In order to be successful in real estate investing, you will need to work with others – specifically people who know this business or can help you build yours. People who can help direct you to buyers for your properties or provide financial assistance or even teach you proven investing buying and selling strategies.
As a real estate investor, you should learn to leverage your time by carefully selecting qualified people to work with on your real estate deals or to help you maintain your investments. A key person that should be on your “Power Team” is a real estate agent or realtor.
Finding The Right Real Estate Agent
A good working relationship with an investor friendly real estate agent is one of the most important assets an investor can have. For one, when a property you are interested in purchasing is listed with a Realtor, you may want to have your own agent working with you to represent your best interests in the deal.
Secondly, investor friendly real estate agents and Realtors can help you evaluate deals by pulling up sold properties comparable to the one you are thinking of buying. They will hand you a CMA (comparative market analysis report) that will give you a good idea of the market value for that neighborhood or type of house.
Thirdly, Realtors have access to the Multiple Listing Service (MLS), a valuable source for finding potential real estate deals and listing your own future deals for sale. Another great benefit of them having MLS access, is that it can give you a real time snapshot of what current prices and rents are being sought after in the market place by other consumers and real estate investors.
The properties on the MLS will usually include pictures and a good deal of information about the property, including the address of the property, the number of bedrooms and baths, the square footage, and other amenities/features. The MLS may also include any special terms the seller may consider.
There are two remarks sections of an MLS listing. One remark section that the public can see on the MLS listing and another that can only be viewed by real estate agents. The remark section of the listing will contain clues about the condition of the property and the motivation of the seller that will be important for your real estate offer. Working with an investing friendly real estate has so many benefits.
Choosing a Realtor
When choosing an investor friendly real estate agent or a Realtor that works with investors, ideally you would want an agent who is creative, hard working, aggressive and an agent who knows how and where to find deals.
Most real estate agents have limited experience with investors. They have never done a creative investing real estate transaction. This can be a challenge for an investor and it can take some time to find the right real estate agent, but the time you spend looking for investor friendly realtors will be well worth it.
One thing to note, most real estate agents are not receptive to “unusual” offers. They may not believe in the “nothing down” offers or creative approaches. If you plan to make a creative offer on a real estate deal and you are working with a real estate agent who doesn’t think “outside the box”- insist on being the one to present the offer because you want the owner to hear the benefits of your offer (as well as build trust). Believing in those benefits will be key to making a convincing presentation.
Let the Realtor know you are looking for distressed properties that need repair. Do not let the real estate agent pre-qualify you. Let them know that you use private funding, are already preapproved by your own bank/lender and can close quickly.
Finding Investor Friendly Real Estate Agents
It’s recommended that you find a real estate agent who works in your target area when you are just getting started in real estate investing. That’s simple, while driving through your target investing area, look for realtor signs, and pick the three real estate companies or agents with the most signs. As you do this, you may notice an agent dominating the area. Real estate agents usually “farm” an area just like investors, meaning that they focus on a particular area and work it to get listings. They do this by actively contacting the owners through phone calls, mailing promotional material, and knocking on doors of nearby listings to build a rapport.
At this point just give them a call. Here is an example of a good introduction of a real estate investor to a Realtor:
“Hello my name is _____________. I’ve noticed all of your listings in the __________area. I am in a position to do some investing in real estate. I am looking to buy properties in your area and I want to see if we can develop a relationship.
Would it be easier for you if I gave you my basic criteria likes properties that are income properties or cosmetically distressed fixer-uppers, nothing major like structural or plumbing, single family, 2 -4 multi-units, 20 – 30% below market value and you arrange to send me out a daily or weekly email with listings that match?”
There are many real estate agents who advertise online as “investor friendly realtors” and they at times specialize in income properties like duplexes and understand how to work with properties that are in need of cosmetic repairs. Lastly, ask for referrals from other investors in your REIA or local real estate clubs for real estate agent with experience working with investors.
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