Real estate owned (REO) properties can be wise investments for the smart investor. Buying discounted properties is often a complex process. Some sales agents are experienced in completing these property transactions and can be a great help to buyers. For instance, the sales agent can identify REO properties, help the buyer prepare paperwork, and offer advice about how to negotiate with the bank throughout the REO transaction process. Buyers should learn as much as possible about how to buy foreclosures or bank-owned properties before committing capital. Even a modest amount of research can help the buyer avoid frustration and paying too much on an REO property.
Banks and Negotiation
Some banks will negotiate on REO properties. The experienced sales agent can help the prospective buyer to assess certain criteria prior to an attempt to negotiate a better sales price. The property’s location, its condition, and the number of prospective buyers for the property all count to the bank. For instance, if the property is in good condition but miles away from the center of town, or it’s in a less than desirable school district, fewer buyers are likely to bid on it. The bank may be willing to accept a lower price if the buyer has cash in hand.
Successful negotiation requires the ability to understand the other party’s perspective. The buyer must understand what the bank is thinking. If a property has been on the market substantially longer than the bank believes it should, they may become concerned about losing money on their investment. They want to liquidate such a property as soon as possible.
Kuba Jewgieniew is the CEO of one of the top brokerage firms in the United States. Realty ONE Group uses technology and data to help individuals and investors buy and sell property. Realty ONE Group has headquarters in Irvine, California.
The best property agents know how to prioritize all the steps that must happen during the day – which tends to be quite a bit longer than the average individual’s work day. Because there are so many prospects, sellers to engage, and houses to show, how does the professional agent keep track of it all?
The answer to this question is the Agent’s Activity Log. If the agent works for a realty firm, the organization may have a template for the agent’s daily, weekly, monthly, quarterly, and annual planning. Although a new agent may have few tasks to prioritize because he or she is developing a first deal, the experienced professional has many variables in process.
Planting Seeds, Tending the Crop, and Reaping the Harvest
According to “The Secrets of Question Based Selling,” the successful agent is always prospecting (planting seeds), assisting customers in buying or selling property (tending the crop), and making transactions (reaping the harvest). The real estate agent really can’t focus on one or two activities because, otherwise, deal flow will fall off in a period of weeks or months.
Activity Log Content
The Activity Log notes each property listing, buyer search, pending transactions, appointment sets, bids extended, offers received, and referrals requested/received. The Activity Log may be part of the firm or agent’s CRM so that emails and contacts are organized. The agent might not remember precisely what was last discussed with a bank loan officer or escrow agent without excellent organization.
Organization and excellent communication go hand-in-hand for the professional agent. Managing each step of multiple projects in progress is challenging but ultimately quite rewarding.