Understanding Real Estate Agents From An Investor’s Point of View

[Ken M.]

If you can find a great RE Agent, keep them. Someone who can cut through the chatter, negotiate like a pro, returns your phone calls and has great contacts. That’s a rare breed of 1% or fewer.

Now, the common real estate agent really is limited in what they do and what they know.

Things to watch out for

First, I would never sign an agreement for more than 90 days. If they demand 180 days, then they aren’t good at what they do and won’t promote your property. Don’t fall for it. You can always renew an agreement. In most cases, don't renew, just find someone new.

Price it according to what has actually sold, not what other’s are asking for their properties. Especially if in a declining market. Bad agents over promise on service and they initially list the property “high” to get your business. Lenders can only lend on what an appraiser says it's worth. It doesn't matter that you think it's worth more. If no one can get a loan on it, who are you going to sell it to?

Their solution when a property doesn’t sell in 3 months (yes, real estate takes time to sell) is to lower the price slowly in small increments. That’s just “Chasing the market down the tube”

If a real estate agent lists your $350,000 property at $400,000 it will sit there unproductive forever. After a few months of trying to get it to sell, lowering the price to $390,000, you take a $10,000 emotional hit, (if the place was worth $400,000 it would have sold at $400,000). The agent takes a 3% or only $300 hit which is nothing. But the beat goes on. You’re still over priced.

Don't "chase the market"

It’s not 2022 at the height of the market. Wake up and smell the humus. Your agent oversold you on the value, in your hopium you listened and now you’re stuck with a lemon of a sale.

When it’s the right time for you to sell, find a pro, list properly, generally the first offer is the best offer you’ll get.

Don’t let an unqualified agent run your life, drop them and get one that actually tries to sell the property, not just lists and waits

I am not a real estate agent. Don’t call me, I can’t help you. :-)