After thirty years in real estate, I’m convinced that real estate agents are presented during any given year with at least one opportunity to sell rental income property…regardless whether they’re a novice or not.Given, But Blowing the OpportunityReal estate agents are in an excellent position to meet someone looking to buy or sell rental property.Think about it. Real estate investors walk and call in to real estate offices, are previous customers, a relative, friend, or neighbor of the agent, or even surface unexpectedly during a cold call. As someone said, real estate is a contact sport, and it’s certainly true that professionals (unless they dwell in a cave) are in contact with numerous people.Okay, but why are there so few agents selling rental property? Worse still, why do many blow the opportunity? It’s not due to a lack of intention…I’ve yet to meet anyone willing to ignore a four of five-figure payday!The problem is that most residential agents swallow the myth about rental income property: “That rental properties are so vastly unlike residential it should not be considered a business alternative sought after by anyone who sells houses”This is not true, of course, but as a result, most realtors when presented with the opportunity get started with investment property do not act, are slow to act, react shamelessly, or refer the income property business away to a colleague. In other words, they squander it away…and this is inexcusable because success in real estate thrives on opportunities!Busting the MythAny agent (even if he or she is a novice to real estate investment property) can sell rental income property…guaranteed…and I’m convinced that it can be done at least one time a year! But here’s what you must do to get started toward that first deal:
Dispel the myth that residential and investment properties exist in different galaxies. Despite the differences in houses and apartment buildings, if you can sell a house, you can sell an income property. After all, consider who buys rental income property…the very customers you’re conditioned to service! Investors are not from another planet, they are just folks seeking a yield on dollars they set aside for investment. Realestate investors are people you know.
Dispel the myth that investment property is reserved for investing experts. Some instances might require a commercial expertise, but agents can typically handle many rental property transactions quite successfully, and generally do.
Prepare yourself for real estate investment dialog. Have a notable response when asked about a cap rate or APOD. The inability to discuss income property effectively is where real estate agents commonly fail to foster a connection with investors. You will never make points if you lack even a basic understanding of rental property nuances. Do your homework via the numerous websites devoted to real estate investment nuances and formulas.
Prepare to service an investor correctly. Bear in mind that real estate investing is not about kitchens and fireplaces, but about the numbers. Be ready to present a property’s income and operating expenses, whether you create them yourself on a spreadsheet or use investment software. Having the ability to present investment property cash flow and rates of return to an investor is vital because it gives the impression that you’re not just concerned about a commission, but genuinely care about the investor’s money enough to assist in a prudent investment decision.
Prepare to work with rental income property today. Don’t wait until you’re asked about income property and then have to scramble. Learn the terms and invest in the tools now, before you need them. Urgency is always an issue when investors make the decision to buy or sell investment property and they will have no qualms about soliciting the services of another real estate agent deemed more suitably prepared to assist them if you’re not.
What’s Keeping You from the Money?Are you aware that investment properties can generate multi-million dollar transactions? That in some cases, you can close investment property deals equal to three or four house transactions; that you have, especially in this troubled market, a golden opportunity to bolster your annual earnings?Yes, it takes some effort, but you didn’t become a real estate professional without effort. The good news is that it’s not that difficult…just some minimal preparation and a small investment of time. That’s how I did it. And if it hadn’t worked for me, I wouldn’t have shared it with you. Honest.