How much should I pay a realtor for comps/realtors can't think out of the box

General Real Estate Investing
1

What is the going rate. I would want pics and information on the comps.
I have talked to this lady and this is our conversation:

Me to her:

"Could you provide comps for a fee? "

Her to me:
“Steve, As a professional realtor dealing with investors my major problem as I told you before is protecting my commission. No offense but investors, buyers and sellers want to by-pass me. Here is my offer to you or anyone else you may bring my way. I will provide free comps to investor buyers if they buy the first property with me. The buyer does not pay the commission the seller does. In order to protect myself and my commission, I feel as though I am being compensated for my time and effort if they buy the first property with me. After the first transaction I will charge $100 for the comps. The same for sellers, they list the first home at 6% for 6months with 90 day grace period, then I charge $100 for the comps. The investors I handle work strictly through me and there is no doubt in my mind they need me. I work honestl y and quickly and have a lot of knowledge of the market. I got into this business to make money off that knowledge and I don’t like working for nothing. You don’t go to a doctor and say can you give me an opinion if I have a cold and walk out without paying him for his diagnosis, thats the way I look at it. I’m a professional and deserve to get paid for my advice.So if you agree to my conditions I’ll be glad to help you or anyone else with comps. The buyers sign a contract on the first transaction to protect myself against working with the seller or another agent. As a young man you will learn that anyone can give their word, but in the business world you have to get everything in writing. I’ve been burnt to many times to take people at their word. Hope I haven’t offended you and that I can help you in the future, talk to you soon”

Me to her:
"I understand where you are coming from. Look at it from my perspective. Say a guy calls my with a house that he is about to lose his house in foreclosure. He wants 85k for it. I can tell that it is atleast a 150k house from the comps I get online. I, as a wholesaler get it under contract, inspected, rehab estimate, and water ever else would make it easier for my buyer to see the value of the deal. Although I can see what the neighboring houses sold for online, it would be more professional if I paid a realtor for the comps. There is no need for a realtor in this situation. I have a contract with an escape clause that I have used so I am covered. I am not asking you for free service, I offered to pay you for the comps.

The comparison about the doctor is off because I am offering to pay you for the services I need.

Let’s say I go the doctor for a runny nose and get a check up (run comps) and then pay him but then he thinks I am using him because he wants to give me x-rays and things I know I don’t need (being a buyers or sellers agent).

For example I have 6 properties that I already have comps on. I have no need for a realtor and the investor selling them does not want to deal with one. But a realtor did make money on this deal by pulling comps on 6 properties. That realtor was not involved in the deal at all and still made money just by pulling comps.

Whether you want to do that or not is fine. Other realtors do it, I just wanted to build a net work of trustworthy people.

Like I said, I have these six properties in Salem. The owner will not deal with a realtor but if you have an investor paying you to find them deals and be an agent that we can work something out. There is alot of equity in this deal and the owner wants a small amount of cash and the buyer to assume the mortgages.
I can throw you these and other pre-forclosures for a fee to be discussed if you are interested. Let me know and I will send you the addresses and numbers.
Thanks"

2

Ridiculous. Realtors are a dime a dozen. I posted a message on my local REI club message board asking for a realtor to provide me comps for free, with the expectation that by doing so, they will get the listing. I got 15 responses by realtors willing to do that on just that message board within 2 hours. Don’t even bother with her.

3

What is the name of your REI club?

4

As long as you use realtor once in a while for the transaction, it’s all good. A big part of my business relies on using agents for their comps. I don’t NEED them for anything else but I use them occasionally to keep them happy. Don’t pay for comps, it takes them 5 minutes out of their otherwise uneventful day to email you the MLS search results. Anyone living on commission is more than used to working for a while without compensation, just make sure you let them feel important by shuffling the paper work sometimes. They can’t do favors forever.

If your dead set against using agents for the transaction, work out something with a more flexible agent to send you comps for a monthly retainer fee. The one you talked to sounds like she’s giving herself more credit and credibility than is due and would ask too much.

5

One final note, make sure the comps the realtor sent you is a good comps. I’ve seen comps that are not even close to what I asked for. Make sure the realtor is knowlegdeable about the MLS system and HONEST! I’ve seen realtors don’t even know how to set up automated email notification when my criteria is matched. Use zillow.com or similar to compare the comps for similarity.

6

I’m in NJ. GSREIA. You should check with your local REI Club

7

Now, that realtor is a real professional. Sticking to the doctor analogy…it’s like going to a doctor and asking if she will take your blood pressure for a fee. Dr. says I have real clients (patients) that pay for a complete diagnosis, make an appointment for a check-up. The succesfull/professional doctor will not waste their time with such a request.

So often we choose “experts” because they were nice and gave us something for free or at a discount…only to be disappointed in the end. Real Estate agents may be a “dime-a-dozen” but a Real Estate Professional is not.

8

To continue the analogy, you can walk into a drug store and check your own blood pressure.

I’m new to real estate investment…is there a way to run your own comps if you are willing to pay for the data?

Do many real estate investors get real estate licenses just so that they can access MLS listings?

9

Offer to pay them their yearly MLS fees in exchange to getting you comps. New realtors do not have enough income and will be so happy to do it. Hell, you may find one willing to share their login information (they are not permitted to do so though).

And yes, i got my license to get access to the MLS. I use it to find comps and list my properties.

10

I think you overestimate the value added of a realtor.

11

And I think you’re lumping good realtors into the same pot as some of the less educated realtors. Some can handle complex transactions and help out an investor, others can barely close a regular retail SFH deal.

12

:bs You are on here wanting help, but in the same breath you are trashing Realtors…

You are the type of guys, that I do charge up front for my professional advice. :bash

I am an Investor and a Professional Realtor toooo!!.

You should have your “team” of professionals around you to give and get. You can not expect it all handed to you and give nothing in return. Believe me you will be short lived in the Realtor circles.

If you want to be considered a “professional” then you need to act like one. Shame on you for expecting something for nothing.

Remember what goes around comes around…

You can catch more flies with honey than vinegar…
You need to bring something to the table too…

Pay a fair price for good work and that will get you a long way, however step on me once and you don’t get a second chance to do it again…

Make sense? Good luck to you…

13

You are on here wanting help, but in the same breath you are trashing Realtors…
I didn’t start the post. All I said was that there are a plethora of realtors that are willing to give comps for free. While I understand that there are some very good realtors, there are a lot more terrible ones.

You should have your “team” of professionals around you to give and get. You can not expect it all handed to you and give nothing in return. Believe me you will be short lived in the Realtor circles.
Wrong. Using a realtor for comps and then giving them 6% of a $300k house + $1000 (if they sell the house in the 1st 30days) is hardly nothing. Especially when I should have multiple houses in a year. Do you really want to ASK to be compensated for that 5 minutes of work per week, when I will be giving you at least $18k (6% of 300k), especially when numerous Realtors will do it for free? It’s a cost of doing business. I wont waste realtors time by asking for comps unnecessarily, but if I’m going to be paying you a large fee, I would expect that 5 minutes a week isn’t much of a burden.

If you want to be considered a “professional” then you need to act like one. Shame on you for expecting something for nothing. Something for nothing? I’m here to make money in real estate and will pay very well for the information that helps me accomplish that. I would NEVER consider asking for a reduction in sales commision. I have told 2 Realtors this. By providing me comps, I will list the property with them exclusively and regardless of my profit, I WILL NOT ever ask them to reduce their commission. I understand the importance of a good Realtor, but there is a ton of them around. Maybe this is unprofessional to you, but I think it’s unprofessional to nickel and dime me when I will pay you a significant commission.

Pay a fair price for good work and that will get you a long way, however step on me once and you don’t get a second chance to do it again… I guess 6% commisions, as well as incentives, is not a fair enough price???

14


And I think you’re lumping good realtors into the same pot as some of the less educated realtors. Some can handle complex transactions and help out an investor, others can barely close a regular retail SFH deal.

Yes, I did inadvertantly lump ALL realtors together. While I understand the importance of a good realtor and know that there are many around, I also understand, at least in my area, that there a lot more of the uneducated realtors. These are the ones that are a dime a dozen.

15

When you say you are going to pay the commish, and “let” the Realtor list it too. … :rolleyes

Is this in writing? :deal Do you have an iron clad promise to do this? Because if not, that is what I’m talking about too. I have seen the Investors “use” :flush the Realtors to get all the info they can hold, then go underneath, :anon snatch the deal, and flip in 30 days.

Then wonder why when the same Investor calls the same Realtor back the answer is no. :shocked

Make sense?

If you have a great working relationship with (a) Realtor, then yes it is business, however, don’t bite the hand that feeds ya.

All I am saying is be honest and be fair.

I know you did not start this topic, I’m just replying to what was stated. :bouncemulti

16

THere’s no reason to sign anything. My realtors are members of my REI club. If I want to exit this business very quickly, I would screw my realtors or anyone in my network. The REI Club is my lifeblood to good contractors, appraisers, lawyers, accountants, wholesalers, etc. If I screw one member, all 800 members will know. Not a good business plan by any means. The last thing I want to be known as is a) someone who does not pay well for information and b) someone who does not keep his word. My plan is to pay realtors and pay them well-- offer performance bonuses and never ask for commission reductions. I’d be less inclined to list multiple properties with them, when they insist on me paying for comps, when I know tons of realtors would do it for free just for the opportunity to list multiple properties for me every year. As a realtor, is it really worth the added income from running comps at the risk of losing 6% of multiple listings every year and incentive bonuses, especially when your competition will do it for free?

17

How many times do you think that a Realtor will give you info and not get anything in return? 1 maybe 2? Would you? All I am saying is you should have a good working relationship where as everything is spelled out and then there would be no “mistrust”.

I too don’t mind giving info, however, I also don’t mind being paid either for my time.

How do I know you would give me all your listings? I don’t. You said you use Realtors. Why do you need more than one?..One Realtor can do everything you need.

I ONCE worked with some clients, being told "we are going to make you very rich…blah…blah… we need x # of properties…blah…blah…blah. Come to find out I was one of MANY Realtors given that same line…

I never charged them for ALL the research I did approx 6 months worth! If they would have been loyal/trustworthy, we would still be working together, but I have no tolerance for betrayal.

We only closed one deal together. There is no loyality/trust. Realtors make a living(shotty one at that) on commission only, so when they get used it does make for sour grapes.

I totally injoy being an Investor more. However, I do have more info at my fingertips than most investors that makes it a little easier.

Can’t tell you how many times I have been used by other Investors before I decided to become one myself. I forgive but won’t forget.

Therefore I will not be like those, because I know how it feels.

I am working with a Noob right now, he has lots of questions, that’s ok Been there too. Just treat people the way you would like to be treated, and all should go well.

18

I don’t see any problem in giving your buying criteria to numerous realtors, the more eyes looking the better. This of course is only if the person asking for this info is a real buyer, not a tire kicker that’s going to waste your time. Even if a buyer has 10 realtors working for them there shouldn’t be a problem providing the buyer is actually buying properties and generating commissions for the work provided. Asking for a ton of info from a million sources when you can only close on one house would be a little silly and wasteful.

19

How many times are we going to have the same fights about real estate agents? Geez.

The original topic was on how to get comps for a fee. Some agents in my local REI club have a fee structure for comps. I don’t charge for comps, but I also don’t take on any many new clients.

Just ask around your local REI club or investor circles. There’s a good chance you can find an agent who has a fee structure for comps. Usually, the best investor agent is also a successful investor. They sometimes won’t take on new “any” clients or are picky about who they work with, so you may have to present your value to them as well.

20

This thread got way off topic. My original post was about how much I should be paying a realtor for comps. I don’t want them for free because I don’t want to sour a business relationship with them if I can not come through on my end. Now, I found a realtor who will go into the property and measure it’s sq footage, pull comps, tell me and what needs to be updated to get the maximum sale price all for $75. I get the $75 back if the buyer I wholesale to lists it with this realtor.
He charges $25 for regular comps.

The first realtor I discussed this with wanted me to list a house with her. I can’t do that since I don’t flip houses. I don’t sell houses, I sell contracts.
I have six houses I need comped so the first realtor is missing out $150 that she could have made for just spending a few minutes in front of her computer.