Running a business is not simple or easy. It takes plenty of hard work, a good dose of dedication, effective systems in place, and the assistance of qualified professionals. And the business of real estate investing is no different – except for the fact that the business tasks are not only multiplied but spread across a broad spectrum. As a real estate investing entrepreneur, there are a few things you should do and do well, and the rest should be handed off to other qualified professionals. So let’s look at the benefits of hiring an agent for even the most self-sufficient investors in Metro Detroit Michigan.
Lead generation is one of those critical, foundational activities for any real estate investing business. It’s also an area where the benefits of hiring an agent are undeniable.
According to Than Merrill, lead generation, which means finding potential investment properties, “may be the most important aspect of any deal. If you are not doing something every day to generate leads, chances are you will fall behind the competition.” And lead generation is something agents can help investors with.
Otherwise, without your agent helping you generate leads, you’ll have to do it all on your own – all while trying to manage the myriad other aspects of your business. If you don’t hand over much of the lead generation to your agent, you will have to spend a good chunk of every week on this task.
Dealing with Sellers
Whether your investment business model is fixing and flipping, buying and holding, or some combination of the two, you have to acquire the investment properties somewhere. And that means dealing with and working with sellers – a lot. As important as generating leads is, it is only the first step.
Dealing with sellers means acting on a promising lead. You have to talk to sellers, determine their motivation, inspect the property, haggle over price, and draw up contracts. It’s all very time-intensive, to say the least. But hiring an agent in Metro Detroit Michigan to handle most of this, which is what agents are for anyway, will free up your time to concentrate on other matters.
Certainly, you have to evaluate any potential investment property to assess the likelihood of a decent return on your investment. “A good property evaluation system will almost act as an inspection before the actual one occurs” (Than Merrill). But again this is part of the business that your agent may be able to perform better than you can.
Property evaluation entails going through a long checklist of items, including roof, electrical system, plumbing, flooring, foundation, and HVAC system. It also involves running the numbers to figure cash flow or after-repair value. Very often your agent will be better trained and have more experience in these evaluations, which is another benefit of hiring an agent.
Setting Up the Deal
One of the chief benefits of hiring an agent for even the most self-sufficient investors in Metro Detroit Michigan is your agent’s negotiating and deal-making skills. You’ll have to use the proper formulas to determine what price you’ll pay, and then you will have to enter into negotiations to try to get that price. Or maybe a cash deal would be better in certain instances. Without an agent, you will have to acquire these skills and then do all this on your own.
Time for Accounting
One of the most important aspects of running a real estate investment business is that of having an accounting system in place. You have to keep track of expenditures, and you have to pay vendors and contractors on time. And this is one task that you as the business owner/operator will want to take care of yourself. One of the benefits of hiring an agent is that you will have time to take of these important accounting tasks because the agent can take care of so much else for you.
Additional Benefits of Hiring an Agent
In addition to the benefits listed above, there are a host of ancillary benefits to hiring an agent, such as:
FAMILIARITY WITH TECHNICAL LANGUAGE
Real estate investing involves a lot of jargon and technical terms that can be more than a little confusing – cap rates, ROI, cash-on-cash returns, 1031 exchanges, and net present value. Agents are familiar with all these terms, and investors who don’t have the time or inclination to learn these terms can lean on their agent’s knowledge.
Also, agents understand what matters to investors, especially their investment goals. A good agent, then, will know the best approach and strategy to help you achieve your goals.
One of best benefits an agent can offer is thorough, up-to-date market knowledge. Good agents will know what neighborhoods are currently hot, where the best schools are, where jobs are moving to, and, basically, what areas offer the best investment opportunities.
NETWORK AND RESOURCES
Good agents also have a broad professional network and can hook investors up with the professionals and tradesman they will need – for example, real estate attorneys, tax planners, plumbers, and painters.
Real estate investors have to keep their margins up and constantly work on cash flow – otherwise, they can’t stay in business. So the benefits of hiring an agent are pretty obvious for even the most self-sufficient investors in Metro Detroit Michigan. If you’d like to get in on these benefits, contact us today! 248-330-4421