Investing in real estate is a time-tested way to grow your portfolio and earn passive income. Whether you’re interested in managing rental properties, flipping and reselling houses, or finding investment properties to sell to other real estate investors, partnering with the right broker can make a significant difference.
A broker can help streamline the selling process, saving you time and effort while maximizing your return on investment. However, it’s crucial to find an experienced broker who is well-versed in the investment market.
This article will discuss essential tips for finding the best broker for your property, whether it’s a townhome, shopping plaza, or medical office.
First, What is a Broker?
A broker, also known as a broker agent, is a real estate agent licensed to own and operate a real estate firm. Brokers have more advanced credentials than non-broker real estate agents, and real estate agents must work under a licensed broker.
Whether you work with a real estate agent at a brokerage or directly with a broker, it’s essential to look for a firm that specializes in investment properties, has a proven track record in the area where you’re investing, and possesses experience with your specific property type.
If you plan to invest in multiple properties, finding a trustworthy broker with whom you can build a long-term professional relationship is even more critical.
Here are some tips to help you determine if a specific broker is the right fit to sell your investment property.
1. Always Ask for References or Case Studies
Whether you’re selling a small single-family house or a large apartment complex, finding a broker who has successfully closed deals with interested buyers is crucial.
When interviewing brokers, ask if they can provide references or case studies of previous sales that you can review. A successful brokerage should be able to offer one, if not both.
Don’t just take their word for it—reach out to past clients or companies to get honest feedback about the broker’s performance and work experience.
2. Make Sure They Understand the Local Market
A broker may have vast experience, but it’s vital to find one who truly understands the market you’re investing in. Before hiring a broker, ask about their previous selling experience in the area.
For example, selling in an up-and-coming area differs significantly from selling in an established suburb. Buyers in each area typically look for different selling points.
A broker who understands the clientele in the area where you’re selling will be better equipped to market your property and secure the highest possible price.
3. Find Out if They Also Invest in Real Estate
Selling a home is very different from selling a commercial investment property. While your broker doesn’t need to be a real estate investor to successfully manage your property sale, finding one with personal investment experience can be advantageous.
A broker with first-hand experience in real estate investments will better understand the process and potential risks, helping to minimize mistakes along the way.
4. Test Their Response Time
You can learn a lot about how well you’ll work with a broker by observing how well your communication styles align. When you reach out to a broker, how long does it take for them to respond? Do they contact you directly, or does an assistant handle it? Is communication primarily via text, email, or phone?
There’s no right or wrong answer here, but you want to ensure that your communication style meshes well with the broker you hire. If you prefer phone conversations, but the broker favors email, you might find the relationship challenging to maintain.
5. Ask to See Their Marketing Plan
How will your broker go about selling your investment property? A marketing plan is the blueprint your broker will follow to generate interest in your property and maximize its sales price.
Ask to discuss the marketing plan—or have the broker develop a high-level plan during your initial meeting—to determine if it aligns with your investment goals. Pay attention to what the plan includes. Are they providing professional photography? A video tour? How will they make your property stand out among similar listings?
Be sure to ask plenty of questions about their marketing approach to better understand how they’ll work to sell your property and whether their strategy resonates with you.
6. Find Out the Costs Upfront
Broker fees and commission rates are critical to understand from the outset. While most brokerages charge a 6% commission, there may be room for negotiation. It’s also essential to know precisely what services you’re getting for that fee, as not everything—such as photography—may be included.
Discount brokerages might offer lower fees than full-service brokerages, but they may also provide fewer services, which could impact the sale of your property.
7. Trust Your Gut
Experience, marketing knowledge, and industry expertise are all essential, but don’t overlook the importance of likability. If you plan to sell multiple investment properties or work with a broker over several years, it’s crucial to find someone you can develop a strong, long-lasting relationship with.
The Bottom Line
Every investor has their own criteria for what makes the perfect broker. For example, if fast communication is a priority for you, you might be less concerned about the broker’s personal experience in real estate investing. However, if you’re building an investment business, you might prioritize a broker’s real-life experience and client references.
Take your time when selecting the right broker for your properties. The right broker plays a significant role in the success of your real estate investments.
For more insights and resources to help you navigate the CRE market, visit VidTech.
