Working With A Realtor....I'm Confused

20 Replies

Hello BP!

We are still quite new to RE Investing. We are getting started with Wholesaling and working with FSBO homes.

My question is "How do we get accurate comparables if no realtor is involved?"

I don't see any incentive for a realtor to run multiple CMA's for us on a weekly basis, if we are not using them to buy the properties because we are working directly with the homeowners and our cash buyers.

I'm sure I'm missing a step or perhaps I misunderstood some aspect of running the numbers.

I was under the impression (from our training) that Realtors would have no problem running comparable if we just ask them...but I just don't see why they would spend their time running comparables if they aren't getting compensated.

So I'm hoping some investor friendly realtors (preferably in Topeka or Kansas City) can help clarify and answer this question for me.  Thanks in advance!

Valorie

@Valorie Lewis

I'm not a realtor, but I believe that if you don't plan to provide any compensation to them from either using them to buy or to sell, then you should not be asking them to do that. If you were flipping and they had the expectation of at least getting the resale listing, then you could ask them to do it. But if you're not, then don't expect it. You need to be able to pull comps yourself from various sources, like Zillow, Redfin, and your county's records. I'm sure there are forum posts about this topic on Bigger Pockets and probably a podcast about it. But this podcast is also very helpful from another site: https://spousesflippinghouses.com/episode-33-findi...

Good luck!

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Originally posted by @Valorie Lewis :

I was under the impression (from our training) that Realtors would have no problem running comparable if we just ask them...but I just don't see why they would spend their time running comparables if they aren't getting compensated.

I think you are right. So if you want a Realtor to run comps for you, then pay them. 

Hi @Valorie Lewis ,

You have to find the right one and you have to have something to offer. One things agents love is motivated leads. For example you find a homeowner in your travels that wants to sell pretty much retail. They are in no way going down to 60% ARV. The house is worth 100K and they want to sell it for 100K. Your buyers list isn't going to even look at it. So what do you do? Walk away head down? Keep beating on it until they kick you out and put a restraining order on you? Nope you say the following to them.

"It's not something my buyers list would be interested in, but let me give your name to an agent friend of mine who deals with properties in this condition. He/She is great at marketing properties on the retail market and I think your property would be perfect for them to take a look at"

Then you call me up and guess who just earned some free CMA's! Now we start our relationship. Will I ever be devoting hours and hours of time? Not unless you are feeding my whole business but me taking some time weekly to run a list for a lead generator, sure that's a no brainer in my opinion.

Keep in mind though it will take the right agent, not everyone will work with a wholesaler, some consider them competition. Some won't even talk to you. 

Good Luck in your investing

Yes, I'm starting to think there was a disconnect or a misunderstanding on my part of the training we received. I thought we could focus on only doing deals on FSBO's, but then the question arose on how would we get accurate comps if no Realtor was involved.

I wanted to double check with the fine people of BP to see if perhaps there was some aspect I was unaware of, where Realtors are just lining up to do free work for wholesalers without any compensation. LOL.

Thanks for the comments. Any additional advice or recommendations are appreciated!

@Mike Cumbie That's GREAT advice! Thank you so much. Yes, I can see how establishing a relationship beforehand would definitely make a Realtor want to occasional run comps for me on FSBOs.

@Chris Eaker Thanks! I'm listening to the recording now.

Valorie,

Mike Cumbie summed up what I would have suggested.  I will ad that you should talk to multiple agents first to see who is even receptive to the reciprocation with you.  When you get the motivated seller that is will not accept your offer, ask them for permission to give your contact info to the realtor. In my experience if you give the realtor's contact info to the seller they will not call them.  

I also recommend looking and studying comparable sales on Zillow (NOT Zestimate).  Topeka is slow for appreciation or depreciation so you could use "sold in the last 12 months". Some realtors will post the actual sold price. The problem using zillow is unless the write up and photos are present, you cannot know what condition was. 

I don't believe you can throw enough money making leads to a realtor that they actually compensate for running all of your comps.  They will get bored with you if they feel it becomes an uneven relationship.  Using a combination of zillow and the county website to see the price a property sold for can give you a good general idea.  When you get the properties you just are not sure of then you could ask your realtor.  

Good Luck!

The best way to get accurate comparables is the MLS, which you have to be an agent to get access to (but is something worth considering). You can, however, also use sites like Zillow, you just need to make sure you're comparing like to like (in terms of size, beds/baths, age and date sold. And don't use the Zestimate!

@Valorie Lewis , have you considered getting your RE license in KS and simply working as an independent contractor for a broker? You would have MLS fees, etc... but it would give you the access you are looking for.

Where we have been investing Sedgwick county has resent sales that you can pull right up on the county website, the problem is there is no way to search for bedrooms or size. So use a online site like zillow or realtor . com to find the comps then go look at the county site for what they sold for.

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@JD Martin @Brent Coombs   I always knew when the Guru's had come through PDX.

my agents would come running to me about this big time investor that was going to buy 5 props a month.

I would tell them to invite them to lunch ( my treat)  I did this to size them up.. 99%  No Money no skills and just looking to abuse my poor agents.. did I feel bad when I flushed them out and put them in their place at lunch ... NA not one bit I was buying   LOL..

Originally posted by @Jay Hinrichs :

@Jd Martin @Brent Coombs   I always knew when the Guru's had come through PDX.

my agents would come running to me about this big time investor that was going to buy 5 props a month.

I would tell them to invite them to lunch ( my treat)  I did this to size them up.. 99%  No Money no skills and just looking to abuse my poor agents.. did I feel bad when I flushed them out and put them in their place at lunch ... NA not one bit I was buying   LOL..

 LOL. You should have made them pay for lunch as well ;)

You can hire an agent to do what you want and pay them for your time . . . however a good agent that would be worth paying is way to busy to get paid hourly to run comps for you.

Yes all the online sites are ok to a point, but by no means as accurate as the local MLS.

I advise all investors that they either need to be a licensed agent so they have their own access or someone on the team need to be licensed.  For many years I was the Realtor of our team, then my husband got his license and the son joined us and got his - we are all licensed now and it works well.

Hi Valorie, If you've got family in Topeka check to see if anyone in your family is an agent. Check your church family to see if their are any agents. Check you pool of close friends to see if there are any agents or if they have someone in their family as agents. Between all of these circles, one of them has an agent. While you are looking within that circle you are informing everyone that you are a real estate investor which increases your chances of getting deals. But back to the agent. Once you locate which circle the agent is in get the friend or relative in that circle to introduce you. Don't ask for comps, tell them this; "I am a real estate investor and I am building my team to grow my business and one of the most important members needed for this team is a real estate agent. I am looking for an agent that is willing to work with me some time in the future once my business is established to run comps for me. I am not ready yet but I would love to stay in contact so that when that time comes I can bring you some solid leads for your business as well". Conversation started.    

Everyone is pretty right on. My own personal opinion is that a realtor needs to be on the team, wether that's you or your partner, or someone with whom you have built a relationship and who has an expectation of getting paid through multiple deals. Barring that, you have to use the sites that are best suited to your market. In some markets Zillow is pretty good, if you have Redfin you're golden.

I have a seperate question for this thread: My mother has her real estate license. What does she need to do to gain access to the MLS? Does she need to put her license under a broker? I was considering this as one way of doing my own comps instead of bothering other realtors. I also have family members and other people I've met through networking who are realtors.

Hi @Jamal Wilson ,

I can't speak to California for sure, however I am fairly certain it is pretty close to what we do in NY. Once she gets her license she has to put it under a broker. Those all very based on how much they take, some can be 95% to her and 5% to them. 

In order to get access to the MLS though, she needs to become a REALTOR®. While the license itself can only be a couple hundred dollars (I could show you how to get licensed in NY for $190) , the dues for the local REALTOR® board can run from 1K to 2K a year. That gives you different ethics and access to the MLS.

Hope it helps some and good luck with your investing

If you are nice with a title company rep they may give you free access to title company website. It generally has easy to access comparables. Plus you can pull some deeds as there sometimes is a mystery to untangle about exact ownership.