Real estate investors have a variety of methods to find fix/flip deals, whether it is direct mail, driving for dollars, connecting with wholesalers or realtors, or another strategy. If you are focused on networking with agents, then do your best to go above and beyond to help them help you.
It can be easy to pick up the phone and call a listing agent, but it may be more difficult to convince them you should be at the top of their list when they have a deal.
Here are some ways to gain their attention.
Double End the Transaction
Make sure agents know you will use them not just for the purchase of the property but also for the sale of the property. They’ll make at least six percent of the total fees, maybe more if they find the initial seller and the ultimate buyer.
Do not just assume they are aware you’ll double end the transaction for them. Ensure they know they will make the most money possible by working with you. Everyone wants to make money, and this is an easy way for you to entice them.
Also, be true to your word even if you decide to wholesale the property. If you choose to wholesale a deal to another investor, ask that investor to sign a listing agreement with your agent.
If an agent comes to you with a deal, be certain to respond quickly, at least within 24 hours. You may be busy, but they will not come back to you if they lose out on the deal because you didn’t get back to them soon enough.
Explain Why You Do Not Want a Deal
Some agents may come to you with a deal they believe will net you a significant profit, but you may determine that’s not the case after running the numbers. As an example, maybe they’ll bring you a deal where you can buy the property for $500K and sell it for $600K. They’ll say you’ll make $100K!
But after diving into the numbers, you might see that the rehab will take $50K, the holding costs will be $30K and the remaining fees will be $15K. So, you’d only make $5K.
There is no way you would do that deal, but do not just brush the agent off. Lay the numbers out, so they understand why the profit margin wouldn’t be enough.
Similarly, if there are other reasons, like high crime areas or poor school districts, let them know. They’ll appreciate the explanation and know what type of deals you want to see moving forward.
Overall, you can differentiate yourself from other investors by using these methods when speaking to real estate agents. In a competitive market, this is critical whether you are a new or experienced investor.
by Jared Newman
Jared is a Loan Officer for the hard money lender Conventus, LLC and has been working in real estate since 2016. He is about to start an investment portfolio of his own with rental properties
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