It’s been quite a while since I last wrote on Bloodhoundblog. It certainly doesn’t mean that I have been absent; frankly, it just means I have been too busy to take 30 minutes and compose an interesting thought provoking piece of writing up to the standard we have all come to know and love on this site.
But I digress, as a real estate investor I have only worked with two great brokers in my entire investing career. I find most run-of-the-mill brokers to be under-educated, uninspired, and more interested in cashing a check by any means necessary than actually meeting my needs. The first broker was a dynamic “buyers” broker, who understood my investment goals and my available capital. Rather than over promising and under delivering, she relentlessly showed me house after house for 4 weekends straight until we found the right quaint little fixer-upper in my price range. Her reward, a $2,000 commission on a $40k home sale and my testimony.
What was my testimony worth? I did two more deals with her, both taking much less time and for a much higher dollar value in the next year (+$10k to her bottom line). I did another deal with her the following year for another $10k to her and I referred her like crazy to all of my investing friends. Even if none of them bought a single thing from her, she turned a $2k commission into $20k, at no additional cost to her and very little time thanks to her investment in me and her in-depth market knowledge.
Realtor number two is basically the same story, but add a few more zeros given some career advancement and price appreciation (Detroit vs. New York City).
From a buyer’s perspective, I am looking for the following qualities:
- Market Knowledge – I don’t need you to print off a list of 80 comps (not reviewed 90% of the time) and ask me what I think. I need you to send me a targeted list of homes you have been inside and already know will meet 90% of my needs. I need you to know why this block is superior to the next and I need you to know something about the seller if at all possible.
- Industry Knowledge – As an investor, I run my own spreadsheets, but I do need you to have a general sense of what properties make sense for investors vs. homeowners. We are different. A home does not qualify as an investment just because it can produce enough rent to cover the mortgage. I need to understand what kind of appreciation this market can expect. Are there good schools in the area? Is it a transitional neighborhood where I should be looking to hold for 3 – 5 years, or is it a heavy flip area where I could probably sell it to another investor? Any new commercial / retail coming to the area? Have a general idea about capitalization rates?
- Passion – Realtors that don’t love real estate should not be employed in real estate. If you don’t spend at least one hour a day looking at interesting real estate articles in your area just for the fun of it, you are not the person I want to hire. It’s great to love putting people in homes, but to be an amazing realtor you need to love homes, neighborhoods, and almost everything else there is to love about real estate. This is one of those characteristics you know when you see it immediately.
Are there other qualities that make a Realtor great, sure, competitive spirit, entrepreneurial drive, basic customer service skills, etc, but the three qualities above are my base criteria.
I am going to make a committed effort to start writing once a week again. Thank you to Don for knocking the cobwebs off of my keyboard.7 comments