I feel that knowing your local market is often times so damn critical.
I just wanted to get some input on gaining knowledge of your particular market. Obviously, real estate agents that are at it 40-60 hrs a week have the advantage.
I wanted to know how the part timers get a feel of the real estate market. How do you anticipate growth and development in certain areas? How do you learn the markets inside and out with less time?
I am curious to see what others are doing.
If you specialize in a certain area of town you can simply drive through often and know what is happening. Talking to business owners, especially restraunt owners, in the area helps as they often know what is happening. I know a couple restraunt owners that let me know about some redevelopment that was going to happen long before it was made public.
While it may seem that realtors have the upper hand in market knowledge, this is not always true. Very few specialize in a small area. If you are an agent in a metro area, chances are that you are working all over, and never really know one market extensively
Call a dozen real estate offices. Ask to talk to an agent who is an active real estate investor. Talk to that person at each office and set up face to face appointments with a few. Tell them what you are looking for and ask them if they think they can find that for you. Find an agent who will find deals for you and don’t work with other agents. If that agent can’t find deals for you, then try another agent. It is important for you to explain what you are looking for and then for you to be able to act on the deal. If I put 2 good deals in front of someone and they don’t bite then I will back-burner that prospect.
The key is to find an agent who actually invests. Believe it or not, most agents have no idea how to analyze an investment or recognize a good investment.
But won’t the agent take all the good ones for himself? No. It’s a broad field and he likes a certain type of deal. Some are too big for him, others are too small. He may hate to mess with tenants, so buy and hold deals on residential property don’t interest him. He may be maxed out financially at the moment. Very few agent/investors have the financial ability to do every good deal he sees.
The important thing is to build a relationship. Tell the agent honestly what you can and can’t do. Tell him how much cash you have to work with and what your FICO score is. Lay your cards on the table and see if he wants to help you. If you won’t share this info, then don’t expect a good agent to work with you. You need to convince the agent that you have the ability to do a deal. I won’t spend time and energy on “nothing down/creative financing” types. Deals certainly exist for those folks but not usually through the MLS.
Talk to the agent at least once a week. You will get an idea pretty quickly whether he is interested in working with you. And don’t take an attitude. There have been investor posts on this board where an investor explains how he talks down to agents and barks “my way or the highway” orders to them. A good agent will not waste time with a person with a bad attitude. Life is too short for that bs. A sharp real estate agent/investor knows things that you don’t know. If you know what you are talking about and have the money and guts to do deals then you should be able to find a good real estate agent who is happy to be on your team.
Great advice Steve! I could not agree more. I work with several realtors right now and they are a huge help.
Also I have a huge map on my wall. I have segmented the markets on the map. I have the low income, working class, middle class etc. neighborhoods outlined on the map. That is the first step to know your local market.
I tend to focus on a decent to small sized part of my county. I am not trying to run myself all over town. I would rather specialize in one area and really know everything I can about the area.
I talk to anyone and everyone I can. I have my bird dogs out there and I try to get as much out of them as I can. The mailman and delivery guys - UPS, FED EX etc. - are some of my best. They are always out there and they let me know what is going on with my area.
IF you are looking to find out what areas are going to be developed you should go to your county. At the moment I can not recall what the report or document is called but your local government should have a short term and long term plan for any area you want.
Gregg, start out by reading your local classified ads for residential sales and rentals - i mean, just by living in the area will help unless you wear blinders over your eyes. when you drive a neighborhood, are their alot of for sale signs? this suggests that SUPPLY is high and that usually means that DEMAND is lower, because the houses are sitting.
the more you drive neighborhoods and read your local classifieds, you will be able to see houses that sit and sit and sit - then price will go down and down and down. or of course, vise versa or you’ll see things are pretty constant/normal.
overall, the country is seeing housing prices fall and you have idiots on Fox News and CNN telling everyone the “bubble is bursting”. they talk about rei as if it was the stock market. ridiculous. yes, the national average price of a home may be dropping, but as you have noted, you must know your local market.
if they are dropping in your local area - that’s good for you as a buyer, bad as a seller. and you can thank me for stating the obvious…lol
anyways, classifieds, drive neighborhoods (take a different route home from work each day). you don’t have to kill yourself and think that you have to put in 40 to 60 hours a week, just to get to know your market. and yes, a good realtor(s) help very much, but being an entrepreneur, i must have an idea so i can check the realtors info. some are very good, most are barely okay and alot just really suck at what they do.
I thought you might have meant that. I go anywhere from 250-500 usually. I haven’t had a bird dog bring me something so big that I could give them a 1,000 or more.
My bird dogs do me a better job of just giving me news about whats going on around town. The mailman is one of the best.
i wish i were in a market where residential investments were at least somewhat of a viable option. the market here for foreclosures and such is ridiculous - so much competition, not to mention the high price of even a foreclosure. there’s alot of money flowing here in new york, it’s sick. if you are not a cash buyer, you’re severely behind the eight ball.
it would be nice to be able to talk with my mail man, he’s very cool, and ask him about the “going’s on” of the neighborhood - but i’d be wasting my time. that’s awesome you can do that.
i figured your compensation was somewhere near 500 bucks. i guess that’s the going rate nationally. what do you think about guys who set up ads and 800 numbers for people to call in or sign up to be a bird dog? i guess anything to generate leads is a plus.
I am strictly a wholesaler. My family lives out on Long Island and that is where I am from but right now I go to school in NJ. The county I live in has been to good me and is such a great wholesaling market. I live off campus and I used to live in an apartment. Now I live in a condo sort place and we have the same mailman day in and day out, where as before it was a different mailman all the time.
Since I live in a condo place we have a mail center as you enter the complex. So I can see the mail truck there and he is there stuffing mail in the boxes for about 2 hours a day. So there is plenty of time to talk there.
The foreclosure market is extremely tough. It works well for me becuase a trick I learned is go to where the money is. Foreclosure investors have money and want properties. I go to the auctions to meet and network with the investors there because they are your cash buyers. It’s just another way to meet new buyers.
500 seems to be the standard give or take. I am still a little undecided about the 1-800 numbers. I feel that it doesnt give a personal touch at all. I would rather work on a few bird dogs and a few people than try and go to recruit an army of people who will just fade out.
The same thing goes for people who have the call me I buy houses 1-800. As a homeowner you are not going to want to call an 800 number because you think it is a big business. I use my local number local area code and all. I dont have that pre recorded message or any of that. Does that work for some people probably does, but its not what I do.
