A question I am often asked is, ‘How do I build relationships with estate agents?’.
Let’s start at the beginning. First of all, why would you want to build a relationship with an estate agent? The answer is that, if you follow a strategy like buy to let, probably 90-95% or more of your deals are going to come through estate agents.
I know there are other ways we can find properties, such as going direct to vendors, through leafleting, running newspaper ads, and so on.
This is all good stuff, by the way, and I would do that. But even if you do that it’s still the case that probably 95% of all the deals you are ever going to want are in the estate agents’ offices. Most vendors, when they want to sell a property, are going to go to the estate agents, so it makes sense that you do need to develop relationships with estate agents in your investment area.
How are we going to do that?
The first thing we are going to do is we are actually going to go in and see them. This might sound blindingly obvious but you would be amazed at the number of people who I meet who say that they want to be a property investor, and they want to be successful in property, but all they do is they sit at their laptop going through Rightmove day after day, and they never do any deals.
They contact me and they say, ‘Peter, I have been on Rightmove everyday for half an hour, but I haven’t done any deals yet. What am I doing wrong?’. The reason why they haven’t done any deals is they’re not talking to people; property is still a people business, you need to get out there and talk to people.
So, the very first thing you need to do to develop a relationship with an estate agent is to go and see them. I know it’s obvious but so many people try and shortcut this and you cannot. You need to be there in their office. Why in their office? What not just ring up, or even in this day and age, email?
Because if you’re face to face it’s much easier to build rapport.
And if you’re in the office and face to face, it’s so much harder for them to say they don’t want to talk to you if you’re actually sat there. If you ring them up and they don’t feel like talking they can say, ‘Look, I’m about to go on a viewing. Can we talk tomorrow?’, and then it’s gone, finished. You’ll probably never hear from them. So, you need to be in there.
The next thing you need to do in order to develop a relationship with an estate agent is to show them that you’re credible and you know what you’re talking about. You need to go into the estate agents knowing exactly what your buying criteria are, what you are trying to achieve, and the type of property that is going to help you to achieve what you want to achieve, so that you can show them that you know what you are talking about.
Many, many people blow their relationship straight off because they will go into the estate agents and they’ll say something along the lines of, ‘Can you help me? I want to buy a property. I’m an investor’, and you’ll be the eleventh one that day. They’ll say, ‘What do you want to buy?’ and you’ll say something like, ‘I’m not sure, I want something I can rent out’.
They’ll say where do you want to buy?
And you might say something like “Wherever tenants want to live’.
I’m being extreme, but I know of so many would-be investors who have conversations like that in estate agent’s offices.
You are going to lose credibility, so you need to go in and show that you know what you want, why you want it, and where it is. When you can do that, they will take you seriously.
At the very first visit, to help build credibility, take in all the stuff they are going want from you. For example, proof of funds. Take in a bank statement, show them you have the money. Even if it’s not your money and it’s your JV partner’s money, take in a bank statement from your JV partner and put it in front of the estate agents. Or get a DIP (decision in principle) from your mortgage broker and take that to show them. It’s all about building credibility. And if you do that you will get the deals.
After that initial contact you need to keep in touch. If you can, if you’re buying near home, you want to pop in once a week. Go and see them, go and sit down and have a chat, take them a coffee, or take them a coffee and a doughnut, and then you are going to be their best friend.
By the way, some people will think I’m being a bit flippant, but I am being serious. And some of use might feel it’s out of our comfort zone to do that kind of thing. But if you do that, they will appreciate it, they will remember you, and you will get deals.
And then talk to them. If you can’t go every week because perhaps, you’re buying out of town in a remote location, then at least ring them once a week. Being with them is going to be better but if you can’t do anything else then do ring them, but don’t just think ringing them is enough.
I hope you understand what I am trying to say. Being with them is better but if you can’t be with them then ring them You are trying to make sure that you are in their mind space so that they remember you and take you seriously.
After that what can you do to build a relationship? When they get in touch with you and they have a property to view, go and view it. Yes, even if it’s not quite what you are looking for. It’ll give you a chance to meet the agent and chat (if they are doing the viewing). Just as important it’ll also help the agent as they’ll probably be under pressure from their client to get viewings, and it’ll help you build rapport.
Of course, one of the best ways to build a relationship with an agent is, when you find a property which matches your criteria, buy it. There’s nothing more frustrating for an agent than to give you exactly what you ask for, but you don’t follow through.
But if there are good reasons why you can’t or shouldn’t buy it, then take the time to explain exactly what those reasons are. Keeping the agent informed will make a massive difference.
Just one last point. Sometimes people say to me, ‘But surely the estate agents keep all the best deals for their preferred buyers so why would they sell to me?’.
That doesn’t make any sense to me because the so-called preferred buyer could be following a completely different property strategy to you, and might be looking for a completely different type of property.
If you’re buying for buy to lets but their preferred buyer wants to buy flips, then you aren’t going to lose out. Or maybe you’re buying flips and so you’re looking for flip property and maybe the preferred buyer that the estate agent knows is buying buy to lets.
Or maybe their preferred buyers want properties worth around £150,000 but your budget is £100,000.
The point is that the chances are you aren’t really in competition with the “preferred buyers”. There are plenty of properties for all and I think it would be quite an unusual thing if all the buyers were all following the same strategy and all wanting all the exact same properties in an areas you. It ‘s not going to happen, so don’t worry about it.
Just go to the estate agents, build the relationship and start doing the deals.
Peter Jones B.Sc FRICS
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