How to deal with a Real Estate Agent?

General Real Estate Investing
1

So I found a listing I thought was a FSBO that stated to be very negotiable and said Motivated Seller (two keywords for a potential deal).

I replied via email inquiring about the property. It’s a Brownstone in Brooklyn, NY. Running for $650,000. Come to find out its an Agent listing (sounds so Matrix-ish).

This is my very first time inquiring about a property to invest in and want to pursue this, if for nothing else just the negotiating experience.

Any ideas on how to approach this R.E.Agent?

I am planning on asking the basics and see where it takes me:

  1. Why is the owner selling?
  2. What is the home worth?
  3. What are the repairs?
  4. Is it currently an investment or residential? If investment what is the RR?
  5. Are there any liens on the property?

Any assistance would be wonderful!

Thanks!

The Rookie

2

It sounds like you first need to figure out what you want to do with it: rental or rehab and flip? Once you determine that find out how much the house is worth (CMA, FMV and tax appraisals). If you’re paying full price, then you know the seller really isn’t motivated and you wont be able to flip it for profit. You might find though that it could be a good rental? Good luck and let us know how it turns out.

3

MannyMo,
I doubt you are going to steal the place unless the agent has no clue. My guess is that the agent is motivated because he has either owned the place for 5 yrs an has sucked out majority of depreciation or he bought it cheap and did a little rehab. If you have a similiar property the agent may be up for 1031 Exchange. Good luck

4

Hi, since I am a Realtor, maybe I can help. First, in our state, it is a law that realty companies or agents must disclose their relationship with the seller, so I am a bit puzzled by the ad you saw. It sounds as though some relevant information was missing in the ad.

  1. Why is the owner selling? This information is protected by the agency relationship and most likely won’t be disclosed to you unless the seller has given permission.
  2. What is the home worth? Any Realtor who is working for the buyer will provide a Competitive Market Analysis on the property they are considering. This tool compares similar properties that have sold recently, ideally within 3-6 months in a very active market.
  3. What are the repairs? You should ask for an independent whole-house inspection as a contingency on any contract. It will be the best $200-250 investment you make.
  4. Is it currently an investment or residential? If investment what is the RR? These questions are fair game and answers should be verifiable.
  5. Are there any liens on the property? Check courthouse records.

Most importantly, if a property is listed, then get your own Realtor. The seller pays the commission, so you get free representation with a buyer’s agent. I just told one of my buyers to walk away this evening because the sellers were holding the price too high on a property. That is my job as his agent–to make sure he gets the best property at the fairest market value possible. I realize that there are “burn em and turn em” Realtors out there, but most of us do the bulk of our business from referrals sent to us by satisfied clients. So, please don’t always assume that the Realtor is your enemy or competitor!
Regards, Marjorie

5

Tips from another Realtor, don’t get your own realtor, unless you have problems negotiating. Negotiate the price and also the commission. Most Realtors will want to make the sale, and will negotiate with the commission. Maybe you can let hime know that you are going to flip the property and let him resell it for you. The $$$$$ signs will flash in his eyes, and might even try a little harder for you.
Good Luck