How Do You Compensate Your Acquisitions Manager / House Buyer?

Question

With more leads coming in I am considering taking on an assistant.  My first thought is to hire a buyer to train, assist with marketing, visit properties, and make offers.

If you have buyers on your team, how do you compensate them?  Commission only?  Base + commission?  Thanks for sharing!

Crystal Smith · Answer

Sounds like your business is going well & you're starting to systemize it.  We don't have "buyers".  We do have independent property finders,  photographers & virtual assistants.  Property finders get paid when deals close.  Photographers get paid per job.  Virtual assistants get paid per hour.

Steven Fiszer · Answer

Chris,

I have a conference call for the job of an acquisition rep. It is a 1099 job that pays around 2-5K a deal. I will let you know how the call goes tomorrow.

David Billings · Answer

Good advice from Jr. T and Karen Barber.  Thanks.  Hmmm, I hadn't thought about the idea of using an agent.  That bears some more though.  I know having an agent as an acquisitions manager adds some layers of complication.  The would need to disclose clearly every time that they were an agent.  I believe they would also have some additional fiduciary duties to the sellers, even if they were operating as contract negotiator in a private sale and not representing the seller or buyer as an agent.

Karen Barber · Answer

We had a in house acquisitions person at one of the companies I worked at. He followed the acquisition process, scheduling inspections, getting with the finance company to finance the deal (submit loan applications), make sure insurance was set up, worked with the title company.  This person was paid a salary & worked a typical 8 - 5 job in our office.

What worked best for us was hiring Real Estate Broker, they usually get a % off the HUD that is negotiable, if we gave them the lead they would not collect their fee from us.  This also enabled them to do contracts for us, they were able to also find additional leads through their MLS system on our behalf.  They were either paid on they HUD or we paid a Fee for services on a 1099 basis.

JR T. · Answer

You can get into a lot of trouble paying employees as 1099. If your worker is working tasks you assign under your supervision and control, they work a schedule, they work inside your offices, etc. they are your employee.

Small operators get away with this sort of thing for years. What usually brings it down is you'll have to let somebody go at some point and they will file for unemployment. They're not entitled to it because they're not your "employee." When they complain unemployment will start an investigation to determine if they met the definition of "contractor" or "employee." If they find you paid employees as contractors they'll involve state and federal taxing authorities and you'll wind up owing years of back withholdings for which both you personally and the business are liable.

Tread carefully.

Chris Bounds · Answer

@David Billings, not yet.  So far we've decided to hold on to the higher paid tasks and outsource some of the simpler tasks.  We outsourced bookkeeping a long time ago.  We recently outsourced blog writing for SEO.  We're still looking for motivated acquisition agents, but meanwhile we're developing our systems to minimize training time.

David Billings · Answer

Chris  Did you ever hire for that position.  My team's grown to the point where I've set a goal at add a purchasing manager to my team.   I have 3 VA's and a VA manager handling all of the initial calls from my marketing.  The also tend and screen all my leads until they qualify financially and show proper motivation to be a good candidate for one of my buying / exit strategies.  I have the right problem now that I have too many qualified leads to contact and follow up on considering my evening time with my family that's a top priority.  I'm wondering if you made the hire, how it's going if you did and if anyone else has advice from adding a purchasing manager to their team?

Crystal Smith · Answer

@Derek Walvoord we use VAs for administrative tasks.  Haven't found any yet that we'll allow to directly interact w/ leads, clients, partners....

Derek Walvoord · Answer

What do you use the virtual assistants for?  Phone screening, etc.?  It seems like that might be a really good way to stretch time and get more done.  I would love to hear a little more.

How Do You Compensate Your Acquisitions Manager / House Buyer?

Most Popular Reply