Most investors know what they’re doing when it comes to real estate. So that’s why the really savvy investors work with agents. Simply put, working with an agent is usually more profitable for investors – which is, after all, the whole point of investing in real estate. A good agent can help an investor save money and time, as well as find the properties that will work best for that investor’s particular business model.
That old bit of financial wisdom is more on the money today than it has ever been – and that is that the easiest way to make more is to spend less and it’s one of the main reasons why investors work with agents.
Rookie investors often think they are saving money buying properties themselves but are they really? The buyer’s agents who work with investors have the valuable and hard-won knowledge, experience, and expertise to help investors find the best ways to negotiate prices. Paying an agent’s fee in order to wind up saving tens of thousands of dollars on a property’s purchase price is a big savings and a sound investment.
A top reason investors work with agents is that it also saves them a lot of time, especially those investors who have another job besides their real estate investment business. So investors who don’t work with agents often have to sacrifice any personal free time they do have to run their investment business. Finding and researching likely properties can eat up a ton of time.
But an agent’s job is to do all that searching the market and researching the properties for you, which in turn frees up your time so you can take care of other urgent business matters. Time is money, and the less time you spend on tasks that can be handed over to an agent, the more your investing dollar earns you per hour.
And there are other important tasks and duties an agent can handle for a time-constrained investor – for example, setting up landlord insurance and arranging property management (even before settlement). An agent can streamline the whole process and avoid (or at least reduce) complications.
Meeting the Business-Model Needs
Different real estate investors have different business models. Some do nothing but fix and flip, others buy and hold in order to rent or sell later, and still others have a combination of those, a hybrid model. So a major task for investors is determining exactly which properties best fit their business model and then sifting through all the possibilities to find exactly those properties.
Investors work with agents so that they don’t have to shoulder all this burden themselves. As an investor, you build a relationship with your agent who then knows exactly what kind of properties you need. The delightful – and money- and a time-saving result – is that you can just turn them loose with an idea of what to look for, and they’ll go out and find it for you. With a thorough knowledge of your business model and business needs, a good agent can tell you what you should buy – and not the other way around.
For an investor (or any other real estate buyer, really) an agent can be a profit-enhancing ally and partner. But, as an investor, you need an agent who knows the ins and outs of real estate investing.
Finding An Agent
So how do you find expert oriented agents? Ask other investors. During your own investing journey will come across other investors who have successfully done what you are trying to do. Ask them who their agent is. I also recommend finding an agent who is an investor themselves. While it is not a deal breaker, an agent who is also an investor will understand the process in much greater detail and provide in-depth first hand invaluable knowledge and experience throughout the transaction and well after closing.