Buyers who invest in real estate can be a lucrative source of repeat business. Unlike typical clients, who may only be involved in a few transactions during their lifetime, investors are frequent buyers. When they're involved with fixing and flipping, they can be frequent sellers as well. Working with investors, however, requires you to adjust the nature of the service you provide.
Meeting a Different Set of Needs
Typically, your buyers are concerned about location, good schools, and the quality of life offered by the neighborhoods they are considering. They look at multiple properties - both online and in person - until they find one that feels like home. Investors have entirely different sets of criteria.
For example, investors may not even look at a property until they are well on their way to acquiring it. Their primary focus is on th efinancial aspects of the transaction. Unless they can purchase the property at a price that is likely to result in the desired return on their investment, they move on.
Therefore, when serving this type of buyer, it's also essential to understand the "math" behind their approach. This is the only way you'll be able to spot properties that may meet their criteria and help them acquire these properties on the right terms. That isn't to say that your qualitative skills aren't useful. For instance, part of the analysis for rental investors requires an accurate assessment of how much a property will rent for in an area, the trend in occupancy rates, and knowing what impacts these trends.
The Nature of the Relationship
While investors like to build relationships with Real Estate Agents who understand them, they tend to work with a number of different ones. This is good news if you want to work with this segment of the market, since they are always looking for the next deal. However, just don't expect an exclusive relationship.
When meeting an investor for the first time, your first priority should be understanding how they value properties. It can differ from person to person. Specifically, yo uwill want to understand what kind of discount to current value they look for and whether they tend to hold and rent property or improve and resell it quickly. Also, you'll want to get a feeling for what is important to them when they review listing information, along with their preferences for visiting the properties.
While negotiating deals for individuals can be challenging, you typically reach a compromise quickly. Investors take a different tact. So, be prepared to submit many bids with little room for negotiation, all while keeping to a tight deadline.
Essentially, the greatest value you can provide investor clients is efficiency. The faster and better you become at setting them up to succeed in realizing their goals, the stronger your relationship will become and the more business you are likely to close.