Me :). My RE Agent was my previous landlady. I rented her house for five years and then decided it was time to start looking for my own house. She was also my inspiration to buy a duplex and rent out part of the house. That was how she started out and now owns a number of real estate properties.
I was a little concerned at first about using her as my agent, since we already had an important professional relationship and I didn't want that to muddy the waters. But everything worked out well. She did a great job looking out for my interests and she did earn a commission from the seller when my home closed.
Though then she "half jokingly" told me I should rent out both sides of my new duplex and keep renting from her, lol.
Hi @Al Williamson - I have a couple of tenants in place that were concerned about signing a long lease because they were thinking about buying down the road. So, we structured it so that they could get out of the lease if they decided to buy a home, as long as I was able to serve them as their agent. So far, neither has started looking - so we'll see how it goes. I plan to do a better job letting my other tenants know that I can serve them as an agent to buy as well. I've lost a couple to home purchases in the past, and unfortunately, they did not realize I was an agent.
Me :). My RE Agent was my previous landlady. I rented her house for five years and then decided it was time to start looking for my own house. She was also my inspiration to buy a duplex and rent out part of the house. That was how she started out and now owns a number of real estate properties.
I was a little concerned at first about using her as my agent, since we already had an important professional relationship and I didn't want that to muddy the waters. But everything worked out well. She did a great job looking out for my interests and she did earn a commission from the seller when my home closed.
Though then she "half jokingly" told me I should rent out both sides of my new duplex and keep renting from her, lol.
@Al Williamson I'm an agent, and I have had a few tenants ask me to help them buy a house. Thanks for the reminder that I need to be better about letting them know I do sales on top of property management!
Please tell me what a good marketing funnel would look like for such a tactic.
@Jonna Weber please chime in as well. What steps would you recommend a RE agent/landlord take to make this a profitable strategy (you end with a vacancy and commission). What's the plan?
While I am not a real estate agent, if I was I would have in my buy out clause, that it was null and void if they used me as their agent. Since I charge 2 months notice, and two months fee. This would be a great incentive to them. It would also get my name out since I spend an hour going over all the parts of the lease. It's also subtle so not too in their face. Of course I am not an agent so not sure how "legal" that is.
You could also put that they get a free months rent or 1/2 etc for every referral and sale that is made! Just a thought.
@Al Williamson If these are properties you own, I agree with @Elizabeth Colegrove that you can add a flexibility clause. If the tenant uses you to buy a home, you will let them out of their lease with a 30 day notice at anytime, or whatever you think will work.
In general, I would make sure my email signature makes it clear that I'm a real estate agent. If I knew they planned on buying a house at some point, I would simply ask for the business. Otherwise, you could send out an email blast once every six months or quarter that reminds the tenants to change the air filters, smoke detector batteries, etc, and in that you can also mention that if they are looking to buy a home in the future to keep you in mind.
First, as an agent I would first make sure that the tenant is someone I feel I can effectively serve as an agent. I want to make sure it is a fit based on how we interact, the area they might be interested in, and my expertise If they are looking in the area I serve and are compatible, it could be a real win-win.
Second, I have found that it is a great idea to mention you are an agent when you first interview them on the phone. Some potential tenants are waffling between renting and buying - so if they decided to buy, you want to be one that they call!
Lastly - I have a couple of strong agents I refer some clients out to - this creates a referral income stream for me and I know they are in great hands and well taken care of.