A while back, I referred to a great post by Chris Lengquist’s at Kansas City Real Estate Investing named: 7 Questions To Ask Your REALTOR Before Looking For Investment Property. If you have read my blog for any length of time, you may have noticed that I don’t do much (if any) self promotion. Without selling myself too heavily, I thought it would be interesting for me to answer those 7 questions so you can see how a full-time investment property Realtor would respond:
- Are you an investment property owner and/or do you take any specialized classes to assist you with evaluating real estate investment property? I have been an investment property owner since 2002. I own and manage almost 30 units from single family to multi-family in many different parts of the Twin Cities. Additionally, I have attended numerous classes and seminars over the years both as an investor and a Minnesota Real Estate Agent.
- How long have you been working with investment properties? As I mentioned above, I have been an investor since 2002, but I have specialized in investment properties as a Realtor since I started. I sell only about 1-2 owner occupant houses per year.
- Can you show me how you evaluate an income property, numbers wise? I use a customized spreadsheet that I built over the years to analyze large volumes of investment properties. It allows me to pull down up to several hundred properties at a time from the MLS and find the best values for my customers in a matter of minutes. See the spreadsheet on the right (click to see a larger version).
- What are your feelings about cash flow or appreciation? Cash flow is a must. I know that there are other “gurus” out there that say negative cash flow is OK. I disagree. In this market, you can absolutely buy a nice property at a great price and have cash flow also. Appreciation is what we are all in this game for. I like my tenants, but I would rather be spending that time with my family. The cash flow is fine, but I am waiting for the pot of money at the end of the rainbow when I sell everything!
- What are your hours of availability? I carry a PDA and check it most of the day. I also spend about 2-4 hours per day on my laptop. Typically, I am available from 8am to 8pm during the week and weekends by appointment. This might not be normal for most real estate agents, but it is just how I work.
- Do you require a Property Management agreement in addition to an Exclusive Buyer’s Agency Agreement? No. We simply sign a Buyers Representation Agreement once we begin to work together.
- Who do you work with concerning inspections, repairs, maintenance and property management? Over the years, I have accumulated many contractors and repairmen that I always refer to my customers. I also always try to have at least one inspector and property manager that I can recommend to my customers.
The above questions are important to ask your Realtor when venturing into Investment Real Estate. I hope my answers give you some insight into what a full-time investment Real Estate agent can offer. Why not work with someone that specializes in investment property?