer initially. Once the request is made, the property is inspected based on the specifications comprehensively. Following this an appraisal is made on the property and an estimated value for the property is fixed. Once the valuation is done, an open home inspection is carried out on the property which makes an assessment of the present condition of the property (Zumpano et.al, 1996). If the condition is deemed to be satisfactory, the feedback is sent to the buyer who decides whether to buy the property or not. If the decision is a yes, the process flow shifts on to Realtor who decides whether the sale is to be done through an auction or by private means. The deal is closed in the final step with the property being purchased by the buyer. The To-Be process flow of buying a house The initial process here is an approval from the seller that he is ready to sell the property. Once the request for the sale is received by the Realtor, the inspection takes place through virtual reality. Advanced Imaging such as 3D modelling is used, which examines the condition of the interiors and the rooms. Virtual reality is used by the buyer who does the inspection of the property through tools which give an interactive feeling. Once the virtual inspection is done, the decision to buy or sell is again made by the buyer who participates in a live, virtual reality based auction. The advantage of using this method is that buyers from remote areas can participate in the auction without any loss of information. The final step here is completed by the buyer who makes the pivotal decision as to whether the purchase has to be made or not. The advantage of using process flows such as the As-Is and To-Be models are that the viewers would get a clear picture in the current setting and how it could be enhanced by technology in the near future. References Bond, S.A., Karolyi, G.A. and Sanders, A.B., 2003. International real estate returns: a multifactor, multicountry approach.Real Estate Economics,31(3), pp.481-500. Crowe, C., DellAriccia, G., Igan, D. and Rabanal, P., 2013. How to deal with real estate booms: Lessons from country experiences.Journal of Financial Stability,9(3), pp.300-319. Graff, R., Harrington, A. and Young, M., 1997. The shape of Australian real estate return distributions and comparisons to the United States.Journal of Real Estate Research,14(3), pp.291-308. Wills, P.C., 2008. Corporate real estate practice in Australia.Journal of Corporate Real Estate,10(1), pp.40-53. Zumpano, L.V., Elder, H.W. and Baryla, E.A., 1996. Buying a house and the decision to use a real estate broker.The Journal of Real Estate Finance and Economics,13(2), pp.169-181.