Good Morning All,
I am a new member of a real estate team in Kansas City. I was brought on to build relationships with investors, builders, and developers. One of the complaints I have often heard is that most real estate agents are only concerned about retail buying and selling customers who will probably only have three real estate transactions in their lifetime. That means that MOST real estate agents don’t understand the needs of investors, builders, and developers. So I am asking the question...
What are you looking for in a real estate agent?
Our team is looking to build a customizable system that makes us an asset to investors, builders, and developers... Not just another headache. Please feel free to comment and share your experiences and let me know what you wish your real estate agent knew about your business.
Keep in mind that while I have 3 pieces of property, I'm new to the concept of really buying as an investor. That being said, I plan to do things very differently and hope I can find a willing agent for my next transaction.
I want an agent who understands that I can't pay full price if the numbers don't work out (and they usually don't at full price). I want an agent who understands that more of my offers will be rejected than accepted.
Brandon says only about 10% of his offers are accepted. Recently another BP member was having issues with their agent because they were trying to give offers at 80-90% of value and the agent said they were low balling and demanded a $5000 retainer (or something), plus that they sign an exclusive contract (which I understand is more normal than when I last bought).
I want an agent who understands that it's just a numbers game and that I may need to work with wholesalers, too. I also want one who is willing (for a fee, of course), to complete the paperwork for me that the wholesaler won't, in order to finish my transaction. It would be even better if they were willing to do the paperwork on a Driving for Dollars or other property I found on my own (again, for a fee).
I want an agent who cares about my cash on cash ROI and my cash flow. If I'd had an agent who was a BP member and let me sit in their office and run numbers on a tool like BP has so I would have known what to offer when buying my other properties, that would have been AMAZING! (But no doubt asking too much. Maybe the office could purchase a Pro membership and have a computer that clients could sign up to use? That would be AWESOME! Just an idea... ;-) )
I also want an agent that I feel genuinely cares about me. I've known my agent since I was a kid, so she regularly tells me she thinks of me like a daughter. She's retiring soon and I'm freaking out about that. How will I ever have an agent who will tell me what she REALLY thinks about me buying a property (especially when I knew even less than I do now)? I want to feel connected to my agent and like they have my best interests at heart--that I'm not just a commission check. (My agent sends housewarming gifts to all her clients and every year after that, Christmas cards. I'm sure it becomes a pain over time, keeping up with that giant list, but it's awesome that she did it!)
There's probably more than I'm not thinking of right now and I'm probably being unrealistic, but this is what I'm hoping for with my next real estate purchase, now that I'm a wiser buyer. :-)
If you're trying to market to investors and developers you need to understand how to run a pro forma and do some calculations instead of just forwarding newly listed properties that don't even pencil out.
For development, you will need to understand even more the due diligence developers need to evaluate or do before building--soil report, survey, civil engineering, zoning, set backs, FAR. I don't know how many times someone sends me a deal saying it's shovel ready and I find missing info.
@Tyler Hiatt I am an agent and GC. That said I only use my licenses for our own investing/business. The problem I have seen across the board is that most agents simply don't understand the principles of investing, what investors are looking for or how to walk a property and adequately estimate repair costs.
Unfortunately, most of these skills are only acquired through adequate study and conducting your own renovations.
Not sure what your business model is or how exactly you are trying to outreach to investors or builders. Do you have experience in purchasing land? Renovation or construction? Are you an investor yourself? If so have you flipped or do you acquire and then landlord? REI, like more things in life, is not complicated but it is nuanced and requires in-depth knowledge. To me, it is hard to see how an agent with only cursory knowledge could be of real value to an investor.
@Jody Schnurrenberger - don't fight the MLS. We flip and I can tell you I haven't used the MLS since May to find a deal. Since that time we have secured five deals and have two more in the pipeline. While there are still some good deals on the MLS, this time of year, I would encourage you to seek out deals through other sources.(mailings, networking, wholesalers, etc...) We can honestly not keep up with demand or the amount of deals out there. If you have to fight other investors for the deal - it probably won't be a great deal.
Best of luck to you both.
@Jason Hsiao , @Dan Krupa , @Jody Schnurrenberger So it sounds like the thing that makes an agent valuable in your mind is an understanding of the analysis and doing some of that work up front so the investor can quickly see if the numbers work. I’d be interested in the systems you use to calculate deals.
Are there any other services that you wish agents provided that would make a long term relationship mutually beneficial? Also, it sounds like often times you bypass the retail market (obviously) for other avenues of finding deals. Do you still employ an agent as a transaction broker or similar to handle paperwork and escrow?
You guys are awesome. I love getting into strong business minds!
Previously, to see if a deal was any good, I just let my financial planner figure it out because I thought it was all too complicated. But now that I've found the BP calculators, I'm in love...and so is my financial planner, if for no other reason, it takes some of the weight of telling me "No" off of him because I can see for myself that it's a bad deal. lol
To make a long-term relationship mutually beneficial, I'd love for my agent (or their agency) to also do PM. I love doing everything under one roof.
While I haven't (YET) bought from anyplace but the MLS, I do plan to now that I've found BP. As I'm very anti-paperwork, I DO still plan to use an agent to do the paperwork for me. :-) Laziness helps the economy! lol
@Tyler Hiatt - hands down the biggest thing is the agent has to be able to react quickly. To do this they need to understand the needs of their client, the market, and what a "real deal" looks like.
The great deals last hours, maybe a day or two if it is a down period. So being able to spot the deal and give to the investor quickly is the most important aspect.
Also, to reiterate - they should be investors themselves. There is a world of knowledge only gleaned from investing.
Hope this helps.
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