Hey All --
I wanted to see if we could put together some great tips for real estate agents who want to work with investors. What are your best bits of advice for real estate agents would would want to get more investor clients? What should they know? How can they better serve the investor segment of the market?
@Joshua Dorkin this is not meant to be a wise *** comment (as much as I normally enjoy making them)
Included in this list should be Don't work with real estate agents
Many new investors aren't even aware that deals can be had outside of the traditional buy from a real estate agent paradigm. Only small percentage of my deals have gone through real estate agents.
I am not suggesting we discourage going through agents. Let's just let new investors know there are other methods of finding deals. - Ned
Define the type of investor you are wanting to work with and find out what their needs are and where the other broker/agents are failing them.
My niche is on the triple net leasing and multifamily apartment buildings for working with investors. The investors I work with are typically very different from residential investors and transactions. The investors typically have higher net worth and are more sophisticated in their analysis and knowledge levels of analyzing and buying properties.
Start farming properties as a listing broker/agent to control the inventory. If you hold inventory or know of off market deals with your contacts the buyers will seek you out.
Investigate a partnership with an investor just as hard as they are looking at you. Look at how realistic they are, if they have actual funds they control, how many transactions they will conduct each year (book of business for the time invested). No investors shouldn't just be a transaction or a number but have to be quantified for the time and return invested.
My clients do not take offense to the analysis and respect the fact that I value my time as a broker and investor myself for the return I am seeking. I look at a long term relationship and prefer to bring quality deals to a circle of trusted investors I work with. It's better to have an ongoing relationship than one off deals.
Thanks for posting your thoughts. I respect all peoples opinions as long as everything is kept civil and thoughts are given out based on a rational and well thought out opinion.
Whether you need a broker/agent will depend on many factors. There is a difference between wholesaling a house, turn key, flip, buy and hold, commercial deals etc.
All require a different skillset and level of knowledge to help minimize risk and a successful outcome in a deal. I have no doubt there are some investors who do not want or need any help and then there are others who actively seek out help.
I do not need every investor or piece of business in the world to be highly successful. I only need those clients who want the same long term and equal relationship I am looking for where I look out for their interests and they do the same for me.
I don't take it as being a wise *** comment, Ned . . . that said, the point of this post is to get feedback to help agents who want to work with investors.
What skillsets do they need to bring to the picture for you guys?
What would make an agent attractive to investors?
This isn't a post meant to garner debate of any kind. I just want your best tips for agents.....
So, lay them on me!
Every good agent will have a list of investors, real buyers, rehab flippers, landlords and ethical seller/finance wrap installment types.
The Realtor needs them as buyers and sellers. Not all properties are suitable for retail to the average family.
The same things that a "wholesale" type need to do is what Realtors should be able to do, identify deals that don't fit the standard listing, understand rehab and get estimates, provide comps and rent rates.
A Realtor needs to understand the valuation process based on good data. Share the details.
Know what your investors are interested in and keep an eye out for those, pretty simple, investors are easy sales, much easier than the average buyer or seller.
Keep in touch as you would in any relationship, let them know you're there.
Don't be critical off the bat with new investors, they don't know what they are doing is illegal or unethical (do as I suggest, not as I do, LOL) if they actually have the ability to do deals then teach them, they will return loyalty and appreciate you keeping them out of trouble.
I'd suggest that Realtors should be more receptive concerning lease-options and installment deals, if all they do is work with qualified buyers today, they aren't building future sales as they could be. Understand that you can earn a fee as well as a commission on a sale.
My list would be:
1. Learn how to properly comp a investment property.
2. Learn how to estimate remodel costs.
3. Take a commission cut on the buy side and make it up on the list side.
4. Be a bull dog when submitting the offer. Again, take a commission cut if you can to get the deal closed.
Oops, sorry everyone I read the original post too fast. I thought @Joshua Dorkin was looking for tip for investors to work with agents not the other way around.
OK my list
1) Recognize that while you may be an expert on homeowner real estate you probably have a LOT to learn about investment properties.
2) Learn what makes a good investment deal. Many agents don't understand how cheaply and investor has to buy to make a profit. You should know rules like the 50% rule, 2% rule, the ARV X 65% rule as well as investors do. You should also know when the DO NOT apply.
3) Market yourself here and other places that investors meet. Join you r local REIA and become know as the investing expert agent.
4) Qualify your investors. Just like you qualify Homeowners as to what they can buy and what is a appropriate you will have to do this for investors also. Different investors have different needs and different abilities and resources. There are many types of investors and many types of deal. The best agents are going to match them up. - Ned
Thanks Guys! Keep the tips coming everyone.
Tips for RE agent?
Get listings and investors will find you. You want to be able to choose which investors you want to work with, and which ones you tell to hit the road? Get listings, get listings, get listings.
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