Does your Realtor® understand ARV? If you’re working with Realtors® as an investor, he or she should be able to intelligently discuss After Repair Value (ARV) with you. Unfortunately, most Realtors® aren’t fluent in the language of investors. They’re fluent in calculating down payments and pointing out the shiny stainless steel appliances in the kitchen – the language of white picket fence buyers.
An investor savvy Realtor® won’t be asking how many children you have and if you want a backyard swimming pool. Instead, he or she is asking what your investment strategy is? Is it fix to flip or long term rentals? Are you looking for distressed properties or turnkey rentals with a qualified tenant in place? Do you want to hear about every property that comes on the market or is it the agent’s responsibility to screen for only the best opportunities?
How to Find the Right Realtor® When Working with Realtors® as an Investor
Realtors® interested in investment properties hang out at the same places as investors do. These aren’t the open houses showcasing the most polished house in a neighborhood. However, it can be worth your time checking out Realtors® that specialize in the types of houses and neighborhoods you invest in. Drive through these neighborhoods looking for “For Sale” signs. Also call on listings in marketing brochures. But remember they need to speak your investor lingo.
Just because an agent is the office “Rock Star” doesn’t make him/her a good Realtor®` for investors. Working with Realtors® as an investor still means they understand phrases like “hurdle rate”, “cap rate”, “rate of return”, and “income vs. capital gains”. You can check out some Realtors® by making telephone calls or sending out emails asking the right questions.
A better avenue to finding a Realtor® knowledgeable in working with investors is one of the thousands of real estate investor groups across the country. Most of these groups welcome real estate professionals as members. Realtors® join these groups because they want to work with investors. Even if he or she is new to the group and not yet up to speed, you know you are working with someone interested in the investment world. You can find local groups on websites such as REIclub.com and NationalREIA.com or by simply doing a Google search for real estate investing groups in your city.
How to Best Work with Realtors® as an Investor
One way you benefit by working with Realtors® as an investor is having them keep you current on market trends. You probably have your own secret formula for rehabbing houses that sell fast and for top dollar. But the market is always changing. Today’s megatrend is driven by the Millennials that now dominate the market. Are you fully up to speed on their needs and wants?
Where are the best rental opportunities? Which neighborhoods are ‘hot’ right now for sales? Where are new jobs being created or new schools being built? This is information Realtors® are often more tuned into than investors are.
However, it’s a two way street. The more he/she knows about your objectives, the more useful a Realtor® can be in tailoring your efforts to help achieve them. Once they master bringing you the best deals, he/she needs to specialize in is closing the deal tomorrow.
When you have a shortlist of Realtors® wanting to work with you, the next step is having a face-to-face conversation. You need to be clear about what it means to be working with a Realtor® as an investor. You need to be clear about your investing strategy. You need to let him or her know your price range, your neighborhoods, and what your exist strategy is. You need to let them know if you expect to be shown the interior of every potential house or if the Realtor® only needs to forward you prospective houses and you’ll drive by to view the outside but only ask for access to the interiors when you are truly thinking about making the purchase.
Ultimately, working with a Realtor® as an investor often works best when he/she is an investor them self. There is a possible conflict of interest here because the Realtor® might scoop up investments that you would have been interested in. However, there are usually more than enough to go around. Another work around to this issue is having more than one Realtor® working with you. You shouldn’t have any trouble finding as many investment grade properties as you want.
What you need to do now is TAKE ACTION!
By Wendy Patton
For more than 30 years, I’ve used the Sandwich Lease Option System to earn myself and my students millions of dollars. From my experience, I know there is plenty of room and opportunity in the real estate investment market for everyone wanting to participate to find profitable deals. It’s because of that fact and my personal success that I share the Sandwich Lease Option System with others.
If you found this information useful, please visit again soon at wendypatton.com.
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