Are real estate agents obsolete?
These days, you can search listings and tour houses entirely through internet platforms. You can also list and sell properties using mobile phone apps.
It’s safe to say our processes for buying and selling properties have completely changed with technological innovation.
In this new landscape, however, real estate investors need real estate professionals on their side … now more than ever.
In this episode of The Real Estate Guys™ show, we’ll explain why the most CRUCIAL relationship you’ll ever have as a real estate investor is with your real estate agent.
You’ll hear from:
- Your sprightly host, Robert Helms
- His ancient co-host, Russell Gray
- Eight-decade investor and broker, Bob Helms
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What is the role of the real estate agent?
First a definition … when we say real estate agent, broker, or professional, we’re referring in general to a person representing you, for a fee, in the purchase or sale of a property.
The role of the real estate agent has really evolved over the past several decades. In the past, only real estate agents had access to listings … but now, anyone with internet access can look up property prices on Zillow.
Although the WAY real estate agents function has changed, the core job of a real estate agent hasn’t changed at all. Real estate agents exist to represent YOU.
Their three main roles:
- Representative. Agents represent clients as a third party, at arm’s length. Someone who is not emotionally or financially attached to a deal can usually negotiate a better number.
- Fiduciary expert. It is the agent’s duty to hold clients to the highest legal level possible.
- Counselor. Agents are experts in empathy and adding value. They provide access to key individuals through their networks and can give you valuable information about the neighborhood you’re investing in.
Agents provide value by interjecting the available information with their accumulated wisdom and connections.
And if you really think about it … how much time can you spend developing negotiation skills for a deal you’ll only do four or five times in your lifetime?
Real estate professionals do the same transaction four or five times … every WEEK. They’ve built up skills and knowledge and have their thumbs on the pulse of the real estate world.
Negotiation is a learned skill
Negotiation is critical to good deals.
It’s even more critical when a deal starts to go sideways.
When a loan doesn’t come through or your financing falls apart, you have to get creative. But how can you get creative with no experience?
And just as importantly, how can you successfully navigate an emotionally negative event?
There’s a real art form to negotiating a win-win deal, and often the best option for a successful negotiation is having a professional do it for you.
A skilled professional can play a neutral role, win the trust of both the buyer and the seller, and figure out deal breakers and makers for both parties.
Critically, an agent doesn’t just broker sales. They’re your advocate. It’s their job to work with both sides … but get you a leg up.
A skilled salesperson can help people get over buyers’ remorse and help them implement the decision they have already made. And that could be the difference between a deal and no deal.
A win-win outcome IS possible … when you’ve got a professional who can suss out the objectives of each party involved in the deal.
A broker IS worth it
We weren’t surprised when we read new research from Collateral Analytics that shows properties sold by agents net a higher final price than homes sold by owners.
In fact, homes for sale by owners receive 5.5 percent less than those sold with the help of agents.
Some of you may be thinking, “What about agent fees?”
If agent fees are approximately equivalent or even slightly more than the difference between the sale price you would have gotten with them and the price you would have gotten without them … then you’re netting a similar deal for SIGNIFICANTLY less time and effort on your part.
Part of being a real estate investor is getting yourself into what we call deal flow … giving up tasks, delegating, and forming networks so the best deals flow straight to YOU.
Delegating tasks to a broker can actually MAKE you money, if your resulting deal flow gets you access to better deals.
It’s extremely important to understand that your business as a professional real estate investor is building a network of people who will feed you money, deals, and information … and have your back when you need support.
And you find people who’ll have your back … by having theirs. That means supporting your agent.
We’re big believers in building relationships to infiltrate a market. Find a way to form two-way relationships. Make other happy so they’ll want to make you happy too!
Don’t go at it on your own
So, what’s changed? One of the biggest changes these days is that brokers do less research.
It’s less about the data agents have at their fingertips … and more about the wisdom they can offer you.
Real estate agents and brokers play the same game they did decades ago. It’s all about negotiation and selling skills.
One more pro to having an agent on your side … professional brokers have both errors and omissions insurance AND a legal team.
They know where landmines are and can help you navigate new and unfamiliar markets without making a legal misstep … or spending a ton of money on a real estate attorney.
If there’s anything you get from this episode, we hope you realize it doesn’t pay to be penny wise and pound foolish.
The best professionals won’t cost you money … they’ll make you money. So, don’t be afraid to pay for the services you need.
And once you find a trustworthy professional, get everything you can from them. Build a relationship. Seek their advice. Eventually, YOU’LL be the one they start bringing unlisted deals to.
Kudos to all the real estate professionals out there.
Don’t have an agent yet? Consider this your challenge to get out there and find one!
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