Strangers in the Night: Residential Real Estate Investors and Agents

It was 2008 when something started to change in my neighborhood. The once familiar family homes were now freckled with For Sale signs. You couldn’t miss them, like many a bank account during that time period, they were completely empty. Front yards with overgrown grass were quickly transformed into brightly painted façades, and with seemingly equal speed flipped back on to the market now listed as “Pride of Ownership” (or investorship). It was happening so quickly. Something was ominous about it and it took a moment to realize these weren’t your traditional homeowners, they were residential real estate investors. As far as I was (subconsciously) concerned, those were mutually exclusive titles.

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I thought to myself, “Why do investors and agents in residential real estate seem like strangers in the night? “Typically, investors have a method by which they evaluate deals and have no emotional attachment to any properties that they are attempting to acquire. Although they will write offers on anything that makes sense, they have no hesitation about walking away from a deal that no longer shows their minimum profit threshold at the price a seller is willing to accept,” explains Jeremy Colonna, a mortgage broker with Matchpoint Funding in Greater Los Angeles. In other words, these investors are “not as easily influenced by real estate agents” adds Colonna, “and that can be frustrating for agents.”

Often investment properties and single family homes are considered different property types despite both ultimately being an investment. Just look at the descriptions used for “investment” versus “home” and it does in fact seem like a different language. Residential agents are also taught to focus more on the emotional appeal, school district and other factors while commercial real estate is more about return on investment and cash-flow analysis.

shutterstock_49146385But real estate agents have good reason to want to learn the language of investors as part of their strategy for new business. One reason is the U.S. is still considered one of the top five markets for residential investors. CNN Money online recently wrote Top 5 housing markets for global investors placing the U.S. in the very top of all global residential investor markets. According to NAR’s recent report on home sales, 13% of the all-cash real estate transactions in September 2015 were individual investors. That means knowing what a CAP rate is or the buy and hold vs. flipping strategies would benefit you greatly.

What is the best way to appeal to investors as a residential real estate agent?

  1. Team Up With a Lender. Colonna recommends teaming up with a lender who can educate you thoroughly on investor financing. “An agent who is informed about the intricacies of hard money financing, commercial lending and multi-family loan products,” says Colonna, “will inspire a great deal more trust in an investor. Partnering with a lender also can give an investor “a clearer picture of the purchase from start to finish, leverage on the buy side and is able to capitalize on attractive terms offered to the future buyer.”
  2. numbersUnderstand Investment Strategies like Buy and Hold or Fix and Flip. A great resource for educating yourself on the topic is on Marshall Reddick’s Website. Check out their LEARN section and educate yourself on residential investment topics from the experts who currently teach it across the U.S.
  3. Find a Reputable Lead Generation Company that brings you exclusive real estate leads through the internet, where investors are no doubt starting their search. Nothing will give you a deeper understanding of working with investor clients than having actual experience working with them!
  4. Join social networks like Bigger Pockets where investors frequent and hear firsthand what challenges they face and what they are looking for in a real estate agent.

As the market changes and traditional home buying becomes more difficult to define, being able to speak the many languages of residential real estate (ex. investor, traditional, millenial) will open more doors for you and alleviate frustration. We may then see the two working together in a way that benefits both just as the old Sinatra tune ends, “It turned out so right, for those strangers in the night…”

 

 

Written byLauren Agajanian

Lauren Agajanian, MBA

 

 

 

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Phone Etiquette for Real Estate Agents That Speaks Volumes

by Lauren Agajanian

Phone Etiquette for Real Estate Agents

Some days don’t you wish all of your calls were sent to voicemail? After all, you didn’t record your greeting fourteen times so no one would hear it. Every interaction you have in real estate makes an impression and particularly if it’s their first of you. Robert Lee Holtz, a science writer for The Wall Street Journal, wrote an article that is a must-read if you aspire to be an industry leader. In How to Train Your Voice to be More Charismatic, Holtz describes the power of the voice as “an instrument of rare persuasive power, tuned by evolution and culture to communicate far more than words alone convey.” Phone etiquette and your voice can make a powerful statement about your personal brand as well. These etiquette essentials make sure the image you radiate through the cell phone waves is a good one:

 

  1. Identify Yourself Using Both a First and Last Name. Using both names when you introduce yourself to someone new, “shows that you take yourself seriously as an adult and expect the same treatment from others,” says Etiquette International. That doesn’t mean you’re demanding to be treated as superior, it means you take the needs of your client as seriously as you do your own career. This also saves your caller from the uncomfortable exchange of having to ask if you are, in fact, the owner of the direct number stamped on every “Just Listed” postcard you left on their doorstep this year.Smile on a Business Call

  2. Smile and Sit/Stand Up Straight. Project, with your happiest of phone voices, that you are full of energy, love what you do for a living, and are nothing short of ecstatic to show your caller another perfect home…for the 17th time this week. Stand or sit up straight, “but not too straight” offers Peter Smith, author of Essential Radio Skills: How to Present a Radio Show. “You can afford to relax a little,” he adds, to avoid sounding nervous or stiff. “ This will reduce tension, keep you alert, and increase the resonance in your voice,” says Smith
  3. Speak Clearly and Avoid High Acoustic-Risk Locales. Clarity has everything to do with conveying your message. If you are speaking too fast, chewing gum or a dog is barking at the gardener’s leaf blower outside your window, your caller is thinking more about how to politely end the call, than anything they think they might have heard you say.
  4. Keep a Bottle of Water Within Reach. “Your vocal cords vibrate very fast, and having a proper water balance helps keep them lubricated,” an article 10 Tips to a Healthy Voice from Live Science tells us. And it can also stop an unexpected cackle from flying out of your mouth on a broom of embarrassment during your next presentation. You aren’t likely to face judgement day over a couple of ahem’s, but why fight it? Water is always a win-win.Picture9
  5. Don’t Curse or Use Slang. Even if your logo has navy blue and white stripes with a gold anchor, there won’t be smooth sailing in your conversation if you swear like the one navigating the vessel. Using terms found only in an Urban Dictionary or shortening words that weren’t difficult to say in the first place are major phone etiquette follies. The eloquent words of wisdom spoken by Anthony Burgess (Author of A Clockwork Orange, 1962), “The downtrodden are the great creators of slang.” You, on the other hand, are on the up and up.
  6. Don’t Smoke. Ever. Remember the witches cackle and the broom? Not even appropriate for Halloween.