Finding a real estate agent who is investor-friendly is not as simple as finding an agent to buy or sell the average home.
Real estate investing works under a different set of standards than buying or selling a primary residence, and it requires particular knowledge and a set of skills that not every real estate agent possesses.
If you’re considering real estate investing, you need to find the right agent and the right area to begin your investment search.
Looking for a real estate agent? Check out BiggerPockets’s agent match!
5 Qualities of Investor-Friendly Real Estate Agents
Ideally, every real estate agent should know about buying and selling homes. However, most agents focus on working with people who want to buy a property to keep—either to live in or to use for other purposes, such as housing a business. In contrast, not as many agents are familiar with the process of using real estate as an investment option. You want your purchase to ultimately yield you a profit—something only certain agents are capable of assisting with.
Therefore, you need to find an agent who understands real estate investing. Look for these qualities in your next agent.
1. They have personal investment experience.
Ideally, you want an agent who has done his or her own real estate investing. Their experience doesn’t necessarily have to be substantial, but it’s helpful if they’ve gone through the process on their own. This ensures familiarity with investing on a personal level, not simply as an agent. Agents like this will understand your motivations and will be easier to work with in general.
2. They’re comfortable making (a lot of) offers.
Real estate investing can require making numerous offers, often all in the same day. You’re trying to get a seller to bite on the lowest possible offer you can manage, and this sometimes requires throwing out numbers one after another until something sticks. Not every agent is capable of doing this, as it requires a stomach for numerous rejections and the ability to weather negative feedback from sellers and their agents.
Related: 3 Tips for Finding a Real Estate Agent (for Investors!)
3. They’re familiar with the numbers.
An investor-friendly agent will know: a) what a cap rate is and b) how to calculate one. Even if you don’t personally use cap rates for residential properties, that’s fine, but any agent who is savvy on investing should know this term and the basic workings of it. More specifically, an agent should understand how to calculate a return. If an agent can’t talk about the returns on a particular property fairly quickly and intelligently, they may not be that investor-friendly.
4. They have experience working with investors.
Speaking of investor-friendly, there’s no substitute for an experienced agent when you’re trying to make money buying real estate. You want an agent who has worked with other investors, preferably three or more. It’s not that you can’t hire an eager newcomer, but you should be prepared to learn the process together if you go this route. If you’re looking for the fastest path to success, experience is usually the way to go.
New! Investor-friendly agents
No matter your investing experience or where you’re looking to invest, connect with a local agent who knows the market inside and out and can evaluate properties from an investor’s perspective. Here’s how BiggerPockets’s agent marketplace works:
- Pick your market
- Share your investment criteria
- Match with an agent!
5. They have a good reputation with other investors.
If the agent has some experience, he or she should also have some references. Call each reference and discuss the individual’s experience with the agent. Not every real estate investment will be successful, and people who lose money may have negative things to say even if the agent was not responsible for the loss. However, most investors will be aware enough to hold criticisms to the actual work of the agent, not the quirks of the market.
6. They’re honest.
Look for an agent who will give it to you straight. This means that if he or she is not comfortable throwing out ridiculous low-ball offers to sellers, they’ll tell you. Honest agents will explain to you up front what they are and are not willing to do to help you in the investment process. Some are glad to help with flipping houses, while others may prefer the steadier route of buying and holding.
The best agent for you is one that lays everything on the table up front, leaving you to decide if the fit is right. Integrity goes a long way in business and should be a priority when picking a real estate agent for investing.
7. They’re local to the market you want to invest in.
If you’re like many investors, you’re looking for markets prime for buying low and eventually selling high. These areas may not be in your hometown or anywhere near it, which means you need someone with his or her finger on the pulse of the market you’re considering.
A good local agent can also help you avoid any area scams that attempt to take advantage of unsuspecting outsiders.
It may take some time, some searching, and several interviews before you find an investor-friendly agent in the town or city you want, but it can be done. Just don’t make the mistake of picking an agent who doesn’t know the local market—even if he or she is perfect otherwise.
Where Can You Find Investor-Friendly Agents?
So, how should you go about finding the ideal agent? The easiest way is probably through referrals.
Thanks to sites like BiggerPockets, this is incredibly easy. Just scan the agent directory or post on the forums, asking for an investor-friendly agent for a particular location. Regardless of whether you find an agent through a referral or you scour the internet and call random prospects, you should always ask about their experience working with investors early on in the conversation.
What kind of investors do they primarily work with? What do they look for on behalf of the investors in terms of qualities of a potential property?
Here is where they should be mentioning location and numbers. If they don’t, be sure to ask.
Is it a requirement to work with an agent who already knows these things? Absolutely not. You’re welcome to train an agent on what you are looking for, but why not just work with someone who already knows what they are talking about?
In some markets, this may be more difficult—particularly if it’s not a common investing area. You may be forced to train someone in that case, which is okay, too. Regardless, just like with finding any other team member, start asking for referrals and interviewing different people.
Find the Right Agent for Your Real Estate Investing Goals
There’s no sure way to be successful in real estate investing. However, you can increase your chances of making a profit by choosing the right market and the right agent for that market. Use this information as a guide, and do your best to find the right agent that works for you. Remember: Never be hasty when it comes to real estate investing.
Do your homework until you are reasonably satisfied you will be making the profit you expect to achieve!
What has your experience been when trying to find an investor-friendly agent? Any other qualities you’d add to the list above?
Leave a comment—we’d love to hear from you!