One of the things that I think holds many property investors back is their lack of wanting to think outside the box. Believing that buying from estate agents is not profitable is an example of this type of thinking.
This is not just erroneous thinking of those that are new to property investing it is also true of experienced property investors as well. In fact it is probably more of a problem with experienced property investors who have bought ten properties or more than it is of inexperience property investors who are normally more open to new ideas.
As mentioned earlier one of the common misconceptions is that you cannot get any good deals from estate agents and to forget about buying from estate agents altogether. This is a big mistake and if you follow this philosophy you are leaving money on the table when you don’t need to.
Many property investors swear by leaflet marketing and advertising in newspapers and while these forms of finding below market value properties might bring fantastic rewards, you should also not close your eyes and ears to other opportunities that might be right in from of you.
A problem with dealing with estate agents can be that many either do not want to deal with property investors or developers or those that do, already have a close knit community of investors which they call if they have below market value deals.
For those estate agents that don’t like dealing with property investors, there are two routes that you can take, the bottom line is that some of them will not deal with you and you need to just accept that and move on to ones that will deal with you, because there are plenty out there. However, many of the ones that at first glance don’t want to do business with you actually would do business with you if you just educate them on how you can work together.
Take time to win them over and make them your allies instead of them just looking at you as someone who wants to cheat them out of a bigger commission cheque because you are only looking for bargain basement priced properties.
You have to looking at buying investment properties through estate agents the same as buying properties directly from the vendor. You have to create win win situations.
Things to make sure you estate agent knows about you.
- You can move quickly to buy properties
- Exactly what sort of properties you are looking to buy
- You are a cash buyer
- You are not out to rob them of commission, you are actually there as an alternative when the traditional methods of trying to sell a property have not worked for them.
Once you have helped the estate agent to understand these things, then if they are open to working with property investors, then they will be eager to work with you.
If you are in a situation where the estate agent you want to work with already has a list of preferred property investors that they like to work with, then it is probably true that you don’t need to do any work on trying to convince them of the benefits of working with property investors in general, instead all you need to do is convince them of the benefits of working with you and calling you first instead of the other investors on their list.
This can actually be a harder task than trying to convince an estate agent, who doesn’t want to work with property investors, to work with you in the first place. There is no easy way to do this one. The fact is that they might have been working with these other investors and developers for years and these other investors might have bought tens of properties off them so it is logical that they are going to be the ones that get the call first.
When buying from estate agents in this situation, you need to focus on continued contact with the estate agent. Every few weeks contact them to let them know you are still looking to buy properties in the area and every so often when you have bought a property locally and it has been completed you can send them the details to let them know that you have actually bought a property in the area and that you are looking to buy more. By doing this they get to understand that you are a serious player and you are not just all talk.
One day the estate agent will have a property to sell and their preferred choices of property investors, for whatever reason, will not be able to buy it. This is the time when they will call you and you and providing the property meets your buying criteria, which by now the estate agent should be well aware of, you need to do all you can to buy the property.
All of a sudden you can find yourself catapulted from number four choice to number one, this simple moving up the ranks could mean five, ten or even more extra below market value deals for you a year.
The fact is that while you are waiting to move up the rankings with one estate agent you are not just focused on them and you will also be attempting to work with all the estate agents in the area. Buying from estate agents can be especially effectively if you set yourself up as a chain angel.
The bottom line is that buying from estate agents should not replace any other part of your marketing strategy. You should still be leafleting or advertising and doing everything else you normally do. Buying from estate agents, as an investor is simply another string in your bow in addition to all your other efforts; however, if done correctly it could easily end up being as lucrative an addition as any of your other market efforts. This can be especially true in periods of economic downturn when vendors and estate agents are desperate for a sale.**Nothing on this website should be confused with financial or legal advice. If you need this, or any other type of advice, please seek the help of a competent professional. In addition, because real estate laws change all the time and differ from state to state, and even city to city in the same state, everything in these pages should be considered general marketing advice and ideas. Please see link to full Disclaimer at the bottom of this page.