Best agent type for multi-family properties of various sizes?

17 Replies

Seems like a silly question, but can a Commercial Real Estate Agent represent the buyer in a Residential MFH (2-4 unit)? And how about vice-versa, can a Residential Real Estate Agent represent the buyer in a Commercial multi 5+ or apartment property?

Thanks in advance!

I believe it depends on the state. I would recommend just getting a residential agent if you're purchased residential and commercial if you're purchasing commercial. The respective agents will be more familiar with their markets: e.g. local cap rates (commercial), purchase prices, etc... The two different sectors can be very different within one area market.

@Sandy Metivier , in Ohio a real estate sales agent is an real estate sales agent, with no different licensing or course work for to sell commercial vs residential.

So, in Ohio a commercial broker could sell a single family home and a residential broker could sell a $100m apartment complex.  In reality, the commercial broker won't work with someone looking at a 4 family since this broker is working on commissions that might be as much as the 4 family's purchase price.  Alternatively, a residential broker will likely not serve any purpose or provide any value in trying to negotiate a $100m apartment transaction.  

Depending on the markets you are looking in, residential agents are most commonly listing 8 units and under, at least in the markets I have looked.  When you get to the 8-20 unit range, you get a mixed bag of residential and commercial agents, and over 20 tend to heavily skew to agents marketing themselves as commercial agents.  But back to my first comment, from a licensing standpoint in Ohio, any agent can do any listing.

@Sandy Metivier

Any real estate agent in Ohio can represent you in the purchase and sale of real property. If you’re looking for a good commercial broker ask if they own investment property as well.

Originally posted by @Sandy Metivier :

Seems like a silly question, but can a Commercial Real Estate Agent represent the buyer in a Residential MFH (2-4 unit)? And how about vice-versa, can a Residential Real Estate Agent represent the buyer in a Commercial multi 5+ or apartment property?

Thanks in advance!

 In Ohio, they can do either. Although most agents are poor with both.

Sure brokers are brokers.  Resi guy may focus on knowing buyers/sellers in resi market and comm in owners of his product type.

Comm guy may know the math a little better though.

@Sandy Metivier a license is a license, but like the folks above said...you will benefit from working with a specialist. Residential agents often represent MF deals, but not well...the worst thing is that the client doesn't know any better. It's a risky equation. MF transactions behave differently than single family.

Best of luck

@Sandy Metivier

No difference here in Illinois, but you are going to want to find a broker/agent who specializes in the type of real property you are looking to purchase. If 99% of an agents business is in SHF and they have only ever done one multi or commercial property, then you probably want to find another agent for your search.

Originally posted by @Sandy Metivier :

Seems like a silly question, but can a Commercial Real Estate Agent represent the buyer in a Residential MFH (2-4 unit)? And how about vice-versa, can a Residential Real Estate Agent represent the buyer in a Commercial multi 5+ or apartment property?

Thanks in advance!

 Yes, in Ohio, an agent can represent both. Although as some others have mentioned, most realtors aren't great at both. 

Wow, thank you for those responses! There are so many of you to tag and individually reply to with thanks.

You all seem to be echoing the same message, so that is confirming... Agents can do both, but probably don't have expertise in both. 

Thank you all.

Basically, agents take classes for the Salesperson License so for the most part they can both. 

Interestingly, some residential agents aren't very familiar with commercial real estate so it is best to find those agents who are comfortable with that part of the business. 

Originally posted by @Tony Angelos :

@Remington Lyman Just want to take a moment to say your comment is excellent

 The cool thing is that if you can respond to calls/texts/emails you can make $100,000+ in your first year

The short answer is yes.  A licensed agent can represent an investor on both residential and commercial transactions. The challenge is usually when it comes to creating a proforma or any kind of projection that can define a cap rate and cash on cash returns for example. Then projecting that info out 5 to 7 years and being informed on what rents and potential areas are more profitable than others just to name a few examples of the knowledge base it takes to help guide an investor.