San Luis Obispo, CA · Member since 2017 · 40 posts · 14 votes
I am an investor, but only have a vague idea about the inner workings of a real estate brokerage. My question is: what are the incentives for a realtor to work with an out of state investor? It seems to me that out of state investors, due to their usually particular requirements and extra support needs, take more time and effort than the typical retail buyer. Yet because an investor is usually interested in low to moderately priced properties which often have physical or title problems, the realtors commission is much lower than for a typical retail sale. So why would a realtor be interested in working with an out of state investor?
At the end of the day, they still make a commission! And investors are repeat buyers. I've also seen some out of state investors pay their agent a little more commission.
At the end of the day, they still make a commission! And investors are repeat buyers. I've also seen some out of state investors pay their agent a little more commission.
@Will Triplett - when OOS buyers come to town, they don't mess around; they have an objective in mind and buying is a priority. So an agent won't have to spend a lot of time showing. Here's an example: a client (and now friend) of mine came to town 3 years ago to buy a condo. We identified 8 to see. At the last minute he informed me that his friend (now also a friend) also wanted a place, so the 3 of us saw all 8. He selected one and purchased it. The second gentleman picked one, however it went under contract before we could get it. One month later the unit immediately 2 floors below came on the market and he bought it. The first guy is currently under contract for another condo (yes, through me). They don't mess around. Don't get me wrong, there are those who are just browsing....that's ok, put them on automatic notification. But those who are serious will move. Hope that helps.
Yeah, especially for investors, it is numbers, not emotions. I bought two properties on the beach site-unseen this past winter. Not a small $$ commitment as there were 22 bedrooms in all, but the numbers worked. First time I saw the places was during the week before closing.
I will echo some of the others. Out of State investors are generally a GO or NO/GO right off the bat. Retail clients look for a paint color, need mom to get out and look at it first, It just doesn't feel right. That bathroom shower is a little odd. Which is fine and part of working with them. But they also work with retail commissions. If I have an out of state investor they generally respect my time as much as I do theirs. Being able to rough guess repair costs and pull the trigger is what they do