How to get an agent help with ARV + Rental price?

Question

What is a creative way to form a relationship with an agent, where they can help you quickly figure out ARV and potential rents for a wholesaling deal?

I have few deals that come my way from a wholesaler without renovation price, ARV, and rents, and I need some help to do a quick analysis and make an offer, before sending out my people to the actual property?

Charlie MacPherson · Answer

@Einat Menashe  A few things to think about.

1. You're buying through a wholesaler, so asking a Realtor to run an ARV analysis is asking him to work for you for free.  In a wholesaler transaction, there's no commission for a Realtor unless you're paying it directly.

2. Many (perhaps most) Realtors wouldn't get involved with a wholesaler's deal.  Almost universally, the wholesaler is screwing the seller out of equity.  That's the only way they make any money.  There are very serious ethical implications for a Realtor involved - not to mention that in many (again, perhaps most) jurisdictions, marketing a property that you don't already own requires a real estate license.

3. Depending on a wholesaler to provide ARV and renovation figures is asking the fox to promise that the hen house is safe.  Wholesalers almost exclusively make a living by stealing equity from sellers who are either so desperate that the have to take a bad deal to get out of a jam, or are simply ignorant as to actual market value.  That's inherently dishonest - and that's not someone that's trustworthy in my estimation. YMMV, but at your risk.

The exception is for those who double-close and are selling a property that they already own.  As a Realtor, I wouldn't have a problem with that transaction, but otherwise, I'd be directly involved with a chain of events that screwed a seller out of equity that was rightly theirs.

Here's an example: https://www.biggerpockets.com/...

Carey Salmon · Answer

Find a nice agent at a local REIA meeting and chat them up. Also I think a bigger pockets Pro membership has all the calculators you would need to run your own analysis. I plan on going "Pro" in the near future. On another note. From what I've seen and read your wholesaler should have all the particulars of the "deal" already worked out when they bring it to you. They should have already worked out what the ARV, comps, potential rents and all other key info pieces showing you why its a good deal. This should be presented to you in some sort of write up or info pack. If they are bringing you the deal but you have to do all the leg work yourself that doesn't sound like a solid wholesale partner. Doing your own due diligence is of course always recommended but they should at least have done some homework. I hope they turn out to be good deals for you and make you some money!!!!

Gorden Lopes · Answer

Hi @Einat Menashe

I usually rely on Rentometer to give me a rent estimate and I also look on Craigslist and Zillow rents to see how much houses in the neighborhoods are renting for.

As for establishing a relationship, once you have done a deal with a realtor I am sure you would have established enough trust and if you are really using a realtors help in a wholesaling deal then there are ways where the realtor can be compensated in the wholesaling deal. And once a realtor has a incentive to help you things will be much easier.

Hope that helps!

Einat Menashe · Answer

@Kiley N. great advice

Kiley N. · Answer

@Einat Menashe

Another route that may be helpful would be to check with your PM if you're OOS.  They would have a good handle on the real-time condition vs rents question.  They may also have contacts with trusted realtors and contractors who can offer added value to you.

Einat Menashe · Answer

@Lydia S. good advice!

Lydia S. · Answer

@Einat Menashe

You might find a Realtor willing to run numbers for you if you promise that when you find a seller who wants it listed on the market instead of wholesaled, you will pass it along to your Realtor.

Nicholas Salnicky · Answer

@Einat Menashe

Id say go to Zillow, click on the map then lot lines this will show you an estimate of all the homes surrounding it. And the yellow dots are what the homes in the area of sold for. I would take to compare homes with like homes.( tri- level with tri- level. Ranch with ranch. Etc)..... i would say to look at what homes have sold for not what they are listed at. And also know that Zillow isn't accurate to the tee. I would say its pretty close and can swing 10% either way.

Hope that helps.

Tanner Marsey · Answer

It’s called a BPO (brokers price opinion). People will do this for a flat fee. Generally used for people who want to know what their home is worth before selling. You might have to do some digging to find someone that will do it for you on a distressed property with an estimated ARV but I’m sure one is out there in your area. Easiest thing to do..... learn how to do it on your own via open houses and all the listing sites.

Einat Menashe · Answer

@John Morgan thank you for the advice

How to get an agent help with ARV + Rental price?

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