Why You Don't Need To Know How To Do Comps
Would you believe it if I told you that I haven’t run a single property comparable since I started flipping houses? Yeah, I really hate that part of the process. Like, I really hate it. “Wait a minute Andrew. How have you not lost money on every deal? Isn’t estimating a property’s After Repair Value (ARV) a critical skill?” That’s why I found a work-around to this problem so I could focus on the aspects of the business that I enjoy actively engaging in.
I’m a huge proponent of sticking to the tasks you enjoy doing and delegating what you dislike to someone who would be the best fit for it. And who better to run comps for you than an agent who is an expert in their local market? That’s why every time I find a deal on Redfin/Zillow or some wholesaler’s list, I text or call up my agent to run comps for me to tell me what the property could sell for once it’s in a perfect fixed up condition. I can do this because I have a long working history with this particular agent.
I was hesitant at first and took everything they said with a grain of salt (got burned too many times in the past) but after a few sales together and seeing us always hit at or above our list price, I slowly gained confidence in her ability to run solid comps and have just trusted her with that process ever since. Sounds like a contradiction, I know. I’m giving advice on trusting agents who are supposed to be the experts while also telling you to be cautious of them. Because not all agents are created equal and this is why you should…
Lesson #3: Surround yourself with a good team.
So, here’s what I look for in an agent that I’m considering working with…
- Must be an actively investing themselves
- Must be doing real estate as their full time job
- Must have a client base that is >50% investors
- Must have a List-to-Sell ratio >98%
That’s not to say that I’ll never learn to run my own comps. I plan to go into multifamily some time in the near future and I think it’ll be important that I have the ability to run comps myself for that. I just never liked the ambiguity of single family versus multifamily.
What are your thoughts on this? Leave a comment below and let me know which parts of the business you enjoy the most and which parts you’ve delegated to others and why.
Comments