Presenting MLS Deals to Investors

12 Replies

Hi Everyone! 

I currently assist clients who provide business professionals and corporate employees with short-term rental accommodations via the rental arbitrage model. I have been quite successful, but the job keeps me away from home, more than I would like, as I have to physically visit the properties, have face-to-face conversations with the landlords, etc. (And yes, face-to-face meetings with landlords and property owners is non-negotiable. There's nothing like looking someone in the eye, and getting a feel for the type of person you are dealing with. Call me crazy, but that's what I do ;) ) Also, the short-term rental ordinances are increasing, making it a lot harder for investors in the markets I serve. That said, I am looking for additional income streams. So I wanted to run this idea by a few of my fellow investors and see how I can structure this new service!

Let's say I have 5 investors, a mix of fix and flip, buy and hold, and short-term rental investors who each give me their preferences on acquisition cost, cash flow, property specs, location, etc. I locate properties on MLS.com and various real estate marketing portals. I analyze the property, and estimate rehab costs (with inspectors and contractors), add a buffer for unexpected repairs, as well as an ROI comparison of setting the property up as a rental vs. selling the property.

If I am ONLY presenting the deal to the investor, meaning I am NOT buying the property myself or setting up any type of assignment, just "connecting" the investor to the property and running the numbers. What type of contract and fee structure would be considered “fair” for both myself and the investor, to ensure I am paid for all of the “pre-work”, i.e. property analysis, and what fee/commission should I charge if/when the deal is closed? Any thoughts, concerns, comments (please keep it positive), would be greatly appreciated! 

Hi @Account Closed

If you are "connecting" you are "brokering" which I believe in CA needs a license. Fortunately you can get one for a couple hundred dollars. Then join a small brokerage that just wants a transaction fee and follow that model. You will be legal and everyone will be off your case. You do not need to join the Board or the REALTOR association if you don't want. But if you are just looking at finding properties on Zillow and MLS.com etc and then offering them to your investors with a pretty packaged number set, I'd do it that way.

Good Luck!

Hi @Mike Cumbie  and @Matt K. ! Thanks for your response. All of the deals I would be "connecting" are outside of California. Mainly Phoenix, Seattle, Austin, Denver, Atlanta and Dallas. I DEFINITELY do not want to spend years and years as a real estate agent, and then take classes, and then take a broker exam. I'm still paying off my absolutely USELESS college degree as it is! Ha! I'm done with that game! ;) You mentioned CA, so maybe the rules are different for other states? It is very helpful to know that simply connecting someone could be considered brokering, so thank you for that! 

"I DEFINITELY do not want to spend years and years as a real estate agent"

Bah it's a couple weekends of clicking next on a computer while you sip on drinks containing Rum in the privacy of your own home :)

Not like getting a degree and darn sure without that cost!

Or find a way to avoid the word commission. If your providing agents leads as flat fee and maybe % of completed sales...

But if you have a degree, it's not hard to get your license

@Matt K. Oh I know how to avoid all KINDS of words! Being in the "services" industry, you kind of have to. It's one of my many specialties! However, I'm still learning which words to avoid when it comes to real estate, so, duly noted! But why am I finding info on 3-5 years as an agent being required, before I can apply for a broker license? That's originally what deterred me. I am ADDICTED to learning...but learning in school, at a physical location, is a different story. If I can play that game online, I'm all for it!

Originally posted by @Account Closed :

@Matt K. Oh I know how to avoid all KINDS of words! Being in the "services" industry, you kind of have to. It's one of my many specialties! However, I'm still learning which words to avoid when it comes to real estate, so, duly noted! But why am I finding info on 3-5 years as an agent being required, before I can apply for a broker license? That's originally what deterred me. I am ADDICTED to learning...but learning in school, at a physical location, is a different story. If I can play that game online, I'm all for it!

 You don't need to be a broker, but as an agent you need to hang your license with a brokerage. Agents can split/share whatever commission with other agents. If you find a brokerage that only charges transaction fee then you're good to go.

Verify this and do your own due diligence...

@Matt K. Thanks again for the input! Sounds like getting a real estate license is at least worth researching further. And I just spoke with a family friend that said she didn't have to attend classes in person, and Century 21 just sent her a workbook in place of the classes. So a lot to consider. It'll definitely be an “in front of the computer” kind of evening for me! Thanks again and have a wonderful weekend!

@Account Closed If you have the know-how to run the business you are doing, there's no way you wont breeze thru the realtor curriculum. Have you meet all the realtors out there?? (they somehow passed) The toughest challenge will be choosing your rums and pacing yourself on that. 

As a non-agent / consultant, you could look at charging hourly or per project basis for your specialist analysis. Maybe even some profit share too. There's always the education courses you could go brand for yourself.

@Danny Webber I will definitely keep you posted! @Matt K. @Mike Cumbie Thanks again for all of your advice! I have started my pre-licensing coursework for becoming a Buyer's Agent in Arizona, so looks like I need to invest in some kind of Rum delivery service for my study sessions! Ha! Since I would like to stay on this side of the law, I figured I'd go ahead and license it up! Hopefully, I won't be pulling my hair out by this time next year! ;) 

@CP Chou Thank you so much for the encouragement! I am glad I went ahead and researched getting my real estate license. There are actually quite a few states, that I want to present deals in, that allow reciprocity, so it won't be as hard as I thought. I will have to take the state exam for them all, but it is what it is. And if I am strictly a Buyer's Agent, which I want to be, as I only want to work with investors, I know that's the best way to go. Thanks again everyone!!! BiggerPockets' community is the BEST!! :)