Buyers Agents
I would like to know what everyone thinks about using a buyer’s agent that specializes in investment property to help you find your first deal or two-- and possibly using that same company for your property management.
My thinking being that an experienced buyers agent hopefully knows what a good deal is and can help me quickly find property that they could manage. With that said they should therefore have a good idea of what the property can be rented for and thus what profit, if any, I could expect. The agent(s) are buyers only and do not list properties for sale themselves.
Thanks,
pataz
I've not had much luck with agents.
Most of them view investors as time wasters. So your not going to be a priority to them unless you got 20% down or all cash, and even then, they know your going to be looking at lots of houses before you buy one.
The exception to this is, if the agent is new and very hungry for your business. But most agents would much rather deal with a homebuyer than a investor.
Your best (cheapest) way to find your properties by driving the neighborhoods for unkept empty houses, and checking foreclosures and REO's, these are almost always rehabs and not on the MLS. To find out what properties are worth contact your local tax office, most large cities have this online. View current sales of similar houses, in the neighborhood your interested in, based on cost per sq. ft and go from there. As far as comps go, you can ask 3 agents what the comps are and you'll get a spreads of 30k off, probaby more on the higher priced properties. Or worse, they are less than forthright about the comps in order to make a property appear like a steal, when it's a dog.
I had one do comps for me on a rehab w/ 20k of repairs needed the other day, and she sent me all the ones that showed the property was worth 30k more than it's asking price, all with pools, but, when I pull the numbers myself, I see where she neglected to show me 2 exact houses as mine (without pools) on the same street that sold for the same price as the asking price in the last 6 months.
So yea, they manipulate the numbers too, so you can't even trust what they say. Remember, agents are there to sell houses. They'll often say what they need to, to do that. [ Edited by GWmson on Date 01/15/2004 ]
Thanks for the reply GWmson!
This particular agent is specifically a buyers agent FOR investors, not just a regular agent. I thought it may present an opportunity to learn from him as well.
Thanks again,
pataz
There are agents who will work for you and then there are agents who will work for themselves. In any profession you have to weed them out and find one who has your interests in mind. A buyer agent has a contract with you, the buyer and not with the seller, although ultimately the seller may pay your commission. Have a long talk with this agent. Have him buy you lunch (it's deductible for him anyway) ask to get names of other investors that he has worked with and call them to see if they have had a good experience working with this agent. Just remember that if you sign a buyer agency agreement you are stuck with that agent for the term of the agreement and if you find a property on your own or through a FSBO you will owe the agent a commission. Yoy will have to be loyal to the agency agreement.
Quote:
On 2004-01-15 15:05, Sandbahr wrote:
There are agents who will work for you and then there are agents who will work for themselves. In any profession you have to weed them out and find one who has your interests in mind. A buyer agent has a contract with you, the buyer and not with the seller, although ultimately the seller may pay your commission. Have a long talk with this agent. Have him buy you lunch (it's deductible for him anyway) ask to get names of other investors that he has worked with and call them to see if they have had a good experience working with this agent. Just remember that if you sign a buyer agency agreement you are stuck with that agent for the term of the agreement and if you find a property on your own or through a FSBO you will owe the agent a commission. Yoy will have to be loyal to the agency agreement.
Thanks for the reply Sandbahr!
I realize I will have to be loyal to any contract I sign so I should make it for a short a time as possible.
Also, If I were to provide someone with references about me, I would provide them with the best references I have-- think job application, you don't want to provide bad references, so, same thing goes here. That's not to say that it shouldn't be done. Just that the amount of weight you place on them shouldn't be all that great. Its just another peice of the puzzle.
Thanks again,
pataz
Nobody else has anything to say about this?[ Edited by pataz on Date 01/16/2004 ]