Are you an investor-savvy realtor?

Question

Having been a KW Productivity Coach and MLS executive I understand how realtors have been trained. Working with investors is NOT the traditional way of practicing real estate. But, if you're here, you think differently! I love that!

But the question is ... how do you distinguish yourself? What is your Unique Value to the market?

But the question is ... how do you distinguish yourself? What is your Unique Value to the market?

Jim Herrera · Answer

Thank you Adam and Russell for your comments. It's interesting to hear the different positions and experiences.

I agree with you Adam - that the real important relationships are lifelong; they don't end with a transaction. I think that experienced investors are seeking these types of relationships - I know that's what I'm looking for. That's why I have a business package that informs my business partners about who I am and what I stand for. It also gives my realtor partners a reasonable expectation about how we would work together; how it benefits the realtor; and how they would get paid. In return, I would expect the realtor to do the assist me by finding opportunities. Then, I set deadlines where we meet to discuss if the business arrangement works for both of us.

When conducting business in this way, both sides can feel they won't be taken advantage of.

My wife is a realtor. And the worst thing in the world for her business momentum is to spend time with people who will not help her achieve her business goals. I would hope that investors don't waste realtor's time without any intention of compensating him/her. I know I wouldn't.

Best to you all,

Jim Herrera

Perceptive Investments

Brian Gibbons · Answer

@Jim Herrera

Jim I love KW but they're too conservative sometimes for investors, I train real estate agents to do creative financing much like in the book " Shift " by Gary Keller see chapter 10

Let's say you had a low equity house worth 500,000 and owes 490,000  and it cost the sellers 10% to sell in commissions closing costs and other costs

Well a lease purchase or a lease with an option or a sub two or a land contract might be appropriate for the low equity seller

But a lot of brokers are very risk adverse to any kind seller financing or creative financing

Many of these reasons why brokers don't want to do creative financing include the buyer never gets permanent financing or their errors and omissions insurance doesn't cover it

Do you care to comment?

Russell Brazil · Answer

@Jim Herrera Simply being a Realtor who will take on investors as a client is distinguishable in my area. I only know of a few agents who do a descent amount of business with investors.  I would say about 25% of my clients are investors and 75% is retail buyers and sellers.

The investors I work with are a mix of buy and hold investors, and fix and flip investors.  Most often the flippers are not purchasing the property through me, as it is nearly impossible to find flippable properties on the MLS.  They will use me to sell them on the back end.  The flippers usually are tapping me for my knowledge through out the flipping process though, asking for input on finishes, arv and all that.

Adam Wright · Answer

@Jim Herrera  Good question and discussion. For me, I distinguish myself as an investor-friendly realtor by being available to answer questions about the market, both on-market and off-market properties.   Many investors simply want to talk to you about what you see on the market without a sales pitch from you every time you talk.   It is about being a resource to the investor and helping them make sound decisions on their investments.  It is a lifelong relationship and not one that ends with the signing of closing documents.   You can add value even by knowing people in the community like contractors, insurance people, stagers, etc.   I think of myself as more of a real estate professional than I do a real estate salesman (although you have to sale as well).

Of course, I also present value by having access to market data through the MLS.  However, I carefully control this aspect of my business by not doing CMAs at the spur of the moment with every investor that calls on me.  Too much abuse potential with no ROI for me.  I need to know that we will be business partners together before I give out this service too often.    I will give out a certain amount of CMAs at no charge and then charge a nominal fee for any after that...if I do business with an investor by closing a file, I will waive the fee for a quarter.  Six or more transactions will result in a lifetime waiver.  It is a matter of establishing a trust between myself and my investor clients.  The road goes both ways.

You are right that when this arrangement works well, it is a boon for both the realtor and the investor.  We both end up making money and build a good rapport at the same time.   As an investor myself, I look for ways I can help my clients make better decisions and they help me to grow as a professional.   I am on my way to making that first million!

Jim Herrera · Answer

Hi Brian,

I agree completely with your assessment of traditional brokers. I've had similar scenarios within KW and outside of KW.

I believe that agents can definitely benefit from thinking like you suggest.

But working with an investor is different. As an investor, I'm not looking for "granite counter tops" and "beautifully upgraded" homes. I'm seeking an opportunity to find properties that I can buy low, invest to rehab and sell at market rates. Sometimes I'll hold, sometimes I won't. It depends on my market, my partners and my portfolio needs.

However, in return for working with me, I offer my agent/partner an opportunity to generate multiple listings over the course of a year.  And, as Gary Keller points out in MREA (Millionaire Real Estate Agent), it's all about listings!

Do you know any millionaire mindset agents?

Best to you and thanks for your response!

Jim Herrera

Principal, Perceptive Investments

Are you an investor-savvy realtor?

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