All Forum Posts by: Allison Park

@Allison Park

Two pro tips to share.

1. I'd offer to pay more in commission than what you think is the "going rate" (not your exact words but what you are wondering) on my first deal or two with agents so that they are enticed to work with you.

2. I'd think about creating a very specific buy box and show why agents would be interested in working with you. Saying that you are looking for a good investment property would not be helpful for an agent. Being specific about geography, price points, willingness to take as is properties, speed of decision making and closing, whether you are a cash buyer or not, property specs....that will go a long way in your brand as a good match for an agent.

Quote from @Nathan Gesner:

Quote from @Allison Park:

Good agents won't want to work with you.

Nothing has changed with commissions. The NAR settlement was ridiculous and has only forced agents to do more paperwork and disclosures, but the vast majority of us are still working the same way.

The law requires the agent to sign an agreement with you. If you don't sign the contract and hire that agent, then they legally shouldn't be working for you. There are some ways around this, but it's not in your best interest.

The fact is, a buyer's agent doesn't get paid unless you buy a property. They are literally working for free in hopes of getting paid when you close the deal. If you want to work with multiple agents, those agents know there's a very low chance of ever earning a dime, so they won't waste their time.

Agents do much more than find property. You can do that on your own. What you want is an agent with experience who knows how to negotiate, watch your back, navigate difficult situations, understand contracts and law, provides an objective cross-check, etc.

Definitely learned a few things from this post and really appreciate your honesty.  It sounds like there are some things that are negotiable in the rep agreement such as limiting it to a certain area and shorter duration so you aren't committed to working with someone that isn't compatible or not finding deals.  I definitely see your point that you wouldn't want several relators sending you the same deal.  

Quote from @Bruce Lynn:

The new standards are yet to shake out I think and it probably does cause some indigestion for investors and agents both.  In the past I would often show investors 1-2-3 properties without a buyer's rep agreement as we got to know each other.  Often pretty quickly....see something online at 1pm and I'm meeting you there at 2pm to see if we can lock it up before someone else did.  Now we can't do that.  We need a buyer's representation agreement signed before we can show.  That probably in most cases for me, will result in a delay between the time you call and the time we can prepare that document, get it to you to review and sign, and then schedule a showing.  If I am going to take time to prepare it, then I am going to want some kind of commitment from you to stick with me.  Maybe it should have been that way all along.  If you are new to investing we also need to spend some time somewhere, maybe 1hr to talk about your expectations and the realities of the market and see if there is correlation.

Interestingly enough I think with the NAR lawsuit some expected commissions to go down. Early indications as I expected is that they have gone up slightly. My though is the weak agents are going to get lost in the shuffle. If they were part time and weren't up to date on training, most probably go away. The good news for you as an investor will be likely you get a better and more experienced agent. Bad news you may also have to cover your own commissions. If you think about it in any industry less transparency and more friction in the transaction will increase fees/commission vs reducing them.

I like the idea as an investor of having different agents, a team of agents maybe 3-4 bringing me deals, but I think less of that will happen now as all will have to have you sign some kind of agreement up front. What if all of us send you the same property and you have 4 agents. We're probably not going to take the risk if we're busy agents to play that game. We want to be committed to you and you to us. Finding properties to me is about 5-10% of the work in closing a property. Zillow actually is probably not a great resource for finding properties anyway. The public searches are pretty limited in scope for a true investor. We have much more robust capabilities in MLS that typically in most areas aren't available to the general public. For example searching on keywords in both the description and private remarks that aren't shown to the public. I have all kinds of specific searches set up for my investor clients to help find the best deals. Short Sales, Bank Owned, $/sqft, school district, days on market, etc.

Off market deals I say are not really the bread and butter of most retail agents. We focus and specialize in "on market" MLS deals. Off market is really just a marketing term. Most are very much on the market and subject to bidding. Just go to one of the Friday afternoon 2pm 1hr showing windows of most wholesalers and see another 25-30 investors there "inspecting" the property. If you want off market deals, typically the best deals are the ones you are going to source on your own, not from an agent or wholesaler. You're going to buy some lists, like a preforeclosure list and mail and call and mail and call and mail and call until you get them to meet with you and then you strike the deal. You have to think, if we do that and we get the call we are going to try to list for maximum value to the broad market as we have a fiduciary duty to do that. It might just be every rare instance we get someone that doesn't want to list, just needs cash offer and quick close lets say before foreclosures and they might call on Friday when the sale is the next Tuesday. That's when we call you, so cash deal, not hard money, no financing, need to close it on Monday. Those deals are pretty rare though in my experience, we don't get those every day. Those we also give to our know resources that stick with us, not to the free agents who haven't yet signed a buyer's rep.

Sounds harsh I know, but that is often the reality of the situation as I see and experience it.

@Allison Park: it would be great to hear what differentiated the two listings in terms of the service and your experience. 

Fair objections. Regarding licensure, there are a ton of licensed but formally- or informally-inactive agents. I doubt it would be too hard to recruit some to open doors and hand out list sheets for per-tour pay (think of Uber drivers, but with real estate sales agent licenses). 

Regarding tire kicking, yes, that’s a tougher issue. Maybe prospects would pre-qualify in some basic way before touring (e.g., they’d have to upload pre-approval letters and ID to an app).