How much info do you require to make an offer?

[Gurjot Grewal]

Hello BP! 

Iv been working with a great agent. He's been very patient with me. I think im doing the normal newbie thing and asking way to many questions for each property, offering lower than list, getting told no and wasting everyones and my time. He mentioned this to me himself. 

I dont want to be difficult to work with and want this to be a good long term relationship. What is some key info you would ask your agent prior to making an offer? 

Im looking to BRRR from a distance. Plan on flying down regularly. I dont want to over pay for the property. Some info I feel I need is:

-Sales comps/ opinion of ARV

-rough rehab estimates (before getting a contractor to quote) 

Prior I was asking:

-why is the seller selling ?

-Neighbourhood grade ( agent gave me a map to find this for myself) 

-rent comps ( agent just uses rentometer, made an account myself) 

-cosmetic or structural repairs ? 

-any neighbourhood specific info ? (Vacancy, crime, appreciation, school zone ) 

I found this info on redfin, although I dont know how accurate it is 

[Kevin Sobilo]

Quote from @Gurjot Grewal:

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@Gurjot Grewal, all of those pieces of info are good but how many properties are you asking the agent to provide info about? and what level of interest do you have before asking for these items?

Sales Comps and ARV: I recommend you start with your own estimate of these and then if those make sense after you run numbers, THEN you ask your agent for comps and their opinion of the ARV as a double check. This way you don't ask for this often and only when needed.

Rough Rehab Estimates: That would be something YOU generate not your agent.

Why is the seller selling?: Most times the agent cannot answer this. If they are the listing agent then it could be breaking their confidence to reveal that. If they are only your buyer's agent likely they don't know. You can ask if they know but don't expect you'll always get an answer.

Neighborhood Grade: You have a GOOD agent! They should not answer this. Agents are taught to refer you to an objective resource for information like this. An agent could get themselves in trouble by characterizing a neighborhood for a variety of discriminatory related reasons. It may sound silly to you, but your agent did exactly what they were taught.

Rental Comps: Using a source is solid, unless they are themselves an agent and can provide deeper insight maybe.

Cosmetic or Structural Repairs?: An agent will point out material defects disclosed by the seller and also anything they see themselves, but beyond that its YOUR responsibility to do your own due diligence.

Neighborhood Info: Same as neighborhood grade. 

 @Kevin Sobilo Thanks for the reply! I was inquiring about quite a few properties. Have been trying to make about 1 offer a day. I would say I asked about any property that looked like it made some sense on paper. So some level of interest for each. 

Since Im at a distance some listing will simply say in description property needs TLC. With no pics. In this case its hard for me to gauge any rehab estimation. Wouldn't it make sense to get my agent to contact the listing agent for this info? 

 @Gurjot Grewal, I can see why your agent balked. Thats a lot of work for them. At that level of work even if you buy a property using them they could make less than minimum wage for their time! This is why they are frustrated.

If you are making offers unlikely to be accepted, I suggest asking the agent to just tell the listing agent your offer orally and ask if its worth putting in writing. That could save your agent a lot of wasted time putting together contracts that have no chance of being signed.

How would the listing agent know what rehab you would choose to do? I can bring to you 3 experienced investors and each would do a different kind of rehab. That is something you have to do yourself.

Have your agent walk through the property and facetime you so you can see the property. They can zoom in to show you details of interest. Maybe find a local partner who can go in person or even a handyman you develop a long term relationship with. Try to set up multiple showings back to back and pay the handyman for their time. They can tell you more specifically the work that needs to be done. 

 @Kevin Sobilo understood! I will learn from this and change my approach going forward. Thank you for the great info. 

The walk would only happen after the property is under contract correct? 

I am trying to self educate on rehab estimations. I understand the level of rehab will vary from investor to investor but it would vary greatly if its just some carpet and paint vs a full gut rehab. This would change my offer. Not sure how to approach this if theres no pictures on the ad. Any tips for this ? 

@Gurjot Grewal, most people walk-thru the property before making offers unless there is no access or maybe they assume a full gut rehab. 

 @Kevin Sobilo this is whats kind of throwing me off. Wouldnt it be a much larger waste of time for my agent to walk every property of interest. Versus asking the listing agent a rough idea for scope of work, then getting a contractor to walk it once its under contract? 

 Again, how would anyone besides YOU know the scope of work?!? You have to develop that yourself. The listing agent will not try to provide that.

You should be able to narrow your focus and be making SERIOUS offers on maybe every 3 or 5 houses. If your agent can do a few showings in a row that isn't much time for them to invest.

If you look at 50 interesting listings and narrow that down to 15 by doing some research and estimates based on info you can find from old listings, google street views, etc etc etc etc. Then your agent spends maybe 10 hours doing those 15 walk thrus with you. You make some casual oral offers but really focus in on 3 properties that you make serious offers and negotiate on then your agent might have 15-25 hours invested to get a house under contract for you which is very reasonable.