Finding The Right Realtor For Your Investing Business
By JD Esajian on July 14, 2014
Regardless of where you are in your real estate career, the right realtor can add value to your business. In addition to finding and submitting offers on deals, they can help you understand exactly the market you are buying in. Your realtor is one of, if not the, most important members in your investing team. Developing a relationship with them takes time, communication and a shared vision of exactly what you want out of each deal. A highly successful realtor may not be the best fit for you if they do not understand the investing business or how profits are made. Anyone can find a realtor to submit an offer, but working with the right realtor can help your business take off exponentially.
How can a realtor that closes two deals a month be more valuable to you than one that closes ten? The answer lies with what types of deals they are closing. If a realtor concentrates primarily on listings, they may be able to help find you a deal or two on the listing side. Depending on what stage you are in and how you have looked for deals, your realtor may be your go to source for leads. This means that you want to work with a realtor that has immediate access to the MLS, knows the market, has worked with distressed property sales and knows what to look for in an investment property. Sometimes the highest producing realtor in an office does not fit these criteria.
Working with those looking for a primary residence or an investment property are two completely different buyers. Primary residence buyers look for location and a finished product to live in for the next several years. Investors look to make a profit either in the long or short term. Your realtor should have a grasp on your goals and what types of properties you are looking for. If you don’t have this conversation before you start, you will end up largely wasting each other’s time. You don’t need to work with a realtor that has sold to several investors, but they should have at least a basic understanding of how to make offers on these properties and what the after repair value could be for a given neighborhood. You will be different to work with than a new married couple looking for their first home. As long as your realtor understands and accepts this, you will get off on the right foot.
If your prospective realtor is working with you just for a one time commission, they may be disappointed in the results. As an investor, depending on your market, you may entertain buying properties that will be on the low end spectrum. As commissioned employees, this does not excite even the best realtors. What the most successful realtors understand is that – to develop a relationship and hopefully years of transactions they will have to work with a few properties like this. They will work almost as hard on a property three or four times more expensive only to receive a fraction of the commission. If your realtor balks at showing you inexpensive properties or is less than enthusiastic about going into certain neighborhoods, you need to look elsewhere.
One of the hidden characteristics that often get overlooked in business is availability. In this day and age of technology, in almost every sector, there is really no excuse for not staying in communication. You can have a realtor that has access to properties and knows the business, but if you can’t reach them for a day or two it doesn’t do you much good. You don’t need to take advantage of your realtor and call them four times a day, but you should feel comfortable asking for comparables on properties you are considering making offers on and other real estate related tasks. A simple text, email or phone call is not asking for much at all. If you can’t get in contact with your realtor, you need to work with someone that values your business.
Another hidden trait for prospective realtors is the ability to make offers and close deals. An inexperienced investor may think that all a realtor does is simply send over a contract and wait for an answer. This may be the case if you are buying as your primary residence, but not for investment properties. Anyone that has worked on short sales or foreclosures knows that the amount of paperwork and the process that is required to get approved is tedious and can take weeks if not months. Even working with traditional sellers, an investor offer can be difficult to get an approval on without the proper documentation and items on the contract. Your realtor has to be an expert in getting your offers closed as quickly as possible and for the lowest possible amount. If you find yourself losing deals before you get them, you need to consider working with a realtor that can seal the deal.
There are plenty of good realtors in every part of the country. Finding one that is a good fit for you and your experience is critical to your success. If your current realtor isn’t a good fit, you need to move on. This isn’t always the easiest thing to do, but it needs to be done. Once you find a realtor that you can trust and you know has your best interests in mind, it will allow you to focus on other areas of the business. Finding a good realtor can help you close deals, but finding the right realtor can help you grow your business.