Are REALTORs Neighborhood Experts?

Are REALTORs Neighborhood Experts?

Having an investor friendly REALTOR is critical for you to be successful in real estate, however it is important to realize that not all REALTORs are created equal! This being the case you need a REALTOR that will assist you in finding deals, understanding the market, writing & submitting offers.

When you begin investing it’s a good idea to start in your backyard & have a REALTOR that understands your
“back yard”. One problems is that this is not the case for all REALTORs.

Hank Miller wrote an article for Inman News were he addressed this issue in more detail.

“Just as walking through a kitchen doesn’t make you a chef, living in a neighborhood doesn’t make an agent a “neighborhood expert.

An expert is defined as “a person who has a comprehensive and authoritative knowledge of or skill in a particular area. Experts have a prolonged or intense experience through practice and education in a particular field.”

Using this definition, it’s reasonable to assume that an “expert” agent would have many years of experience, and a fairly comprehensive body of work. Every definition of “expert” focuses on a skill — not “how long they have lived and worked in Anytown, USA.”

Experience and knowledge seem to play a larger role than where someone lives. But what does the “neighborhood expert” tell buyers and sellers? “I live here and know this community cold … My kids went to that school … Homes here sell so fast … They’re building a new mall in the area that will make this area even more desirable … We’re recovered and are back on the increase.”

Buyers and sellers should ask themselves: Can’t any agent, or anyone, collect demographic data on the community? Can’t any agent, or anyone, collect school data on the community? Has anyone, anywhere, been able to guarantee anything when it comes to development? How did that work during the boom? With guaranteed appreciation? The market has “recovered”? Real estate works at the micromarket level. The last five years have forever changed the business. Washington now controls things, and Washington has a track record. “This is a very unique area, you need local expertise.” Perhaps.

But consider: Is the “neighborhood agent” that expert? Why? No other agent can put the home in the MLS? What’s unique about the area? What impact will it have on the big picture? Is the “neighborhood expert” so focused that they don’t have a larger perspective? What about competing areas, and how they impact the process? What about potential appraisal issues? If “unique” is taken literally, does the “neighborhood expert” understand the appraisal process? Are they the only ones to speak about it? “I have sold homes in this community for years.” OK, but: How many and how recently? Full time or opportunity agent? References? Source of business? Overall volume? Reputation in the industry? Competing markets? Will the seller or buyer miss other opportunities due to a myopic “neighborhood agent” view? Will the home seller have unrealistic expectations planted? “I have buyers just waiting for homes to buy right here.” Sure you do: Listings that don’t require agents to move around much are always welcomed by the “neighborhood agent.” A variation of the “we need homes” nonsense is basic marketing and something that’s drilled into every agent’s head. The objective is to get a sign in the yard.

Is it reasonable to assume that when the home hits the MLS that all buyers in that and similar neighborhoods will be interested? “This area/house/lot is worth … because I KNOW this market.” This is perhaps the single most damaging claim the “neighborhood expert” will make, because: Agents “know” nothing, the market knows everything. The buyers are the market and they talk — “neighborhood expert” may not want to listen. Without recent data suitable for use in an appraisal, this is highly irresponsible to say but routinely done. This approach — opinion before data — is especially common with custom homes and second homes. “Neighborhood expert” won’t hesitate to manipulate or dismiss data that doesn’t fit their opinion.”

See more at: http://www.inman.com/2014/01/31/the-fallacy-of-the-agent-as-neighborhood...

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Woking with your agent

This brings up a great point with agents. I am just starting with a new agent in my area and it takes some time to get them going making offers. I need to be the one who knows the value of the homes, i need them to find the deals and submit the offers. But in my market I need to be the best and well informed on what homes are selling at.

The more you know about your own market the easier it is to wholesale and get deals under contract.

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