Real estate agents' perspective
Insurance Agent · Las Vegas, NV · Member since 2019 · 158 posts · 80 votes
I usually hear about qualities we need from our real estate agents as investors, but I don't generally know what agents need, especially when working with investors.
What does your ideal, investor, working relationship look like? What are your expectations from him/her? What value do you generally bring in your relationship with them? How much collaboration goes into making offers?
I'm legitimately curious about this subject as my first investments came outside the help of a realtor.
Simple answer. Cut the ********, dont waste my time. I dont mind opening doors, but trust my professional opinion when I tell you something like your offer of 70% of asking price for a house thats been on the market 3 days wont fly.
Your the investor, im the agent. I wont run your #s for you, thats your job. No reason to increase liability for me, and we may value things differently. Dont get cold feet. I can handle cold feet from first time homebuyers, but your supposed to be a professional. Act like it.
Im here to open doors, run comps, and do my best to get an offer accepted and get the transaction to the finish line if buying. List side is getting the listing marketed correctly and getting you the best offer the quickest in addition to guiding the transaction to its conclusion.
When I find you something that meets your criteria, your job is to pull the trigger and get your ducks in a row so we can close.
Agents only have so much time in the day, and for 99.999% of us we are 100% commission. I would rather work with first time homebuyers than a newbie investor, and that says a lot.
Professionalism goes both ways, you should expect your Realtor to be professional, and you should be professional towards him/her. Questions are ok to ask. General questions are probably better saved for google, though.
Really the most important thing is just this: 'Dont waste time'. Every minute I spend working with a newer investor is a minute I am taking away from another client of mine who I know will close. For some agents, that is not worth the risk.
Hope this helps, Good luck!
@Jacoby Atako
Mainly one that has their s**t together. I don’t mind researching some stuff, even if its something they could look up themselves if the legitimately just “can’t do it.”
I’ve read on bp “investor friendly agents” should be running tons of numbers for their clients. I think that’s bumpcus in this day and age. The information is all out there. An informed client is a good client. They can run the numbers themselves and determine what they are really interested in. Agents are paid on commission. Maybe I’m not as interested as others, but being other people’s analyst is really not in my job description as an agent. Especially since people have their own ideas about costs, etc.
In short, the investor has to be putting in their own time and effort. As an investor functioning as an agent, I like to think I bring a much more informed opinion and increased research skill (than your “regular” agent). The synergy is when both parties have skills and can focus on their specialities. The agent’s focus is providing listing info, area info, access, communicAting and coordinating with the listing agent, and generally trying to broker a transaction. Being used as some sort of analyst and sometimes gopher is not the best use of a commissioned agent’s time in my opinion.
@David M.
I'm really glad I asked, because I really think most investors really don't know, Im definitely learning.
What about with writing offers? Usually I've seen investors looking to write offers that meet their needs, but realtors not wanting to take the time to write a ton of offers knowing many won't be accepted. Especially in a seller's market like today.
Simple answer. Cut the ********, dont waste my time. I dont mind opening doors, but trust my professional opinion when I tell you something like your offer of 70% of asking price for a house thats been on the market 3 days wont fly.
Your the investor, im the agent. I wont run your #s for you, thats your job. No reason to increase liability for me, and we may value things differently. Dont get cold feet. I can handle cold feet from first time homebuyers, but your supposed to be a professional. Act like it.
Im here to open doors, run comps, and do my best to get an offer accepted and get the transaction to the finish line if buying. List side is getting the listing marketed correctly and getting you the best offer the quickest in addition to guiding the transaction to its conclusion.
When I find you something that meets your criteria, your job is to pull the trigger and get your ducks in a row so we can close.
Agents only have so much time in the day, and for 99.999% of us we are 100% commission. I would rather work with first time homebuyers than a newbie investor, and that says a lot.
Professionalism goes both ways, you should expect your Realtor to be professional, and you should be professional towards him/her. Questions are ok to ask. General questions are probably better saved for google, though.
Really the most important thing is just this: 'Dont waste time'. Every minute I spend working with a newer investor is a minute I am taking away from another client of mine who I know will close. For some agents, that is not worth the risk.
Hope this helps, Good luck!
Again, it comes down to the "pain in the ***" factor. As agents, we are paid on commission (yeah, except those on salary, but you probably aren't working with them). Meanwhile, investor purchases are always at a lower price point. You could try to equate the commission to an equivalent wage, but that really is still comparing apples with oranges.
Writing up offers isn't that bad being able to do everything electronically.
@DJ M.
I can hear the pain in your words. It's an interesting dynamic. Maybe that's the reason do many investors end up getting their real estate license.
That's part of it... There are many investors who don't have their license. They general may use a Realtor to list, but they find their own deals off market.
You need to ask yourself, what are you looking for from your Realtor? I don't mind spending time with an investor, but it needs to be meaningful. You have to chat, built a rapport, and get an understanding of what the investor is looking for. But, it starts getting silly when the investor/client has no feel for the neighborhoods, doesn't understand what it will take to rehab (especially on a really distressed home), or just has unrealistic expectations on pricing.
While most real estate investments are considered passive by the IRS, it doesn't mean one can just "sit there" and invest. Put it another way, even investing in stocks takes a lot of research. Would you spend hours with a stock broker picking stocks? Or, do your own research? Same thing with real estate. The investor really has to do a lot of their homework which ridiculously easy to do now since just about all the info is available online.
I think this is where the "disconnect," if you will, lies between investor and agent.
Good luck.
@David M.
I think you nailed it on the head. I started my investment career with off market deals, which seemed to be a better way to go, but I definitely will need a realtor should I ever decide to sell a property. Thanks for the info!
@Jacoby Atako I am an agent in Texas, here is an example of what not to do as an investor (happend to me a few weeks ago):
Me (agent): Hey Josh (investor) 👋 I found a rare forclosure deal on the Dallas MLS - a home for 330k, need a few repairs & updates but overall looks in good condition, comps for the property in the neighborhood showing ARV of 400k+
Josh: yes I want it! Write an offer for 200k, cash!
Me: Josh I just got off the phone with listing agent and he mentioned a multiple offers situation.
Josh: I don't care, write an offer 200k cash now
Me: mmm... I have a phone call, I'll get back with you.
Real story! Link to the property (now pending): https://kw.com/property/LST-6712789422267412483-1
@Yaron Yashar
Yeah that's pretty ridiculous
@Jacoby Atako along the lines of Yaron, and basically all others. Be real and logical. Not only with me but with yourself. Don’t try and spread yourself so thin, especially when it comes to financing. I want investor clients who will be around for flip 2, 3, 4, and so on; not who will call it quits after the first.
So what I'm reading from the previous posts is that we do not need realtors because you can research everything as an investor yourself....
Hmmm....I have bought multiple properties based on my research (extensive) but relied heavily on my RE agent to guide me on the area i was considering.
My take: Investors should do their research (lots of investors invest our of their area)......but, find a good agent that knows the market!!!!!!
****Great RE agents are invaluable if you are investing in unfamiliar area..
Yup pretty much.. maybe I’m jaded because I run into local investors who know, or should know, the General area. Sure I give my opinion and sometimes local specifics that the investor isn’t aware, but can confirm for themselves later.
Like it’s been posted many times before, if you already know how to do a transaction, the Realtor doesn’t necessarily help much (they can still help with the brokering aspects).
The big issue is to the changing times where the investors can do much of their research. There is no point making the realtor chase down a bunch of numbers and crunch them for one property, then ask again for another. I’ve had that and it sucks to keep going into the different databases for one property at a time.
It’s a balance...
@DJ M.
I can hear the pain in your words. It's an interesting dynamic. Maybe that's the reason do many investors end up getting their real estate license.
As an investor first, this is exactly why I got my license. I never found an agent that was truly willing to help unless it was almost immediately advantageous to them. Most agents are focused on the retail buyer and don't usually see things from an investors perspective. With that being said, there are agents who are "investor friendly". What I have found is that the investor friendly agents are often times investors themselves. The way I look at it is this... real estate is a relationship business. If you bring value to the relationship, it will be fruitful. This goes both ways.
Hey Jacoby,
If you read between the lines from the agent comments above...
1. Do all the homework yourself
2. Call the agent to put in an offer (which takes 30 min)
3. Let them sit back and cash my commission check
...
If you plan to go after on market listing, just go straight to listing agent, get all the info from the horses mouth...and offer them double commission
That alone will open up the listing agent to hear where you need to be to get deal.
You can move faster and make more offers doing this rather then waiting for the time your agent gets sick of you when your 10th offer is rejected
( based on experience when I started)
when you approach listing agent. Act professional, and be confident so they know you aren't kicking tires and are looking to buy asap.
@Jacoby Atako I am an agent in Texas, here is an example of what not to do as an investor (happend to me a few weeks ago):
Me (agent): Hey Josh (investor) 👋 I found a rare forclosure deal on the Dallas MLS - a home for 330k, need a few repairs & updates but overall looks in good condition, comps for the property in the neighborhood showing ARV of 400k+
Josh: yes I want it! Write an offer for 200k, cash!
Me: Josh I just got off the phone with listing agent and he mentioned a multiple offers situation.
Josh: I don't care, write an offer 200k cash now
Me: mmm... I have a phone call, I'll get back with you.
Real story! Link to the property (now pending): https://kw.com/property/LST-6712789422267412483-1
Classic... this is exactly what a lot of so called "investors" do. In my opinion, this is what an investor with no or little experience does. This is someone who just read a book on flipping or watched a bunch of YouTube videos and now they are an "investor". You can tell real quick from a conversation whether or not you are dealing with an experienced investor. I like your response "I have a phone call, I'll get back with you." LOL.
Over the years, I have received multiple calls from investors wanting to submit low ball cash offers on listings. As soon as I say sure, email me your proof of funds, this almost always results in them saying that they will get back to me... and of course, I never hear back from them. Or, you end up getting a generic proof of funds letter that they got from some internet based hard money lender that no one has ever heard of. A quick conversation asking the right questions will usually allow you to determine if you are wasting your time or not.
@Jacoby Atako
Ask yourself if you like to work for free. Most likely the answer is NO. So anytime you ask the realtor to run your numbers, see a house that you know you won’t buy, refuse to get pre-qualified, or write 25 delusional offers....you are asking them to go to work for free. Value your realtor’s time like you value your own.
@Bradley Sriro
Yeah this totally makes sense to me.
@Joe Cassandra
I've actually used this approach once, and it was fruitful. Although I didn't get the deal to agent definitely warmed up to me. This approach seems to make the most sense given the comments.
It sounds like there is usually a differing of the needs between realtor and investor.
Yes, in many ways it comes down to "profit/income." The investor just wants to make money on the cash flow or appreciation of the property. The agent is compensated on a commission basis per transaction. They don't always align. As @Bradley Sriro said it well, the "classic" investor treats the agent as some sort of "throw away" and as a member of their team.
I've written about this a few times recently in BP. My agent (before I turned recently) doesn't do any investing but was 'savy' enough to realize how it benefited her. I did over a dozen transactions with her, and she got at least a couple dozen sales throughout the years off of my tenants when they needed to go look for a house. How else can you cultivate one client and get so many transactions?? Many agents don't think this way AND I admit its pretty rare to find a client like this. It took me two solid years to find this agent.
I don't know how much you've been reading on BP, but its been written about many times how BP investors don't think agents are "worth it" or how can they get around paying the commission. EVERY piece of advice includes "building your team." Yet, for some reason the agent doesn't seem to be considered a potential team member in my opinion. As you've seen here, some would rather use the listing agent with the incentive of double ending the deal instead of having an agent work for them for all their deals.
Just my two cents...
@Bradley Sriro exactly ! I felt bad it was my first time to say no to a buyer that asked me to write an offer and represent him, but I couldn't see anything good in wasting about 45 minutes to write down the offer knowing it will never be accepted.
@Jacoby Atako loyalty. It’s bothersome to spend your time working hard for someone for them to give someone else the deal especially if you’re agent is doing the work.
No one works for free. The longer you invest, the more you learn this. Many new investors belive they will or should hit a homerun their first time at bat. If it means they burn every bridge they come to, so be it. Bob and Betty bad *** are alive and well. This is a long game and you can only be a jerk so long, before no one wants to work with you. Like it or not this is a team sport.
If everything goes according to plan then anyone can do my job. The first time something goes wrong, it will be clear why using an expereinced agent is imperative. I buy and sell more real-estate for myself and others than 99% of investors. My help and knowledge is for sale, this is how I make my living.
@Bradley Sriro exactly ! I felt bad it was my first time to say no to a buyer that asked me to write an offer and represent him, but I couldn't see anything good in wasting about 45 minutes to write down the offer knowing it will never be accepted.
Couldn't agree more... Being able and willing to say no can save you lots of potential future headaches.
This maybe was said in other ways, but it is always good in general to have a client who knows what they want.
@Jacoby Atako Jacob. Hello. I hope you getting a good idea what you can expect with Realtors these days. when you have a hot market you have people that do less and less work because money is falling out of the skies. I'm working on finding a multi-family . the first buyers agent I selected could care less about representing me as a buyer even though I specifically sought her out. totally ambivalent on every issue. First time I met her to view she showed me one property that I liked ..but went thru quickly and after ten minutes asked me if we should write an offer..even though we had another to see. This Market is take it or leave it so these Realtors responding are right and they're being brutally honest.
Though I doubt they're that honest when they actually meet a prospective buyer.... but this is what you can expect, zero , nothing, most of the houses I'm looking at have no disclosure forms , not required in NJ.... and the listing agents are not giving information out to the sub broker, I understand that if the seller has nothing to give you then you have nothing to pass along buy it's a real sad state of affairs, you're on your own. I remember the old days when a realtor would pick you up and drive you around from house to house forget that. Lol