New to the game and new to the website. So, thanks in advance for working with me through this process. I hope to meet a number of you, through here or through other means.
I understand the relationship between the MLS and the RE investor is crucial. Being a newbie to the entirety of real estate, I do not possess my license. So, will I need a Real estate agent? I know people perform these transaction sans Realtors, but I have heard a ton of different opinions on the subject. I, also, understand that the real money is in FSBOs if you approach them correctly. But again as a newbie to the market, I am undecided on where to start.
As my first step is to wholesale my butt off, I would like to know BP community's opinion on the need for an "investor friendly" realtor/ real estate agent.
Have you found it hard to work with a certain type of Realtor or realtors in general?
What makes your relationship with your agent work well? (if you have one)
Is there newbie proof way of circumventing the use of realtors?
Am I crazy? (please don't answer... retorical haha) But, please do let me know, if I am off base with the focus of questions.
Thanks for your input in advance.
Tracking this thread. I'm having a time getting that relationship to work
The biggest problem is that the vast majority of agents do not have investors as their focus. Most agents want that traditional, pre-qualified, first or second time buyer. The deals you will likely seek to structure as an investor may not even be something the run of the mill agent can understand.
Understand to that the agent gets paid based on commission, they lack incentive to negotiate aggressively on your behalf. If you were an agent who's call would you rather get...the investor with his creative financing and ruthless concern for the bottom line, or the mold able and sometimes gullible newlyweds that want the perfect house?
With that said, I have met several investors who are also agents....these folks tend to have a more comprehensive understanding of what your looking for and they can help lead you to some deals...but in my experience these folks are few and far between. The thing that will make these guys work hard for you is follow through on your part. Not that you have to buy every deal they throw at you, but an ability to follow through (and occasionally doing so) is the key to building a good relationship. I've known a couple of these investor/realtors in the past that have sold me properties, and in a couple cases I have watched these guys liquidate their own holdings as old age approached...their properties tended to be sold in bulk at very fair prices. In one case a budy of mine picked up several houses at once and ended up making regular payments to the sellers estate...it was a terrific deal all around.
You can probably find an agent or two that will at least complete the periodic search of the MLS for you and let you compare whats out there...of course by then there are agents involved (commissions to be paid), and every investor and regular buyer in town can see the offer....so like you already mentioned some of the opportunity has eroded.
Hmm i guess i can play devils advocate a little here as i am a realtor and investor.The MLS is a great way to find properties but even as a realtor i don't find all of my deals on the MLS. some of the work has to be done on your end! make sure you check the local auctions, and foreclosure websites. My latest buy was from a foreclosure website and had nothing to do with the MLS! So to answer your question do you need a realtor the answer is NO! ( man this isn't good for business for me huh haha... ) Now with that being said the MLS has a TON of great options to buy you just have to be smart about it!
What makes the relationship with your realtor a good one? hmm thats easy enough to answer form my point of view... one don't try and screw us over ( don't try and talk the commission rate down every single house we don't ask you to cut your pay checks! but also if you find a realtor make a deal with them... " hey if i use you to buy X many house is there anyways i can get a rebate after so many" i am perfectly happy with the you scratch mine i scratch yours... ) Also you want your realtor to be someone you can go drink a beer with and have a normal conversation with. My investors that i have a good relationship with i hangout with. I actually ran into one in downtown Cbus the other day and we had a beer together at brothers bar and grill. i couldn't stay but thats the relationship we have.
@Dante Bellins If i was your realtor and you asked me where to start i would ask a few questions, 1) how much cash do you have to invest? 2) are you looking for quick flips or buy and holds 3) if buy and holds what areas are you ok with? do you want to do with section 8 have you found a property management group? 4) wholesaling... is it legal in the state of VA? I know its not in ohio so if you came to me to wholesale i would advise you to buy the property and then sell it tying up your own cash for a little while but still making money on the back end.
I think you still have a lot more reading to do before you jump into the pool feet 1st but you are here so thats a great start! As far as realtors call a few of them up and start general conversations with them about what your goal is. Then meet with a few of them and see what one you like and then you will have you answer on if you like them or not.
I hope this helped and welcome to BP
As an investor without a license, I would concur that it's in the agents benefit to notify me of really good deals, even before they go on the mls. They know I want good deals, and I know they want the commission. Most people can't act as fast as I do, but most agents know I can pull the trigger fast if I know a deal is good.
@Jeremy Davis hit the nail on the head with his post. As an investor who decided to pursue the license for my own purposes I decided also to work with investors primarily in in their pursuits. It has brought me clients as they know I already know how to run the numbers and structure a deal from an investors point of view. The thing that bogs realtors down the most is a wholesaler not looking to actually purchase or someone who just wants CMAs for property after property with only the intentions of wholesaling. Here in Maryland a small group of us Realtors chose to build a team primarily around working with investors. Of course we will do retail and we still invest ourselves, but we are there to help. So if you can find an investor-agent versus an investor-friendly agent, (see the difference) you are in good shape. Just be ready to perform.
I work almost exclusively with investors. Now I am an investor myself and run a property management company so it just makes sense that that'd what I would be doing.
I will say this working with investors can be very profitable because a retail buyer is going to buy 1 house from you. Where an investor will buy Many houses from you. But a smart agent will make sure they are working with the right kind of investor. ONES WITH MONEY TO INVEST.
I get many calls from guys wanting to use "creative financing" techniques. That's all well and good if you can put in the time and effort and get yourself a deal with little to no money that is great im happy for you. But don't think i'll be letting you use my valuable time and resources to do it.
@Dante Bellins welcome to the site.
@Dante Bellins Welcome to Bigger Pockets.
Do you need an investor friendly agent? Yes! and No!
You can do transactions without an agent involved, but why would you limit yourself to ONLY those types of transactions? A great agent is essential to your business, but you won't need to use them for every transaction. Be aware, if you are not using an agent, you are the one responsible for complying with the Federal and State laws, for things like Property Disclosures.
Most agents are retail agents, and work with traditional buyers and sellers. They can get you basic information and access, but to evaluate a property as an investment, you'd be on your own. There are two types of agents I work with. First and preferred,is an investor-agent like @James Wise or @Jeremy Davis. Second, there are a few agents who are not investors, but work well with investor clients and understand what investors are looking for.
I keep my relationship working with my agent by watching out for their best interest too. I pass them leads for listings, have them submit all my MLS offers, and refer good clients to them. They in turn give me comps even if there isn't a commission, watch for great deals for me, and refer people to me that decide they don't want to list.
Nothing is newbie proof. Why try to circumvent an agent or anyone? Should a buyer try to circumvent you as a wholesaler? That's just bad Karma from the beginning.
Welcome to BP.
thanks @Darrin Carey
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