Working with real estate agents can be a challenge if the agent you've selected isn't aware of your needs in acquiring property. They're accustomed to selling at retail and any deviation from what they consider normal can jeopardize what could otherwise be a great working relationship. The good news is that you have the power to provide the education – if you're willing to take the time. Here's how you can do your part.
If you're trying to work with a real estate agent that has never seen – much less worked with – a real estate investor, the first thing you need to do is have a sit-down meeting to explain your goals, your investing strategy, and your needs.
But don't forget that your real estate agent also has needs.
The good news is that today's market conditions make this a good time to forge what could be a mutually satisfying long-term relationship. Unless you've been living under a rock you're pretty well aware that retail buyers have disappeared. Because of this – and low prices – real estate investors are on a buying spree. You can work together and turn incredible profits with the help of a real estate agent that “gets it”.
You may be an investor that typically avoids real estate agents whenever possible because you don't want to deal with real estate commissions. That's fine and dandy, but in some locations you may not have a choice.
More and more states are enacting rules designed to protect consumers from those who would take advantage of them. As a result, states like Oregon have passed laws requiring that real estate agents be involved in any deal that causes homeowner equity to be transferred to another party. Other states such as California could follow suit.
Instead of arguing the merits of the rules, accept them and move on. You can also use a real estate agent effectively as a negotiation tool when working short sales. If you're new to short sales or are working with a lender with whom you've never worked before, you may not be aware of the specific steps involved. In addition, some lender loss mitigation departments have their own rules, policies, and procedures. If you violate protocol your offer will be delayed – or rejected.
A real estate agent is a known commodity to the friendly banker. Banks work closely with real estate agents on traditional purchases, so there's an institutional bias that favors the real estate agent.
The bank is more likely to consider an offer that makes sense if it's presented by someone who speaks their language. Here's another thought to consider: If a good real estate agent can help grease the wheels and get your offer in front of a lender, you can get an answer more quickly, and potentially close more deals.
There can also be other perks to working with a real estate agent: research. Once you establish a solid working relationship, a real estate agent will be willing to share information with you that would take much longer for you to do yourself. Comps and other MLS data is available through a real estate agent; however, you don't want to abuse the relationship.
Solid relationships with a real estate agent will open doors for you that may have been securely closed in the past. It makes sense to build relationships that will further your goals, enhance your career, and add real value to your bottom line. A real estate agent can help you as much as you can help them with repeat business and providing the means to keep earning money despite the fact that the retail residential real estate market has almost completely dried up.