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You're listening to the Investor Agent Nation podcast, empowering agents and investors to collaborate effectively and grow their businesses symbiotically.
Your host, Randy Zemnock and Eric Gross, share real-life case studies, trending tactics, and expert strategies that have helped them to accomplish over $1 billion in sales volume.
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This is the Investor Agent Nation podcast.
Awesome.
Well, let's go ahead and get started then.
I'll do a quick introduction.
I know Gordon jumped on a little bit, but Gordon has been an agent up in Cincinnati.
About as long as I have, I want to say going on seven years, right, Gordon?
Actually, licensed in January 2015.
Okay.
So much longer than I have.
Just kidding.
Going on 10 years.
So Gordon is amazing.
his team is amazing. He works with a ton of investors up in Cincinnati. I can easily recommend his team.
You know, either us or Gordon, you can't really go wrong with agents in Cincinnati. So if anybody's got any business, they want done up there. Just reach out to us or Gordon. But we're really going to be talking about this NAR lawsuit today.
Kind of differences that it's made with agents, how it's going to affect agents business. But also, I think one of the big things we want to talk about is what does this mean for investors?
So anybody who isn't sure of the change that just took place a couple months ago, the NAR is now going to have to come out as a buyer agent.
You're going to have to have a buyer agency signed before you show properties.
So before, you know, it was normal for if you listed a property in the MLS, you would have the broker co-op listed in the MLS.
It would state whatever percentage it is.
There is no normal percentage.
We have to shy away from saying that.
It's always been that way anyways.
It's always ranged on homes that we've shown and done things with.
But there were some lawsuits where sellers felt like they were being taken advantage of
and being required to pay the commissions.
So with this lawsuit, NAR basically agreed that it will not be listed in the MLS,
the co-op commission percentage, and that a buyer's agent is going to have to have a buyer
broker agreement signed before they start to show properties. So going forward as agents,
what we're probably going to see changes is we're not going to be able to see in the MLS that,
you know, the seller is offering a two or three percent commission. It's negotiable on who
pays it, how much is paid, when it's paid, and everything like that. So that's kind of the
overview of what is changing here soon. I think it goes into effect July or August. They keep pushing
it back. It was supposed to be like first week of July, then it was end of July. I believe now it's
supposed to be sometime in August. So, Gordon, what I kind of wanted to have the conversation with is
how do you think this is going to affect working with some of your investors? Like, what are some
ways that you see this being a positive for your investors that you work with? Yeah. So first off,
I just want to say thank you very much for the introduction. Super appreciate that. You know,
Ever since we met all those years ago at the Fieldsertle, Panera, you had greatness.
You know, as a young agent, I knew you were going to achieve great things.
And look at the following.
I appreciate it.
You built.
So thank you.
I'm honored to be here.
We're glad to have you.
Fantastic topic because there's a lot of misinformation.
There's a lot of questions.
And we really have not seen how this is going to truly play out.
As you mentioned, they've been kicking the can down the road, another 30 days, maybe another 60 days.
in all reality, that may be next year when we finally see this thing roll out the whole way.
So, you know, we definitely see some challenges up front.
Regular buyers, people that are buying homes, you know, your average home in our area is just around $300,000 now.
So your average home buyer, if they have to come up with a down payment, $3, 5, 10, 20, 25%, pay their closing cost, which can be 3, 4, 5%, 5% as well.
and then also have to pay an additional 3% or some other percentage that's negotiated on the exclusive buyer agency.
It's going to bankrupt them.
They're not, they don't have the savings.
You know, just looking around, we are facing serious inflation across the board.
Gas prices, homes, groceries, food, clothing, et cetera.
Everything is more expensive now.
And I think savings are really taking a huge hit.
So I think this is going to greatly affect those buyers for sure.
Those that don't have, you know, $30, $40, $50,000 saved up minimum to walk into the front side of a real estate purchase.
So that will be, I think, our first benefit to investors.
Most investors, you know, once they get the ball rolling, they have savings.
They flipped a couple properties.
They have a couple rentals.
And they have some cash sitting on the side, whether it's from a 401k or 1031 exchange where they sold another price.
property or just something that they saved up and whittled over the years.
They have a war chest to go play with and they will be able to write better offers.
They will be able to react more quickly.
They'll be able to close more quickly.
And I think that will be a huge benefit to the investor where they can pick up more
opportunity that buyers are going to have to walk away from.
Yeah, absolutely.
And I think one of the things that probably one of the most like misunderstood things I've understood from this lawsuit talking to other agents is that there are agents that think, okay, the buyer always is going to have to pay the commission.
And that's not necessarily going to be the case.
When we sign these buyer broker agreements with clients that are looking to purchase a property, it's not stating in there who is going to pay the commission.
It's just stating in there what the commission can be up to.
So if I sign one with the buyer, it might say, you know, my commission is going to be.
up to 3%.
And whether it's paid by the seller or the buyer, it will be purchased.
So it's still negotiable.
I know me and Addison have cut our commissions plenty of times to help a buyer be able to,
with closing costs or something like that,
to be able to help them get through or repairs come up or something unexpected comes up.
So it's going to be an, oh, Abraham, I think you're unmooted.
But it's going to be one of those things where it can still be paid by the seller.
It's just not going to be marketed as that way.
And I do agree, Gordon.
I think that investors are going to be in a spot where the benefit is if you're an investor
and you want to find properties, there's no better way to get agents looking for it than to say,
hey, I will pay you 3% commission for every deal you find as long as the deal makes sense
with your commission paid into it.
And a lot of my investors have always been that way.
No matter what, if we find it through a wholesaler, if we find it off market, there's a 3% commission
as long as my numbers make sense.
And the benefit there for an agent is I'm going to be motivated to work for you if I know you're going to pay 3% as long as I bring you a deal.
So I'm going to have that incentive to really go out there, hit the pavement, and kind of be that acquisitions.
Yeah, I think what you said there right there is a point that I wanted to bring up today was that most investors, they're very savvy about their numbers, right?
If you look at the standard buyer, it's payment.
You go to buy a car, it's payment.
You go to buy a house, it's payment.
Can I buy this house and how much house can I buy?
But as long as it fits my DTI and my payment, right?
Even if that payment's less than what you could possibly do and they have that budget,
it's all about the payment.
But investors, they have all the other numbers.
You know, how much am I putting up front?
What's my purchase price?
What's my potential exit strategy?
ARV numbers, taxes, all this stuff.
So they are going to, you know, the professional.
ones. They're going to underwrite their own deals or even have somebody on their team that
underwrites their purchases. And they're going to take that extra 3% and say, okay, this is a cost
of business, right? This is 3% that we're adding into our acquisition cost that we're going to
pay our agent because the agent is out there doing great workforce, bird dogging deals,
giving us at least a little bit of underwriting up front to see if it matches our buy box,
if you will, and we're going to pay them for bringing these deals our way.
Most investors are used to working with agents.
They're used to working with wholesalers and they're used to paying some sort of fee.
You know, I do it, you do it.
It's just part of the game unless you're setting up your own marketing scheme.
You know, you've got your postcards and your ISA and all that stuff.
Most investors don't have that, so they're paying a fee in exchange for that.
Absolutely.
And I think if you're an investor and you're looking for deals, I mean,
as crazy as it sounds, but let's say you have an agent that you know, like and trust is going
to find you deals. Maybe you go above 3%. Maybe you say, hey, look, we can go all the way up to 4%
if you find a deal. You bring it to me first. And as an investor, I think that's going to be something
that is going to be a huge benefit. You'll be able to roll it in to there as well. Maybe the seller
is willing to pay 3% and you as an investor are willing to pay 1% to the agent. But now you kind of
have a reason to get it going. Or maybe you have a ton of agents in your market that are really good
at finding deals and there's a lot of competition for it and it could even drive down agent prices.
So maybe you have 15 agents you know that can find you deals.
As an investor, you might be able to say, hey, you know, if the seller's not willing to pay
it, I'll give you 2% or something like that and you can find a way to make it work.
So I think in general, it's going to be more, it's going to be different in every situation,
but as an investor, I think you can really leverage it.
And I think as an investor, agents are going to be more, they're going to be more apt to want to work with investors.
There's going to be a lot of buyers, retail buyers, that are going to go to the listing agent instead of wanting to work with an agent or forego working with anyone to save that commission.
So I think there's going to be more agents that are going to be open to, you know, who knows, driving for dollars or sending out mailers or cold calling, you know, tax abatement lists and things like that to try and get deals for you.
to earn their income.
So that's definitely one of the benefits.
What are,
what's a negative you can think of on top of your head?
Yeah,
let's hear it.
From personal experience,
even before any of the Senate or lawsuit came up,
you know,
I've been working with investors as a part of my business
since the very beginning because I realize
they're,
they're usually dispassionate about the whole situation.
They're easy to work with.
They communicate well.
And they,
they bring you multiple pieces of business, plus they know a lot of people in their network
that can refer. But on the other side, a lot of these investors, they don't want to pay a full
commission when it comes time to list that property that you help them buy on the flip. So they might
want to do a 5% and 3% of the buyer. But I've already heard conversations with local investors
here and had some personal conversations as well, where they're seeing this as a potential
opportunity for them to get 3% more profit on the backside when they go to sell.
It's like, oh, I have to pay the agent that's bringing a buyer anymore, right?
I don't have to advertise that I'm going to pay them anymore, right?
So their buyer can pay them.
Invariably, that's going to have a lot of kickback effects.
You know, you're going to have lower sales prices, homes sitting on the market longer.
You'll have buyers that can't buy the property because they don't have the
for savings, you know, there's a lot of potential things that could happen as a downside of this
that may look like today's investor benefit, you know, saving 3%, but in reality,
it might actually bite them in the end.
Yeah, absolutely.
And I think, and I know me and you have talked about this when this first came down,
but I don't know if we have anybody in Washington state that's licensed here,
but this has actually been kind of the norm in Washington for, I want to say,
say a year, year and a half. I talked to a broker there. And they have some pretty interesting
stats about for sellers who decide to not pay a broker commission or a co-op commission,
those homes tend to sit longer and they tend to sell for less. And I think that's just human
nature. I mean, if you're an agent, you are not supposed to, you know, look at that commission
and do it one way or another, but Washington, it's not listed. But if I'm calling a broker and I find out
my buyer doesn't have the ability to pay my commission or if I'm talking to the agent they're like hey seller's not paying commission I go to my buyer if I go hey I know you love this property but you have to pay me something like we have this in writing you know are you willing a lot of buyers will say no like I'm I'm not going to go an extra 3% that's just you know for whatever reason there is kind of a psychological uh you know hurdle for that so what we've seen are what people in Washington have seen is those homes
homes do tend to sit. So I think one of the cautions for investors would be, don't do that.
Now is the time, I think, to offer that 3% buyer commission or two and a half or two or offer
something up because there's going to be sellers that decide to try and save the 3%.
But oftentimes in business, when you try and cut cost measures like that, it's not great.
I mean, you're paying an agent for bringing a buyer.
So, you know, it's a benefit. It is a huge thing.
If everybody, you know, if every seller in your market, like, I'm not offering any co-op,
that's a huge advantage if you're a seller.
Like I would think as a seller, I'd be like, hey, here's 4%.
I don't care.
Just bring me a buyer.
Let's get it sold, especially if the market starts to soften.
So you make a great point there.
You know, look at Chipotle today.
Their business is getting blocked out, walked out.
Customers are just running and never coming back.
And, you know, you look at an interview with the previous CEO.
He said, I didn't talk about portion control.
In fact, I said, give the people what they want.
Give as much as you possibly can because then they will come back.
You know, very similar situation where we're seeing them cost cut on the front end where the customer sees it, right?
They might cost cut on the back end, you know, with purchases or supply or whatever.
But when it's with the actual product and the customer's like, hey, I'm not getting what I want here.
Customers are going to complain.
They're going to talk about it.
early in my career, I had a broker say, hey, look, if you do wrong by somebody, they will go out and tell 10 people.
They'll tell 100 people.
You know, if you do write by somebody, they'll tell their people that are close to them.
But having that negative effect by saying, you know what, we're not going to offer compensation.
Yeah.
You really have that negative, negative effect for you, for sure.
Yeah.
And I think it's just something that it's going to be, you know, it's going to be a way as an investor.
It's almost like thinking of it as a business cost.
So I've talked to a lot of the investors we work with and they see, you know, paying for direct mailers.
They pay for, you know, text campaigns.
They pay for driving for dollars.
They pay for VAs.
Everything you're paying for.
It can be wrapped up into one.
And that's why me and Randy kind of started this investor agent nation, which was you can really leverage.
As an investor, you can really leverage a good agent to bring you deals.
They can bring you business.
They can make you money.
They have to be worth their weight in gold.
You don't want to pay an agent who's just sending you stuff on the MLS that's retail value
as, you know, blowing you up.
A lot of times what we'll try to do for our investors is kind of dig through it,
sift through kind of what we're seeing and send it to them.
Now that depends if they're ready to go and they're like, hey, we're ready to purchase right now.
We'll do that.
If I get an investor that's like, I'm probably not going to be looking for six months.
I have too much going on to sit there and sit through deals and say, hey, in six months,
let me really get you an idea of what it's going to look like.
But when you're ready to go, we're ready to help any way we can.
So in a way, you have to kind of look at this commission as like a new business cost.
And again, it doesn't mean that it's always going to be that way.
Addison, I do want to ask you a question because this was something we talked a little bit about.
But we're even seeing a change.
Fannie and Freddie, I believe, they're allowing this to be rolled into the loan.
And it's not going to count towards closing costs.
So a conventional loan, you can ask for up the 3% closing costs,
and they're not going to count the 3% closing costs if you're paying a 3% agent fee.
So you can ask for a total of up to 6%, correct?
That is correct.
And I know they're working on FHA and government right now, too.
Yeah.
I think we're supposed to hear something in the next two weeks to a month on the government side is what I've been told.
And I'm assuming you can do something similar with the government side.
I mean, that's the borrowers who typically don't have money and have the lower credit score.
So I would think they almost need to be more sympathetic to the government loans than the conventional.
That's just my personal opinion.
But that's what I would think.
Okay.
Yeah.
And that's what I thought.
I think the only one we were still waiting on was possibly VA.
And I believe the last time I talked to somebody who had anything that kind of knew about it was that FHA, they're pretty much going to allow it.
And then VA, they're just trying to figure out the best way to word it, but it should be good to go.
And I think me and Randy talked about this.
And the way they're going to do it is like the way you word the credit for the agent.
So and also having a seller do it.
Like you can have a seller do it as well if you say, hey, we're going to come in at.
150, but we'll go in at 155 if you pay the 3% commission.
And I'll give a good example of this.
One of the agents on our team in Cincinnati, she looked at a property.
And as ironically enough, the property have been sitting for seven months, which Gordon,
you can attest to in Cincinnati, that does not happen ever.
They started super high on price.
They lowered it down a ton.
And then literally as soon as the NAR lawsuit thing came out, you could tell in our MLS,
last because it keeps a history.
They dropped the commission from like one and a half percent to zero percent.
That's fine.
No problem.
So our agent called us.
She's a newer agent.
She was freaking out.
She's like, what do I do?
And I'm like, call the agent.
It was at like 130.
They started at like 210.
I call the agent and ask, his got her, her investor wasn't going to pay more than
130.
I said, you just have to net that, net his offer to be 130.
So we ended up, I think, doing 125 and the investor would pay.
the 3% to our agents, so like 3,500. And it was written in there. So there's going to be changes
like that. And they ended up accepting the offer. So it's something where you just, as an investor,
you're just going to have to get used to it. And then as agents, we're going to have to get
used to having those conversations of, hey, I'm providing a value as much as I would love to do this
for free. I'm just, you know, not at that point in my career yet. So, you know, I had to get paid
and the seller's unwilling to pay, would you be willing to pay?
And I think there'll be conversations too.
Let's say if our agent knows she's going to get the listing on the back end,
maybe, hey, I won't take a buyer fee, but I want a full 3% commission on the sales side.
So that's something else to consider as well.
Eric, let's also talk about something I saw earlier this week, maybe last week,
exclusive buyer agent commission and the maximum commission.
So you work with a buyer.
an investor, and on that EBA, you say, look, I am asking for a 3%, they negotiate and said,
look, I'm willing to pay you 2.5 or 2%, right, or maybe even 1.5. If you find me a deal,
bring it to me. At that percentage, whatever's listed on the exclusive buyer agency, as I understand
it, even if the seller is offering 3%, 4%, or even 5% to the buyer's agent, whatever's listed
on that EBA is the maximum commission that you can get paid. Have you,
heard about it? Yeah. So whatever you sign, it is an up to and it cannot exceed above.
Up to us. Yeah. Yep. So if you sign as an agent, if you sign an agreement saying that, hey, my commission's
going to be 3%. And let's say, and I will say we've seen this down here in Tampa quite a bit where
the listing agent will offer 3% plus a $5,000 credit to get the property sold. Well, if I've got a,
you know, exclusive buyer agreement at 3%, that's the most I can take.
So for our agents in this meeting, you do not, I would do almost up to 4% or 5%, and I would let them know,
we're never going to get to that.
But if for some reason a seller's offering 4% or 5%, you're crazy to think I'm not going to, you know,
take it if they're willing to pay it.
The chances of that aren't super likely, but it is possible.
and I will say some of the conversations we've had amongst some of the people at EXP in our group was,
if you're working with an investor and you can find deals,
you might write an exclusive buyer agency saying,
hey, I want paid four or five percent,
and I'll go out and find properties that are sitting forever,
and we'll write 50 contracts and as long as the numbers make sense.
So this could be for a lot of people, a really big benefit for agents that know their worth
and are willing to say, hey, I will give you white glove service.
Like, you are going to be taken care of.
Your deals are going to be great.
I'm going to constantly feed you deals, but I want paid for what I'm doing for it.
And that wasn't common before because whatever was in the MLS, the agent was like,
or the investors like, hey, you're getting paid with the sellers decided,
but that's starting to change in a good way.
If you don't mind, let me talk about that, the buyer's agreement.
So there's benefits to both sides.
I know we have investors and we have agents in here.
We have a mix of both, right?
So let me talk about the benefits of a bilateral protection and a partnership.
So the exclusive buyer's agency is not basically just to protect the agent and for them to get a commission at the closing.
Right. It's also a handshake.
It's a contract.
It's saying, hey, I'm going to protect your interest.
I'm going to look out for what you're trying to find out here.
I'm going to sift through the bad deals.
and I'm going to send you the good ones.
And on the other side, from the investor, it's like, hey, you know what, I have somebody
that's willing to work with me.
I want to protect this relationship, grow it and build it.
We're just putting a framework around it.
So me as I started off as a listing agent in this business and we just had a listing appointment
this afternoon.
Whenever we sit down, we have them signed a consumer guide to agency to explain our agency
roles, at least in the state of Ohio here.
and then also the listing agreement, whether it's a lease or a sale, even if it's one that's not going to hit the market publicly, we still have an agreement.
Now, why do we work with our sellers and have an agreement, but always look to the buyers and say, I'm afraid to sit down and have that conversation?
When you look at every single buyer and every investor as a business partner, a client, a customer, and say, I have a higher standard.
We have a contract. I want to go over this contract and explain that.
the protections for both sides because there really are protections on both sides of that.
Yep.
And I would say, like I couldn't agree more to that.
This is for both parties, like for the agent and for the investor in this, the agent, you're kind
of getting a guarantee.
There will be non-exclusive buyer agreements as well.
I already know of some that are kind of going around.
So that'll be something to as an investor.
You don't have to tie yourself to one agent.
So keep that in mind.
Like you don't have to, you know, tie yourself to the agent or you can do, I've even seen some agents will do like a 10 day or like a five day exclusive buyer agreement to go show a property.
But that buyer agency spells out for any reason if the buyer agent isn't doing their responsibilities.
Like I know us as a team, we're going to list out what we'll do as buyers agents.
We'll run comps.
We'll have lists of inspectors and contractors.
will have literally pretty much our entire buyer's packet that we give to buyers already.
And we'll spell out and say if any of these items aren't met and it's like a 25 page
presentation, you let us know and we cut it immediately.
We cut ties.
So that's protecting the buyer, whether it's an investor or retail buyer.
And then on the flip side, I think we all as agents have been burned by some buyer who
wants to go look at a property and you go show it.
And then you find out their mom is licensed.
and it's never sold a property,
but now she's going to be writing a contract.
I just took the time to go show you this property.
Like, where is this coming from?
So there will be some ways that we see that navigated.
But I think as an investor, again,
I think it's something that is great because it's spelling out.
Like, we'll probably have a separate buyer agency agreement for our investors
that spell out, what will we do?
Like, we'll go above and beyond.
We'll kind of be boots on ground.
And maybe they'll even be,
I know some agents do listing tiers, so they do like 6% for full package, 5.5%.
Maybe it's just photos and then 5% for something that's more limited service.
We might do that for investors now.
We might say, hey, if you want kind of bare bones, we'll write offers for you, shotgun style.
The most you'll ever have to pay max is 1%.
For 2%, we'll do that and throw in some of our contacts.
and then maybe like three or four percent will do, you know, boots on ground,
help manage the project, do update videos.
So there'll be some really cool ways I think this will really shift, you know,
kind of that working relationship.
Kind of break it up a little bit.
Does anybody have any questions while we're talking about this?
I don't want to.
We still got some points I want to hit, but does anybody, based off of what we've said so far,
does anybody have any questions?
I'll give it a second.
it. I'm also curious if anybody that's on here has had an experience with this or questions
from your investor, you know, or the exclusive buyer's agreement, because that's really one of
the biggest parts of it. What are your experiences out there? Are you having challenges?
Everybody's like that. We're good. We'll continue on with this, too, but I'll leave some time at the
end for questions. I just want to try and break it up if we can. So if anybody has any of
that comes up, feel free to like unmute yourself or do your raise the hand on
on Zoom to talk about it. I do think everything we kind of talk about right now,
because me and Randy have been planning on talking about this topic for a while now,
the reason we held off was we really wanted to jump onto it and have the conversation
when it first came out, but they've already changed what this is going to entail and
when it's going to happen and what it's going to look like 50 times. So,
You know, in six months, this recording could very much be, you know, something nobody heeds the advice of.
They could be like, well, great.
Like, none of this is going to end up happening.
But as it sits right now, the changes are kind of looking like they're going to happen.
And I think there will be, for a benefit, some really good changes in the business.
I really do.
Even as an agent, I think this is really going to be a positive.
And I think for consumers, I think there's going to be more protection.
I think as agents, we're going to have to really be able to spell out our,
value and same to investors if we can't spell it out, you know.
I agree. I wanted to talk about two interesting things that I've seen since this all rolled out.
We call a lot of expired listings and for sale by owner listings from Zillow and other places.
And two unique things that I've seen pop up recently. One, not somebody I called, not our
market, but the gentleman listed his home for sale on Zillow and put all sorts of information
about the NAR lawsuit and how he doesn't have to pay anymore.
It went viral.
I'm sure everybody's seen it by now, but it was very interesting.
It was almost like the rants of somebody that's just been on, you know,
hasn't slept in 72 hours and then decided to list his house.
It was very interesting to see that.
So I think we're going to have some more uncertainty surrounding that and some very
interesting things pop up.
On the opposite spectrum, we called a gentleman here in Cincinnati.
He has a home listed for $2.1 million in Hyde Park, and all signs point to it's overpriced, right, by at least a couple hundred thousand dollars. However, this gentleman is not willing to list with an agent. He doesn't believe there's any value in the listing agent side of things. However, he sees that there's an opportunity to bring a great buyer. So he's paying 5% of $2.1 million to a buyer's agent to negotiate against his interest, which I thought was hilarious.
When I listed it out like that, I said, you know, you're paying somebody literally a six-figure salary to sell your house and negotiate against your interest.
And he paused and said, yeah.
Like he said, you know, other people aren't going to pay buyers agents, so I'm going to pay them more.
I can't argue with that.
You know, that's solid value.
Maybe they will have more incentive to bring you a buyer.
So there's both sides of that.
Yeah.
And we've had a lot more.
Oh, go ahead.
Yeah, no, I was just going to mention that, I mean, I'm an investor.
I've been investing since 2016 and I recently got licensed.
So I just see this as like, it's going to be, like you said, it's going to be about communicating our value, like
being able to negotiate more and really coming to something to kind of, so the buyers do see the clear value.
Because if I can negotiate 20,000 from the listing side, but they're only going to pay me like 10,000.
dollar buyer's fee that's nothing where if i can put the deal together where it works out for them so
i don't really i just see it's like an opportunity for people that really out of value or can kind of
come up with ideas to like communicate that value because yes it's going to be harder but it's at
the same time it's like buyers there's people that buy now have money you know so if they're out there
and yes some might have less but again if we can come up with ideas and kind of like it's like if i
But it's like when you're analyzing an investment property, you analyze it.
It's calculated to risk.
You have to kind of do your numbers.
You have to come out with different exit strategies ahead of time.
So now as agents, that's something.
Even though they're not investors, they're going to have to do that.
They really want to be able to kind of compete out there.
Again, in my opinion, you know, that's what I'm thinking.
No, and I think you're spot on.
I think something else will probably see as a lot of agents.
And I don't wish this on anybody.
But there's going to be a lot of agents that probably leave the business as well, because this is going to change the way agents have to not only communicate their value, but it's going to change how they have to operate.
And there's going to be, I've had a lot of conversations with agents that have been in the business, even agents that have been in the business for 20 years and they're like, I don't want to deal with this.
Like, I'm probably just going to be out of it.
So I think the agents that are going to remain are going to be the ones that are open to communicating that value, open to kind of changing how things are going on.
And then as investors, I see this as like, there's going to be a group of investors who have no clue what's going on.
There's going to be a group of investors that are, they're maybe just, you know, in it occasionally.
And they're not going to be as worried about all of this or how to kind of almost game it.
But I think there's going to be another group of investors that are going to be very smart with it.
And they're going to realize kind of what, again, all of this is about that are going to say,
I can leverage these agents now who are looking to get more deals, who maybe, you know,
you know, retail buyers aren't going to be out there as much,
I can now leverage them to become my acquisitions team.
They're going to be the ones that are going to be boots on the ground,
looking for deals,
going through all of the lists that are motivated sellers,
talking to motivated sellers.
So I think as an agent,
you really hone your skills to get all of that taken care of,
negotiate, talk to motivated sellers,
find those lists,
do everything like that.
Then you can go to investors and say,
look like I'm not you know I'm for the right pay I will do all of this stuff for you let's set
something up and that's almost what I did up in Cincinnati originally with the flipper I worked with
I just said hey look like one way or another I'd like to get paid just so I'm not doing everything
for free but I'll become your acquisitions I don't care I'll go walk properties with you know
bedbugs and fleas like I don't that's okay okay with me let's figure it out but you know
in the back end or through the buyer's side I want
some sort of way to do it.
It got to the point where, like,
I was the one that was bringing the folder in the contract
and then going with the seller and saying,
I can list your property,
and this is what it would look like,
or I can offer you a cash offer.
We can close in seven days.
This is what it would look like.
What option do you prefer, A or B?
And I had both available.
And then when I would lock it up,
I wouldn't have the seller pay the commission.
The flipper would.
And oftentimes they would.
So I just think it's one of those things
where we're just both investors and agents and the people that are both,
they're going to have to kind of change as it changes as well.
Yeah.
Oh, go ahead.
Yeah.
Ricardo, I actually just wanted to say that you bring up a good point here,
you know, about the underwriting of the deal, you know, running the numbers.
You know, generally when we sit down with someone that's selling a house,
we will talk about their net sheet, the seller's net sheet, right?
How much they're going to sell for, estimated, of course.
And then what their mortgage balance is.
what their taxes look like, what commissions look like,
title company fees, transfer taxes, utilities, et cetera, right?
And at the end of that, generally, we're pretty close
if we know what our numbers look like,
and we're within $1,000 or a couple thousand dollars sometimes.
We should be doing the same thing with our buyers.
So partnering with our guys like Addison
and our loan officers out there who work with investors and buyers
and say, okay, here's what your numbers are actually going to look like.
because oftentimes buyers, even savvy investors, will get to the closing and have sticker shock
and say, what is this? I can't pay all this. I didn't know this. So having those sit-down education
moments as investors and also as agents, we have to bring forward the information, lay it out in a way
that makes sense, and also provide that as one of the pillars of the value that we have. We talk about value,
bringing it forward.
And a lot of agents are scared to talk about the value.
You know, sometimes they'll throw up a meme of the 150 things agents will do for the buyers.
But in all reality, we need to be voicing this talking about it just like a company or a corporation would.
So we can solidify our stance in the market, attract the people who we want to work with.
Agreed.
I couldn't agree more.
And I was going to mention related to this one time.
what I was,
I was telling some agents that like just increase your network.
Like,
you know,
find like increase your network.
That's always good because you can add value through others.
You know,
that's a big way.
Yeah.
So like even for me,
I was thinking now instead of just flipping my own houses,
I'll be able to maybe even help other people flip their houses in a
way.
Like for example,
they want to get a fixer-upper.
Maybe and if they can qualify to get it,
I can,
you know,
coordinate the contractors or maybe even,
throwing the project management fee.
So it's kind of like that opens, again, that opens for me as an investor and as an agent.
I see that that's going to open a lot of things.
In addition to the commission, I can negotiate another commission for the project management
and even other things.
But again, it comes down to analyzing, laying it out before we get to that opportunity, you know?
Yeah.
Absolutely.
And I think as agents, like Gordon mentioned this at the beginning,
But this kind of gives security to some agents because if you have it listed and you're doing all that work and you're negotiating deals and you're going out and showing properties, you have some protection.
But then again, as an investor, for example, one of the investors I work with in Tampa, he signed an exclusive buyer agreement and the agent didn't do any of what was listed in the exclusive buyer.
And it was somebody that he was like, the agent was like, I'm not going to show you any properties until he signed it.
So he signed it.
It was like a 10 day.
and the dude never sent any other properties, had no clue what he was doing, and it was a bad experience.
So I think, you know, finding those agents that you're going to be able to kind of, who's going to offer value?
Those are going to be the ones you're willing to pay.
But if they're not offering value or doing anything, like out of the ordinary, then obviously you're not going to want to pay them for the little bit of work they're doing at that point.
Yeah, you make a good point there.
You know, we have calls on investment listings that we have.
we will break the property down, show them the property, give them all the numbers,
do his video, FaceTime call if they're out of town.
And then the next morning we get a contract from that buyer from another brokerage.
Yeah.
What the heck did I do wrong?
You know, and I've had these conversations throughout my career.
And it's like, we didn't do anything wrong.
Basically, I as an investor, I'm going to call everybody.
My teacher, my mentor, my guru told me to call all the agents.
And you guys are going to bird dog deals for me.
So the more agents I have, the better.
And as an agent, it's tough to want to work with somebody that's calling every other agent out there, right?
You know, you want some exclusive interaction with this individual.
So in order to secure that and win big, you really have to show your value, follow up, do what you say you're going to do.
And if it's on that exclusive buyers agency or if you verbalized it, just follow through.
It's too easy.
You follow up with a phone call.
You send a couple properties from the NLS.
It's going to take you 10 and 15 minutes.
Just do the thing that you said you're going to do and keep following up and tying them down.
Tying them down to making offers, tying them down to working with you, showing value.
And then you'll be indispensable to them.
Yeah.
And I think for both investors and agents, there's something to take out of that.
if you're an agent, make yourself irreplaceable.
So, like, if you're doing what every other agent is doing and there's nothing else that
you're offering, then, like, why is an investor, wouldn't I just call somebody else?
Or why wouldn't I bounce around?
Like, if I feel like, you know, and there's a lot of agents that they don't really offer much.
You know, they're just, they're just there to, they're just what I call like door openers and
that's it.
And they just, you know, they're opening doors.
Tell me what you think.
Okay, what would you like to offer?
Like, we come from, you know, very high value of like, we'll tell you what they're
the scope of work is, we'll run comps, we'll get you the contractors, we'll line you up with
hard money lenders, get yourself you replace it as an agent. And then as an investor, I see this
as like a huge benefit because if there's like a go-to agent in your area that's like crushing
it and there's usually a couple, but like marry yourself up with one of them, go to somebody
who you know is going to be a go-getter and say, look, I won't talk to another agent. I'll
sign this exclusive for a year. But like these are what I want you to do. Are you willing to do it?
then spell it out and then maybe even have it in that exclusive buyer agreement that if any of it
isn't taking place, then you can be released from it. But that way you're locking up an agent that's
going to have your best interest and it's going to do a really good job. So that way you know,
hey, they're stuck to me at the hip. And it's, again, a symbiotic relationship. That's why me
and Randy kind of started all this was oftentimes investors and agents business overlap.
And for whatever reason, both groups of people kind of hate each other. So like most of the time,
I've seen like agents are like investors are the worst.
They're stupid.
All they care about is money.
This is so annoying.
And most investors are like agents are stupid.
They're dumb.
They don't know what they're doing.
It's like that's just generalizing.
Like there is some killer investors that have no problem paying people what they're worth and
their value and they know how to leverage the business.
And then there's agents that know what they're doing.
They know comps.
They know the area.
They're rock stars.
Why like I've seen it personally in my business.
When you partner with the right person or the right investor, it benefits both mutual.
mutually more than you could ever imagine. Whereas if you try and do it by yourself or if you try
and kind of isolate yourself, it's really tough to make it work. For more insights and to join
the Investor Agent Nation community, visit investoragentnation.com. If you like this episode,
please subscribe to the podcast and leave a five-star rating to help Randy and Eric continue delivering
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