Realtor Refuses to Initiate Purchase

BRRRR - Buy, Rehab, Rent, Refinance, Repeat

Realtor Refuses to Initiate Purchase

Investor · Atlanta, GA · Member since 2020 · 294 posts · 142 votes

I already know my realtor is not investor friendly...

I am using the BRRRR strategy to determine how much to offer on a property.

She pretty much told me she does not want to waste her time because “it is still a sellers market, no one is going to accept your offer.” keep in mind properties where built in the the 1950/60s and will need renovating. And offer is not off compared to other unrenovated properties(off compared to asking price).

Anyone had a similar experience?

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Nick C.

Investor · Tampa, FL · Member since 2011 · 2k+ posts · 3k+ votes

It's better to find out sooner rather than later. You just need to find one that's a better fit for what you're trying to do. Or better yet, get licensed and be your own realtor. Then you won't be depending on anyone else.

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Nick C.
Investor · Tampa, FL · Member since 2011 · 2k+ posts · 3k+ votes
6y
It's better to find out sooner rather than later. You just need to find one that's a better fit for what you're trying to do. Or better yet, get licensed and be your own realtor. Then you won't be depending on anyone else.
9 Reply
Evan Polaski
Cincinnati, OH · Member since 2020 · 4k+ posts · 3k+ votes
6y
Personally I have not had this experience. As your agent, she has a fiduciary duty to write up and submit your offer. And the seller's agent has a fiduciary duty to present it to the seller.
Have you signed anything with this agent? The cleanest way would be to remind her that she has as duty to submit all offers on your behalf. And use her for anything related to this house. Then find a new agent going forward.
If you fire her, whether you have signed any agency agreements with her or not, and have another agent submit an offer that is accepted for this property, your current agent may have some type of claim to the commission, since she first showed you the house.
6 Reply
Frank Wong
Real Estate Broker · Bay Area · Member since 2018 · 1k+ posts · 3k+ votes
6y
The realtor is just being honest with you. Some realtors will help you and will represent you but you need to be realistic of the current market.
Most important from a realtors perspective. Are you serious? Can you close? Do you have the funds to close in cash or have a lender that will close on these BRRR deals?
6 Reply
Adah N.
OP
Investor · Atlanta, GA · Member since 2020 · 294 posts · 142 votes
6y
@Frank Wong
Yes, yes and yes. I may still walk away if the contractor estimates make the numbers not work
1 Reply
Adah N.
OP
Investor · Atlanta, GA · Member since 2020 · 294 posts · 142 votes
6y
@Evan Polaski
She has yet to show these ones. She had in the past and to save time I suggested making a verbal offer to gauge motivation to sell before we go see. She just refuses to initiate contact.
0 Reply
Joseph CacciapagliaBusiness Member
Lender · San Antonio, TX · Member since 2020 · 1k+ posts · 1k+ votes
6y
Originally posted by @Adah N.:
@Frank Wong
Yes, yes and yes. I may still walk away if the contractor estimates make the numbers not work

A lot of agents don't like making low offers, because they don't believe it's a good use of their time. In this business it's important to protect your time, because a lot of wannabe investors will waste it, if you give them half a chance. Many agents can't tell the difference between a real investor and a wannabe investor, so they just make blanket rules about low ball offers. That works to protect their time, but isn't very helpful for investors.
I spend a lot of time making low offers for clients, but only when it's appropriate. I'll often let clients know I don't think it's a good use of our time to offer a certain number on a specific property. In a strong sellers' market like we're in today, I'm typically only making low offers on properties that have sat on the market for several weeks, or if I have some other indication that there is some price flexibility. If either of those situations exist for you, then you probably need to find another agent.
[email protected]979-218-2286
Joseph Cacciapaglia powered by Morty
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Adah N.
OP
Investor · Atlanta, GA · Member since 2020 · 294 posts · 142 votes
6y
@Joseph Cacciapaglia
Thanks Joseph, they have been 17, 44, 60, 120, 324 days. Plus some un-renovated properties sold for less(some more) than my offer in the past 0-4 months. So I did not think my offer is totally off
2 Reply
Evan Polaski
Cincinnati, OH · Member since 2020 · 4k+ posts · 3k+ votes
6y
@Adah N., another option. Call the listing agent yourself. The listing agent will be thrilled to get both sides of the commission, and may give you some insight into seller's motivation. In this instance it is like playing telephone in elementary school. You can remove a link and get a better picture of the seller going straight to their agent.
Joseph is correct. It is a fine balance. And she is helping protect your time too. Spending time driving around time to see properties that you know are drastically overpriced, and just hit the market, is a waste for you too.
But at the end of the day, she is your representative. If you feel she is not operating with your best interests in mind, find someone who will.
2 Reply
Joseph CacciapagliaBusiness Member
Lender · San Antonio, TX · Member since 2020 · 1k+ posts · 1k+ votes
6y
Originally posted by @Adah N.:
@Joseph Cacciapaglia
Thanks Joseph, they have been 17, 44, 60, 120, 324 days. Plus some un-renovated properties sold for less(some more) than my offer in the past 0-4 months. So I did not think my offer is totally off

It sounds like it's time for a new agent then.

[email protected]979-218-2286
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2 Reply
Wayne Brooks
Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
6y
@Evan Polaski An agent has no duty to write up an offer for you....they have the right to pick their method of going business and who to work with and who not to. Of course if they signed some kind of representation agreement with you, they should terminate it.
3 Reply
Derrick Dill
Investor · Hawaiian Gardens, CA · Member since 2015 · 308 posts · 386 votes
6y
Get a new realtor.
When I was putting in offers with my investor-minded realtor, I would go 20%+ below listed price OFTEN. If seller is serious, they would put in a counter-offer and our negotiations would start there. I've got some great deals this way. We never know what kind of situation sellers are in.
This agent doesn't want your business? Fine, there are several (here on BP even) who do want it.
2 Reply
Brian Van Pelt
Specialist · Owings Mills, MD · Member since 2017 · 485 posts · 415 votes
6y
@Evan Polaski

You are not correct. A real estate agent represents the Broker in a real estate transaction. The Broker represents the Buyer or Seller in a Buyers Agency Agreement, Listing Agreement or Contracted real estate transaction. A real estate agent is an Independent Contractor who in most states like Maryland are Licenced Salespeople NOT Realtors. A Realtor is a Salesperson who belongs to the National Board of Realtors

A licencee does not have a fiduciary responsibility to write a contract, The Broker does.

If a licencee refused to write an offer, the first thing to do, is to contact the Broker and discuss the situation with the Broker. The Broker will probably (if they are smart) assign a different licencee to the Buyer. A lot of times a Broker will be able to fit the right person to help with the Buyer needs.
I've written contracts for Buyers for 20 percent of list price. Sometimes a Buyer has to get rejected a few times before they take advice.
1 Reply
Lydia R.
Investor · Austin TX · Member since 2016 · 1k+ posts · 2k+ votes
6y
@Adah None Sounds like its time to fire that agent and get one that will actually help you find what you are looking for.
1 Reply
Steve Vaughan
Rental Property Investor · East Wenatchee, WA · Member since 2014 · 10k+ posts · 16k+ votes
6y
I probably wouldn't want to become known as a low-baller agent, especially if I honestly thought the probability of success was low. I'm not an agent, but we all have reputations to build and protect.

The answer to me is to submit your offer via a Letter of Intent directly to the LA via e-mail. If the seller likes terms you outline, then make a formal offer with a buyers agent if you feel you need to get one. I offer solo, allowing the cooperating brokers' side open to sweeten the deal for the LA or increase seller net. They work it out. Saying the buyers agent costs you nothing is horse sh*t.

LOIs are faster, more personable and can have multiple options. No need to have to submit a full PSA to test seller interest.
3 Reply
Jason JamesPro Member
Rental Property Investor · Hillsboro, OR · Member since 2018 · 117 posts · 64 votes
6y
@Adah N. Find an agent that is aligned with your goals. Obliviously this one is not, or they don't understand your strategy. You stated their not investor friendly which is a big red flag, if your goal is to BRRRR.
1 Reply
Adah N.
OP
Investor · Atlanta, GA · Member since 2020 · 294 posts · 142 votes
6y
@Jason James @Lydia T. @Derrick Dill thanks. Yes the plan was to use her for the first buy and move one to one that aligned with my goals.
0 Reply
Adah N.
OP
Investor · Atlanta, GA · Member since 2020 · 294 posts · 142 votes
6y
@Steve Vaughan thanks. I like the idea of initiating purchase via a LOI.
1 Reply
Joanne Eriaku
Realtor · NY · Member since 2020 · 167 posts · 169 votes
6y
@Adah N., is there a reason why you as an investor choose to be with a non-inevstor friendly agent? I think the team you choose to work with really matters, they can either help you or hurt you.
2 Reply
Natalie Schanne
Real Estate Agent · Princeton, NJ · Member since 2016 · 1k+ posts · 1k+ votes
6y
@Adah None - if you’re adamant about getting a good deal after seeing lots of houses, you can become an agent yourself (it will take about a month and $700) and then you’ll be able to pay yourself 1.5-2% of the gross sale price. Or if you are not good at estimating market value you could miss out on some negotiations and overpay. But all depends on your agents skills.
- one strategy is to offer at or a little less than list and try to get some significant repairs done before closing - new driveway, furnace whatever or a reduction in purchase price. Sometimes it works. Sometimes it doesn’t. You’re likely to walk away after spending $500 in this case.
- last strategy is to
- if you’re qualified to buy a home and serious and your agent isn’t showing you properties relatively quickly after you ask to see them, or calling to ask the listing agent if theres wiggle room on the price, you should terminate your buyer agency agreement. If any. Kind of sounds like she fired you first
2 Reply
Steve K.
Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes
6y
@Evan Polaski there is no fiduciary duty for an agent to submit lowball offers on behalf of a buyer. I think you may be getting this mixed up with the fiduciary duty for the listing agent to present all offers to the seller (unless the seller has specified that they don't want to see any offers below a certain amount). Personally I only submit blood-sucking offers if they can be justified (condition of the property, vacancies, comparables, DOM, property has been in and out of contract with previous buyers, buyer is willing to waive inspection or other contingencies, is making a cash offer, quick close or working with the sellers terms, offering something to entice the seller in exchange for the price discount). There's a saying "My price, your terms. Your terms, my price". Without reasoning, lowball offers usually just offend the seller and go nowhere, so it's a waste of people's time. A lot of new investors like to make offers based on how the numbers work for them, from some rule like the 1% rule or something in a book they read, or an online analysis tool, but if the market doesn't support that number there's a low probability of success using that approach. It's important to know the market and have relationships with local operators which is where an agents expertise comes in. A lot of times the people that spam lowball offers around are the same people that don't actually close on deals. As an agent if I think there's any chance of a low offer being entertained for whatever reason, I just jump on a phone call with the listing agent and assess the situation, then follow up with an LOI to show we're serious if it seems like there may be a path forward. I think it's dangerous for an unlicensed buyer to go directly to the listing agent, unless the buyer is very experienced in real estate, knows the contract and sales process inside and out, etc. The listing agent represents the seller and has no duty to protect the interests of the buyer. Many listing agents will take advantage of an inexperienced buyer and leave out important contingencies to protect them if they know they're inexperienced and not represented by an agent on their end. They usually already have a listing agreement that stipulates they keep the full 6-7% commission anyway if the buyer doesn't have an agent, so it's not always true that you can save 2-3% going directly to the listing agent. I would be careful with that approach as a beginner. If you're looking to make a lot of lowball offers, your best bet is probably to find a newer agent who is eager for experience and doesn't mind writing a bunch of offers with low probability of success. Be ready for a high rejection rate. But who knows, you might get lucky!
2 Reply
John Chung
Member since 2020 · 2 posts · 0 votes
6y
@Steve Vaughan
Great idea, is there example of letter of intent?
0 Reply
Steve Vaughan
Rental Property Investor · East Wenatchee, WA · Member since 2014 · 10k+ posts · 16k+ votes
6y
Originally posted by @John Chung:
@Steve Vaughan
Great idea, is there example of letter of intent?

Here's one I found in the BP Fileplace, but I haven't seen it or used it :

https://www.biggerpockets.com/...

1 Reply
Anthony H.
Rental Property Investor · Denham Springs, LA · Member since 2018 · 95 posts · 44 votes
6y
@Adah N. From a realtor point of view I understand the reasoning but as an investor myself I also know offers (low ball or not) buy properties. It is all about finding the right professional who will understand your needs and investment thinking. That realtor should be an added value to your team by sharing her/his knowledge of the market according to your input. In your case it seems like you are trying to make it work when obviously the chemistry is not there. Just move on to the next.
Another way to resolve this is to get your own real estate license and work for yourself.
1 Reply
Victor Ong
Developer · Los Angeles, CA · Member since 2020 · 90 posts · 50 votes
6y
Dont rely an agent to submit offers for you. If you already found the property and figured out the number, then find a platform like Redfin or Openlisting/Open Door to submit offer based on your terms and conditions. They even offer rebate on closing commission. Since you already performed your due diligence, the buying agent wont be able to provide much value to you other than writing an offer. They just need to execute on your behalf.
Properties are bought not sold these days. Real estate consumer experience have shifted dramatically from being force fed with info to actively looking for data on their own. Buyers are in more control of the acquisition process than ever.
3 Reply
Theresa HarrisPro Member
Member since 2019 · 15k+ posts · 11k+ votes
6y
Another vote to find another agent. Look for one that works with investors.
1 Reply

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