Whether you’re a new real estate agent, or adding investor business to an already profitable strategy, below are tips that could help you expand your investor client business.
1. THINK LIKE A HOMEBUYER NEW TO INVESTING
The landscape of real estate investing and home lending is in a steady state of fluctuation. In fact, the only constant is change. By thinking as a new real estate investor, you open your mind up to different ways to market towards individuals or families looking to purchase residential property to diversify their investment portfolio.
Let’s take that thought one step further. Different people have different risk thresholds/tolerances. Some are higher, and some are lower depending on the person. As you’re getting to know your customer, ask them specific questions geared towards their risk tolerance. This is an important step when establishing yourself as not only the expert in the field of real estate (as a supplement to one’s investment strategy), but it also differentiates you from other real estate agents who skip this step altogether.
2. WHAT MAKES YOU THE EXPERT?
Do you have your GC (general contractors) license? Have you personally bought and flipped homes before? Do you employ the buy, hold, and rent strategy? Remember step 1, “Think Like A Homebuyer That Is New to Real Estate Investing.” There are different types of real estate investors out there. And there are even more real estate agents looking to build up their investor book of business. That said, any extra credentials you can add behind your name helps.
If I were looking to buy my first investment property, it would help if the agent I was working with had a GC license. It instantly makes that agent more creditable and knowledgeable on what the cost of improvements could be. That agent would also be knowledgeable on certain red flags to stay away from when walking through various properties. Remember perception is reality; and even if you’re a newer agent, you could overcome the lack of ten year with special designations, or real-world experience.
3. HAVE A RESOURCE LIST AND BRAG BOOK
Most people in general are visual learners. Meaning, they tend to retain more information when they see things vs. just hearing about something. Use that fact to your advantage. Come to a client meeting prepared with a resource list of other professionals in your network. You’re building value by showing the customer you ARE equipped to help them in any situation pertaining to real estate investing. So, in the event you don’t have a GC license, or if you’re not a licensed home inspector as an example, the client(s) can rest easy with you in their corner.
Also, don’t forget to create a brag book of success stories to show your prospective clients. Many agents will post photos of them and their past customers. Take that one step further; take before and after photos of a home you helped a client renovate. Add in positive survey responses from deals that could have went sideways but didn’t because of your intervention. Then have that brag book bound and laminated in case you need it. You only get once chance to make a first impression!
4. KNOW THE BASICS OF INVESTMENT LENDING
Remember we talked about having a resource list in section 3. Well, not every lender knows their way around optimal strategies for investment lending. Make sure you’re asking your lending partner what makes them a lender who’s equipped to handle even the most complex customer. Then learn the basics of investment lending yourself.
Some questions to ask your lender:
- If a client has intentions to own multiple properties, what is your strategy?
- Do you know how to read self-employed tax returns?
- Are you able to broker out deals to investors with tougher client scenarios?
- Are you comfortable having intelligent conversations with Investment Advisors or Certified Financial Planners?
5. FIND HIDDEN, OFF-MARKET PROPERTIES.
Befriend, learn, and hang out with other Real Estate professionals who work in the investor client space. And remember, expand your connections to real estate attorneys. It will help you build your exclusive network of off market properties. These off-market properties are the ones in which the owner needs to get rid of the property quickly for one of many reasons. Who better to give you the pocket listing, than a real estate attorney who’s helping a family with an estate sale, or a divorce situation?
Finally, have a written business plan. If you don’t have a written plan that is actionable, how can you really hold yourself accountable to your goals. In fact, a goal without a measurable action plan is a dream… and dreams are less likely to come true. Ricky Cheath