One reason not to work with investor friendly agents?

Question

Hello all, I am asking this because I am an agent myself and have not ran into the problem but I see it being a legit concern.

If you are an agent who invests in the market, but also help clients invest in the market. What is stopping you from investing in the deals that your clients are looking for? As a client they would never have to know if you bought an STR (for example) that they could have also wanted.

Russell Brazil · Answer

I sell 50 houses a year.

I buy 1 or 2 per year. I couldn't possibly buy every single property I come acrosss that worth buying

Eliott Elias · Answer

Nothing, I don't take on clients that have the same criteria as me. You should not be pursuing the same deals your clients are.

Michael Weigum · Answer

Why would you use an agent that isn't investing themselves? If you want to be a real estate investor, you should work with agents that have been there and done that. When I bought my first investment property I wanted to work with an agent who had investments, because they know more about the situation. There are a lot of agents in my area that don't understand the ins and outs of short term rental and oceanfront condotels. As an investor and agent I bring more value to clients because I can share my experience with them.

As others have said, not everyone is looking for the same property at the same time with the same criteria. Represent your clients interest first and bring value to the relationship and everyone wins.

Brad Jacobson · Answer

I put my clients first.  If they don't pursue and I still think it's a good deal, then I'll pursue.

That happened last October.  Found a duplex that I thought checked all the boxes and sent it to my client.  We went and saw it, he choose not to pursue, so I did, and got it UC.  I was super transparent with him too.  I let him know if he wanted it, my loyalties are to him, but if not, I was going to pursue, and I did!  It further strengthened our relationship too.  He trusts me more than ever after watching that ordeal.

Clients first.

Bruce Lynn · Answer

This...right here....

Will Fraser · Answer

Agreed!  If you put your clients' interests above your own and give them excellent service, it somehow never fails that you have what you need.

I built my portfolio initially off of "sloppy seconds" that my investor clients passed up.

Ironically most of them are still passing on deals that are "too skinny" and waiting on the sidelines instead of scaling with vision.

Bruce Lynn · Answer

@Brett Deas    #1   Can't buy every single deal.

#2 Different investors have different wants, needs, desires, price ranges, locations, etc.   Maybe I want flips, investor client wants buy and hold.  Maybe i want this city and they want a different one.  Maybe they like big flips and I like small ones.  Maybe I am deep in the weeds now with a rehab and don't want to take on another one at the moment, but they've just finished one and ready for another.

#3  Maybe they want STR and I don't and only want LTR.

#4 Maybe they are a cash buyer and I am a financed buyer so that deal won't finance.

#5 They may have different cost structure to everything as well, some might can pay more than me because they're going to do the work themselves and they'll save money doing that.  I might use super cheap labor I source myself and they're using top of the line GC which will cost them more.  Maybe we have different visions on what rehab needs done.  Maybe we have different profit criteria.  They want to make fast $5000-$10,000 and I want minimum $25,000 on my deals.

All kinds of reasons.....just like I send the same deal to 20-50 clients....very rare more than 1 calls me back on any one deal.  Not like they're all jumping on it at the same time.  And if they do, then may the best buyer win.

I personally would never get in front of one of my investor clients.  I probably have given up a few deals to them over the years, but there's always another one around the corner.   If you get in front of them, then you could potentially loose that client or all your investor clients if they find out.

I would also say that most of my clients would never do the deals I do or want or be able to do them.  I go further out than they are willing to go.  I am willing to buy without seeing inside the house.  I buy cash on the courthouse steps.   How many of your clients are willing to buy sight unseen?   Very few I expect.  How many can take off all day to go to the foreclosure sale?  Very few I expect.  How many have cash cash to buy on the courthouse steps?   Very few I expect.

For me it really has never been an issue.   Every so often I do tell them when we go look at a house, if you don't want this one let me know by tomorrow as I do and I am going to bid if you don't.

January Johnson · Answer

We can't buy EVERYTHING that comes up for sale, ha ha ha!  I DID buy 4 (my first one from out of state, sight-unseen until the day before closing).  Trust me, we want you to be as successful as we are, and we have personal experience that can save you time and heartache.  Trust us!

Colin Higgins · Answer

I agree if you find your client has the same exact criteria as you, at the same time you are looking to purchase as well, just ... refer them out to another good agent. There's plenty of fish in the sea. This way it won't be a conflict of interest and you can do your fiduciary duty, & possibly make a little referral fee on the side. Chances are you can't/won't buy every deal you come across and their needs/approach will be different than yours.

One reason not to work with investor friendly agents?

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