A Path of self-discovery exploding the myths while building massive wealth and income
I learned early on in my real estate investing career that virtually all real estate agents were only educated for and interested in helping you and I buy and sell our own homes. They really didn’t know or understand the investing side of real estate. As a result, within my first year of investing, I decided to get my own real estate license to make my investing life a little easier. Consequently I learned some valuable lessons about the rules of engagement for real estate investors and agents! More about that later but first I want to share with you the biggest problems I saw and myths that I busted. For example:
- Investors think they are saving money by not using and even avoiding real estate agents as much as possible.
- This is such a limiting belief and is easily busted. When we step back and look at our investing activities and they are focused solely on FSBO’s (For sale by owner), owner financing, expired listings (They didn’t sell using a real estate agent), people going through pre-foreclosure, divorce, bankruptcy, etc. and we don’t use one of the greatest information tools available – the MLS (multi listing service) available through real estate agents, we are missing the majority of the investing opportunities that are out there. So, on the acquisition side of the business, we are leaving a tremendous number of potential opportunities untapped. Furthermore, any commission due is customarily paid by the seller.
- On the selling side of an investment, by not using a real estate agent, who provides the MLS, we are not marketing to the majority of consumers who are using real estate agents to find properties for them to buy. The truth of the matter is that when you sell your investment property though as real estate agent, that agent is actually marketing to the thousands of other agents who are then providing the information to their buying clients. So instead of you trying to do it all yourself and maybe tapping into 1% of the potential buying marketplace you can now have not one but potentially thousands of real estate agents working to sell your property! Furthermore, who do you think would be inclined to pay more for your property? People looking to buy For Sale By Owner or people who use a real estate agent? Statistics conclusively show that on average, properties sell for closer to list price and in less time using a real estate agent than without. In fact, it’s not even close!
- Real Estate agents believe that real estate investors are cheap.
- While there are many investment transactions that are small in price there is no law that says an agent has to take a relatively small commission. Actually, a good agent, an agent who really knows the investing rules of engagement and how to work with investors, is worth their weight in gold and as such should ask for and receive a minimum commission. The wise Investor Agent, asks for and receives, minimum commissions based on an assumed 3% of the medium sales price for the area. I did this when representing other investors. But this pales in comparison to the true value of building long term relationships with investors.
- The real beauty of this Investor agent relationship is that many investors, including mine, evolve and grow their portfolios to include bigger and better properties with bigger and better list prices and therefore bigger and better commissions for you. When you read my Investor Agent you can see that I have made some pretty substantial commissions, in the 10’s of thousands, on a lot of these transactions.
- Investors think they don’t need agents because now everything is online through systems like Zillow, Trulia, Realtor.com, etc.
- First of all, these systems, Zillow, Trulia, Realto.com, etc. are all leech systems. In other words, they get the bulk of their data form the one true source, the MLS! What’s even worse is that their data isn’t complete and they don’t have adequate systems in place to keep the data current. For example, have you ever seen Zillow attempt to display a multi-unit property correctly? They can’t get it right because their systems are designed to focus on single family homes! And when a property gets sold it looks like it still active for sometimes months! Ridiculous.
- What’s most important though is that when you use an agent and data from the MLS you make available to yourself an abundance of tools and information that just can’t be gotten anywhere else and can broaden your investing activities and achievements. One of the best developments recently is that a lot of MLS systems are now integrated with the local tax records. How do you like them apples!
- Agents think investors only buy run down pieces of junk.
- Actually, Good investors, the kind you will work with, look for the best property at the best price and needing the least amount of work relative to perceived value after repairs are made. In other words, while there are investors who focus on war zone properties because they think that’s all they can afford, the better investors focus on moderate income areas for rentals, particularly multi units, and middle class, and in some areas, upper middle class and even luxury neighborhoods for flips.
- I personally have made a ton of money working with flippers because I earn a commission when they first buy the property. I earn a commission when they sell it for profit. And I can even earn a third commission if I bring the buyer! How about that – one client, one property, three commissions!
- Investors believe they can do much better investing without agents.
- The bottom line is this; you can make good money investing in real estate. You can make incredible money with a team of rock stars working on your behalf. You spend time to build relationships for financing, title work, insurance, remodeling, inspectors and appraisers. Add one more, real sate agent, more specifically, Investor- Agent, and watch your wealth and income go form linear growth to growing exponentially!
- Agents think investors are crooked and/or are breaking all the rules.
- This is simply a case of lack of education and information. As agents, we are trained by our brokers and other providers to focus virtually all our energy on owner occupants, who 99.9% of the time use traditional contracts, negotiating strategies, deal structuring. As a result, they are never exposed to the whole wide world of techniques and strategies available in real estate. While real estate is the only body of contract law that is required to be in writing in order to be supported in the court of law, there can be an infinite number of variations in how sales agreements and negotiations are structured. Plain language laws do come into play now so I have a solution for investors and agents.
- Use the pre-approved real estate agreements that are provided by your state’s board. Then add addendums to present the language that you require to make your deal work for you. Addendums override the agreement they are amending. I do this and it works every time. Agents, remember, when an investor wants something out of the ordinary, it isn’t crooked its creative!
- In conclusion, it’s not an “OR” world, it’s an “AND” world. Instead of operating in a world that is mutually exclusive, the worlds of investors and agents intersects in a way that can and should be immensely profitable for both. Investors should get their real estate license and serve other investors, thereby, opening up a very relevant and easy to implement line of business that compliments and leverages their already existing investing activities. Agents should further leverage the use of their real estate license to serve investors, thereby leverage what they are already doing and as a result they will learn how to invest themselves – the right way and really expand and grow their wealth and income!
About the Author:
Gary Wilson is widely considered the leading authority on teaching Real Estate Investors and Agents alike how to leverage what they’re already doing and create massive new wealth and income.
Gary has been investing in Real Estate for nearly 30 years building a rental portfolio worth millions of dollars, flipping other properties and even wholesaling. He has been a licensed Real Estate agent for more than a dozen years and Broker for more than half of that time, creating the fastest growing Real Estate brokerage company in Pennsylvania during the Great Recession, while others were shrinking by 50%. Gary also went onto create an Appraisal business, a Title Closing business and a Property Management business that grew from 40 units to nearly 500 in less than 3 years with virtually no marketing costs.
Gary has grown into a sought after speaker, writer, teacher and coach to investors and agents across the world. Fortunes have been made by those who follow Gary and implement his systems of creating massive wealth and income by using their Real License as an income producing asset to serve the Real Estate Investment community
Gary spends his personal time participating in high adventure activities, visiting friends and family far and wide and promoting his greatest accomplishment – The Healing House Foundation.
A portion of all proceeds from Gary’s business ventures goes towards the support of the Healing House Foundation – a Non-Profit venture that serves families who are healing and rebuilding their loving relationships after suffering from the wounds caused by the illness of addiction of a loved one.
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