Wearing Two Hats

My wife and our Broker, Angie Francis, wrote this excellent blog:

My brokerage specializes in sponsoring Real Estate Agents who are also active Investors. This makes us unique. Many people in the real estate field, whether agent or investor, think that you can't do both.

Many agents tell me they are nervous about becoming an investor and investors tell me they worry that getting their license will hinder their business. I'm here to tell them both otherwise.

Here at StepStone we all know the advantage of wearing two hats when it comes to real estate.

Why an Investor should put on an Agent Hat

I have many investor colleagues who are sure that getting their license is a bad idea and will inhibit their business. I say not only will it not inhibit your business but it will enhance what you are already doing and make you more money!

• How many leads do you walk away from because the don't have enough equity or they just don't want to take a low investor offer? I bet a lot of times you don't even go to the property if the lead falls into one of these categories. If you can't buy it yourself then why not list it? You already have the skills and knowledge to help a homeowner sell their house so why not get paid on a lead instead of having another deal lead added to your bone pile. Listing these leads will help you recoup some of your marketing money so you can keep looking for the deals you really want!

• In your marketing I know that you are getting calls for underwater sellers. These folks need a short sale. There was a time several years ago when short sales were great money making strategy for investors. However, as short sales became more common and after the sub-prime fall out this opportunity has dried up for investors as short sale lenders, title companies and buyer's lenders have put up road blocks to keep investors from flipping these sales. However, just like my point above, you do not have to walk away from this lead. List the short sale! At StepStone Realty, we have made this one of the easiest listings you can have because we do all the processing for you! Imagine all the commissions you could have made from all those underwater sellers.

• As an investor with your real estate license you get to take advantage of all the tools that agents have access to. No more guesstimating an ARV based on Zillow or Redfin or relying on an agent for comps. With MLS access you can do as detailed a search as you would like. Sure, a market report will give you a broad picture of the value of the home but when it's your rehab dollars on the line wouldn't you like to dig a little more? Check out the photos, comments, market history, neighborhood trends?

• Also, before you start a rehab, how would you like to go preview the other sales in the neighborhood, keep up with trends and get a personal tour of your competition? That's much easier when you have your own handy-dandy Ekey! Not to mention, of course, access to contracts, forms, and other resources provided by Realtor organizations.

• Finally, and really the reason I first got my license, you can list and buy your own properties. Talk about a money saving opportunity as well as having more control over your sales and purchases. Don't ever again have to rely on an agent to write up an offer for you when time is of the essence.

Why a Real Estate Agent should put on an Investor Hat

I've met plenty of Realtors who know investing is a good idea but yet they don't actively invest in real estate themselves and why not!

• You already have all the tools and knowledge you need to get into real estate investing. Do you know how many investors would love to have access to the tools that an agent uses every day? You are already steps ahead of most investors with your access and knowledge of how to use the MLS and compare properties. I can't tell you how many times an investor has told me the “Zestimate” when I ask them the ARV (After Repaired Value) of a property. What an advantage you have to not have to rely on Zillow or Redfin to evaluate properties! Not only is the MLS a valuable tool but you also have a working knowledge of your market area, access to TAR contracts and forms, and that handy key that will let you preview properties before you buy or sell in a neighborhood!

• Many times I've gone to meet a seller whose property I am interested in buying and have been told that the seller consulted a Realtor who gave them a laundry list of items to complete before the house can be listed. Often the seller doesn't have the money, means or time to make those repairs. Let's face it... there are just some houses that are in too poor shape to list. Instead of walking away from a listing you can help that homeowner by either purchasing the property or finding someone who will by wholesaling it. If you don't... rest assured they will be responding to my “I buy houses” marketing and it will be my pleasure to help them out of their problem.

• A down market is always a struggle for a real estate agent. Fewer listings and fewer buyers means fewer closings! Guess what. A down market is the best time to be a real estate investor as that is when there are more distressed homeowners and more investor deals for the taking. By being flexible and having multiple income strategies you don't have to live in fear of the dreaded slow market.

While there are some additional disclosures you will need to make as an investor agent they should not inhibit your business as either a Realtor or an Investor. At StepStone Realty we strive to treat all of our customers and clients with respect and most importantly honesty. As a Realtor/Investor it is my goal to assist home sellers with their best option... sometimes that means wearing my investor hat and sometimes that means wearing my Realtor hat (always in that order!) Either way, my sellers are happy.