Why wouldn't your realtor take the investment for themselves?

Rental Property Investor · Morgan Hill, CA · Member since 2020 · 17 posts · 11 votes

Hello BP community! Cynical newbie investor question. If you're working with a realtor who is also an investor, and they find you a good investment property, what's to stop them from taking that opportunity for themselves?

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Wayne Brooks

Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes

They can’t buy them all. If you don’t work with them, you’ll never know what they find.

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Calvin OzanickBusiness Member
Property Manager · Janesville, WI · Member since 2017 · 708 posts · 297 votes
6y
As a buyer's agent for investors around the country in the Janesville and Beloit market here in Wisconsin, I can tell you that agents cannot buy them all. Also, agents are not always financially ready to jump into every deal they see, or they may just have good intentions to help you find the best deal for you. I can personally tell you my goal is to help my buyers find any investment deal that fits their specific criteria.
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Colin Reid
Investor · St Petersburg, FL · Member since 2014 · 231 posts · 221 votes
6y
My agent is a seasoned investor, so she knows how to work with me, what I'm looking for, etc. But her investing business is very different from mine. She and her partners are doing some very advanced stuff that I'm not even sure I fully understand. She's not interested in competing with me for triplexes.

Originally posted by @Mike Cumbie:
Ever gone fishing?
Ever caught them all?
:)

Only once.
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Marcus Auerbach
Investor · Milwaukee - Mequon, WI · Member since 2010 · 5k+ posts · 7k+ votes
6y
In my experience much less of an issue tha one might think. I have been an investor much longer than an agent and naturaly I work with a lot of investors.
We are all looking for a good deal, but oddly enough the right deal looks different for most of us. Rarely did I have a situation where two of my clients were interested in the same deal, let alone that I was interesting in something a client has been.

Many of my younger buyer clients are looking for a house hack, typically a dupex in Wauwatosa, the North Shore, West Allis or one of the good neighborhoods of Milwaukee. They are looking for a good investment and a good place to live, shops and restaurants close by etc.

My seasoned investor clients with a growing portfolio have usually different preferences, often they are willing to either take on more work (they have cash on hand to do that) or focus more on the numbers and less on the lifestyle as an owner occupant would.

I buy single family homes in the suburbs, usually in need of major renovations and at higher price points.

So, you can see it's much less of an issue as you would think. I like @Mike Cumbie's fishing analogy - we might be fishing in the same lake, but we are all looking for different fish with different lures.
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Travis Gregory
OP
Rental Property Investor · Morgan Hill, CA · Member since 2020 · 17 posts · 11 votes
6y
Thank you all for the really thoughtful replies, super informative. Big takeaways:
1. Turns out, not everyone has money to invest on every good deal they find.
2. Alot of the time your investing strategy and your realtors strategy are different.
3. Potential very negative career and reputation repercussions for the agent.
4. If it's a really good deal, chances are you'll never even know about it.
Thanks all! ✌🏼
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Account Closed
Realtor · Austin, TX · Member since 2018 · 2 posts · 2 votes
6y
@Travis Gregory
As a realtor, my primary obligation is to my client. Yes, a deal may pass me by if I give first dibs to my client, but I’ll more than make up for it with repeat business and referrals. Apart from the ethics of serving my client’s best interest, by doing so my business grows and my own goals are met.
As an investor, it’s rare that my personal investment goals will align entirely with my clients. It may be an issue of timing. I may not be looking to expand my portfolio at the moment, for personal reasons like being overly busy and not wanting to take on a new project. It may be an issue of capitol and readiness to buy. Very often I may be committed to my own ventures that are already in motion, either with a particular property, investment partners, or a specific development.
On a personal note, I think most of us got into real estate because we discovered there is money to be made, enough to go around, and we wanted a part of that for ourselves. The reality is there are plenty of deals to be made and I’m not in competition with you for those opportunities. If you have the mentality that deals are made not found you’re less likely to feel the pinch and more likely to expand to a future oriented, goals mindset.
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Jennifer Ashmore
Property Manager · Little Rock, AR · Member since 2019 · 27 posts · 8 votes
6y
@Lien Vuong - exactly. It is our fiduciary duty to take care of our clients first. However this is an epidemic in our city.
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