Along with two friends, we’re going to start buying and rehabbing homes. One question that has come up is whether or not to use a real estate agent to purchase a property. We’ll be using one to sell the property.
Given that we’re new to this, I wanted to be sure we had an agent that could pull and analyze comps, etc…is there some kind of rule of thumb for this? What does everyone usually do?
It is good to develop a strong realtionship with a good Relator that “gets it” about what you are doing and how you are doing it (you may have noticed that there are multiple strategies to acquire, hold, and exit properties).
That said, I use Realtors to buy property that is listed with other Realtors and they have always given me comps for free.
My two cents (BTW - this is another topic that has gone around and around dozens of times!).
I would suggest the same thing have one good realtor that “get’s it”, this becomes you go to realtor. But, don’t sign up to have them as your buyers agent unless it is on a per house basis. Try to devope as many realtor relationships as possible so that they call you when the good stuff get’s listed, and if your “Go to” agent doesn’ t get you the property first then I would suggest buying with the selling realtor but going to the go to realtor for advice.
It certainly can’t hurt to work with several real estate agents. However, don’t count on them as your only source for deals. From my limited experience, if it’s made it to a listing through a real estate agency, it unlikely to be a good deal. (at least in my area). It can happen, but again, in my experience, its unlikely. Even the REOs are overpriced in the MLS.
Good deals are still VERY hard to find in my area but seem to be more possible when buying directly from distressed sellers.
The answer about using an agent is it depends greatly on exactly WHAT you are trying to accomplish and WHERE you expect to find the majority of your deals. It’s always a good idea to have an agent on call that “get’s it” as they say above, however, it’s going to cost you one way or another if you NEVER use them to buy/sell properties. Need to know your plan of action.
As to the whole multiple agent thing, unless you’re seriously planning on jumping out of the starting gate buying 10-20 or more props a year, then it’s total CRAP!!
Find an agent that understands what you’re trying to do AND still wants to work with you AND STICK WITH THEM. An agent working for you is SUPPOSED to be getting you the best price possible. The list agent won’t do that for you. Legally, they can’t. And unless you’ve proven to agents that you’ll a) close the deal and b) you’ll close alot of them, you won’t have agents knocking down your door trying to get you to buy their listings. So why piss of the one that DOES want to work with you by occassionally NOT using them to work your MLS deals.
Think it through. If YOU were the agent, who would you work the hardest for. A client that says, “if you bring me the deal, then I’ll use you. If you don’t, you lose.” Or the client that says, “Do my comps, etc for me and I’ll make ALL my MLS offers through you AND I also want you to do the paperwork, etc on my Non-MLS deals and I’ll pay you $X for that.”
I just love cheap investors :rolleyes
If you learn how the MLS in your area works, then you’ll also learn to laugh when you hear investors say, " if it’s made it to a listing through a real estate agency, it unlikely to be a good deal" One of the best kept secrets left in RE investing I guess.
The most important person is the person finding and negotiating deals, and the person raising money to finance those deals… Everyone / everything else can be outsourced and contracted away at a much cheaper than 33% of the profits.
The seller pays realtor commissions, so if your using a realtor to buy a prop that is listed with another realtor, then they both get paid commission, but by the seller. Your turn to pay comes when you sell if you choose to sell with a realtor.
Nope…not a buyer’s agent, per se. Just an agent that I have had long discussions about what I am doing and how I do it. She understands what my model is, what I am looking for, and when I buy listed properties, I use her. She gets her cut at closing. When I needed to sell so properties quickly, I used her, too. She sold all four properties in less than a week.