Real Estate Agents
Your real estate agent is your window to the market. They are your eyes and ears and can have a great impact on your success. As a result, finding the right agent is a must. Any agent can find you a property, but it takes an experienced and dedicated agent to find exactly what you’re looking for. While this may be a challenge, it’s definitely well worth your time and effort.
A Problem Among Them
Due to rather low barriers to entry, you’ll find a vast range of differences among real estate agents. While some may have years of experience and a plethora of investment knowledge, others may have zero investment knowledge and be completely new to the game. You’ll find some who only work part-time, and some who don’t work at all…Because of the wide differences among agents, it’s important to understand your agent’s mindset, experience and work ethic.
Finding Your Agent
While you can walk into any old real estate office and pick the first one you see, this is probably not the best option. So where do you find a good agent? Start by asking around. Find out who other investors have used and what their opinion is of those individuals. You can learn a lot from other’s experiences. Whether this is who to use, or who not to use…it’s all valuable information.
Another effective way to find an agent is through professional recommendations. Lenders, accountants, developers etc…will most likely have working relationships with real estate agents. Use these individuals as a resource. Tell them what you’re looking for and they just might have your guy/gal.
Aside from referrals from investors and professionals, you’ll find real estate agents in publications, paid advertisements, real estate offices, open houses etc…. Finding an agent from one of these may take a little more initiative on your part. Make sure to ask questions and test their investing knowledge. Ask how long they’ve been in the business and if they have any investments of their own. This should get you started down the right path.
Communicating Your Goals
When working with a real estate agent, it’s important to communicate exactly what you are looking for. As mentioned previously, your agent is your eyes and ears to the market. They will know when new listings come online, and often have access to information prior to it hitting the market. As a result, they must understand exactly what you want.
A real estate agent’s compensation is not a place to try to save money. Many buyers try to negotiate lower commissions with their real estate agents. While this may be beneficial in the short-term, it’ll work against you in the long-term. Agents make their living from commissions, and like most individuals are motivated by money. Negotiating a lower commission puts you at the bottom of the list. If an agent is working with 4 investors and you’re paying the lowest commission, you’re likelihood of getting first or even second pick is slim to none. So, while it’s advantageous to minimize costs and maximize revenue, this must not be done in a way that negatively affects your chances of finding a great investment property.