Many real estate agents who sell residential property exclude the potential to list and sell rental income property (at least correctly) because they accept the misconception that income-producing property has little or no part in their residential business. And as a result are costing themselves multiple opportunities to close more deals and to increase annual revenues.
Here’s how that misconception plays out.
1) When residential real estate agents do list income property for sale they regularly omit crucial financial data such as net operating income, cash flow, and rates of return. They present no APOD, Proforma income statement, or marketing package to those who inquire about the property. Mostly, they are content to let the selling agent run the numbers. But here’s the problem.
When you fail to make even a minimal effort to present income-producing property correctly, you appear as one with little regard for real estate investing and instead come off as one who simply “throws it up on the wall and hopes it sticks.” And this approach not only can cost you ample recognition from your colleagues that could later result in getting income property referrals, you probably will also fail to give investors any motivation to work with you further.
2) When residential agents aren’t prepared to service income property on a moments notice they typically lose an opportunity to capture additional rental property business. I cannot tell you how many agent-colleagues I have known who lost huge opportunities to create investment real estate business during their floor time merely because they were not prepared for the inquiry. Bear in mind that you have a small window of opportunity to win the trust and loyalty of a customer, but when you stutter or delay you chance to lose that customer to a competitor forever.
3) When agents do not become proactive with real estate investing they lose any opportunity to convert their house buyers into real estate investors. Bear in mind that every person you sell a house to could also be in the market for rental property. In fact, considering the fluctuations in our economy, it would not be surprising to discover that more than a few of your homeowners are ready to pull their money out of Wall Street and put it into income-producing property on Elm Street. Naturally you won’t know unless you ask, but you undoubtedly are not going to ask until you make some commitment to sell rental property.
Okay, now ask yourself this: Why wouldn’t you want to supplement your residential business with a rental income property business? After all, you’re already in a very good position to actively list and sell rental properties because you’re already selling real estate. Plus, there is real estate investment software available that make it easy to create an APOD, Proforma, and other reports with the numbers you need to make presentations that are both informative and impressive without costing you an arm and a leg.
Here’s the bottom-line.
Make the commitment to work with investment real estate. Next, obtain the right tools to run the numbers and create your presentations. Finally, devote a sliver of your time proactively pursuing investment property opportunities. If done diligently you will make more money.