Real Estate Agents — Are They Valuable To Investors?
This is a discussion savored best as an observer. 🙂 Having been on just about every side there is in the industry, I can tell ya this. Put 10 agents in a room and you’ll get 11 answers to the question. Ditto with investors. Experience tells me that a reasonably worded survey given to investors on the subject wouldn’t look good for agents. Then again, ask a room full of agents about investors and you’ll discover what venting is all about. Thing is, when both sides’ complaints are objectively analyzed, they both make excellent points, and foolishly silly ones.
1. Investors, as a group, haven’t been impressed with agents. This is largely based on experience.
2. Agents pretty much think investors are perpetually high. This is also based on experience.
How to Invest in Real Estate While Working a Full-Time Job
Many investors think that they need to quit their job to get started in real estate. Not true! Many investors successfully build large portfolios over the years while enjoying the stability of their full-time job. If that’s something you are interested in, then this investor’s story of how he built a real estate business while keeping his 9-5 might be helpful.
Thing is, They’re Both Right, at Least Much of the Time.
The problem is shared. First off, mea culpa to my brothers ‘n sisters in the business. But most real estate agents couldn’t spell investment if you spotted them the ‘invest’. It’s for the best of reasons though. It’s not what they do, not anything close to either their training or experience. Yet some persist in learning a few quick formulas, some catch phrases, and convince others, if not themselves they know enough to be a part of the solution, not the problem. Much (most?) of the time they’re dealing with investors who’re merely a few chapters ahead of their agents in ‘the book’. This only exacerbates the problem. (Understatement of the year, maybe?)
Three Types of Real Estate Investors
I’ve learned, broadly speaking, there are three kinds of long term investors.
1. The beginner. They’ve read all the books and articles. Attended all the Real Estate Investing meetings. Made themselves spreadsheet blind. Maybe they’ve even been mentored by a solid veteran for awhile. They know every formula ever concocted since Moses’ son died. They know every single person who could possibly be involved in the acquisition of long term real estate investment property.
Except Mr. Murphy.
2. The veteran. Their experience includes lessons learned the hard way. They’ve been there, done that, and have the scars to prove it. Their success has been earned. They know what they’re doin’, and know when an agent is, shall we say, knowledge challenged. For many of these vets, real estate agents are to be seen and not heard. They’re only value is to do what they’re told, quickly, and without deviation. To the experienced investor, on their best days, most agents are merely a necessary evil.
3. The expert advisor based investor. They’ve found somebody they trust to advise them. It’s often a more experienced investor or a real estate agent. This investor could just as easily be a virgin investor as a grizzled veteran. It’s a personal preference, usually based upon their comfort zone.
#’s 2 and 3 differ mainly in approach. One’s a DIY type, while the other prefers to rely on expert advice. Or at least blend it into the mix. The fact that one doesn’t use an expert advisor and the other does, isn’t anywhere near a predictor of their ultimate track record. Frankly, the proof is in the pudding, right? I’ve met dozens of investors who’ve never used an advisor or at least not since their first investment. I’ve also met a ton of successful investors whose experience with ‘expert’ advisors has been dubious at best. Go figure.
Again — It’s Almost Always About Your Comfort Zone.
I’ll go out on a limb and confidently declare that all real estate investors wanna be as successful as possible. Whether they’re a rank beginner or the aforementioned grizzled vet, they’ve chosen their M.Os based upon what makes them most comfy. Some end up with an expert at some point, lookin’ to take their game up a notch or three. Some begin with one, and keep it that way. Others go their entire investment lives doin’ almost everything themselves.
In the end, what matters is their bottom line. Did it work out to their satisfaction?
Yes? Then they did it the ‘right’ way. ‘Nuff said.