What's this agent's angle?

Question

I met a real estate agent last week when I was out doing my "home work", looking at houses in my area.

I gave him my standard spiel: I'm an investor interested in undervalued properties, I pay cash and close quickly. We exchanged cards.

He called me today and said that he has a line on 10 short sales and is looking for an investor to submit low bids. He told me that he has an idea of what the bank will take for the houses and is going to send me details via e-mail.

Noob question: Why is he calling me if he has properties that can be bought cheap? Is there an angle he's working? Is he using me to make someone else's offer look good/better/more reasonable?

Any advice on how to proceed?

N/A N/A · Answer

Thanks for the replies. I guess I wasn't clear in my question - I didn't mean to ask why the agent was calling me rather than buying the properties himself, I was just wondering why he was so eager to have me look at them, and I was wondering this specifically because they're short sales, which I haven't worked with, and was wondering if there are any pitfalls I should be looking for.

I was also curious because he's a young guy, fairly green, and he has 10 listings - not bad for a n00b. I've since learned that he's pretty heavily wired into the Hispanic community in this particular area, which is how he's picked up so many listings.

Thanks again.

Tom McGiveron · Answer

talk to your attorney about shorts.  you can also read up on them a little here and on other sites.

the pitfalls will mostly lie within the houses themselves and wthin the numbers.

you've got to analyze the deals.

Robin Vidovich · Answer

From the information you have provided I would assume that the Realtor is being smart and utilizing contacts to make a sale. He has access to what
you want and you are what he needs.

A smart person in the business will never overlook an opportunity to gain contacts.

Tom McGiveron · Answer

accordingly, you can be a realtor and run into someone who says they can close quick and "pay cash" and you find out that they can't at all and that they want you to fax out 100 offers a month for offering .45 cents on the dollar for properties.

agent beware.

Scott Ficek · Answer

If you handed me your business card and said you pay cash and will move fast, as a Realtor, I would be calling you the next day with deals.  Working with investors like you is much easier than driving Bob and Sally Jones around to 87 houses looking for that one special one!

That agent is probably thinking he is the luckiest guy in his office!

Nothing wrong with short sales.  You are going to see them for many years to come as the market adjusts.

Tom McGiveron · Answer

also, as a REALTOR, if you start buying up "investment properties" - you're not really representing the best interests of the seller.  that can get sticky if you start buying up stuff.

people stick to what makes them money.  it's like any other business - agents work on and in THEIR business.  his business is moving properties fast, using investors that pay cash and close quick.  that's why he called you.

Account Closed · Answer

The agent is an agent and not an investor. Likely the agent does not have the cash to do the deals directly. Hence the agent needs someone who has the cash so the agent can earn a slice of the deal.

At some level forget the agent's agenda and focus on the deals. If the short sale packages make sense to you and you would buy at the price offered then move forward. Best is when the agent will do a lot of the work getting the packages sorted and you sign off if you like the price.

John Corey

Jennifer Karlen · Answer

Echoing the other sentiments - what works for one type of investor doesn't always work for another.  You don't know what the Realtor's personal situation is.  He may be leveraged on other investments - or he may have no interest in flipping.

[Personally, I'm a Realtor, and I don't flip as a general rule.  I buy, hold for the long term and act as a landlord generally.]

Most Realtors in my area that work with investors are quite content to just make their commissions and move on down the road. Its fast, no risk, and doesn't tie up their money that they may have working on other things.

Shoot the offers in and see what happens.  Good luck. :)

Tom Wood · Answer

There are lots of agents who are much more comfortable taking their commission and brokering the deal.  Yes, they may miss out on a very large profit, but there is a lot less risk.

Calvin N. · Answer

The realtor is doing what makes them money, trying to match a buyer with a seller.  Like Mike said, you told him you were in the market and could close quickly.  Hopefully, you do have money lined up and are ready to purchase IF the deals are good.  Realtors will often be familiar with what a bank will accept.  As to how to proceed:  look at the properties, do your own research, and if the numbers work, buy it!  Best of luck.