Working with Real Estate Agents Who Understand Investment Property

The world is full of real estate agents and brokers eager to do a deal … but only a small handful of those agents are qualified to service your unique needs.

The best partnerships between agents and investors create mutual success. How do you find an agent that works FOR you and WITH you?

In this episode of The Real Estate Guys™ show, we chat with Bob Helms, the Godfather of Real Estate. His experience as both an investor and a broker spans decades … and he knows how valuable relationships between professionals are to successful deals.

You’ll hear from:

  • Your play-maker host, Robert Helms
  • His playful co-host, Russell Gray
  • Bob Helms, the Godfather of Real Estate

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This is a relationship business

One of the most critical relationships you have as an investor is with your real estate professional.

Whether you’re working with an agent or a broker … and we’ll use the terms interchangeably … the partnership you have with the individual legally representing you in a deal is vital to your success.

We call Bob Helms the Godfather of Real Estate … and for good reason. Bob has spent decades actively brokering properties, teaching and managing agents, and investing in deals himself.

“This is a relationship business,” Bob says. And it’s absolutely true.

Your agent isn’t your enemy. The very best deals we’ve ever been involved in have been with real estate professionals who know their stuff.

When it comes to real estate brokerage, it’s about cooperation … not competition.

“It’s urgently important that you not practice business by trying to take advantage of the person on the other side of the transaction,” Bob says.

Both sides have to win

So many investors think they have to squeeze every last dime that they can out of a deal in order to call it a win. They think they have to get the upper hand to be the winner … which means the buyer or seller is the loser.

The best transactions are when a deal closes and everyone in the room gives each other a high five.

Those are the deals you want to do again. And real estate investment is a long-term game.

Unlike the typical homeowner … who moves every four to seven years to a different marketplace … investors do multiple transactions over time in the same market. And you do more business more often.

There’s a good chance you will do additional deals with these same people, so your attitude is important, Bob says.

If you’re the guy who is trying to exploit the other guy, no one will want to work with you again.

Remember, it’s about relationships. There IS a better way!

Working well with your agent

How do you work with an agent or broker to get the best deals at the right prices?

The first thing to keep in mind is loyalty.

You might think it’s a good idea to have several agents working for you in a single marketplace. But more often than not, this competition doesn’t work in your favor.

If an agent knows you have other agents working for you too, they are less likely to invest time in finding you the best deals.

On the other hand, if an agent knows you are invested in a long-term relationship with them, they’ll work hard to impress you and keep you around.

Exhibit loyalty to your agent, and they’ll be loyal to you.

Find the best agent you can, and set up a meeting. If they are at the top of their market, they probably already have a full portfolio of clients.

Show the agent you are worth their attention. Be able to articulate why you are qualified, why you are serious about making things happen, and how you can add value to their business.

Can’t get an appointment? Try taking the agent to lunch. Everybody has to eat!

You may have to start with a “C” agent and work your way up to an “A” agent … and that’s ok.

Even if your agent of choice isn’t ready to take you on, take advantage of their experience.

“Say, ‘I want to be your best client in five years. If you were me and starting over today, what would you do? What do you wish your current clients knew?’” Bob says.

Show you’re there for the long haul, and start building a relationship.

Why agents should work with investors

The majority of real estate agents sell houses to people who want to live in them. But the investment property niche can be very profitable.

So, if you are reading this from the perspective of a real estate agent, here are four big reasons to get involved with investors …

  1. Do more transactions. Investors purchase properties in the same market again and again.
  2. Get more referrals. Investors tend to work in multiple marketplaces. They rely on a network of agents to help them. You can pass clients to other agents and have clients passed on to you. That saves you money you would have spent tracking down new buyers and sellers.
  3. Earn bigger commissions. Investors graduate to bigger and bigger properties over time. That means bigger and bigger commissions for agents.
  4. Become an investor yourself. Be your own best client. Learn from the investors you work with. Make a living selling to other people and get success by buying yourself.

Keep brokering real estate deals, but invest your money into deals of your own.

Investors love working with agents who invest too. That means the agent knows the rules of the game, and will bring investors the deals they can’t do … but would do … themselves.

Most real estate agents don’t work with investors because they don’t know how.

Bob Helms’ new book Be in the Top 1%: A Real Estate Agent’s Guide to Getting Rich in the Investment Property Niche is a great resource for getting started.

The book is aimed at agents, but investors can benefit from its lessons too … because by working together, agents and investors can form long-term relationships destined for success.


More From The Real Estate Guys™…

The Real Estate Guys™ radio show and podcast provides real estate investing news, education, training, and resources to help real estate investors succeed.


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Profitable Niches – Residential Assisted Living Homes

The Silver Tsunami is coming. That’s right. It’s no secret Baby Boomers are retiring and entering a new phase of life, and looking for an alternative to traditional assisted living facilities.  

In the third episode in our Profitable Niches series, we explore the world of residential assisted living homes.

We chat with leading national expert and President of Residential Assisted Living (RAL) Academy, Gene Guarino, about this compelling investment opportunity, and four of his students who are successfully investing in this space.    

In this episode of The Real Estate Guys™ show you’ll hear from:

  • Your happy-to-assist host, Robert Helms
  • His in-need-of-assistance co-host, Russell Gray
  • RAL Academy President Gene Guarino
  • A few of Gene’s star students, Sherry Ellingson and Rocky McKay, Loe Hornbuckle, and CJ Matthews

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An explosive demographic with specific needs

So much of real estate is about understanding specific demographics and their needs. All around the world, and especially in the United States, there is a massive population that has created business opportunities through every season of their lives … baby boomers.

Baby boomers are retiring in droves, and they aren’t too far away from not being able to live independently anymore. Unlike generations before them, boomers (in general) are adamant about not living in an institution or hospital. They want to live in a home and have a social life.

That’s what makes residential assisted living homes such a fascinating investment niche. This specific demographic and a unique financial model means more CASH FLOW than a typical single-family home investment.

Gene Guarino is the leading expert in this investment niche. As president of the Residential Assisted Living (RAL) Academy, he teaches investors everything they need to know to get started.

“It all starts with education. Get educated first. If you don’t, you’ll most likely go out, make mistakes, and bang your head against the wall,” Gene says.

We’re all about education for effective action. So, we sat down with a few of Gene’s star students to learn about their experiences and what advice they have for other investors.

Building your brand from the ground up

Sherry Ellingson and Rocky McKay are business partners who attended Gene’s class several years ago.

“We kept hearing about senior living,” Sherry says. “We both have parents who are going to be entering into this category before long, and after taking a look at some of the current options in our area we thought, ‘You know, we could do this a little bit better.’”

Rocky and Sherry first acquired an existing assisted living facility that needed some updating. The property is 10 beds with jack-and-jill baths and lots of places for residents to be able to visit with friends and family. The goal is to have residents feel at home and have a happy, safe place to make their own.

How do they attract tenants? Case workers from hospitals and rehab centers refer potential residents and their families to placement agents who find out what they are looking for in an assisted living facility.

Then, the agents take them on tours and show refer them to various home options. That’s why a good reputation is so important.

“The reputation of a home is attached to the owner, so your focus should really be on creating your own reputation and brand from the ground up,” Sherry says.

“The demand for a good home is extremely high, and as we provide such an essential service for our residents, it feels like we are doing the right thing,” Rocky adds.

For investors just starting in the niche, Sherry and Rocky recommend looking for an existing home and remodeling it into a residential assisted living home. They also suggest having a fixed rent rate with everything included so families can set their budget and not worry about hidden fees.

And don’t forget that there is benefit in adding more properties. More residents means the ability to buy supplies in bulk and save even more money on operation costs. Sherry and Rocky hope to have a couple hundred operating homes in the next several years.

Raising capital and expanding your network

After going through the RAL Academy course, Loe Hornbuckle found his passion. Since then, he has opened 40 beds in residential assisted living homes and is in the process of developing an 80-bed facility made up of five homes on six acres as a planned community.

“I look at residential assisted living as a tool to keep people out of nursing homes or institutional environments that may not be right for them,” Loe says. “There are a lot of people who are placed inappropriately in those settings.”

Even though he was passionate about the type of investment he was making, Loe says he still had a lot to learn when it came to raising capital.

“The first time I raised capital, I put out my business plan, and at the end of the first day my wife found me in the fetal position on the floor. It was harder than I thought it would be,” Loe says.

Proper education changed this for Loe. He learned you have to build a network to effectively raise capital. He suggests that RAL investors attend events and conferences so they can meet the many people out there who are willing to help them along the way.

“Your network is everything. When you build your network, you have the power to step into good business like residential assisted living,” Loe says.

Syndication and working smarter

As a self-proclaimed real estate addict, CJ Matthews was looking for an investment with good cash flow and without a huge amount of ongoing work. After hearing Gene speak on RAL homes, she knew she had found the perfect niche.

“With residential assisted living, you do the work to set everything up, and then you become the business owner. At that point, someone else can actually run the day-to-day business for you,” CJ says.

The biggest advice CJ offers to potential RAL investors is to learn about and apply effective syndication.

“Before learning to syndicate, going out and asking for money felt risky or scary to me, but after I attended the Secrets of Syndication seminar, I knew what I needed to do,” CJ says.

When it comes to working with partners, CJ recommends choosing people who have skill sets you don’t. That way you can work synergistically and accelerate your success. And don’t forget this particular investment niche requires a special touch.

“This space isn’t for everyone. You need to love real estate, love making money, love putting in work on the front end, and most importantly have a heart. If you aren’t willing to care about these people and making the last years of their lives happy, then this may not be the investment for you,” CJ says.

Interested in learning more about investing in residential assisted living? Listen in to the show to hear more from Gene and his students. You can also email us at ALF@realestateguysradio.com, and don’t forget that Gene will be cruising with us on our Investor Summit at Sea. We’d love to see you there!

Listen to other episodes in our Profitable Niches series (like Stacking up Profits with Self Storage or Making Money with Mobile Homes) to step off the beaten path and learn more about other lucrative, but as-yet unexploited asset classes.


More From The Real Estate Guys™…

The Real Estate Guys™ radio show and podcast provides real estate investing news, education, training and resources to help real estate investors succeed.

Profitable Niches – Making Money with Mobile Homes

Low-hassle affordable housing + land banking + triple-net leases = what? There’s only one answer to this real estate investing equation, and that’s mobile home parks.

In the second episode in our Profitable Niches series, we venture into the land of mobile home park investing.

We chat with super syndicator Andrew Lanoie about why he ventured into this niche and what benefits investors can find in the mobile home space.

In this episode of The Real Estate Guys™ show you’ll hear from:

  • Your mobile host, Robert Helms
  • His unmovable co-host, Russell Gray
  • Experienced syndicator, Andrew Lanoie

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Broadcasting since 1997 with over 300 episodes on iTunes!

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An expert investor in a unique space

Do we know what’s going on in the mobile home space? We’ve got some general knowledge … enough to form some hypotheses.

But to test our hypotheses, we turned to Andrew Lanoie, principal partner at Park Place Communities. He’s been in the mobile home space for the last five years.

Why mobile homes? Two reasons:

  1. Increasing demand for affordable housing in the marketplace.
  2. Adequate supply of mobile home properties for sale, often by owners suffering from lazy landlord syndrome … which means many properties also have a value-add opportunity.

These two reasons are the main factors Andrew has made a place for himself in the mobile home space.

He started out in single-family homes but realized things weren’t penciling out after several years in the space. Andrew then tried multi-family properties … same problem.

Prices were escalating while returns were decreasing. So, Andrew started looking at different asset classes, eventually arriving on mobile home parks.

Today, he looks for distressed assets where he can buy low and add value.

Are mobile homes actually “mobile”? Not really. Ninety percent of mobile homes stay in place for the entire life of the home. Most residents sell their homes and buy new ones instead of paying pricy moving fees.

Why are mobile homes in demand? This class of affordable housing offers a lot of square footage for each resident’s dollar.

Think about it … the standard double-wide mobile home is equivalent to a 3-bedroom, 2-bath apartment. For $500-600 a month, that’s a lot of bang for a renter’s buck.

Plus, residents don’t have to share walls.

Pros of mobile home investing, and where to step cautiously

There are many benefits for investors, too. For example, Andrew says one big difference between a multi-family property and a mobile home community is the expense ratio.

“The expense ratio is reduced in mobile home communities because you only have to deal with below-the-ground issues.” That’s because generally, residents own the mobile home they live in, while investors only own the ground beneath their feet.

Owners’ biggest costs will be infrastructure costs, like sewers, water systems, roads, and electrical setups. Another cost is the cost of vacancies, although buyers can bring that down by renovating and reselling non-performing homes.

One area for upside is rent increases, although investors should be very careful in this space. In the affordable housing sphere, “You cannot just gauge rents up,” says Andrew.

However, investors can make slow and steady rent increases … as long as they are making other improvements to increase the value of the property to residents.

How does tenant-landlord law work? In most cases, residents are paying a pad rent plus an additional lease amount if they don’t own the mobile home outright. If a mobile home owner can’t pay their pad rent, operators can essentially put a lien on the mobile home.

“It’s usually a 90-day process to get someone out,” notes Andrew. In many cases, operators can make a deal with residents before it gets to that point. But if necessary, it is relatively easy to expel a non-paying and uncommunicative tenant.

While there are many benefits to buying a mobile home community, Andrew recommends caution as an overarching strategy when purchasing. Deferred maintenance and other issues crop up often in older properties, so buyers should do thorough due diligence before buying.

Another thing to consider is the path of progress. Some mobile home properties increase in value as cities grow around them. “I wouldn’t plan on that as an exit strategy, though,” warns Andrew.

One tough aspect of mobile home investing is that commercial lenders are almost always unwilling to offer loans for this investment class when occupancy rates are low. Investors interested in distressed assets will have to find alternate financing sources.

One option? Syndication. This is the model Andrew uses to buy and operate mobile home investments. Keep reading to learn about his strategy!

A peek at Andrew Lanoie’s prolific syndication portfolio

With his team at Park Place Communities (PPC), Andrew has almost 1100 operating units in 15 communities spread throughout 8 different states.

“We get the most traction in the Midwest and Southeast,” says Andrew.

Many of his investments aren’t in major metros … but towns can’t be one-trick ponies, either. He’s looking for markets with multiple employers and diverse, stable populations.

An essential part of running this kind of operation is building a stellar team. Andrew has people on the ground in every state to search for and buy new properties.

Because this asset class is often difficult to operate and there isn’t a property management company that could fill all PPC’s needs in every state, Andrew and his team have built out their own management team.

They’ve also formed a construction company to renovate homes at new sites. For Andrew, renovations are the “low-hanging fruit” when adding value.

PPC also works with manufacturers when a lot needs new mobile homes … the cost of which investors can potentially recoup when they sell to residents. These homes do not need to be paid for with cash, but can be mortgaged, freeing up money for the investor.

Once the construction crew is done and units are in place, the marketing department takes over to find residents. Once residents are found, they’re sent to PPC’s lender, who looks for a history of on-time rent payments and an ability to pay the rent going forward.

One other essential relationship is with brokers. Andrew and his team have built great relationships with brokers, which allow them to access off-market deals and pocket listings.

Andrew’s operation has a TON of moving pieces … which allows the PPC team to leverage efficiencies for maximum return.

For the average mom-and-pop real estate investor, running an operation like Andrew’s is out of the question. That’s why PPC syndicates deals … so investors can access a high-cap-rate investment passively.

Another pro to this investment class? It grows slowly and steadily … even during downturns.

We asked Andrew what potential investors need to know. His number-one piece of advice is to do your due diligence before jumping into a deal.

Interested in learning more about investing in the mobile home space? Listen in to the show to get access to Andrew’s curated report on mobile home park investing. He’s compiled a detailed overview of why he and his team are bullish on affordable housing and mobile home communities … and why you should be too.

We encourage you to do your own research and learn more … and keep listening to the Profitable Niches series to step off the beaten path and learn more about other lucrative, but as-yet unexploited asset classes.


More From The Real Estate Guys™…

The Real Estate Guys™ radio show and podcast provides real estate investing news, education, training and resources to help real estate investors succeed.

Waiting for the next recession …

Like waves on the beach or the rising and setting of the sun … the ebb and flow of the infamous “business cycle” is something every entrepreneur and investor must navigate.

The marketplace is fluid and dynamic.  There are no lane lines or guard rails.

More importantly, there is no singular cycle because there is no singular market.  As Jim Rickards says … it’s a complex system.

At our last Investor Summit at Sea™, Fannie Mae’s chief economist Doug Duncan warned the current economic expansion is one of the longest on record.

The odds, Duncan says, are high another recession is around the corner.

And as we’ve noted before, 10 of the last 13 times the Fed embarked on a rate raising program … the result was recession.  So …

Should real estate investors wait for the next recession to add to their portfolio?

The answer is … it depends.

That’s because it’s probably not smart to apply a one-size-fits-all simple strategy to an investing question about a complex system.

And even trying to “narrow” the question down to “real estate” is still complex.

After all, “real estate” covers a lot of ground (sorry, couldn’t help it) … in terms of geographic markets, property types, teams, available financing, and specific deal terms.

Common sense says if you look at enough deals, you’ll probably find a good one … in any cycle … because every real estate deal is unique.

So macro conditions are interesting for deciding which markets to shop in, but less so for deciding whether or not you want to find a deal.

Because if you won’t even look because you’re waiting for a macro-sale, you might miss a micro-sale… and find yourself sitting out much longer than you planned.

Remember, you can’t profit on property you don’t own.

Markets get hot for a reason …

When a real estate market gets hot, it’s because buyers are bullish about the future.  Sometimes they’re wrong, but often they’re right.

Local real estate markets are driven by local factors … the local economy, local tax and business policies; local infrastructure, weather, amenities and population trends.

When LOCAL factors are positive, LOCAL real estate prices and rents rise.  Sometimes in sync.

But sometimes, prices get ahead of rents.  Cap rates (rent ratios) fall.  Investors are willing to pay more for the same income in that market … for a reason.

And in a recession, the problem can actually get worse.  In other words, it’s not unusual in hard times for quality markets to become even MORE expensive.

That’s because when clouds form … or it starts raining … money seeks shelter in quality.

So strong markets and property types often attract MORE capital in uncertain times … thereby raising the price to acquire safe haven assets.

As we discussed last time, Americans and foreigners have already shown a strong preference for U.S. real estate … housing in particular … even as stock markets are raging to record highs.

Royal flushes are rare …

When a macro-event comes and slaps down the national or global economy, sometimes great markets get caught in the downdraft.

This happened in 2008 and it created some of the best buying opportunities since the real estate bust of 1989.  For those who were in position when it happened and acted, it was awesome.

But think about that.

If you missed buying the bargains coming out of 1989 and sat out waiting for the next real estate recession, you’d have been on the sidelines for nearly two decades.

Meanwhile, lots of people made lots of money in real estate … without getting the bargain of the century on every deal.

Pigs get fed.  Hogs get slaughtered … or starve.

This variation on an old investing adage still rings true in today’s investing climate.

The idea is there’s danger in getting greedy.  It’s about being overexposed to a market top, and taking on a lot of downside risk trying to squeeze out a little more upside gain.

But it’s also true about waiting … and waiting … and waiting … for the BIG correction, so you can swoop in and gobble up distressed assets for pennies on the dollar.

Remember … you can also strike out by standing at the plate waiting for the perfect pitch.  It’s usually better to swing.

What are YOU waiting for?  

A PIG is a Passive Income Generator … like rental real estate.  It’s the kind of asset which actually attracts capital in a recession.

That’s because when asset prices are uncertain, income is reassuring.  And as prices of stocks, bonds, commodities, and currencies go up and down like a roller coaster …

… working-class people ride the merry-go-round of getting up and going to work every day to pay their rent.

And if they don’t, you can replace them with someone who will … IF you’re in a market and product type with solid supply and demand dynamics.

To be there, you may have to pay a premium for quality.  The deal still needs to make sense, but it doesn’t have to be cheap to be a bargain.

“Bargain” is a relative term … and price is only ONE component.  There’s more to value and desirability than just price.  Few people want the cheapest brain surgeon.

So long as the market, team, property, and deal make sense … meaning you’ve got staying power to ride out a recession if it comes …

… then you can sail through the business cycle riding a PIG.  It’s not sexy.  But it’s better than starving or getting slaughtered.  You can score a lot of points with base hits.

Until next time … good investing!


 More From The Real Estate Guys™…

The Real Estate Guys™ radio show and podcast provides real estate investing news, education, training and resources to help real estate investors succeed.