All Forum Posts by: Paul De Luca

@Diana Reinfeld

Not all agents provide equal value and service. Most of the value of a buyer's agent can be boiled down to the advice they give based on their experience, market knowledge, and network. Of course there are other things like integrity, responsiveness, customer service, asking the right questions, and administration (like scheduling showings) which are equally important and part of the job.

In my experience, most sellers are willing to pay a buyer agent commission if the net sales proceeds is acceptable. From a seller's perspective, I think the most important thing a buyer's agent does is connect them with a qualified buyer that can actually purchase on their home and close. Buyer agents are only paid on their performance and ability to do that.

An investor-friendly agent has a particularly unique skillset beyond a traditional primary home purchase/sale because they (should) help you identify good investment opportunities that make sense for you. That includes things like sourcing, underwriting, referrals for lenders/attorneys/inspectors/property management, advice on management, and more. So there is quite a lot more that goes into buying investment property that could make it worth your while to hire an agent.

For example, if you're inexperienced with analyzing/underwriting investment properties, you could easily overestimate/underestimate the income and expenses, which could lead to you either overlooking good potential properties or buying properties that don't offer a good return. 

If making a particular investment purchase could either help you earn thousands of dollars per year, or lead to you potentially losing thousands of dollars per year, do you think it's worth hiring a professional?

@Michele Richard

I recommend connecting with a few investor-friendly lenders to discuss your options. If you need a few referrals, let me know.

@Mi'al Rice

Welcome! I recommend checking out the BP books and free content here on the website when getting started. There's so much to learn, especially in the beginning, so I recommend being a sponge and absorbing as much as you can. But, be sure to take steps to apply what you've learned to get your first property (sooner is better than later).

 Agreed! On another note I have a unit listed for rent and when viewing applications we have to "conditionally approve" applicants before we can even look at their background check. It's ridiculous. Criminals aren't a protected class (yet).

@Eshe Harvey

I recommend focusing on one strategy when getting started. I think narrow and deep focus is better than wide and superficial.

@James Huff

House hacking in the suburbs can be tough if your goal is cash flow post move-out depending on the exact area due to higher taxes and city inspections (Berwyn, Cicero for example). A 3-4 unit in Aurora in Elgin could work but you'll likely need to do some sweat equity.

@Nathan Joy

Welcome! What's your strategy for getting your first investment property? I would start there and then connect with a lender & agent to talk about your plans.

What do you guys think about this? Current bill status can be found here.

@Ryan Cadwell

I think this depends on the ROI for you. Some investors like turnkey while others like to do value add.

Speaking from my own experience though, most investors I have worked with prefer something more turnkey. I think there's a larger buyer pool for properties that are ready to go. 

@Andrew Sangar

To address your second question about getting something cheaper or more expensive - there's always going to be tradeoffs so it's important you be honest about what makes sense for you. 

Benefits of cheaper properties - you can buy more of them. In theory, your yield could be higher.

Cons of cheaper properties - Likely to generate lower rents because the area is lower quality. This in turn will generally attract lower quality tenants who are more price sensitive or cost conscious. Lower quality tenants are less likely to maintain your property so that means you could end up spending a lot of money on repairs and turnover.

The pros and cons of comparably more expensive properties are the reverse of what I stated for cheaper properties.

Prices, taxes, and rents are good indicators of value but it's not a perfect correlation.