Should I be an investor-friendly real estate agent?

Real Estate Agent · Saint Clair, MI · Member since 2015 · 34 posts · 6 votes

Hi everyone,

Ok, here is today's question: I have seen a lot of posts on BP about "investor-friendly" real estate agents. Some people say that agents don't understand investing. Others say that agents won't waste their time working with investors. Still others say they have a great agent that they work with all the time. BP has an ebook about how to be an investor-friendly real estate agent.

So, what's the scoop? I live in Michigan, and am about 40 minutes away from Detroit. I will be able to practice all over the area, and there is a lot going on. Is this a viable avenue as a new agent? Does it/can it work?

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Michael Noto

Real Estate Agent · Southington, CT · Member since 2008 · 5k+ posts · 3k+ votes

10y

The large majority of residential property (1-4 units) "investors" are a complete waste of time for an agent and will never buy anything. Sorry to be blunt but that is a fact. They will just waste your time.

To avoid wasting your time make sure the buyers are pre-qualified for financing at the least and if they say they are paying "cash" ask to see a proof of funds from the get go. Either will need to be submitted with an offer anyway so to go look at properties with someone who has no money, no access to it, or no access to financing does not make a whole lot of sense to me considering the only way you get paid is if they buy something.

Then just take it from there and just make sure what they are looking for in an investment property is even possible.

In other words make sure they are worth your time before you dive in and give them your all as an agent. Someone who is serious should already know you will be asking for a pre qual or POF and will already have a reasonable plan in place.

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Kelly Smith
Lender · Across US · Member since 2015 · 66 posts · 18 votes
10y
My personal opinion - you become an investor agent without marketing that effort. It's a track record of proving you know good comps, your market, and searching for 'deals' on the MLS. The other thought if you market yourself as strictly an investor's agent (as someone already said) is that you'll be taken advantage of...
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Merlina Rodas
Woodside, NY · Member since 2015 · 33 posts · 9 votes
10y
I really like the point that Brad A brought up, being a real estate agent you know that once a person purchases a home to live in, they usually stay there for a while, therefor won't be a repeat client. However, investors will likely continue buying properties and if they like the property you helped them find, and they think you're a good addition to their team, they are likely to contact you for future deals. So being "investor friendly" might be better in the long run.
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Craig E.
Investor · Sacramento, CA · Member since 2011 · 87 posts · 56 votes
10y
@Kelly Choate You should work with investors. You'll learn much more about advanced or creative real estate transactions than you will working with traditional buyers/sellers. Particularly fix-flip or buy-fix-hold. Become an expert on due diligence and deal analysis/rehabs/ARV/funding/exit strategies (i.e. the product). You need to learn these things by immersion. Imo.
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Lance A WhitePro Member
Flipper/Rehabber · Lincoln, NE · Member since 2014 · 171 posts · 54 votes
10y
Kelly,
There is less babysitting with professional investors. You don't have to coddle them or "sell" them on a property. My favorite REO Agent unlocks the door for me and then just stands back. If I like the property, I ask him to give me comps. If the deal makes sense, we buy it. He knows he will make significantly less on a deal then if he works with a retail buyer, but I can literally swamp him with repeat business. REO/investor friendly agents, don't have to worry about the condition or presentation of the property. I personally like the ones I have to crawl over mounds of stuff to look at. "IF" agents don't have to spend all day with the client. We line up three to four houses, go look at them, take pictures and notes, and then he goes on about his business knowing that if I found something I liked, I will call him back.
The pitfall to working with investors is that you make a lot of low offers. If you care what others think about you, you may not want to work with investors, If you want to make a lot of money on repeat business, you may want to get to know 5-6 cash buyers and bring them good deals.
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James Park
Real Estate Broker · Johns Creek, GA · Member since 2009 · 870 posts · 664 votes
10y
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Roy N.Pro Member
Rental Property Investor · Fredericton, New Brunswick · Member since 2013 · 7k+ posts · 4k+ votes
10y
Originally posted by @Lance A White:

Kelly,
There is less babysitting with professional investors. You don't have to coddle them or "sell" them on a property. My favorite REO Agent unlocks the door for me and then just stands back. If I like the property, I ask him to give me comps.
Our agent and I have "Forgotten Fridays" where he and I pull together a list of 2 - 3 candidates which have been on market beyond their best-before date. I bring him a coffee and bagel and he catches up on paperwork while I walk the property and make notes. We've been doing this once per month for a couple of years. He enjoys the downtime and I get to do my thing.
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Ward Mcdaniel
Real Estate Agent · Easley, SC · Member since 2015 · 14 posts · 14 votes
10y
Hi Kelly,
I am an investor friendly realtor in the Greenville, SC area. It is a great title and means nothing personal or otherwise except that you understand the investor mindset. It helps that I am an investor as well and know what I would want in a flip or a buy and hold property SF or multi. It's basically a question that you have to answer for yourself now that you have gathered the info.
If you are not an investor, I suggest spend some time with the tools section at the top and learn about what investors are looking at in ROI % for the flips, the scope of work on the rehabs and the CF and COC for the buy and holds.
Work done and knowledge learned will always be returned to you, if not in the current deal that you place the offer for the investor than the next or the next....just keep at it....
hope that helps you out...
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Joel OwensBusiness Member
Moderator
Real Estate Broker · Canton, GA · Member since 2010 · 15k+ posts · 11k+ votes
10y
It helps when you are already an investor and a broker/agent.
Some brokers/agents tend to be one sided and have only transacted.
When you can look at a property from redevelopment experience, a broker/agent, and an investor as well you bring more value to your clients.
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Robert Haynes
Residential Real Estate Agent · Gainesville, FL · Member since 2015 · 16 posts · 8 votes
10y
It honestly depends on the type of investor.

I find that working Fix-and-flippers, Buy-and-Holders, Commercial, and Land development clients is a real joy, imo.

If you treat them right, they will come back.

However, you simply must make sure that the investor that you are working with is serious. Your time is money.
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Kelly Choate
OP
Real Estate Agent · Saint Clair, MI · Member since 2015 · 34 posts · 6 votes
10y
@Ward Mcdaniel Investing is part of the plan for me, so I am very interested in learning all I can about that aspect, so thanks for the suggestion about the Tools section.
@James Park...great post and very thought provoking! Thank you for the insight.
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Justin Spaulding
Real Estate Investor · Milton, WI · Member since 2015 · 52 posts · 14 votes
10y
I feel that there are many real estate agents do not know anything about investing and what investors are looking for. That being said, I treat them on a case by case basis because the ones who get it ARE VERY KNOWLEDGEABLE and can add a great deal of value! As long as you know what you are doing and are educated, you can kill it. Why not go for it!? Be great in 2016!
@Kelly Choate
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Katie Rogers
Santa Barbara, CA · Member since 2015 · 75 posts · 17 votes
10y
My problem with most buyer's agents is that they want to sell me the property rather than advise me on the merits or demerits of the property. They have difficulty not resorting to the emotional arguments that manipulate most buyers into buying something they will regret or paying too much. They want me to "love" the house, when all I am interested in is whether the numbers will work whether I am buying an investment or my personal residence. They also seem incapable of explaining how an atypical or creative deal will benefit the seller. Agents will not do any homework like look at the public records or check the permit status, but they want to be paid as if they did more than open the front door. They rarely present true comps, only the comps their office software generates. They seem unable of looking at those comps and figuring out which ones actually compare to the house in question. Unsurprisingly, they like to pick merely the highest comps. It is extremely hard to find a good buyer's agent.
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Steve A.
Specialist · Triad, NC · Member since 2013 · 38 posts · 24 votes
10y
One of the most critical steps for investors is finding a competent real estate agent who understands their needs and will work hard for them. Real Estate Investing works under a different set of standards than buying or selling a home to live in, and it requires particular knowledge and a set of skills that not every real estate agent/broker possesses. Investors want a transaction to ultimately yield them a profit – something only certain agents are capable of assisting with.
Steve
Investor Friendly Realtor, Triad NC
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