As a real estate investor, there are many things to accomplish in a day and not that many hours. To make the most efficient use of your time you may choose to leverage some of those “to do’s” to others on your team. As an investor, it is important to have quality members on your team from your lender all the way to your attorney and in between to your Realtor®.
When it's time to leverage someone else doing the searching for a property for you and the negotiations, consider these important qualities as you look for the right real estate agent.
- Choose someone with Experience in Real Estate Investing – Your average agent is used to working with buyers who are looking for the perfect forever home that they will live in for a long time. These agents are not familiar with the unique requests and needs of an investor; and they often do not speak the same lingo as the investor, which means they don’t know what the investor is truly looking to find. Ideally, you want to find an agent that has personal knowledge or experience in investing, whether it is through their own past investments, or experience managing, buying, and selling investments for clients, or they are currently investors.
- Experience dealing with Investors – If the agent you choose to hire does not have personal experience in investing, the next best thing is an agent who has worked for investors previously and may even have current investor clients. If they have a great track record with multiple investors, you want to work with them. Talk to other investors and see who they use. Word of mouth is the best way to find the right agent.
- Market Agility – There are lots of agents out there who you can work with, the key is to find one that can juggle all of your requests. Most agents work with a client and it is a one-and-done transaction. Investors may want to make multiple offers in a day, they may want to do offers each week and on different properties in different price ranges in different areas. This means you need a well-organized, detail-oriented agent that can juggle your requests with their current pipeline and deliver quality customer service. Ask any agent you are interviewing how quickly they can get an offer over on a property and how often they will be in touch with you as an investor. Be certain to set your expectations clearly.
- Service the Market You Want – Most agents focus on one area or city or even neighbourhood. Most investors don’t; they go where the deal is located. For that reason, you may want more than one agent on your team that works in different areas, or you may want to look for an agent that is willing to go all over the metropolis. One warning on the agent that goes anywhere, this may not mean they do their homework if they have not been to a specific area before they may just look at the numbers and tell you its a good deal but they may have missed the fact that the crime rate in that neighbourhood is through the roof or that the city approved a plan to put a new water tower in the field behind the home which now made the value of your investment drop. Be careful in getting the jack of all trades versus the specialist. There is a time and place for both. Interview the agent and ask the tough questions.
- Their Character – Most importantly you want an agent with high integrity, a code of ethics, and good character. Not only do you want them to be this way with you but you want them to do the same for the sellers of the properties you purchase as well as any prospective tenants they work with for your rental properties. Remember they represent you in this transaction, you want an ethical agent, not one who will be underhanded just to get the deal done.
Finally, be sure to ask all the tough questions upfront, lay the foundation for how the relationship should work and most of all be clear on what communications you want the agent to provide. Don’t assume they will tell you all the information about that property because most won’t. Most will just tell you what is on MLS. Do they know that neighbourhood, do they know the quality of tenants that you could get for that unit? Do they know what kind of end-buyer would be interested in this flip?
This is an investment of your time and money, make sure the agent on your team treats this opportunity with the utmost respect as if it was their own investment.