Even if you’re one of those house agents, it’s worth your while to develop the expertise to allow you start working with investors. Here’s why:
1. Most people retire poor, or very close to it. Investing in real estate can prevent this.
2. Some investors buy multiple properties every year.
3. The better you do for an investor, the more $$ they have to invest – with you
4. Most Investors don’t have 4 months to look driving around the greater metropolis area trying to find the perfect 3 bedroom colonial. They need to work efficiently, which works well for me.
5. (Great) Investors make decision based on numbers, not emotion. This makes it easier to figure out what opportunities are right for them.
6. People can’t stop referring people who make them money. The more money you make your clients, the more referrals they give you.
7. Most people who buy residential real estate with you could probably afford to buy an investment property – You help your client base develop wealth while increasing your business. At my firm we call that a ‘win-win’
8. Investors are usually goal oriented, successful people who are fun to be around. That’s why they can afford to buy real estate.
9. If you help someone with their health, wealth or family, they’ll never forget you. This takes care of one of those.
10. Your investment clients can buy your listings that need a good rehab before anyone will move into them. Win for the seller, a Win for the investor, and a Win for you.
11.Most people retire poor, or very close to it. Investing in real estate can prevent this. Help them.
12. When you find a project you like, you now have a ready and able list of people who can capitalize on the opportunity. Instead of showing tons of properties to a buyer, you find the opportunities first, and then offer it to your buyers.
13. Investors understand the value of paying for a good Realtor’s service.
14. Most Realtors have very little knowledge about effectively helping investors, leaving lots of opportunity for those who want to learn how.
14. Investors spend time looking for people they can joint venture with – which is sort of like them going out and finding YOU more clients, except they also get in on the action. Win-win-win (sort of a pattern, eh?)
15. You can work with investors from across the world. Jonathan Dalton does business with Canadians investing in Arizona. I just did a deal for over a million with a client from Kuwait. The Internet has created a massive pool of probable clients.
16. People can’t stop referring people who make them money. The more money you make your clients, the more referrals they give you.
17. Working with real estate investors will ensure you start investing in real estate yourself (if you don’t invest already). Selling real estate can make you a living, but investing in it will make you a fortune.
Go educate yourself on how you can best serve investors. Reach out to me, or someone in your local market who specializes in helping investors. Start reading investment blogs – I particularly recommend Bawldguy’s blog, I hear he’s pretty good at this sort of thing.
Get out there, ask people if they’ve ever thought about investing in real estate. Show them how this could be the opportunity their family has been waiting for.
You’ll help your clients get rich, and you’ll grow your business at the same time.
Genuine Chris Johnson
April 25, 2008 at 7:07 am
You forgot to mention that you can also expose yourself to fraud, too, on high LTV ndoc stated loans.
Benjamin Bach
April 25, 2008 at 7:55 am
Those without integrity can expose themselves to fraud in every business.
Bill Lublin
April 25, 2008 at 9:47 am
Benjamin;
Great post – and one that agents should really pay attention too – and #17 is an amazing benefit that can really build wealth- Amazing how many of us don’t invest in the product we sell to others. And there are more people who vreated wealth buying real estate then are people who created wealth selling it!
BTW my partner and I are always looking for solid opportunities to buy real estate anywhere! 🙂
Thomas Johnson
April 25, 2008 at 12:44 pm
@ Genuine Chris. Most investors have downpayments….
Genuine Chris Johnson
April 25, 2008 at 12:49 pm
@ thomas yeah they do. I’d be into it as a Realtor. Not as a morgage guy
Benjamin Bach
April 25, 2008 at 12:51 pm
My clients and colleagues don’t tell white lies to lenders, insurance companies, the government, or anyone else. Anyone who does is *begging* for trouble.
BawldGuy Talking
April 25, 2008 at 3:19 pm
Benjamin — Thanks for the kind mention, as it’s very much appreciated.
I disagree with your premise though. Before I began taking investors out of San Diego, one of the factors contributing mightily to our success building our clients’ wealth, was in dealing with house agents who got some training, or read a book or two on real estate investing.
Dealing with house agents on the other side of the table is almost literally like stealing in some cases. Most of the time our clients have either bought for too low with terms which would’ve been out of the question had you been representing the other side.
Most of these agents are hard working, and pretty darn smart. Still, it’s my years of experience that says unequivocally the house agent who decides to take on the investment client will do far more harm than good over the long haul for sure, and also most likely the short term. It’s my contention they could study what you do for a year, and still not know what you’ve already forgotten.
They should be referring their investment clients to you, Benjamin. If I had a thousand bucks for every cluster$%^& I’ve had to unwind in the last three decades, due to using a house agent, I’d own a string of Starbucks in addition to everything else. 🙂
You underrate your incredible value, Benjamin.
Glenn fm Naples
April 26, 2008 at 2:07 pm
You might want to mention agents will need to brush up on their mathematics and be sure to talk before and after income taxes and returns on equity.
Landflip
April 27, 2008 at 8:40 pm
I think it is good to keep yourself open to all types of selling strategies. Have have two very close friends that are real estate agents. One sells houses and the other sells land and works with various investments groups. I know it depends on the market, but it seems that the one that works mainly with investors will make more money in the long run. Also, he has been able to join in some of the deals, and make even more money. I think it pays to have an open mind and broaden your expertise.