Last week we started this series of articles on how to find, develop and work with agents. As you may recall, we covered 5 characteristics that you should look for when vetting realtors to work with on your house flipping business. Surprisingly none of them had anything to do with investing!
Today we’re going to the next piece of the puzzle and talking about how you can build your relationship with an agent.
Trust is the foundation
Now, as you know, the foundation of any relationship is trust. When you trust someone and they trust you, you are working towards building something that will last. If a relationship is the foundation of the business you are building, then trust is the cement from which that relationship is created.
And as I’m sure you also know, building trust is something that, by it’s very nature, requires time and effort. And this is just as true when you are building a relationship that will propel your business forward.
So, the question I often get is “how can I build trust with an agent so they know I’m serious and will do the work to help me make offers on properties?” and of course, if you add in the fact that you might be a brand new investor without a track record (or even a Proof of Funds) that can make things a little bit trickier.
Well, after you have found someone with the right characteristics, then the next step is building that relationship, and today we have 4 specific keys that might help you get the ball rolling and work on developing the trust you will need to propel your business forward.
1. Get a good referral
Sometimes it is all about who you know. (Or who the people you know, know.) Odds are you already know an agent or two, or you know people who are friends with agents. They are often a good place to start. Ask around for the right type of person (based on the last post) and see if you can find them among your network.
But even if you don’t have any in your network, find a real estate office in your area and ask the main broker who they can recommend who will be aggressive on your behalf, and not be complacent. You really are looking for an agent who can service your needs, and that requires someone with the right skills (they know their market and how to search it) and the right motivation (they are hungry to learn, grow and develop).
When an agent is referred to you by someone they know, they are more likely to trust that you could be someone they want to work with. When you are the stranger walking in off the street you start from a more challenging position in terms of building a relationship, so any little thing can really help give that partnership a boost.
2. Show you are serious
The problem a lot of agents have is that they are often approached by people who are “investors”, but are not actually people who are working hard to make things happen. (And you aren’t one of those, are you? 😉 )
You see, just like there are lots of different types of realtors, there are also lots of different types of investors. And while you might be seeking agents with specific characteristics, you can bet they are doing the same thing with you.
You have to come across in a way that shows you are serious and you mean to do some serious damage on the local market (but, y’know … in a good way). If you walk in and say “I want you to help me find houses to flip” that is not nearly as strong as “I plan to put 5 houses a month under contract. Is that something you can help with?“, which sends a totally different message.
Let them know you are serious and you are looking to build a real business that is going to do some good volume. You want to buy a lot of houses, and if they know that is your intention (and they can see you are actually putting in the work) then that will go a long way to forging that business alliance.
3. Break their paradigm
Here’s the thing … a lot of agents are trained from the moment they get their license, that the most houses they’ll probably ever help a customer buy is one — the one the customer will live in. That is a paradigm that gets engrained in them from day one.
And since they are in the business of making commissions, the answer to them is to be working with a lot of different clients at the same time, allowing them to maximize the amount of commissions they’ll make.
So, your job is to help them shift their mindset and realize that, with the right client (you!) they will have all the properties being bought that they can handle. This means you need to provide a bit of understanding, explanation and education so that they realize that they will probably be much better off helping you get those 5 houses a month under contract, than helping Mr. and Mrs. Smith buy the family home to live in for the next 20 years.
Agents are looking for higher volumes, and they need to know that you can provide that for them. Since that is out of their normal reality, you’re going to have to shake things up. (This is also why having someone who is coachable is important!)
4. Get some practice
The reality is, if you are new to the investing game, you probably don’t have much experience or don’t have the experience to really show a realtor that you know what you are doing (if you even know what you are doing).
And that is okay. We all start from zero knowledge and build from there. Skills in real estate investing aren’t something any of us are born with, and like any skill it takes consistent practice to get better.
So, perhaps one solution would be to find an agent that is also learning their craft and work with them to learn together. You both learn from each other and from real world action and experience, which means each of you is growing and moving forward.
And even if you don’t end up working with that agent in the long run, or the relationship just doesn’t work out, that is totally fine. Because you know what? You just got a ton of experience and you are no longer at “level zero”. You have more understanding and knowledge than you used to and you can use that to find someone else to work with.
Each time you take action and move forward you are learning, and whether or not the low-ball distressed houses fall from the sky, you are always developing your investing skills and your ability to work effectively with an agent.
So, get out there and get some practice. Pound the pavement. Knock on doors. Shake hands. Get to know people. The more action you take (yes, even the “wrong” action) the closer you will be to making that first deal. And after the first deal you then have the experience to bring in that second deal which will be just around the corner.
Just like last week, I would like to share a video from my main agent, Kyle, that shows his thoughts on the process of building a relationship with an agent. Each of the 4 things I mentioned above are things he touched on during our monthly private Mastermind hangout and this is definitely worth watching. (If you would like information on how to join the mastermind, just click here.)
Considering that Kyle didn’t know much of anything about how to work with investors when we first met, and in the last two years we’ve bought over 100 houses together, he definitely has some major experience with regards to developing relationships with agents.
So, just like any relationship you want to build, creating a long-term relationship with a real estate agent is about trust. Trust that is developed by showing your commitment to your cause and purpose. It also requires you to help them understand why what you are doing is different than what many other run-of-the-mill house buyers are looking to do.
In the end, it is going to take you some practice to build up these relationships (or even know what is involved in doing so). But if you take action to make things happen you will eventually get there.
Thanks again to Kyle for coming on to our monthly hangout. If you’re interested in checking out these hangouts, they’re available to members of the House Flipping Mastermind Group, and you can get more information about how to join up by clicking here.
Do you have any other thoughts on ways you can develop these sorts of relationships? What is your biggest challenge when trying to work with agents? I’d love to hear your ideas in the comments below, so go ahead and let us know what you’re thinking!