Can I use a realtor to find deals on properties? Such as foreclosures? Up until coming to this board I was just going to buy a duplex at market value and thought that was what I should do. Thank you guys for stopping me from making a big mistake.
Yes you can use a real estate agent, but that agent has to know what to look for. In Houston there are 175,000 real estate agents. You may say that is too many. He must have slipped a decimal. No there are that many. That being said, most of them are not actively finding deals, they are showing nice families pretty paint and berber carpet. About a year ago, I tried to “turn” a young agent. I tried to teach her how to find out if there was any money in a property. I told her how to determine comps to determine discount from retail. They learn how to pull comps, but they aren’t taught what that means so they pull wrong comps and they can’t interpret the results. What she got from that is to show me houses that cost $125k or less. She just couldn’t get her pretty little head around it. You will find that at your local real estate investor’s club meetings there are a couple lurking around. These guys know how to find deals. Talk to them. Two real estate agents called me last night that I met at the club. I am in the market for a couple more houses and they both had good prospects. One agent was relatively new to this investor business although she had been an agent for 10 years or so. Her deal was a little pricey considering rehab costs. The price was good and the rents were strong. She doesn’t quite have the rehab part down yet. But real estate agents can be a really good source for deals.
i’m also looking for an investment minded real estate agent. but once I find one how can I convince him/her to work with me? and to send me all the best deals? if they are not just agents but also investors, don’t they take all the best deals for themselves?
also, if i find a property without an agent, how can I run comparables on it if i don’t have access to the MLS? can i ask an agent to help me with that? how can i convince him/her? why would he/she help me?
if they are not just agents but also investors, don't they take all the best deals for themselves?Nobody can do all the deals. They will have to find someone to get the spillover.
without an agent, how can I run comparablesI don't know how it works in you area, but I am able to purchase access to sales in my area through my local real estate investors club. They have worked out a deal because of the large number of members (one more reason to join your local club). It costs me about $400/year and I get solds data that allows me to run comps that are the same as an agent. This is why I am able to tell the agent if their comps are ok or not. Agents can sometimes pull houses that are not just like the subject property. Sometimes agents will run comps based on asking price. You have to pick the ones you use to compare and you have to use sold price and within the year. Make them throw out the highest sold price (someone just had to live next to the Jones) and the low (the husband died and it was a distressed sell), don't let the computer pick them.
The key thing about a RE agent is they have a fiduciary responsibility to their client. Very simply put, they are supposed to be looking out for your best interest. I had a RE agent, whom I had a buyer’s agent contract with once, who found me a property and flat out told me if I didn’t buy it, she would. Meaning, she knew as an agent with a signed buyer’s agent agreement with me, I was to be given first dibs on the property. Of course, the RE agent profession is like any other. Some are better than others, some understand their client’s needs better than others, etc. Finding an agent that completely understands your needs as an investor can be a chore, but they are out there.
I use another agent as well now, who I found via my REI club. I was actually looking for an investor-minded broker who other investors recommended. People referred me to this one broker, who I use today. He in turn gave me a referral to a RE agent that is top-notch. Nothing like networking!