How to Win Real Estate Investor Loyalty and Gain Future Business!
Any real estate agent who has had experience working with real estate investors undoubtedly understands the challenge
"How do I take advantage of that initial meeting with a real estate investor and exhibit enough of that 'special something' to win their loyalty and get them to repeatedly call me back rather than my competition?"
After all, real estate investors are typically known to remain more loyal to their hair stylists and auto mechanics than to the services of real estate agents. Why? Because they perceive one as a service and the other as simply trying to get their hands in their pocket.
Fair enough. It's imperative, therefore, that realtors and brokers gain real estate investor loyalty as quickly as possible if they plan to overcome the challenge and move forward.
There's no magic formula, unfortunately (wish their was).
Nonetheless, there are some things I learned along the way that you can exhibit to increase an investors' willingness to entrust their real estate investment decisions to you and not to the real estate agent down the street.
1. Be Trustworthy
Whether the real estate investor is a highly successful chest-beater that owns entire blocks of investment real estate, or a "mom and pop" investor with just one or two smaller rental properties, investors are typically reluctant to work with brokers that they can't trust.
So be truthful about everything you discuss with the investor.
When presenting a rental property listed by a colleague, for instance, if the numbers don’t add up defend your investor, not the colleague's numbers. Convey in no uncertain terms that you will confront the listing broker and uncover what the true numbers are before going any further. Bear in mind that it’s okay for you not to know the facts, just be sure to admit it and then make it your job to find out.
2. Put the Investor First
You must be willing to advise an investor when a rental income property doesn’t appear to be in their best interest even though it could cost you a commission.
The investor must feel that you are a real estate agent who genuinely cares how he or she spends their money. That you are wholly committed to “partnering” with them to find the most profitable investment property possible for them regardless what the cost might be to you.
3. Understand the Nuances
You don't have to become a real estate investing expert. But you must have a good working knowledge about real estate investing. Unless you are adequately prepared to discuss the nuances surrounding real estate investment, though you may get invited to the investor’s barbeques, you may never be entrusted with their investments.
Do your homework. At the very least learn what a cap rate, APOD and Proforma Income Statement are; and how they might affect an investment decision. Give your investors the confidence that you know what you’re talking about.
4. Understand the Numbers
Unlike a residential buyer looking for a home to raise a family, real estate investors are buying the property's cash flow and making investment decisions based upon it's profitability.
Learn how to compute cash flow, rates of return and other financial measures so you can adequately discuss a rental property's financial performance. The book below can help. But you might also want to consider investing in a real estate investment software solution that computes it for you. The idea is to never give investors any reason to doubt your commitment to service investment property.
5. Stay Engaged
Make a commitment to work for your real estate investor. Make the calls, go to the meetings, search online. Always strive to locate rental properties your investor might want to consider. Real estate investors always tend to become more loyal to real estate agents that are out there beating the bushes trying to find money-making deals on their behalf.
About the Author
- Understanding Net Present Value: Knowing Whether The Next Income Property You Buy Will Achieve Your
Learn about net present value, its calculation, and how to use it in a real estate analysis.
- The Annual Property Operating Data (APOD): Why Real Estate Investors Use It and How to Construct!
Learn about the APOD. Why it's a popular real estate investing report and how to construct one.
- The Proforma Income Statement: How to Project Rental Property Cash Flows And Performance!
Why a proforma income statement is used for rental income property revenue projections. Learn how to construct one. Samples provided.
- What Every Real Estate Agent Needs to Know About Selling Real Estate Investment Property!
What real estate agents need to know about selling rental property. The benefit, truths, myths, and the right way to prepare. It's easier than you might imagine.
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