What Every Realtor Needs to Know About Selling Real Estate Investment Property!
For the many of you real estate agents that already sell rental property successfully what I have to say will simply be preaching to the choir.
On the other hand, If you’re a real estate agent who doesn't currently sell rental properties but would like to supplement your business by getting involved, then this one is definitely for you.
In this article, I want to share three essentials.
- Why it's smart for real estate agents to sell rental income property
- Some truths and myths about selling rental income property
- What you should do to prepare yourself to sell rental income property
Why It's Smart
The primary reason it's smart to service rental properties is the money.
When I started selling real estate, the average commission for selling a house was about $1,500 after the broker split. When I made my first income-property sale as a residential agent, however, I made $15,000 after the broker split. That sale took place in 1978. And having gotten a taste, I decided to make rental properties my real estate business exclusively over the past thirty four years since.
But hold on.
You don't have to forsake your current residential business and become a multifamily specialist as I did. Just sell investment property as a supplement to your residential real estate business because of the additional revenues you can earn.
Let me give you a real-life example.
Several years ago a colleague of mine decided to push the envelop and called a FSBO regarding a small vacant lot. That call ultimately connected her with an apartment builder who subsequently allowed her to list about sixty apartment units.
She never stopped selling houses, but because she thought outside the box and also made an effort to expand her residential business, she unwittingly fell into investment real estate and made a sizable commission as a result.
But there are other reasons why you should sell rental income property as well.
- You already have at your disposal a ton of potential investors. Given this economy and the fact that banks are only paying so little to use our money, it might surprise you to discover that homeowners who have never invested in rental property are more open to the idea now than ever before.
- It prepares you to service walk-ins and others who inquire about income property. So you never risk losing a sale opportunity or have to refer it away because you’re not prepared to work with real estate investors.
The myth surrounding multifamily property that you must become a specialist or have special training to sell it is not true.
There are exceptions with some types of commercial property, of course, but at the end of the day most properties associated with real estate investing require minimal preparation and effort on your part.
How to Prepare
First, do some reading and learn some of the nuances, terms, and formulas associated with real estate investing. There are books galore available on the web as well as many well-written articles.
Secondly, invest in a good real estate investing software solution. This may seem trivial but software developed for real estate analysis and marketing will serve you well. Consider this:
- Real estate investing is all about cash flows, rates of return, and profitability analysis. A good real estate investment software solution will enable you to run those numbers correctly, concisely, and effortlessly.
- Software will provide you with quality presentations for investors and colleagues. This not has the potential of gaining you customers, you may even get referral business from colleagues.
- Software provides a realistic way for you to learn about real estate investing. Just by using the software many of the real estate investing nuances will simply rub off and give you knowledge just by association.
- Software (really) works.
Here’s to your success.
About the Author
James Kobzeff is a real estate professional and the owner/developer of ProAPOD - leading real estate investment software solutions since 2000. Create cash flow, rates of return, and profitability analysis on rental property at your fingertips in minutes! Learn more at www.proapod.com
ProAPOD also provides iCalculator - an online real estate calculator that enables you to learn dozens of real estate definitions and formulas as you calculate. You save 64%. Learn more at real estate calculator
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