Selling or buying condos, multi family homes, single family homes or apartments can be a very intimidating process, especially for a beginner real estate investor. This is why investors should consider working with a real estate agent. A qualified and experienced realtor can make the task of selling or buying investment property less stressful and much smoother.
Here are some of the benefits of buying a house with a realtor:
- Pricing expertise – Many property owners are not aware of the true worth of their homes. As a result, they are likely to overprice or underprice a house when selling. Since the real estate agent is familiar with the prices of similar homes in your area (real estate comps), they can help list your property at the right price. Similarly, a real estate agent can help ensure you don’t overpay for an investment property for sale.
- Vetting contractors – Selling or buying income property involves working with appraisers, inspectors, title companies, staging companies, and home repair professionals. A good real estate agent will be able to find the best contractors in the market.
- Access to the Multiple Listing Service (MLS) – Your realtor will help list your home on the MLS, thus increasing your exposure to potential buyers. And if you’re buying a rental property, you will get access to the MLS, which otherwise, you would need a license to access on your own as a real estate investor.
- Professional negotiation – Negotiating with buyers or sellers directly is not easy. Most real estate agents are professional negotiators and will help you get the best price possible.
- Following legal regulations – Certified realtors are familiar with the legalities involved in selling or buying a house to rent out and can help ensure you don’t break any laws or incur any fines.
- Handling paperwork – Real estate transactions cannot happen without paperwork. Your agent will help draft the documents required for every stage of the transaction.
It would seem then that working with a real estate agent is in your best interest. But what happens if you end up with a bad real estate agent? Someone who, rather than provide the above benefits, only makes the entire experience of real estate investing a nightmare. The best way to prevent this is to look out for some warning signs upon hiring an agent.
So, how can you tell if a real estate agent is bad? Here are some of the tell-tale signs of a bad real estate agent:
10 Signs of a Bad Real Estate Agent
1. Poor communication
Poor communication is one of the top complaints about realtors. This can be extremely frustrating and could result in losing real estate investment opportunities. A good real estate agent will always update you on the buying or selling progress, whether it is via text, email or phone call. When you contact them with an inquiry, they should get back to you within 24-48 hours. A bad real estate agent doesn’t make the effort to communicate with you quickly and efficiently.
2. Lack of confidence
Top real estate agents exude a great degree of confidence. A bad real estate agent lacks self-belief, and will therefore not be able to represent you effectively. As a result, you are likely to get the short end of the stick on the negotiation table.
3. Lack of leadership
The role of a real estate agent is to guide you through the real estate investing process. Since they are the expert, they should offer advice based on their experience and research. If your agent is not willing to provide leadership in the process, you may want to look for someone else.
4. Poor listening skills
Is the agent too preoccupied to hear what you have to say? This is one of the signs of a bad realtor. The best real estate agent will ask questions such as:
- What are you looking for in an investment property?
- What is your time frame for selling or buying?
- What is your preferred channel of communication?
- What do you expect from me?
5. Lack of experience
Besides having the necessary certification, a real estate agent should also have a good level of experience. Preferably, the agent should have at least 5 years of experience selling or buying houses in your preferred neighborhood. In addition, you want to look for an investor-friendly real estate agent. If an agent is not familiar with jargon such as cap rate, cash on cash return, cash flow or occupancy rate, look for someone else. While this doesn’t necessarily make them a bad real estate agent, it just means they are not the right fit for you.
One of the major signs of a bad real estate agent is unprofessionalism. Does your agent show up late for appointments? Do they dress appropriately for meetings? Are they clean and well-groomed? Do they use proper grammar when communicating? If you detect signs of unprofessionalism, don’t think twice about firing a real estate agent.
7. Too much pressure
While you would want to have an agent that will guide you through the process of real estate investing, be wary of anyone that puts pressure on you. A bad real estate agent will coerce you to buy a particular investment property for sale over another, or force you to accept an offer you are not happy about.
8. Poor negotiation skills
As mentioned earlier, one of the main roles of a real estate agent is to negotiate on your behalf. If you are buying an investment property for sale and the agent is a poor negotiator, you might end up paying a higher price. And with a bad real estate agent, you are likely to take a loss on a rental property when selling. To figure out if this is the case with your agent, you may have to read agent reviews online or ask a few previous clients. After all, you don’t want to wait until you’re at the negotiation table to find this out.
9. Lack of real estate marketing skills
When selling a home, effective marketing is very important to attract the right buyers. Poor marketing skills is one of the signs of a bad real estate agent. To determine whether an agent is a good marketer, conduct an online search of your agent’s name. An agent with a strong web presence will have a website and several active social media pages and profiles.
10. Dishonest or unethical
A bad real estate agent is dishonest or unethical. If an agent asks you to make a false claim on an advert or lie about disclosures, walk away and don’t look back. Dealing with a bad real estate agent who is dishonest can cost you dearly.
So, What Can You Do If You’ve Hired a Bad Realtor?
In case you realize that you’ve hired a bad real estate agent, be sure to voice your dissatisfaction. At times, the agent will be kind enough to release you from the agreement you’ve signed. However, in most cases, breaking a contract comes with conditions. For instance, you might be required to reimburse the marketing and advertisement costs. Generally, the process of withdrawing from the contract will vary from one situation to another. But it can be worth it if you really are unhappy with the service you are getting. Remember, there are many great real estate agents out there who go above and beyond to help new and experienced real estate investors. So don’t let one bad experience scare you away from working with a real estate agent.
Wondering how to find the best real estate agent when buying an investment property? You can attend open houses to see how they interact with others and their clients. It’s also a good idea to ask for references from friends and family and check agent reviews on different real estate sites.