Working with realtors and the house hunt

23 Replies

Question for you experienced rehabbers out there that work with realtors... I found a couple of realtors that look promising, but am worried that looking at such a large amount of houses won't be cool. I read about the "100 house" thing in J. Scott's book, and I want to look at as many as possible, but won't a realtor get pretty angry if you're dragging them to look at tons of properties and having them write up multiple low offers for home after home until one is accepted.... I mean they work on commission, I don't think I'd like that if I was a realtor... I think I'm going to just get my license eventually, but must work with a realtor for my first couple of deals.

So is there a workaround for this? I plan to drive my farm area once I move, get a feel for things, but aside from stalking houses alone and not getting to see much of the inside, how do those of you who work with realtors deal with this? I know it must be an issue...

I thought about contacting listing agents directly for some properties, but then I learned I'd run into a legal catch-22 where the listing agent would expect to represent me, etc... 

Thoughts? 

If your looking to see 100 houses per purchase & sending in many low ball offers I would recommend getting a license. Most Realtors would not be willing to work with you.

(myself included)

This is not too say your plan is a bad one, it is just a very ineffective use of the Realtors time so anyone with a decent book of business would not be interested.

You may be able to find some new Realtors hard up for business but you should be very honest and up front about your intentions, it is the right thing to do.

Totally, I agree. That's why I don't intend to put any realtor through that and felt hesitant when I read about it. Just trying to figure out what rehabbers did when they were looking for their first deal, if they scouted properties themselves before contacting a realtor, or had any other suggestions.

I want to work with a realtor only when I have a small realistic set of houses to view.

You can have a Realtor put you on an auto feed from the MLS.

You choose the criteria

  • Zip codes
  • Sq footage
  • # of baths
  • # of Beds
  • Price range
  • REO/Short sale/Owner owned etc.

Then every property that fits your criteria is automatically sent to you. From there I would do external views, you can tell a lot just from the outside of a house.

That will greatly narrow down the possibilities.

If I were you I would find out who the wholesalers are in your area and also go to several REI meet up as possible. Let people know that you're looking. Seek out someone that has been doing it awhile and see if you could pay him to look at a property if you found one.

In the meantime I would seek out my team. So when i found one i can start immediately. 

@Sarah T.  

If you find an agent that is used to working with investors, it may not be as big a deal as you think. (Local REI meetings are great for finding them) Most are used to it.

One method you could employ is to look online for anything you may be interested in or have your realtor send you every listing in your area with phrases such as "handyman special, fixer upper, tlc needed," etc. If any of them look promising, submit an offer low enough that you couldn't possibly lose money. Maybe not lowball, but low enough for serious wiggle room. Investors realtors are used to submitting lots of offers and with a digital signature you wont have to meet up for every one of them. Most offers, even if they are low ball won't be ignored and will at least be countered. Find the counters that look like they are willing to negotiate and then schedule to see the property, possibly with your contractor if you have one, so that they can give you a bid on what renovations will actually cost you.  

Originally posted by @Jeff West:

@Sarah T. 

If you find an agent that is used to working with investors, it may not be as big a deal as you think. (Local REI meetings are great for finding them) Most are used to it.

One method you could employ is to look online for anything you may be interested in or have your realtor send you every listing in your area with phrases such as "handyman special, fixer upper, tlc needed," etc. If any of them look promising, submit an offer low enough that you couldn't possibly lose money. Maybe not lowball, but low enough for serious wiggle room. Investors realtors are used to submitting lots of offers and with a digital signature you wont have to meet up for every one of them. Most offers, even if they are low ball won't be ignored and will at least be countered. Find the counters that look like they are willing to negotiate and then schedule to see the property, possibly with your contractor if you have one, so that they can give you a bid on what renovations will actually cost you.  

 Thank you @Jeff West! That make me feel a lot better about it!

@James Wise  Great input, I use a similar strategy.

I set up new investor clients with my standard MLS auto emails for different MLS lists (SF 3/2's, investor listings, MF, condo.). If they ask for me for a different set of search criteria, I set that up as a personal feed. I also set them up on a listingbook portal account that allows them to search the MLS at their leisure.

If they inquire about a specific property, we run a quick comp and see if it fits either exit strategy for flip or B&H.  

So, what y'all are in essence saying is that once I find a realtor, I can go ahead and get a feed based on my specific criteria NOW and also possibly gain access through a client portal to search the MLS myself?

I will be buying once our house here is sold, so I'm looking at 5 months max before I have cash in hand to buy my first rehab. Is five months too long to have access to the MLS as a client of a realtor?

Or should I wait until closer to the date to ask for this? I'd like as long as possible to analyze deals.. 

Originally posted by @Sarah T. :

So, what y'all are in essence saying is that once I find a realtor, I can go ahead and get a feed based on my specific criteria NOW and also possibly gain access through a client portal to search the MLS myself?

I will be buying once our house here is sold, so I'm looking at 5 months max before I have cash in hand to buy my first rehab. Is five months too long to have access to the MLS as a client of a realtor?

Or should I wait until closer to the date to ask for this? I'd like as long as possible to analyze deals.. 

Get the feed now. I put clients on the feed and never take them off. They are automatically deleted if they do not log in at least once every 60 days. As long as they log in once every 60 days they can be on it forever.

By being on the feed you are getting the most up to date information about your specific criteria so your able to see the direction your market is taking over these 5 months.

@Sarah T.  

Absolutely get on the feed now, and study the market, especially sales in the areas of interest. Sounds like you want to rehab, so figure out where the numbers make sense for that strategy, and track everything in your farm areas closely. Every MLS platform is different, but a good investor friendly realtor can provide data to help you. I just generated a map for a new out of town investor who asked me to generate a map of all cash purchases in Jacksonville since 12/1/14 so he could see where the investors are buying. Not all realtors are investor oriented, so spend some time finding the right person.

One more thing.  Be loyal to them if they serve you well.  Make it mutually beneficial and list all your rehabs with them.  Build a relationship.

This is an interesting topic and I really hope that Sarah you have good luck finding a realtor to work with. I have not had any luck with that and also me looking at several properties and being actually client that you have to work for was not something the realtors wanted.

I am pretty new to real estate in US and for past 12 months have worked with 6 different realtors just to find that really the only benefit that they brought to the table was the legal documents and confidence that there is a shared liability through realtor looking at the deal.

Maybe it is that I just have not found good investment or due diligence oriented realtors here in Portland, OR, but I felt like none of the ones I worked with had an idea about bargaining or how to form an offer based on predicted remodeling/fixing or income generation or even market conditions. Also none of them found me properties that I would not have already seen on other sites and the realtors were not capable of asking real property related questions. At the end I had to do all the work except the papers. 

The main thing that I also learned is that all the parties in this region seem to be making gut feeling decisions instead of looking at the numbers and expect totally out of larger market context appreciation on their properties without doing any work on it. 

Obviously this experience helped me to understand why people struggle here all the time with identifying high volatility and fluctuation on prices. 

I think the advice to get early on to the realtor feed and finding a investor oriented realtor is good one. And also I am happy to hear if any of you here know actually realtors who understand about investment properties or property negotiations in Portland Oregon.

If you save a search on Realtor.com it will feed you updates.  I like houses in masterplanned communities where the elementary and middle school are within walking or biking distance...and the schools are at least above average.  Realtor.com lets you search school ratings as well as search by school.  In big cities just a high  school boundary line can be huge.

Once you narrow it down you wont be looking at 100 houses because the pickings are slim.

Wow!! Thank you everyone for the thoughtful responses! Goodness this thread alone helped me formulate a great strategy for getting started.

I'm an OCD personality so I've been combing da

My post cut off, sorry. Was going to say I've been combing data for months using all those sites, Zillow, Realtor, Trulia... I know the MLS is the obvious first choice which is why I"m so pumped I can get a feed when I hook up with a realtor.

When I move I want to get a huge wall-sized map for my office area so I can get really crazy with it and learn the city inside and out.

@Miska Paulorinne  

You are correct, most residential realtors are not interested in spending time with investors, nor do they generally have the knowledge.  It's a rare residential realtor that understands investment property.  One of my motivations to get my license was because I felt like I wasn't getting the service or "expertise" that you should expect.

However, I am also very selective in who I take on as a buyer client. I don't typically take on new investors unless they have cash and will do multiple purchases. I'll work my tail off for you and bring you pocket listings and off market deals. I provide CMA's, cash flow analysis including pre-tax and post-tax, exit strategies, rehab estimates, and market studies even. But I have a commercial real estate, construction and land development background, and just happen to be active in SF investment properties.

There are good ones out there, though, so keep looking.

As was mentioned, get on the MLS feed from your broker and do a drive by on anything that looks promising. If it is empty, peak in any windows and get a feel for things. You can rule out a lot of houses this way without even going in. Then call your broker up and give them a list of what you would like to see and be flexible about working around their other scheduled activities. My broker is pretty easy to work with because she doesn't do huge volumes of business and I have no problem working around her other showings and closings. Her and her father invest in similar things so she knows what we are looking for. I also am loyal to her and direct my parents to her for things to. We are buying low priced properties so commissions are low but as she says it pays the light bill and the secretary's time. She is encouraging me to finish my license and hang it with here so I can go the grunt work myself. She probably also plans to send the other low commission pain in the rear investors to me as payback. ;)

@Miska Paulorinne   One suggestion I would make is for you to attend either the NWREIA meetings and/or the RareBird meetings. There you will find Realtor's, myself included, who are real estate investors as well as real estate agents. Also, the members of these organizations are very experienced and knowledgeable, and they freely impart their knowledge to the newer investors.

That said, there are a lot of investors in the Greater Portland Metro Area and they're all looking for the same properties as you on the MLS (a lot of competition for the good properties, of which there are that many). But, the more successful investors find the majority of their properties through marketing directly to homeowners and not on the MLS. This means getting out there in your car and driving your farms looking for distressed and vacant properties. Once you find something that looks promising, contact either your Realtor or title rep to get additional info on the home, such as the name and address of the owner. I, as a Realtor, can run a trio for any property.

I used a close friend and did feel a little bad making, in total, probably about 30 fairly low offers. But she seemed to not be bothered at all. 

I strongly echo the sentiment that you should find a realtor well-versed in the investor side of real estate. 

One approach you might try is having your realtor start out with "I have an investor interested in your property, how much can you lower your price?".  That should give some indication of how flexible they are without having to send out a bunch of low-ball offers.

You might not get a lot of responses initially, but with houses on the market a while they probably have some amount planned for a follow-up reduction.

Originally posted by @Randy Johnston :

@Miska Paulorinne   One suggestion I would make is for you to attend either the NWREIA meetings and/or the RareBird meetings. There you will find Realtor's, myself included, who are real estate investors as well as real estate agents. Also, the members of these organizations are very experienced and knowledgeable, and they freely impart their knowledge to the newer investors.

That said, there are a lot of investors in the Greater Portland Metro Area and they're all looking for the same properties as you on the MLS (a lot of competition for the good properties, of which there are that many). But, the more successful investors find the majority of their properties through marketing directly to homeowners and not on the MLS. This means getting out there in your car and driving your farms looking for distressed and vacant properties. Once you find something that looks promising, contact either your Realtor or title rep to get additional info on the home, such as the name and address of the owner. I, as a Realtor, can run a trio for any property.

Thanks for the suggestion. I'm looking for my next residential investment property on Vancouver's west side. I'll look for you if I get to one of those meetings.

I've been scouring the neighborhoods where I want to invest. Even had a guy who hand delivers the neighborhood newsletter door-to-door give me a call when he notices vacant properties. The challenge here is almost all of the distressed and vacant properties are bank owned and in the auction pipeline... online auctions or courthouse steps. Going head-to-head at auction is something that is not in my skill set and I don't have a passion for learning the auction dance. Also, we are buy and hold investors, slowly acquiring our properties.

The houses, in the meantime, are deteriorating and/or getting vandalized during the wait for their number to come up... a few I've been watching for more than 4 years now.  I hate it when banks hold onto foreclosed properties and let good assets rot, especially when there are real estate investors eager to rehab the properties, improve the neighborhood and serve a community housing need.

I've had most success with off market properties. The ones on the MLS often are not available for what a prudent investor would consider a deal. End users are buying them and driving up the comps. Equally frustrating are the properties that get listed, and when you inquire, the listing agents are not calling back and when they do (3- 6 days later), say "Oh, the owner decided not to sell - no longer on the market." What gives?

To everyone who suggested finding a realtor and setting up an automated feed from the MLS - Done and Done!!

Spent a few hours combing agent profiles online, found some with investment backgrounds themselves, reached out to a couple, hooked up with one. He currently does buy and hold and has also flipped homes in the past.

He set up an automated feed for me and also grabbed a couple of current listings. I am going into this so much better prepared now! 

Thanks for the help all!!

@Marcia Maynard  I 100% agree with you about bank owned properties. If the banks were at all interested in community building, they would work with investors to move these properties and get them fixed and sold to someone who wants a home that they can take care of themselves.

As for distressed properties found on the MLS . . . there are plenty of people looking to buy them, fix them up and live in them, they feel that otherwise, they may not be able to afford a home.

@Sarah T.  Congratulations on finding a Realtor with whom you can work, I personally feel that it's important to get a Realtor who knows the area and can help you through the plethora of paperwork and disclosures, which seems to change almost yearly. :-)

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