Five Reasons Serious Investors Should Use a Buyer's Agent

I am often surprised at how little thought some sophisticated real estate investors put into their selection of business partners. Specifically many experienced (and inexperienced) investors work with a hodge-podge of agents and middle-men without ever consciously thinking about what makes the most sense for building their business. In my opinion one of the best things a serious real estate investor can do is to develop a strong relationship with a good buyer's agent who will represent that investor in all or most of their real estate purchases in a given market area. There are five basic benefits to investors from consistently working with a buyer's agent:

1. Market knowledge - Working consistently with a buyer's agent who understands the market in which you're investing can provide valuable insight into the day-to-day developments in that market. Even investors who themselves are very knowledgeable about the market can benefit from a buyer's agent's second opinion and on-the-ground perspective.

2. Single Point of Contact - For investors with multiple properties in their investment pipeline at any given time working with a buyer's agent provides a single point of contact for all their transactions. Instead of spending all day following up on dozens of different leads and transactions investors can shift that responsibility to their buyer's agent, freeing up time to focus on other issues such as property management, raising capital, or just enjoying the returns from their investments. Having a single point of contact also means that you, as an investor, don't have to manage the egos and eccentricities of multiple agents, just one.

3. Pre-Screened Deals - By working with any buyer's agent investors ensure that they will receive a steady flow of investment property leads. By working with a good buyer's agent on a consistent basis investors can expect to receive pre-screened leads that really make sense for them. The better your relationship with your buyer's agent the better they will understand what does and doesn't work for you and the less time you will waste looking at dead-end leads.

4. Transactional Efficiency - Consistently working with a buyer's agent can make your investment transactions much more efficient. By working with the same agent on many deals you can streamline the process of viewing properties, making offers, completing due diligence, and closing sales. This saves you time and avoids the mistakes associated with learning to work with a new agent on every deal.

5. First-Look Advantage - Finally, working with a buyer's agent may provide investors with what I call the "First-Look Advantage." This means that if you establish yourself as a go-to buyer for an agent, that agent will consistently show you properties first, before other clients or the general market sees them. This can allow you, as an investor, to scoop up deals with less competition from other buyers.

 

Over the next few days I'll be posting tips on what investors should look for in a buyer's agent, as well as what the investor (and the agent) should do to maintain a relationship that provides all five of the benefits above in abundance. I'll also respond to some common reasons I hear for not consistently working with a buyer's agent.