What is an "Investor-friendly agent"?

[Drew Sygit]

We see this over & over, again & again - someone posts they need help finding a property and suddenly, every agent out there is "Investor-friendly".

Funny thing is, RARELY do you see an agent sharing what qualifies their claim.

In our experience, +95% of agents only know how to deal with owner-occupied transactions.

So, they have barely an inkling of how to work with an investor to find "deals".

Of course, most of the newbie investors don't know what a "deal" is either, with many of them willing to pay asking, or above asking prices. So, maybe those two deserve each other?

In our opinion, an investor should only work with agents that meet at least one of the following:

1) Own rentals themselves for at least 3 years, at least one of them they bought below market.
2) Have a 3-5 year track record of rental transactions, that they can document.
3) Know how to calculate 1% Rule, ROI, NOI, etc. and demonstrate how to actually apply them to assist an investor client.
4) Have access to tired investors selling their rentals.
5) (what can you add here?)

They should also:

1) Be using the BP Calculators, or some similar type of spreadsheet, to show an investor why a particular property is a good investment, as well as supplying sale & rental comparables to justify what they enter in any Calculator or speadsheet.
2) Know how the Property Class affects expected performance of a rental. Investors should NOT be using a 5% Vacancy Factor on anything but Class A properties!

Looking forward to everyone's contributions & comments...

[Doug Smith]

We own both a mortgage company and a real estate business, we do a ton of real estate investor deals, and, personally, my wife and I have flipped or built dozens of homes. That being said, pretty much every investor that reaches out to us seems to be under the impression that they would be our only investor client and that we are sitting on tons of pocket-listings (off market listings) that we are just praying for someone like them to take off our hands at insane discounts. The truth is that, at least in this area, being a licensed agent with MLS access requires the agent to quickly put all listings on the MLS. Keeping them off market isn't in the best interest of the seller the agent is working with. Truthfully, we're slammed with investors that want to make our dreams come true by lowballing deals we list. The other big issue about being an "investor-friendly" agent is that investors expect the agent to chase their tail by driving around looking at every potential home the investor sees on Zillow and then make a bajillion low-ball offers for them "just to see if they stick". The great, knowledgable agents won't do that. The newbie, unknowledgable agents that can't really help you will do it until they realize that they are wasting their time and gas money. We know our stuff when it comes to investment deals, but we completely ignore the emails/posts that say "I'm looking for an investor-friendly agent". We know that's going to have us spinning our wheels. Wouldn't you agree?