Right now is the ideal time to invest, with property prices very low and bargains out there to be had. A real estate agent with strong knowledge in investing is key to be able to buy and sell investment properties. However, what should you look for when finding an agent to help you buy or sell investment properties?
First, there are many types of investment properties. You will want an agent that knows the particular type inside and out. Typically the agent will own these types of properties himself and has ample experience buying and selling them for other parties. Types of investment properties include.
- Flipping homes
- Buying single family homes and renting them out
- Duplexes, triplexes, and 4-plexes
- Commercial rental properties
- Commercial retail properties
- Other types of commercial properties
There are also agents that specialize in building investment properties vs. buying existing investment properties. If you are not sure what type of investment is best for you, generally you will want to stick with one of the first three items and many good investment agents can help you find the one that is best for you.
As mentioned, you typically want an agent that has experience in these types of properties. If you are selling an investment property and the property is marketable to non-investors, then a traditional real estate agent may be a better option as they will be able to stage the home and market it in a way that attracts more buyers. Investment agents often prefer to sell homes empty – which may work if the property is only mean to be purchased by investors but is suicide in today’s market if you want to attract buyers who want to live in the property themselves.
There are a number of debates about whether wealthy agents are always better than agents that are less wealthy. While clearly you want an agent who invests themselves and knows how to profit from it, hiring an agent that spends more time with their investments than with their clients is often not a good idea.
First, a very wealthy investor is more likely to buy themselves all the best deals they come across. Very often this means you will receive investments. Smaller investors will typically have all of their finances in their properties and will be unable to jump on all opportunities – therefore meaning they can pass them on to you.
Another reason against extremely wealthy investors is they have less motivation to help you. After all, why do they? They already make more from their own investments than they will make on the commission they receive for finding you something. Again, smaller investors will have more incentives to make you happy and hence earn your referrals. While they make a good income from their own properties, they still need your business to make a living.
Be careful about investment agents that ask you to sign a blank purchase and sale agreement. This is highly illegal but a number of investment agents do practice it. Their reasoning is often that the hottest investment properties sell fast, but in truth it makes it easier for them to make a sale. While it is true that hot properties sell fast, if you can make some time during the day you can fill all papers out quickly and have an offer the same day. Most listing agents will wait at least a day or two to receive as many offers as possible. It is not in their best interest to take the offer that is sent first without waiting several hours for more.
Do make sure to ask agents about their experience in investment properties. Typically if I do not feel that I am qualified for the type of investment (such as commercial properties) I will refer them to a more qualified agent.
