First Time Investment Property

[Juan Rodriguez]

Hi there! My name is Juan Rodriguez, I am a licensed Finance rep, and I live in Austin TX. Me and my wife have been looking at a few properties but mostly in the San Antonio and Waco area since Austin’s Real estate has gotten so expensive. We have a few properties in mind that we think would generate at least $200 in cash flow as rentals. I know the very first step to starting here is taking that leap and pulling that trigger on a property, currently we’re in a need of a Real Estate Agent. We’re still learning how the market in Waco is and we’re trying to find an Agent that’ll be the best fit to help us out. So my question is, during your first investment property did you use an agent? Why or why not? If you did, what was it that you looked in an agent to decide if they were the best fit?

Thanks for any responses or advice!

-Juan & Brianne Rodriguez

[Joseph Cacciapaglia]

I used an agent for my first investment, and really for the vast majority of my investments over the years. If a deal is listed on the MLS, it doesn't cost me anything to use a buyers agent, and even a bad one will add some value. Of course now I'm an agent so I just represent myself. Despite all the hoopla about off market deals, there are still plenty of investors that buy through agents as their main source of deals.

I would just try to find an agent that is experienced with investing and also knows the market you're interested in. I don't know much about Waco, but I know San Antonio can be a tricky market to invest in. There are a lot of properties that look great on paper, but are in areas where you're going to have a tough time keeping it full or have expensive turnovers. We also have very uneven rent growth and appreciation among sub-markets. It's often the case that if you move over one subdivision, you'll give up a little cash flow, but increase your total returns by a decent amount.

Before I got my license, I always liked to ask agents what percent of their business came from investors. Most agents will say they work with investors, but for many they just dabble or work with them in the off season. You want to know that you are important to their business. If their average sale is a $400K home in a golf course community, how much time are they really going to devote to your $150K investment property purchase?