How to Find an Investor-Friendly Real Estate Agent
Are you interested in purchasing a multi-family property in Cambridge or Somerville? If so, working with a skilled real estate agent is essential.
Having an investor-friendly real estate agent is critical when buying a multi-family property. They have specialized knowledge and experience in the investment market. As a result, they can provide valuable insights and guidance throughout the purchasing process and help you make informed decisions.
A good partnership with your real estate agent is essential. It can lead to a smoother and more successful transaction, which can ultimately contribute to the success of your investment.
Here are some of my recommendations on how to find an investor-friendly agent:
Why look for an investor-friendly real estate agent?
Most real estate agents are not investor friendly, which surprises most buyers and sellers I encounter. Most agents focus, primarily or exclusively, on residential real estate. Residential real estate agents focus on properties with an end user, the primary resident.
An excellent residential selling and buying agent has significant experience in market conditions for residential properties. They also know the major systems of residential houses, like roofs, windows, electrical, plumbing, and HVAC. In addition, residential experts know which areas with homes for sale will appreciate well and which areas will not.
However, there is an entirely different set of skills, goals, and objectives when the end user(s) will be renters.
The end goal for an investor-friendly real estate agent is to maximize your investment’s returns. In this case, you need an expert who understands dozens of different criteria related to investment properties.
Here are a few items an investor-friendly real estate agent will be an expert in:
How much money can you charge to rent each unit
What tenant property expectations look like in a particular area
What typical ‘days on the market,’ or DOM, is for a specific area
Which areas are seeing rental growth now and are likely to continue in the future
What items increase or decrease the value of an investment property
Investor-friendly real estate agents, unlike residential agents, work with a large volume of renters regularly. Because of this, they should have extensive experience in turning your investment property into a viable rental property.
Work with an agent who handles rentals and real estate sales
I recommend working with an agent who handles a large volume of rentals in addition to buy and sell transactions. They will have the experience you need to make an informed purchasing decision. In addition, these agents help avoid properties that look good but have hidden "bombs" that will cause problems after purchase.
Investment agents can identify properties that may not seem attractive at first glance but have long-term profit potential. They can evaluate a property's location, condition, and potential for income and growth. In addition, they consider market trends, rental demand, and maintenance costs.
Agents who cover a large number of rentals provide an additional benefit: renter relationships. Your investor-friendly realtor helps rent out the units after your real estate transaction by acting as your listing agent. In addition, they can help with marketing the property, vetting tenants, and managing lease signing.
Simply put, agents who work with investors strongly understand the rental process from start to finish. As a result, they can ensure that buying, renting, and tenant management are successful.
Agents who understand investments have the ideal network
You will need a particular set of vendors if you decide to purchase an investment property.
In the Cambridge/Somerville area, residential real estate agents typically work with vendors specializing in primary homes. These properties usually have medium to high-end finishes.
However, real estate agents who focus on investments tend to have connections to vendors who specialize in investment properties. These often have low to medium-end finishes.
Investment-friendly agents have a strong network of reliable vendors. These vendors can provide essential services for investment properties, such as handymen, snow removal, cleaning services, pest control, and HVAC maintenance.
Investment experts know which neighborhoods are up-and-coming
An experienced investment real estate agent will know the areas within a town most suitable for investment properties.
Why? An investment real estate agent handles large volumes of rentals and sales and understands on-the-ground trends. These trends include rising rental rates, tenant pool changes, and market times, among other things.
A residential real estate agent will not likely notice rental market changes.
Here are some key points that a great investment-friendly agent can provide:
Information on the average rental growth of an area over the past year, such as an increase of $400-$500 per month
Information on areas that have remained stable over the past few years
Insights into new, popular areas that have recently become attractive to tenants
Information on locations that have experienced a resurgence after being previously inactive.
The recommendations from a great real estate agent can give you an advantage when competing for properties. In addition, they provide valuable insights and information that can help you make informed decisions.
Related: How to decide between a multifamily vs. single-family home
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Access to relevant information gives you the power to make informed decisions about your real estate investments. These decisions increase the chances that your multi-family property will have a superb return on investment. In addition, having the necessary information allows you to make intelligent choices that can result in financial savings and positive cash flow.
Were you thinking of buying or selling? General real estate questions?
Consider reaching out to Cambridge Sage for assistance with your investment goals. We have closed over 100 transactions in 2022 and have received over 100 5-star reviews on Google. Contact us today to learn how we can help you with your investment goals.