In Dean's 30 days to Real Estate Cash book, he talks about getting comps to truly know what to ogger in a property. Whle he doesn't specify where to get them, I know the most accurate results one can get will always come from the MLS. Taking this into account, I should ask my real estate agent to help me with the property, to get comps done, or get a comp online.
The place where I am wholesaling is Seattle, in Washington state. I have tried to reasearch how much information this state releases in regards to sales, to see if getting an estimate from a place like Zillow would be accurate, however I haven't found an answert. If you know the answer, please tell me about it so I can know if Zillow/Trulia can be a plan B.
My main question is this. How do you use the agent to get comps? What do you do and how do you ask them? I would be asking them to run a search on an unlisted property, however I haven't purchased anything through them yet, so they don't see me as a money making source. Of course, I could tell them I will pay them if I get the deal, but here is the things. The ratio is 25:1, so for every 25 comps they get paid only once. How do you get around this? Getting comps is a crucial part of this, but over-using tyour agents could cause them to not want to work with you. I was thinking I could also promise them that if I can't do the deal, I would forward them to the homeowner, they could get some commssion after all, but I don't know how this might work. Also, I am sure you dont send EVERY single possibilitye to your agent, you discard some of them before that. Which ones? (based on the house itself, not motivation)
Something I have learnt, is I need to stick to a system, so I would like to hear about your system! If you can do it, I can too.t
Question: How to get comps from your agent, without over-using them, making them feel a reward is coming, independently of the low pay ratio and which poperties are disquialified before that. Could promising forwarding the lead be enough as well (in case I dont do the deal myself)
PS: If you know about seattle and their discliosure, please tell me!!
You need to interview a few Realtors and be honest and straight forward with your plans. Realtors work on 100% commission basis. No sale, no money. HOWEVER, they realize that they have to invest their time before they get paid. As a former Realtor, I spent countless hours doing Comparative Market Analyses (CMA's) and other market research for free in the hopes of getting a listing or sale. I considered it an investment in a potential client. Look for a Realtor who works with investors. Let them know your investment strategies (wholesale, fix and flip, hold and rent, etc.) It's all about building a relationship and loyalty. Perhaps your Realtor won't make any money when you buy a house directly from an owner, but let them know that you will call them when it's time to sell. They will get the listing and make their money there. If they see that you are a serious investor, they will bring you other deals where they will be able to earn a commission.
Another idea is to look for a newer agent. Usually, they are more hungry/eager to get started. It will be good practice for them to learn their market and since they probably don't already have a large client base, they will have more time to dedicate to you. Ideally your two businesses will grow together.
Live well, laugh often and love much.
Walter Fabiszewski
Southern, FL
You can also connect with other realtors at your local rei club. We have about five in our group, and usually one of them along with my own realtors has time to get you a CMA without abusing the priviledge! It is all about networking with others and trying to help out your realtor with whatever he needs. Mine was interested in investing and building homes. I can also send him leads that I don't do anything with.
www.tw4homes.com website
https://tvallc.isrefer.com/go/RehabLite/reigirl/ FREE SOFTWARE FOR WHOLESALERS, REHABBERS AND AGENTS! Present professional looking deals to buyers and lenders as well as run your numbers and get the ROI.
Thank you for the answer! It is clearer now
Yes you are on the right path it is as you said tell your agent that you will send them any leads that don't work for you thereby getting them business & also that if they send you comps if you get the deal then you will give them $500, this is of course for off market props.
For on market props or MLS props well if they are making offers for you and they should then they will be compensated out of their commission and what I do to not burn out my agents is what Matt suggests, which is 25:1.
In KC MO I just make my offers by multiplying .68% of asking price, of course on fixers or REO's which are usually fixers & HUD props etc. Fanny, Freddie as well.
In Kansas I offer 70% of asking price, in San Diego I offer 79$ of asking price and I don't ask my agent for comps until I get an offer countered or accepted, then I do get comps. And I would always use comps from an agent but only when you get something countered or accepted like I said that way you wont burn out your agent.
Now for off market props get comps, you wont be making tons of offers on off market so it wont matter to your agent, you wont be burning them out. Refer your agent to people who want to short sale their prop or are in foreclosure if they don't want to sell their prop to you or you can't make the deal work, they will love you for it. Make a copy of their business card & hand them out or just hand out their cards they will be on your side forever if you do that.
Tony
Go faster do more! GFDM!
Thanks CaliTony, doing it only for offers that were accepted sounds very good. Online estimates woould provide an estimate close enough to be able to make an offer and lock it up, then the CMA would help when marketing it.
And by any chance, how do you deal with earnest money deposits for MLS properties? There are some good deals that Ive been shown by my agents, but then I remembered this. I have little over 300 dollars in total, so my deposits will be small. Agents usually want larger deposits because they believe it will protect their client, but really it doesn't change much if the clauses give you the money back when deals don't go through. How can I explain the agents, my and listing agent, that I will do put a low deposit and why it doesn't affect the sale?
Thank you,
CaliTony has a great plan with respect to doing CMA's after the offer is placed. However, if you are submitting written offers (as most Realtors will require), that offer immediately becomes the contract if accepted by the seller. On the other hand, if the seller counters your offer, that is a rejection of your offer, therefore rendering the contract null and void. At that point, you have plenty of time to get a CMA and come back with your final offer. Just make sure that you have a few "escape clauses" in your original offer in case the seller accepts and it becomes a legally binding contract. If you are fortunate to find a Realtor who will place verbal offers for you, then you have nothing to worry about.
As for the earnest money, that's a great question. I would love to hear some input from some of the more seasoned members in the group.
Keep asking questions and start taking action.
Live well, laugh often and love much.
Walter Fabiszewski
Southern, FL
EMD(earnest $ dep)-for mls props you have to either A)move really fast & ask for the least amount you can, in kc i ask for $250 in So Cal $1k, when I get something accepted I ask for 2 sets of comps fr 2 diff agents, double chck value(make sure you have equity!) dont inflate ARV's & deflate rehab!
If all is good and I do this whithin an hr, I create the postlet & send it out to my buyers via email, txt & i call them. YOu have to move quickly, you have to guestimate rehab, but also send 3 diff contractors out to get your estimates & send them to you within 24 hours, and tell them if you don't get the prop or they don;t' get the bid that you will refer them to all your network & get them work-that way they will get you estimates at no charge.
So you move really fast is how you do it & ask for the lowest amount for MLS props, now I have partnerd with someone who has $ who will lend me the emd at 30% but I don't care there is still profit-you can do the same go to the REIA's meet people.
For fsbo's you can get away with putting $1.00 emd or $50. the sellers dont ususally even ask about that.
Tony
Go faster do more! GFDM!
yea i have that "Inspection is at buyers sole discretion" which means for any reason like if I don't like the color of the paint of the house I can cancel the contract & get my emd back or just back out of it.
Forgot to mention that you should ask for 14 day inspection or 10 day in hot markets.
Tony
Go faster do more! GFDM!