How to Find an Investor Friendly Real Estate Agent

How to Find an Investor Friendly Real Estate Agent

Hi, it’s Mark Ferguson with Invest Four
More. I’d like to thank you for watching another educational video. Today I want to
talk about what exactly an investor-friendly real estate agent is. So before I get started,
I run It’s a blog with over 200,000 views a month. We discuss rental
properties, fix and flips, and being a real estate agent. I’ve been a realtor since 2001,
I’ve flipped over a hundred houses in my career and I own 11 rental properties. Currently
I have two more under contract. So I am my own real estate agent when I do
transactions. So I don’t have to worry about finding a great real estate agent to help
me buy houses, but many real estate investors do have to find a great investor-friendly
real estate agent. And great agents who represent or owner-occupant buyers aren’t always great
agents when they work with investors. An investor versus an owner-occupant is an entirely different
thing, and you need to know what to look for when you’re looking for a real estate agent. So the first thing to know is most real estate
agents have no idea about real estate investing. They’re used to working with homeowners
who are looking to live in a house as their primary residence. Those homeowners are not
looking for the best deal, they aren’t looking for cash flow, they aren’t thinking about
flipping a house. They want something that will be nice for their family, maybe get a
decent deal, and they’re planning to live there for years. An investor will have much
different priorities. If they’re investing for cash flow, they need to know what it rents
for, what their mortgage payments will be, all the costs involved. If they’re going
to flip it, they need to know what it’s worth after they fix it up, how much the repairs
will cost. There’s a number of different things an investor will have to know. The thing that
most real estate agents don’t understand is a good deal to an owner-occupant could
be 5, maybe 10 percent below market value. A good deal to an investor might be 20, 30
percent or more below market value. And most real estate agents don’t realize
how good of a deal an investor has to get to make it work. Alright so, my first lesson: Do not rely on
your real estate agent to tell you what a good deal is. You need to know that yourself.
You need to know the numbers, what criteria you’re looking for, if you’re using the
70 percent rule for fix and flipping, what rent-to-value ratio you’re looking
for. Don’t rely on your real estate agent to tell you what a good deal is because most
of them don’t know themselves. Most real estate agents don’t invest in rental properties,
they don’t invest in fix and flips—their primary goal is to sell houses, not investing. Alright, so once you’ve figured out that
you have to come up with what a good deal is, what type of agent are you looking for?
Many people automatically think, “I want the most experienced agent. I want an agent
who has been around for 10 years, someone who knows the business—you know, can really
go to work for me.” The problem is, those agents are not good for investors. I myself
am horrible for investors. I’ll be honest with you: You do not want me as your real
estate agent if you’re an investor. And the reason is, I don’t have the time to dedicate
to getting you a good deal. I’m looking for good deals myself, I’m running my real
estate team, I am working on my fix and flips, I’m trying to buy rental properties and
I’m writing articles for my blog, recording videos as well. I don’t have time to work
with an investor, and that’s how many seasoned experienced real estate agents are as well. One of the reasons I get so many great deals
when I am investing myself is I can act so quick. I see a house pop up on MLS, I can
set up a showing, I can drive out there, I can view the house, I can call my assistant,
have him write up an offer, sign it through DocuSign—all in less than an hour. I have
literally submitted offers an hour after it was listed in the MLS system. That’s a huge
advantage for me. And for investors who aren’t real estate agents, if you have to wait two
days to see a house because your agent is busy, you have to wait another day for them
to write a contract because they’re busy, you’ve just lost the deal. There’s no
way you’re going to get a deal if you have to wait two days, three days—sometimes even
day—for your agent to be responsive to you. And the busy agents, the experienced agents—it’s
not their fault, they’re not doing anything wrong—they just don’t have the time to go
show that house right away, to write the contract right away and do things as quickly as an
investor needs them to be done. So many times, I will tell investors, “Don’t
be afraid to talk to the brand new agent.” Now, you want an agent who knows what they’re
doing. One who can write a contract, one who can set up showings, one who is a little bit
experienced, but they don’t have to have ten years, they don’t have to have five years,
maybe not even one year experience. What you want them to have is time. Time to look for
deals for you, time to scour the MLS, they can set up showings right away, they can meet
you out there in half an hour or an hour to see the house. You want an agent who’s hungry,
one that wants to get deals done. Maybe you’re their only client—hopefully not—but maybe
you’re one of five clients they work with. They can work for you, they can spend a lot
of time with you trying to get offers submitted, showing houses to you quickly and looking
for deals for you if they’re not working with a ton of people. The other thing that is very important is
that you have an agent that is tech-savvy. Now not all, but some, seasoned agents have
a hard time with technology, with keeping up with computers and everything. There’s
some who awesome; some who aren’t. New agents—some might be great, there might be some new agents
who are bad at technology as well. But with the MLS system, most systems can be set up
so that the agent can set up a search for you that will automatically email you listings
when they pop up. So if you set up a criteria for, you know, “I want every house that’s
under 150,000 dollars with three bedrooms in this radius or in this city,” they can
set that up so those are automatically sent to you in most MLS systems. Now every system
is little different, but most should be able to do that. Some agents don’t know how to
set those up, some agents are too lazy to try and learn how to set them up. So if you
have a tech-savvy agent who can do that, it’s a huge bonus. You don’t have to rely on
them to find everything for you. And if you’re looking at Zillow, if you’re looking at,
those sites can be days delayed with new listings, with houses coming back on the market, or
houses that are going under contract. So you can’t rely on those sites alone to find great
deals, to act quickly and get those houses under contract. So, you want an agent who
has time, an agent who’s tech-savvy, an agent who’s hungry and willing to work for
you to find those deals. The other thing that happens a lot with investors
and real estate agents is they can burn out their agent. If you’re an investor who likes
to make 50 offers a month at 50 percent of list price, and you never get any offers accepted,
it’s going to be very hard to ever keep an agent for more than a couple weeks. They’re
going to think of it as a waste their time, they don’t think they’re ever going to get
an offer accepted with you because every offer’s low and you’re spending hours of their time
every week or even every day writing new offers when they know it’s a worthless, hopeless
cause in some cases. I’m not saying it’s wrong to make low offers, but you’ve got
to be selective on the properties you make offers on. Look for aged listings. And usually
the 50-percent of list price offers are never going to be accepted. If you really feel that’s the only way you’re
going to get a great deal, then you’re going to have to pony up some money to your agent.
Agents get paid when they sell a house, in most cases, so all that time they’re writing
contracts, all that time they’re showing you houses—if you never buy anything, it’s
all free work to that agent. There’s no law against taking your agent to lunch, taking
him to dinner, showing him you appreciate the time you’re taking with him, and the
time they’re spending on you writing those offers. You could even pay them hourly, if
you wanted to, to keep them working hard for you. And if you’re really serious and you
think you’re going to get that deal, it would be worth it to pay them hourly if that will
get you that awesome deal. Alright so, take care of your agent, make
sure they’re tech-savvy, make sure they have time
for you. And lastly, if you really want to be a great investor, think about getting licensed
yourself. It saved me over 70,000 dollars in real estate commissions last year on my
fix and flips and buying rental properties, plus I get so many more deals because I’m
an agent, because I can act fast, because I have access to MLS. And I can pay more for
flips than most investors because of that commission I’m saving. Alright, thanks a lot for watching. I hope
you enjoyed the video. I’ve got a lot more information on investing in rental properties,
fix and flips and becoming a real estate agent at my blog, That’s “invest,”
and the number four spelled out, F-O-U-R, “more,” M-O-R-E, dot com. Thanks a lot.

7 thoughts on “How to Find an Investor Friendly Real Estate Agent

  1. Great video Mark! 

    Do you by chance have some ideas where an Investor friendly agent could market themselves to investors? ( Websites, investor groups )

  2. Great video!

  3. great video ,

  4. Can I get a copy of your contracts——purchase agreement, assignment contract and Memorandum ? If you have them.

  5. Excellent advice

  6. Please consider doing a video why realtors should work with investors.

  7. How do I find a great deal if the only places that cash flow properly are out of state?

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