How Does a Realtor Help Me in a Flip?

Question

Hi - this may be a weird question, but I was in a mastermind and explaining how I do not have the time or desire to drive for dollars.  The leader explained to me that finding an investor-friendly real estate agent is how she gets her own deals for flips.  I don't understand how a real estate agent would get access to "investor-worthy deals" when I would think the people they work with aren't in a distressed situation and are looking to sell for a profit.  Can someone shed some light on this for me?

Jonathan Pflueger · Answer

Great questions, let me elaborate. When people mention "investor-friendly" real estate agents, they're referring to agents who have a deep understanding of the real estate invesment market and the specific needs of investors. These agents differ from those who primarily work with homeowners looking to buy or sell their primary residences. Here's how investor-friendly agents can access "investor-worthy" deals:

1. Network and Relationships: Investor-friendly agents often have extensive networks within the real estate industry, including connections with banks, attorneys, foreclosure specialists, and other professionals who might have leads on distressed properties or motivated sellers. They might also have relationships with contractors, wholesalers, and property managers, which can be invaluable to an investor. Never underestimate a good network!!

2. Market Knowledge: These agents typically have in-depth knowledge of the local real estate market, including areas with high investment potential, upcoming developments, or changes in zoning laws that could affect property values. This allows them to identify properties that might not seem valuable at first glance but have great potential for investment.

3. Access to Off-Market Deals: Many deals that are ideal for investors never make it to the open market. They are sold off-market, often because the seller wants a quick sale, the property is distressed, or for privacy reasons. Investor-friendly agents often have access to these off-market deals through their networks. Again, this comes down to their network!!

4. Experience with Distressed Properties: While it's true that many clients of real estate agents are looking to sell for a profit in non-distressed situations, investor-friendly agents specialize in or are at least familiar with foreclosures, short sales, and REOs (bank-owned properties). These types of sales can be complex and require a different approach than traditional sales, and they often represent opportunities to buy below market value.

5. Understanding of Investment Strategies: An investor-friendly agent understands various investment strategies, whether it's flipping, buy-and-hold, BRRRR (Buy, Rehab, Rent, Refinance, Repeat), or others. This allows them to tailor their search and recommendations to fit your specific investment goals and criteria.

6. Negotiation Skills: These agents have honed their negotiation skills to ensure they can secure the best deals for their clients. They understand the importance of purchase price in the investment equation and work to negotiate terms that meet the investor's financial goals.

Investor-friendly real estate agents bring a lot more to the table than access to the MLS. They provide insights, connections, and expertise that can help investors find and secure deals that meet their investment criteria, including those that involve distressed properties or sellers in unique situations. It's about leveraging the agent's network, knowledge, and skills to find opportunities that others might overlook. Again, right back to network, network, netwrok!!

Jennifer Wood · Answer

You should win an award with most thorough and easy-to-understand response Jonathan.  Thank you so very much!

Bill J Fay · Answer

Agents are in tune with your market. With that being said, some agents are very traditional and only really work with owners that are buying/selling their primary home. There are other Agents that are focused on the investment side of real estate. These are the Agents that you want to get to know as an investor. They will come to you when they get word of a property that needs love. They are paid when these properties are bought and sold, and you are a critical part of this transaction. Find Investor Friendly Agents here on BP.

Chris Ayars · Answer

@Jennifer Wood I was at a property today from a lead I obtained that needed an investor to flip it pretty badly. I did not know that before the appointment, but saw the issue as soon as I stepped inside the door. The family knew it and did not expect much out of the property.

Even though they had an agent in the family, they were looking for a quick cash buyer. I contacted an investor, but within a few hours they had already accepted another cash offer.

With that said, as a REALTOR®, I need someone on my immediate contact list that can place a cash offer for a property that quickly. Someone I know who will be able to make that quick of a decision within specific price ranges. Like in the case of today, I would represent the buyer and the seller would be unrepresented.

So having a prearranged deal and a good working relationship with a real estate agent can most definitely be to your advantage. Then, you could turn around and use that same agent to help you market the property when you are ready to sell. Remember... contracts are always negotiable, but you both have people to pay and food to put on the table. It could be a win-win situation. That's what I am looking for.

Bradley Buxton · Answer

@Jennifer Wood

There are many ways to get deals. What is the time and energy you're willing to put into it? If it's not driving for dollars then going to networking events and selling what you bring to a deal.  For others like my clients I collect the data, find the deals, do the analysis, and provide references to get the property stabilized. That is a value I can bring to them as an agent. Good deals are based on market conditions, rents, skills, time, and your capital investments among other factors.

Katie Smith · Answer

Hi Jennifer! You will need to pay the agent a commission, which can drastically eat into your cash proceeds on a flip. Are you in touch with any wholesalers in your area? I would reach out to a few wholesalers - and give them your buy box. Wholesalers will send you properties that fit your buy box, and you can work directly with them and a hard money lender to get the deal closed.

Bob Stevens · Answer

BTW, I am not trying to insult any realtors. I am sure there are some good ones that provide value. For me I have yet to find/ need one. I do it all on my own for 10 + years. Even my personal prop to live in I find and negotiate. Realtor sits back, fills out paperwork and makes 3% , not a bad gig LOL ,

All the best

Bob Stevens · Answer

NONE, list them yourself, why use a realtor? I never do. Now do not get me wrong realtors may show up with a buyer, but they are not working for you, they are working for the seller.

Good luck

Matthew Gentile · Answer

Great question @Jennifer Wood. You are absolute spot on when you say @Jonathan Pflueger should win an award that explanation was incredible, concise and very informative and powerful. Well done.

I agree with everything that's been said but I'll highlight probably the most important aspect an investor-focused agent will bring is the network and relationships. It is far easier for someone actively working in the industry to be able to know and reach out to 100-200 people who are on their team or off doing like-minded operations to see who has a distressed property that needs to be offloaded quick. Some buy and hold investors may have outdated beat up buildings that can't be sold conventionally without repair and your flipping operation with the right agent may just happen upon that deal for working with that person. This is a network game, people make deals with people. Relationships are critical. And naturally the more you work with like-minded investors and agents, the more your network starts to expand and momentum is enormous in real estate.

I'm excited for you! Keep us updated on how you're progressing.

Warren Powers · Answer

@Jennifer Wood This is a good question. I finally fought the right agent and now I have access to deals I only dreamed of before. If an agent does not provide you as an investor value then keep looking. The best agents are worth their weight in gold, especially to those of us who have struggled for years trying to make all of the pieces fit.

How Does a Realtor Help Me in a Flip?

Most Popular Reply