Real Estate Agents and Exclusivity
Member since 2022 · 43 posts · 19 votes
I've been contacting REAs in the areas I'm looking to invest and I've contacted several and have some looking in some places, some looking in others. My questions is, Where do I run itno problems having some many REAs in the area? How does it work if I ask one to look at a property, they take awhile or don't get back to me, so I have another one look at it. How does exclusivity work? Is this terribly bad practice that?
How many agents do people tend to have in an area? I just figured that I'm looking for deals, so why not have more people looking for me, but maybe this is super bad practice and I'll run into issues.
Thanks in advance!
Hi @Nathan R Andersen - thanks for the post!
Unless you sign a buyer agreement of some type, technically you can use any agent you choose - but from an ethics perspective that would be more of a conscience decision, you would have to make for yourself.
A few examples:
I'm an agent for investors here in LA and also assist investors with out-of-state properties in NC. I know that I pride myself on great communication, fast follow-through, knowledge of the market, and specializing in investments. I can also tell you that I never make my buyers sign buyer agreements because I'm trying to earn their business and trust with my service. Some agents might disagree with me, but I have never found a problem with this method.
That being said, if I have been searching for homes with you for months only to find out that you bought a property that we may have even seen together with another agent, that would be very frustrating. Legally, I wouldn't be able to "do" anything - but from an ethics perspective, I would hope you as the buyer would feel bad for doing something like that too. Lol.
On the other hand, if you are looking in a city far away from me, I'm also not going to pretend like I'm an expert in a place that I'm not. So good agents would usually refer you to someone who is so that you are getting the best service possible based on your investment strategy. Some agents may hesitate to refer out because they REALLY want that commission check - but I find that it is in these moments when agents overextend themselves, where buyers start to look at other options because those agents can't perform at the level of service that another local expert is able to provide.
So here are my thoughts:
#1 If an agent is giving you world-class service, you owe it to them (though it's not legally binding without a contract) to let them know if you want to use someone else. In these circumstances, I recommend communicating with them about your feelings about what you feel they are not offering you so that you can get on the same page. It's really hard to find a great agent - so if you do, it's worth maintaining the relationship. :)
#2 If an agent is MIA. Doesn't follow up with you, isn't getting back to you, doesn't show properties, doesn't offer insight, etc. I still think it would be kind to let them know you are going to go another direction... but if not, especially if they are MIA, and no contract is signed - go for it.
#3 If you DID sign a buyer's agreement, you will need to figure out when the agreement expires before pursuing with someone else. Communication is key.
Hope this helps! Always happy to help or continue the conversation offline. Let me know if you need good agent referrals as well. :) Cheers
I’m with many points @Garrett Crosby just made. Quality agents will pick up on if you don’t REALLY have intentions to work with them. Work with many and sure find a way to “get away with it.” But eventually you will find the good ones have access to deals that you will never see if you do not demonstrate loyalty.
Not to mention, the value of investor buyers who will only buy at a massive discount is negligible in many respects unless, again, that buyer is willing to be loyal. It’s still largely a sellers market and there’s a LOT of people who will buy that same deal at a discount… I’ll charge the fires hell with a water pistol for my loyal clients but the ones who shop around on agents will get my basic respect and courtesy, but not an abundance of my time.
Totally makes sense. I'm also in the initial stages of finding an agent to work with and think I have one I'd like to work with, but time will tell.
I definitely don't have plans of working with 5 agents if I'm buying 1-2 properties every 4-6 months, but I have to decide what is worth the most to me. I have one that has a contractor to bring along with any showings, another that has off market deals coming in and works with a wholesaler, and another that has a PM in house to get information from.
Thanks for the advice. I'm definitely not the type that wants to screw anyone or take advantage of people, so that's why I ask. :D