I get asked all the time about working with Realtors. I actually have a love-hate relationship with them…
And, some of my students and clients aren’t sure if Realtors are an investor’s friend or foe.
Actually, while Realtors can be both—the traditional listing agents who don’t really understand what we do as investors can be difficult— you still need to think of Realtors as friends.
And here’s what’s cool….
If you know what you’re doing:
- You can make friends of the foes
- And you can make close allies of the ones who are already investor-friendly
It all boils down to knowing how to design your business to integrate the services of an agent.
And if you think agents are our enemies, you’re NOT going to do well in this industry.
Drink this in: 80% of all people who are either buying or selling a property contact a Realtor first thing. (Read: They are not calling you—an investor.)
So, that should tell you where the buyers and sellers are… That’s where the goldmine is located. Ignore that and you’re shooting yourself in the foot.
And, the problem comes when investors overthink (and overcomplicate) the process of working with agents…
All you need to be concerned with is making the offer.
So, how do you work with Realtors?
Well, like I teach my students, one great way is to call up Realtors of listings that have been on the market for at least 90 days and ask how flexible their client is on the price and if they’ll negotiate.
If they say maybe or yes, make an offer!
And you can sweeten the deal for the agent by telling them they’ll get both sides of the commission—representing the seller and you, the buyer. That’s not a bad payday for them.
Remember, don’t overcomplicate it… just make the offer.
So, that’s a way to work with Realtors by you reaching out to them.
But if you want them to bring deals to you, you have to incentivize them. And you basically do that the same way—by offering for them to represent you and yet again, they get both sides of the commission.
So, what about paying Realtors with lease-option deals?
Even though I’m actually a licensed agent myself, here’s a few things I do that you should consider…
If an agent brings me a deal, I offer to pay them a commission. It’s usually 1 month’s rent upfront and then I give them the rest of their commission if and when the tenant-buyer buys the home.
Now, if it’s a sandwich lease option, I become the seller, so I just figure the agent’s commission on the sell-side into my price.
And, I also use Realtors who specialize in finding tenants. And I find those agents by posting ads looking for leasing agents on Craigslist. I offer to pay them a commission of half of 1 month’s rent.
Here’s the thing to remember no matter what kind of deal you’re doing…
Treat your Realtors like gold!
You will do more deals—which means more profits.
Find investor-friendly Realtors and do what you need to do to keep them happy. You’ll BOTH be better off for it. 🙂