Flips, Buy and Hold, & BRRR: Do you work with an agent?

[Reed Vennel]

Listing with an agent, going FSBO, or getting your own license to get that commission yourself--what's your preference?

I'm particularly interested to hear from anyone who's pivoted on this aspect of your business and what effects you've seen from that change!



I'll start: For the 2-3 years I've been in REI I've been using the same agent for all of my transactions --both purchases and sales. I'd be lying if I said it doesn't hurt seeing a 10k commission check on a settlement sheet! BUT I see his value coming in a few ways:

1. Getting confirmation on numbers. 

Sometimes we'll disagree on prices by over 25k ARV or a few hundred in projected rent. As a smaller scale investor, that can be the difference between a worthwhile project and a waste of time. We both run our own comps and if we are in the same ballpark I am much more confident moving forward with a project.



2. Avoiding risks I might underestimate. 

I was interested in a property a little while ago that had promising numbers.  He VERY strongly pushed back on it, citing the nearby creek.  I've lived in the area only 5 years or so, while he's been an agent locally for 30+, so I listened to him over my gut and decided to wait till we found a project where we agreed.  Lo and behold: around 6 months later, that whole neighborhood was under a few feet of water!



3. Being more strategic on repairs. 

He's quick to answer his phone and with his experience, he can tell me things like whether to replace a fridge or just scrap the broken one in a flip.  That single text saved me time and something like $1,000, to say nothing of the ease of mind that it was the right call that I got by leaning on a more experienced professional.  In a flip I'm about to finish, he dissuaded me from adding a half bath on a 4 bed, 1 bath, slab-foundation home.  That submarket's comps doesn't show any added value for an extra half bath.



4. Freeing up time  

I've got a W2 in addition to my REI business with three employees. Every photo, listing, form, call and appointment he takes care of is something I don't have to do.





We've been across the table from plenty of bad agents where the above don't apply, and I think if my current agent were to retire, I'd have some tough thinking to do.