Building Your Client List - Real Estate Investors

By
Education & Training with Cannon Publishing Group

Although it takes some specialized knowledge to work with clients who are investing in real estate, adding a few of these repeat buyers to your client base can increase and stabilize your income, especially during times of low interest rates and depressed property values.  Here, in summary, are some of the arguments I hear, both for and against, working with investors.

Some arguments in favor:

  • Investors tend to be repeat buyers
  • Investors tend to buy bigger and bigger properties
  • With proper care, investors can be loyal customers (especially if they are not local)

 Some arguments against:

  • Investors are not emotionally attached to the property, so they may be more likely to back out of a transaction
  • Investors may not feel any loyalty toward a particular real estate agent
  • Investors generally expect a higher level of specialized knowledge, expertise and experience from their agent
  • Sophisticated investors may want to avoid using a real estate agent in some transactions
  • Investors may not be local

Certainly there are more pros and cons than this, and notice that some of the pros and cons overlap.  Here are the fundamentals of working with investors: first, you have to educate yourself in the basics of investment real estate - know the terminology and techniques of investing; also, start with someone friendly and who is at about the same level of knowledge as you - a successful new investor will grow along with you; know your market, know what the best investments are - perhaps four-plexes are hot right now in your town, or commercial property; finally, develop working relationships with loan officers and financial planners who are also knowledgeable in the field of real estate investing.

Some agents hold classes on real estate investment fundamentals, drawing in new clients by showing and sharing knowledge, experience and expertise.  This is a great way to get started, since these novice investors will see you as a resource and will grow along with you.

If you are struggling right now with a lot of listings and a few buyers who are running you ragged, try spending a bit of time each day educating yourself on investing and nurturing some investment clients.  If you find that you fit in this niche market, you'll find excellent returns on the time you invested.

Posted by

Joe Cooke

www.cannoncooke.com

Comments (2)

Mike Wong
Keller Williams Realty Southwest - Sugar Land, TX
Realtor: Commercial, Residential, Leasing, Invest

Great topic and information. The exact same pros and cons flash before my eyes when I meet a new investor client. In the end we just have to work with them.

Jun 05, 2008 03:14 AM
Erin Newington
(916) 585-3858 - Elk Grove, CA
Elk Grove Realtor

Most of our client base is investors. Since we started in the industry as investors in seemed like a smart way to transitioned into the mortgage industry.  The problem with investors is there is no emotional attachment to the properties they evaluate.  I find often times they will do a lot of the leg work on their own like driving by properties and determining the neighborhoods they want to invest in.  I would say a large percentage of our investor base is dedicated to work with us.  There are many that will call and get the strategy and determine what loan program they need then go to their cousin in the business. That is just the nature of the beast particularly with investors.  Although our investors are starting to buy again, we are still working to build up our first time home buyer arm of our business.  I think if you are new to the investor community now is a good time to position yourself.  But in my market I don't think that model will be completely profitable for about a year or so.  Just my 2 cents.

 

Jun 05, 2008 03:31 AM