At the very least, the wrong investment puts you and your business on hold by tying up time and funds you could be using for other projects.
One unsalable or even a slow-selling property may not sound like that big a deal, but it can be devastating. Rather than turning a project for a $50,000 profit, you could be tied up for nine months (or more) and barely break even, if you’re lucky. With a ninety-day turnaround you could have made a profit from three projects rather than breaking even (hopefully) with one property.
The right agent can make sure you buy with selling in mind. It’s easy to buy a property. It’s essential to be able to sell it, and that’s not always so easy. The right real estate agent will know if a property will be sellable, at what price, and how long it will take to sell. You want a ninety-day flip, not a 270-day flop.
Time Saver
I’ll never forget my dad’s idea that he was the only person who could do anything right. My father was a skilled veterinarian who felt he had to do everything himself. I couldn’t get him to understand that if he could do just one more surgery a week, he could hire someone else to take care of the books, sweep the floors, and clean the cages. When I wasn’t around to do it, which was at least 75% of the time, he had to do it—a skilled surgeon cleaning feces out of cages!
That is almost how it will be for you if you don’t have an agent. You are a skilled real estate investor. You don’t need to waste your time doing busy paperwork, dealing with lenders, title, escrow, termites, and worst of all, other agents whom you might not enjoy working with.
Like my dad, you could save a little and lose a lot more. My dad may have been too busy cleaning out cages to do a several hundred dollar surgery. A real estate investor could lose out on a $50,000 deal because they are too busy trying to get their paperwork in order, rather than looking for another property.
The right agent has the expertise and know-how to help you. You don’t have the time to meet every inspector and appraiser at the property. Nor do you have the time to stop by the zoning office, escrow company, lenders’ offices, etc.
Your time is valuable. If you hire an agent who knows what they are doing, they can perform these duties and free up your time.
Do You Want to Succeed?
This is not a sarcastic question. Do you or don’t you want to succeed?
Would you want to be a race car driver without a team around you? You might lose a bit of time at the pit stop changing the tires and filling up the gas yourself. You will find it equally bad if you don’t use the services of a real estate agent. If you want to succeed, and I’m sure you do or you wouldn’t be reading this, there is no reason not to take every advantage possible to ensure your success.
In athletics and in business there is a small margin between losing and winning. In real estate there are many different roles the right agent will play for you. Any single job could make the difference concerning your success. The most obvious and important role is to find you the right property at the right price.
To succeed, the number-one criteria is to find and buy a property you can rehab and sell for a profit. The right real estate agent is qualified, experienced, and has the connections to provide that property for you. You might have one or two connections of your own, and you might have some great ideas, which you may have tried and been successful with, but it still might not be enough. The right real estate agent has completed many more transactions and has many more connections to help you. Remember, you can still find the property yourself if you desire. But why not increase your odds of finding the best property for your business?
Don’t Allow Greed to Get in Your Way
Greed shows itself in so many different ways. We can often be cheap with the materials, labor, lenders, title, escrow, advertising, and our agent. Remember, your agent’s main motivation is profit too. What do you do when you are around someone who is greedy? That’s right, you turn and run the other way—fast.
Don’t be a greedy investor. Never be cheap. Don’t cut your agent’s commission. When we decide we can’t be successful unless we are cheap, the first person we decide to be cheap with is our agent. We do that for three reasons:
1.We think of him or her first because we work with them the most.
2.They make the most or biggest chunk of money (other than you, the investor).
3.We think we can get away with it.
Stop it. We are dealing with a person and a professional. We don’t ask our doctor to give us a discount! We don’t say, “Hey, Mr. Vons, my grocery bill is too high. You have to take a 25% discount or I’m not buying your groceries.” As an investor, this is the worst thing we could do. You have heard the expression: “biting the hand that feeds you.” Biting the hand that feeds you is exactly what an investor is doing when they cut their agent’s commission. You are insulting, discouraging, irritating, and alienating the most important ally, asset, and friend to your business.
Your real estate agent (if you follow this book) will be the one person who will make and save you tens of thousands of dollars. Most importantly, the right agent will find you the most important thing for the success of your business: a salable property. Think about it--if someone is cutting your income, how hard are you going to work?
An Investor’s Best Friend
Without a doubt, the right real estate agent is an investor’s best friend. An investor can view property, estimate value, and deal with escrow, title, lenders, termite inspectors and other agents and buyers. An agent will find you the best deals. Do you really want to do all the work that an agent does? (Trust me, it is a lot.) Are you willing to miss the deals that an agent can and will bring you?
The right property at the right price is by far the most important event in the process. If you get that right, everything else will fall into place. If you get it wrong, everything else will be a problem. The point here is that if you have ten things to do to make the deal and your agent only finds you a good deal, THAT WOULD BE ENOUGH!
This can’t be overstated, and this is why the right agent is an investor’s best friend. A real estate agent is full-time in the business of working with buyers and, most importantly, banks. Banks do not want to be in the business of selling real estate. Banks have so many properties they don’t know what to do with them all. That is where you and the right agent come to the bank’s rescue and buy some of their most distressed properties.
Your Personal Real Estate Guru
Imagine how great it would be to have someone you can call, text, or email who has all the answers for all your questions. Most people don’t realize what an asset an agent can be. Not only do they help you find the deals, he or she can supply you with a plethora of information. A real estate agent can also lend you psychological, emotional, and moral support. A good agent will give you motivation and inspire you to go on when you feel like quitting.
In the process of finding, negotiating, and closing a deal, there are inevitably problems, often many of them, that can cause a great deal of distress for even the most seasoned investor. This is when your agent’s skills as a counselor can be a godsend. When I worked
