Do real estate agents like working with investors?
Investor · Las Vegas, NV · Member since 2016 · 39 posts · 11 votes
Do real estate agents like working with investors?
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Realtor / Investor · Vienna, VA · Member since 2014 · 133 posts · 114 votes
9yThis is a great question as folks sometimes equate "investor friendly" with a willingness to submit dozens of low ball offers. I don't.
Let's look at it logically. There is only so much time in a week. If an agent has the time to submit dozens of lowball offers in a week, what does that say about their business model and production level? They obviously aren't that busy which leads a client to wonder why. A new agent without a large client base? Perhaps that can be good because they are hungry but do you prefer experience or hunger? No right or wrong answer but know a knowledgeable, experienced, respected agent does not have time to write a dozens of offers a week.
To me investor friendly means they understand the market and investors. They can recognize good deals and see where possible deals may exist vs shooting in the dark. Let me say a good investor friendly agent can use a sniper rifle instead of a shotgun.
The shotgun approach is for marketing, not contract writing.
When I work with rehabbers, I do not demand an exclusive buyer agency agreement. That would be selfish of me. I have them sign an agreement that states any property I present they will work with me on. There is no way one agent can know all of the off market deals in an area or even have insight into all behind the scene situations of every listed seller. I understand and expect that other agents will know more about a specific house or situation once in a while, just as I may have more insight than them another time.
Does this present a possibility that they will take advantage of me and work a deal behind my back? Yes, but then they are not the kind of investor I want to work with. I believe I bring value to table and, really, in any market are there more people who want to flip properties or investor friendly agents? If someone has a business model or ethics I don't like, I will let them go and know that there are many more investors out there.
But if we have an open and honest relationship, good things happen. I get a fair amount of deals. Someone else gets a few deals, But in the end, it is a win-win all around.
36 Replies
- 9yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
some do some don't... the idea of making multiple low ball offers is not anything most agents would entertain.. as work/reward is very low... if your strategy is to make numerous low ball offers
you should get licensed and do it yourself...
you may find an agent to do that.
when I owened my brokerages my agents would be contacted ( usually after a guru came through town) and you would have new investors talking big....
Its one thing If you as a buyer has a lot of capacity IE you can in a year buy one home at least a month for 12 straight months with all cash.. and you can proof your funds. that would give an agent something to bite their teeth into. also a buyer brokerage arrangement so you do't go around the agent...
there are brokers who specialize with investors and you simply get on their buyers list and they feed you deals.. those deals usually go same day.. much like a wholesaler list
- 9yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
@Account Closed not many... thats the answer.. that model is so last decade LOL... just like the 2% rule.... we are in a different market now and so what worked years ago is over now until another cycle.
anyone wanting to really do this NEEDS to get licensed and do it themselves... for the life of me I can't figure out why those that really want in the industry don't get licensed so they can control their destiny..
- Investor · Las Vegas, NV · Member since 2016 · 39 posts · 11 votes9y
You know I've been leaning towards it honestly. I like the added luxury of being able to submit an offer the moment it hits the market, without being at the mercy of a busy agent.
- Rental Property Investor · Rockwall, TX · Member since 2015 · 891 posts · 701 votes9y
@Account Closed
Quite honestly, you're going to struggle to find a good agent in Las Vegas period. There are a few out there (including a couple I personally know on this site) but bulk of the community is pretty substandard. This is why I ended up getting my license. Equally unfortunate is that most of the good ones are very busy in this hot market and don't have time to generate a ton of low ball offers.
Best of luck in your search,
-Christopher
- Real Estate Agent · Beverly, MA · Member since 2013 · 353 posts · 93 votes9y
@Account Closed I am not familiar with that market so can't speak to who to work with. What I can add value to is the process of how to find that agent. I would start by vetting investor/friendly agents here on BP. Share your "business plan" with them, including the fact that you expect to be making lots of offers quickly. Show you are a serious buyer by proving you have the funds (or access to funds) and have the experience or ability to pull the trigger quickly on a good deal. The only reason agents do not make lots of offers for clients, is if they aren't confident that they will close. I would also make sure that the agent has an electronic system to quickly write up offers, or a team that handles writing offers. As an investor/friendly agent, the issue that I run into is with "investors" that really are afraid to pull the trigger and take up lots of my time. The one or two major investors that I know can close will get all the service they need whether writing low ball offers or phone calls.
Hope this helps, but feel free to PM me. Best of luck!
- Real Estate Agent · Falls Church · Member since 2012 · 2k+ posts · 1k+ votes9y
@Account Closed The best advice I can give you is to know what you want.
If you want to flip a house, your offer will reflect the dilapidated condition of the property. So it's not a "lowball" offer.
A common mistake I see is new investors making true "lowball" offers on retail properties that command retail prices.
I wrote a blog that might help you find an agent in the area. Click the link below to read :)
https://www.biggerpockets.com/blogs/5868/52724-im-...
Hope that helps you out.
- Realtor / Investor · Vienna, VA · Member since 2014 · 133 posts · 114 votes9y
This is a great question as folks sometimes equate "investor friendly" with a willingness to submit dozens of low ball offers. I don't.
Let's look at it logically. There is only so much time in a week. If an agent has the time to submit dozens of lowball offers in a week, what does that say about their business model and production level? They obviously aren't that busy which leads a client to wonder why. A new agent without a large client base? Perhaps that can be good because they are hungry but do you prefer experience or hunger? No right or wrong answer but know a knowledgeable, experienced, respected agent does not have time to write a dozens of offers a week.
To me investor friendly means they understand the market and investors. They can recognize good deals and see where possible deals may exist vs shooting in the dark. Let me say a good investor friendly agent can use a sniper rifle instead of a shotgun.
The shotgun approach is for marketing, not contract writing.
When I work with rehabbers, I do not demand an exclusive buyer agency agreement. That would be selfish of me. I have them sign an agreement that states any property I present they will work with me on. There is no way one agent can know all of the off market deals in an area or even have insight into all behind the scene situations of every listed seller. I understand and expect that other agents will know more about a specific house or situation once in a while, just as I may have more insight than them another time.
Does this present a possibility that they will take advantage of me and work a deal behind my back? Yes, but then they are not the kind of investor I want to work with. I believe I bring value to table and, really, in any market are there more people who want to flip properties or investor friendly agents? If someone has a business model or ethics I don't like, I will let them go and know that there are many more investors out there.
But if we have an open and honest relationship, good things happen. I get a fair amount of deals. Someone else gets a few deals, But in the end, it is a win-win all around.
- Emporia, KS · Member since 2016 · 55 posts · 21 votes9y
I like working with informed, self motivated and legitimate investors. But, that's the same as any other type of buyer. A very small percentage of the people I field calls from actually end up buying anything. I wish there was a science to vetting buyers, but only flags that can be used as cues when someones wasting their time.
If I were buying something out of state and needed to find an agent, here's what I'd look for. I'd find the most productive office I could, then pick an agent from it that had 18-24 months experience. Explain to them my strategy, what I'm looking for and how often I want them to check in if no matches are coming up. I'd know that agent was around "hitters" and was seeing a lot of properties before they hit the MLS, but still needed to build their client list that my needs are a high priority and I come to mind first.
Just keep in mind that the idea of lowballing isn't very common anymore, every home has a value and the amount of information available has changed the industry a lot. You're not looking for a steal, you're looking for something that fits your parameters and most listing agents aren't going to let their clients get hammered. I've had a lot of lowball offers come in to my clients, they're usually upset and less likely to negotiate, I also tell them that if they would take something that low, I'd like a chance to speak with some of my investors and I'll cut my 6% commission a little in appreciation.
- Real Estate Agent · Fort Lauderdale, FL · Member since 2015 · 67 posts · 34 votes9y
In my market, making really low ball offers from MLS listings at times just doesn't work. These properties are getting tons of exposure in addition to the MLS ( Zillow, Trulia, and other syndicated sites). Most homes are commanding at or above retail value. Also most agents don't want to have that reputation in the community as the agent that makes low ball offers. No one will take you seriously.
My suggestion would be to find off-market properties and make offers on those. I do a ton of door knocking for my investors and we usually get some amazing deals from individuals who need to offload their properties.
- Real Estate Agent · Las Vegas, NV · Member since 2016 · 11 posts · 4 votes9y
I always inform my clients prior to making an offer with as much information as possible so they can make an educated decision. To low ball and see what sticks isn't necessarily working anymore as the lower price points are seeing multiple offers again and our average sales price has come up quite a bit. Depending what you're looking for I might be able to help give recommendations of agents who specialize in that. My team works on the residential resales and finding something specific you are looking for on or off mls, but it's not necessarily below market value. If you are looking for off market/wholesale/fliips then there would be better agents here that can help.
- Residential Real Estate Broker · San Mateo, CA · Member since 2013 · 585 posts · 264 votes9y
@Jay Hinrichs is right about some of the strategies to get an agent to work with you. Just as there are different types of agents, there are different types of investors. If a client comes to me and owns 100 properties in my local area and asks if we can put together some offers at prices lower than list (and I know he/she can close, understands that every property is not perfect, etc.) that is different than the buyer that wants to do an extremely low offer and then walks from the deal when the sprinkler is broken. What I am trying to say is go to an agent educated, and find one that is hungry, and you should be fine. Don't say we are going to put in 100 offers though. If the agent brings you a good deal that is priced fairly, you should be willing to commit to that (it should not matter what price under list your offer is but more that the numbers make sense for what you are trying to achieve).
- Rental Property Investor · Davenport, FL · Member since 2013 · 285 posts · 220 votes9y
Watch the market, see whats selling for deals and see whats obviously being flipped, then go on Zillow and it should tell you in price/sales history who the buyers/sellers agent was. If its an investor buying or selling, most likely an investor friendly agent
- Real Estate Investor · Las Vegas, NV · Member since 2016 · 399 posts · 260 votes9y
Hi Maceij, I wanted to throw in my opinion since that is what we are good for here. Yes, you can find agents that will submit dozens of offers. Then, when you don't close or give them an incentive to continue to do so they will ghost you. I've seen it happen time and time again. But, alas I've found a solution that works. Pay them. It's much different when you pay someone to do something. We won't get into all the legalities of how you can pay them but you can in many different ways. One way that I could see this working is if someone wanted me to write a hundred offers a week they would have to give me an assistant so they could do most of the work on their behalf. Just an idea. I submit 100s of offers and get 1-3 so I guess it still works for me.
- Investor · Princeton, TX · Member since 2014 · 1k+ posts · 1k+ votes9y
As is usually the case @Jay Hinrichs is right on about this. If you want to do the 1%-2% acceptance game. There are a few things to think about.
1) The MLS is not meant to be a place to find wholesale deals. Be able to close EVERY deal or every professional involved will hold it against you FOREVER.
2) Consider becoming an agent.
3) If you do not want to be an agent in the state where you are buying in consider a different kind of compensation model. Many agents would be happy to send out lots of offers if you pay them say $50 a piece if you want them done quickly. If you are simply making a mass offer one day a week or something then you might get it cheaper.
- Real Estate Agent · Portland, OR · Member since 2016 · 9 posts · 0 votes9y
@Jay Hinrichs You owned your own brokerage. I have a question for you: Is there any reason why a broker wouldn't want an agent who's main focus is to be an investor? I mean if you're at a brokerage and you're focusing on finding deals for yourself and just using your license and MLS access to your own advantage as an investor (as opposed to representing other buyers and sellers for the brokerage) would that be some kind of "no, no". Would they care that your not producing in your capacity as an agent so long as you're bringing them commission from your own deals?
- Member since 2016 · 143 posts · 157 votes9y
I am an investor who often makes offers considered to be lowball but I never waste my RE agents time and he doesn't waste mine. He doesn't care what I offer as long as I make an offer. We are both sometimes surprised at which offers are accepted. I only ask him to view properties I have driven by and or looked into windows (unoccupied) and I am pretty sure I will offer on before going in. Within 10 minutes I either tell him what to offer or say no. He spends very little time on my deals and is kind enough to give me a heads up on things he believes I would be interested in before they hit MLS. You will find an eager, competent agent if you keep looking. Good luck!
- Real Estate Broker · Malone, NY · Member since 2013 · 345 posts · 70 votes9yJust my two cents but as an Agent and investor myself, I prefer to work with investors. Less emotion, more logic, typically.
- Investor · Las Vegas, NV · Member since 2016 · 39 posts · 11 votes9y
These are wonderful answers guys, thanks for taking the time to respond.
- 9yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
@Alexander Friedman yes I have owned my own brokerages 3 of them in fact.
to answer your question it depends on the focus of the borkerage..
the big retail brokerages in our city.... Remax, Keller, Berkshire, these types focus on retail residential real estate and look for agents that sell houses to homeowners.
smaller boutique firms like mine were 50 agents or less.. We had many investor agents thats why they came to work for us.... I myself am an investor agent I do not do retial transaction real estate for the public unless its as a favor or referral situation..
there are plenty of these types of brokerages in the PDX market that will let you do your own deals.
I use to tell my investor clients to lowball directly to the listing agent as it is more likely to get accepted since the listing agent gets both sides. Then I take the listing once its rehabbed.
They would simply need lists sent to them.
REO listings I'd make the offers, typically training my clients not to lowball on new listings etc.- Residential Real Estate Broker · Greenville, NC · Member since 2015 · 164 posts · 90 votes9y
Some agents do and some don't mind as previously stated. I would suggest finding an agent that is an investor themselves and not one just working for the commission check. If they invest themselves they will "get" what you are trying to accomplish in your short term and long term goals.
Contact a few that are members here and offer to take them to lunch to discuss your goals. The more receptive, the more likely they are to understand your business of REI.
- Developer · Santa Clarita, CA · Member since 2008 · 15k+ posts · 10k+ votes9y
This is an age old question and the answer changes with different market conditions. Today, the answer is you don't need an investor friendly agent to write your 100+ offers for you. That is simply not a good use of time for either party. You need to write them yourself (which means you need to be an agent) or you need a third party source to handle it. That said, the best way in this market is to simply contact the listing agents and after making some inquiries, providing a verbal offer amount to them based on them double ending the deal and repping you and seller. They will be much more inclined to "push" your offer amount due to their self interests (double their commission!).
One last point that was already touched on but I feel is important to reiterate, an "investor friendly agent" is NOT an agent willing to write multiple low ball offers for you. The definition is quite different. An investor friendly agent is one who has worked with investor buyers (who had the same investor strategy as you do, i.e. Buy fix and flip or wholesale) in the past therefore they understand the NUMBERS in a transaction that makes sense, they have years of experience thus they have been through multiple real estate cycles, and they can provide systems or work within your systems to accomplish a common goal.
- Rental Property Investor · Rockford, IL · Member since 2014 · 4k+ posts · 2k+ votes9y
Originally posted by @Jay Hinrichs:
@Account Closed not many... thats the answer.. that model is so last decade LOL... just like the 2% rule.... we are in a different market now and so what worked years ago is over now until another cycle.
anyone wanting to really do this NEEDS to get licensed and do it themselves... for the life of me I can't figure out why those that really want in the industry don't get licensed so they can control their destiny..
Just curious...
Are there places in the U.S. where only a licensed agent/broker can present a seller with a purchase offer?
- 9yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
@David Dachtera not exactly sure what you mean
but I did hear in Wisconsin ( a state just north of Illinois) you must be licensed to sell property or engage an agent.
If your talking about do you need a licensed to present a contract to an owner who has the property on MLS or listed with a broker..
in the states I am licensed in CA OR MS and very familiar with WA NO you don't ... however if the sellers sells you to you and a valid listing agreement is in place they will owe a commission to the agent.
I have closed deals on listed properties personally like this...this was CA.. Agent were not responsive went direct to seller ... Agent still got their commish but did not do any work on the sell escrow.
and in IL were you are .. agents hardly do anything anyway.. they put a contract together and hand off to attorney who does most of the heavy lifting IL is a VERY strange animal when it comes to how brokers interact with buyers and sellers.
- Rental Property Investor · Rockford, IL · Member since 2014 · 4k+ posts · 2k+ votes9y
Yes - a member of my investing group was a broker for 20 years before he got involved with us. He tells that story that previously, his job was basically to show properties telling the prospective buyers, "here's the kitchen, here's the bedroom, sign here".
I was confused because it sound like you were saying that only a licensed agent/broker can present a seller with a purchase offer, yet I know deals are done everyday with only attorneys involved - no agent/broker.
That's actually how we sold my Mom's house three years ago: no agent / broker on either side. The house was in a trust; so, all the executor had to do was direct the trustee appropriately.
Actually, I did that. My brother was the executor/POA, but didn't want to deal with it. So he allowed me to be the "executive". I did the work and he signed off on everything as if he'd done it himself.
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