Buying & Selling Houses

Do You NEED an “Investor-Friendly” Agent to Buy an Investment Property?

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“I’m looking for an investor-friendly agent.” Have you heard this statement before—maybe at meetups, on the forums, or in Facebook groups?

It’s really one of the most common things new investors are looking for as they go about finding deals.

And yet, I have never seen a definition of an investor-friendly agent! I think what everyone means when they are looking for an IFA (that’s my handy new acronym for the rest of the article) is the right agent to help them achieve their goals. Aren’t we all!

One of the main assumptions I think investors make is that they want an agent who knows investment properties (and is most likely an investor themselves). The question is: why?

Who Is an Investor Friendly Agent?

In my humble opinion, based on my experience, this is what I think investors mean when describing the perfect IFA:

An investor friendly agent is a licensed real estate professional who has experience with investment properties, has worked with investors, and has knowledge of the local market. Said agent will be an investor, as well. They will help find deals, analyze them, make offers, and sell properties as necessary.

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This seems reasonable enough, right? Sounds like every investor’s dream agent. But let’s revisit the previously mentioned question, “Why do I want this type of agent?”

Get Clear About Your Goals

When it comes to real estate investing, many people have trouble picking a niche or deciding how to go about purchasing their first or second property. I always come back to, “What are your goals?”

If you have clearly defined goals and a plan to get there, a lot of these other questions (and sometimes excuses) go away. 

When you’re looking for an IFA, start with your goals. What is your plan to get where you’re going? How does an agent fit in?

If you’re looking to buy single family, cash-flowing rentals in a specific market, then this will help inform you of the type of agent you’ll need. If you’re looking for houses to flip, then you actually might need the skills of a different IFA.

woman looking through rolled up paper suggesting focusing on one thing

Avoid Asking the Wrong Questions

A lot of consumers and investors make the mistake of going with the first agent that shows them a house. While this can be an indicator of hustle and competence, it can also mean negative things (like desperation).

Instead, it’s important to interview agents first. Let’s dig into some questions investors think are relevant but are actually the wrong ones to ask.

Don’t Ask: Are You an Investor?

Again, the assumption investors make is they need an agent who is also an investor. Why is that the case?

Personally, I’d almost prefer that they’re not an investor. I don’t want to be in competition with my agent for the same properties. I’ve heard of cases where agents cherry pick the best deals (usually before they even go to market) and then push their investor clients into less favorable MLS deals.

Wouldn’t it be better for you if your agent gave you those sweet off-market deals instead of keeping them?

Related: 7 Signs of a BAD Real Estate Agent

Don’t Ask: How Long Have You Been in the Business?

I think this is pretty irrelevant. Many people think you need to go with a super experienced agent. While sometimes this is helpful, let’s look at it from a broader perspective.

If an agent is “experienced,” they probably have many repeat clients and lots of referral business, are quite busy, and are probably doing just fine financially. Are they really going to work hard for you to find that severely distressed property that will only pay them a whopping $1,500 commission?

I’d rather work with a newer, hungrier agent who’s looking to build their business. They’re more likely to have the time to help you, they’ll go the extra mile, and they want to earn your future business.

While they may be less experienced, these newer agents tend to lean heavily on their managing broker for help, advice, and resources. It’s kind of like you’re getting two agents for the price of one.

Don’t Ask: Can You Help Analyze Deals?

Don’t be lazy, guys. Your agent shouldn’t be analyzing deals for you. You should be running all your own numbers.

Of course, you can lean on them for certain information, like local rents, comps, etc. But these you can also find on your own using Rentometer, Craigslist, Zillow, etc.

Don’t Ask: Do You Have a Deal for Me Right Now?

Even if they did, why would they offer it up to you if you haven’t proven yourself as a closer yet. Agents don’t get paid until closing, so they’ll tread carefully until you can prove yourself to them as a serious buyer. Have your financing lined up, know your criteria inside and out, and don’t waste their time. 

Ask These Questions Instead

Here are some questions you’ll definitely want to keep in mind as you interview IFAs.

Do Ask: How Do You Find Deals For Clients?

If an agent is only going to set you up with an MLS feed based on your criteria, just understand that from the beginning. Bonus points if they can score off-market properties for your through their network or other marketing they do.

Do Ask: How Do You Communicate?

This is critical and can ruin a relationship if done poorly. Communication styles vary from person to person. For example, when I was an agent, I noticed that clients would tend to lean on one form of communication over another. Some would prefer a phone call, while others would prefer an email. Many people just want to text. 

Once I noticed that pattern, I would ask clients before working with them in earnest: “What is your preferred method of communication?”

I would always do my best to honor their choice if the situation permitted. Make sure you and your agent are on the same page when it comes to communication—both how you’ll be communicating and how frequently.

Related: 3 Tips for Finding a Real Estate Agent (for Investors!)

Do Ask: How Fast Can You Act?

Speed is important in real estate. You never know when another buyer is around the corner, ready to snatch up your deal. So, make sure your agent can quickly write up a contract (preferably using DocuSign or Dotloop) or get you into a property with relatively short notice. Ask them: if for some reason they can’t show a property, can another agent in their office show houses in a pinch?

Do Ask: Are You Working With Other Investors Who Share My Criteria?

Kind of a no-brainer here, but you probably don’t want to be competing with other investors. Plus, it can be really tricky for the agent to represent both parties faithfully.

Real estate agent handing the house key

What Investors Really Need From Their Agent

So, as an investor, what do you really need from an agent? Here are a few things I think are critical.

Deals

It’s a very competitive market out there, so give your agent a little grace. You may need to take up deal-finding on your own a little bit. They probably won’t drive for dollars for you or send out direct mail.

But they are usually very well networked and constantly out on listing appointments. Also, if they work for a larger office, they can let the other agents know what you need.

Work Ethic

There are some lazy agents out there. Yes, I said it.

Find one who puts in the work needed to make both of you successful.

Communication

Like I mentioned above, you need someone who communicates in a way that you like to be communicated with. And they need to feed you information in a timely manner.

Keeping the Deal Together

Don’t buy into the notion that a Realtor just shows you a house, writes up an offer, and then collects a fat commission check at closing. Great agents work behind the scenes to make sure the transaction is as seamless as possible.

Things go wrong—often—and your agent needs to act quickly to find solutions to problems that are bound to occur.

Honesty

It’s vitally important to find an honest agent, one with integrity. I’ve been tangled up with dishonest agents in the past, both as an agent and as a buyer. It ends up being a huge waste of time and energy.

You also want an agent to have your best interest at heart. I’ve told clients in the past to walk away from a deal for many different reasons. They appreciated my insight.

Alignment

The best business partnerships have perfect alignment. Just like your car needs to be aligned from time to time, your partnership with your agent needs to have the same goals. If they’d rather be showing clients luxury homes than helping you find a fixer-upper, you’re going to be in for a bumpy ride.

What do you look for in a real estate agent? Would you define agents you’ve encountered as investor-friendly? Does it matter?

Share your thoughts in the comment section below.

Nate Shields is a real estate investor and real estate investing coach. He started in real estate in 2013 part-time as an agent and quickly went full-time, enabling him to quit his 9-5. In just two...
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    Nina Grayson Investor from Los Angeles, CA
    Replied 10 months ago
    Nailed It!
    Nate Shields Rental Property Investor from Madison, WI
    Replied 10 months ago
    Thanks Nina!
    Brenden Mitchum Rental Property Investor from Atlanta, GA
    Replied 10 months ago
    Incredibly helpful for a new investor, like myself, who is still learning the ropes and building my team. Thanks, Nate!
    Nate Shields Rental Property Investor from Madison, WI
    Replied 10 months ago
    You got it Brenden. Thanks for reading!
    Shannon S. Investor from Cincinnati, OH
    Replied 10 months ago
    As a Realtor and an agent, I have to say you are spot on!
    Nate Shields Rental Property Investor from Madison, WI
    Replied 10 months ago
    Thanks Shannon!
    Joe Facenda Realtor / Investor from Vienna, Virginia
    Replied 10 months ago
    Well, as an agent and a Realtor, couldn't disagree more... on the first part. The last part is spot on. I have been a Realtor for 30 years and now mentor newer agents in my company. So, yes, if they have an issue, they will come to me or management and "It’s kind of like you’re getting two agents for the price of one." That is if they recognize the problem and come to me. Many new agents don't see the problem until it is too late or they don't know that there is a better way to proceed so they don't optimize the deal for the client. It is better to have a host of tools in the tool bag than think every problem just requires a screwdriver, hammer and saw. True, many "big time" agents are a transaction machine - get the listing and get it sold as quickly as possible - no time to fool around they are so busy. Or they pressure the buyer to buy because they don't want to take time to find a better opportunity. I get it. And that is why when an agent says they are #1 in this or that, it is important to step back and be realistic about what to expect time wise. There is a fine balance between too few transactions so you can't live and too many where you can't give customer service. Every market is different and no one number works nationwide. But any agent looking to have a good business knows that they need referrals and referrals only come from exceeding expectations. Furthermore, investors, unlike owner occupants will do more than one transaction every 7 to 10 years. A sharp agent will work with all investors but especially those who have a business model that means repeat business. They should be able to analyze a deal. Otherwise they will be sending you properties that in no way will fit into your investment strategy. Recently I saw a listing that said "great for investors/rehabbers." it need $30,000 of work and was priced $30,000 below the neighborhood ARV. Is that a flip opportunity? No but a novice agent not familiar with analyzing deals might think - needs work, agent says it is for flippers...I'll send it to my client. (Yes you can offer less but that is not the point. And BTW that home sold to an owner occupant who wanted sweat equity. It was priced well for that buyer. For an agent to say "calling all rehabbers" without knowing how a rehabber looks at the numbers is just plain wrong. Or if a buy and hold investor has certain cash flow goals, an agent should be doing some preliminary screening to see if the property would meet their needs. I can easily screen properties for my clients and toss most into the trash while others look promising. The ones in the middle, I always send as it is the clients final decision but I don't send them the trash k,and an agent mus t be able to determine which is which. We learn by doing. We empathize because we have experienced the same thing as another human. If you are an investor, you are related to every other investor in a unique way and are better able to see the world through their eyes even if their deal is not the type of deal you completed. Do Realtor/investors pick off the best deals for themselves? Honestly, how many deals will any one person buy and still be a Realtor? Will a Realtor/investor see something they might like? Sure. But there is plenty to go around. They can't buy everything. If they can buy everything, then they will be a full time investor and not be working with clients. If this is a serious concern of yours, ask the Realtor about their investing strategy so you know if you are in competition. For instance I invest in out of town rentals. I am not a threat to any local investors. Furthermore, I never have and never will flip a property. I am strictly buy and hold so any flipper clients know I am with them and not against them. But I do agree, communication, speed to market, work ethic, alignment and most importantly, honesty are all critical. Great article because any article that sparks thought is something to be read and digested.
    Nate Shields Rental Property Investor from Madison, WI
    Replied 10 months ago
    Some excellent, well thought out points Joe! Thank you for your insights. To your last point, that was definitely my intent (to get people to think more thoughtfully about this topic). It sounds like you're a true professional and a hero for your clients. Keep it up!
    Ron Gantt Investor from Chino Hills, CA
    Replied 10 months ago
    Hi Nate, You nailed this article. Total “myth buster“ for me. :) Thanks for the insight. I’m curious, how would you gauge integrity in an agent when investing long distance? rg
    Nate Shields Rental Property Investor from Madison, WI
    Replied 9 months ago
    Hey Ron, thanks! I think I would check out online reviews (Zillow, Google, Realtor.com, Facebook) and then ask for references so you can chat with some past clients. Good luck!
    Octavio V. from Tucson, Arizona
    Replied 10 months ago
    Great Article!! Thanks
    Nate Shields Rental Property Investor from Madison, WI
    Replied 9 months ago
    Thank you Octavio! Glad you liked it.
    Ruth Blue Specialist from Pigeon Forge, TN
    Replied 10 months ago
    Absolutely nailed it. The HONESTY is a huge part of being an investor friendly realtor. The question is always asked. If it's such a great deal Why are you not buying it! Something must be wrong! My answer is " I can't own everything there are plenty good investments to go around" !
    Nate Shields Rental Property Investor from Madison, WI
    Replied 9 months ago
    Thanks so much Ruth! Honesty and integrity is number one in my book too.
    Simone Johnson Rental Property Investor from Atlanta, GA
    Replied 9 months ago
    You definitely nailed it here. Thank you for this. I was trying to explain to two of my friends who are new agents, but they cant seem to see the benefit of working with investors. I was hoping to build my team with them, but I am not sure how to help them help us. I have a seasoned RE agent connect who is also an investor and extremely versed as a full service agent. Hopefully I can transform my friends into IFA's (love it!) in the near future and help us all out!
    Jenn Goodyear-Counts
    Replied 9 months ago
    As an agent, I would like to provide some additional inside information! lol... Agents can be "certified" in almost any specialization, (staging, investor friendly, etc...) which sometimes only consists of a 4 hour Lunch and Learn! So ask the additional questions. I call myself an Investor's Agent, but that is only because I feel that I have the background, experience and knowledge to actually help someone in that field. Not because of some lunch & learn. What I find most helpful is my almost 10 years as a Property Manager, before my Realtor career. That means I've seen what kinds of things work and don't work, the requirements/rules the government puts on landlords, what makes some landlords more successful than others, what to look for in preventative maintenance, etc... I understand your concern of using an agent that is an investor themselves, and your right, it is a legitimate concern. However, I am also a landlord myself (not sure if that in itself makes me an investor?), although I will not be purchasing anymore investment properties (saving for a place at the beach at this point!;). So, I would not be in competition with my clients but sincerely believe that it makes me a better investors agent, since I have been in their shoes. Moral of that story is just to ask questions, dont just write them off if they are an investor themselves. Something silly that ends up being very beneficial using an actual Investors Agent is their contact list....think vendors, inspectors, city workers, staff members at the DJ's Offices...those of us with investor experience know many of these people by first name and they are only a text away. It becomes needed more often than you would think! Thank you for allowing my rant - first time posting on BP!
    Nate Shields Rental Property Investor from Madison, WI
    Replied 9 months ago
    Thanks for reading Jenn...and your insights! Awesome that this is your first time posting!
    Joe Hammel Real Estate Agent from Farmington Hills, Michigan
    Replied 7 months ago
    Great Read!