subject: How to get investors to use you as their real estate agent [print this page] How to get investors to use you as their real estate agent
Investors are a unique kind of buyer. As a real estate agent, there are certain advantages to working with investors. First, most investors buy multiple properties. So for one extra client, you might sell 10 extra houses. Second, many investors flip houses, which means you may get some really nice listings out of the deal. Third, it is fairly common for investors to either be able to make a cash purchase, or already funding lined up. And fourth, most investors already understand the real estate buying process, so often times the transaction is easy to close, and you won't have to spend a lot of time walking them through the process.
So if you are convinced now, read on for some ideas of how to get in the game of selling real estate to investors.
Knowing What Investors Want
Know what your potential client wants. The typical investor is more interested in numbers than anything. Here are some questions you should be able to answer:
How quickly will the house sell after repairs are made?What is the after repair value (ARV)?What is the average rental rate in the area?
You also need to understand the different types of investment strategies that you will see. The two most typical that you will deal with are buy and hold' and buy, repair, sell' often called "flipping". These are very different strategies, so you need to understand each. Flipping is pretty straight forward. The investor wants to buy at a low price, make some repairs to the property, and then sell for a profit.
With a buy and hold property, many of the same factors will come in to play, but you also need to know if the property will provide a positive cash flow. You should know how to figure out a CAP rate if you plan to work with investors that own rentals, especially if they are buying properties larger than 4 units.
Marketing For Investors
Plain and simple, investors want good deals. The best way to find investors is to locate a good deal, and advertise it like crazy. Start with Craigslist and Backpage.com. I would also recommend contacting people you know, and post it on Facebook. If you really want to go for it, set up some paid ads on Facebook that target your specific region.
What if you don't have any good deals to offer right now? Then you need to take a different approach. You will need to market yourself as a deal finder, often times referred to as a bird dog. You can advertise on the same sites as mentioned above, only instead of having a specific property, advertise that you can find properties below market value.
Remember, be consistent with your advertising. Keep track of everyone that has contacted you. If you happen to find a spectacular deal, be sure to call people about it. You could end up landing yourself a great client.
