You want to flip houses – an exciting prospect full of opportunity! Real estate is a great investment when done right, and while there is some risk, the potential to earn large gains outweigh them. Many soon-to-be investors wonder, though, do you need a real estate agent to flip houses? If you’re a house flipper without realtor experience, there are benefits you could miss out on.
The answer is two-fold. Could you use a real estate agent to flip houses? Yes, you absolutely could. Do you need to use a real estate agent? No, you don’t, but here’s why you should consider it.
You’ll Have Access To More Homes
The MLS is open to real estate agents. If you work without one, you’re doing all the leg work yourself trying to find houses. You limit your search to homes for sale by owner or some foreclosures. When you have the MLS listings at your disposal, though, the sky’s the limit. Would you rather have a larger selection and less effort on your part or do you enjoy doing the leg work?
You’ll Have Support
Again, buying an investment home is a lot of work. You’re in uncharted territories as you look for homes not to live in, but to potentially fix and flip. If you’re in it to rent a home out, you likely have even more specifications. How do you know if an area is lucrative for renters? What’s the average market rent in the area?
These are just a few of the questions your real estate agent can answer for you. Can you do the work yourself? You could, but it would take a lot of work and sometimes some trial and error. Are you willing to risk your investment or would you rather have the answers upfront?
You’ll Have A Professional Negotiating For You
Negotiating is probably one of the hardest parts of the home buying process. Investors want the biggest piece of the pie, which means looking for the lowest prices. If you’re buying a home to fix and flip, you want lower prices for higher profit margins.
You may negotiate prices yourself, but what background do you have helping you make those decisions? What if you’re way off base? A real estate agent knows the values for the area, knows what’s reasonable, and how to negotiate to get the lowest price.
Real Estate Agents Don’t Cost Buyers Anything
It doesn’t cost you anything to use a real estate agent – the seller covers the cost. If it’s not an expense for you, yet you reap the benefits, why wouldn’t you try it? If you do your homework and find a realtor you have a good relationship with, it could be the first step you take towards a lucrative real estate investment career.
The Downsides Of Using A Real Estate Agent To Flip Houses
You are free to flip houses yourself without a real estate agent too. There’s no rule stating you must use a real estate agent. While it has its benefits, there are downsides too.
When you work with an agent, you’re at their mercy. How often do they send you new listings? How will you connect with one another when something is pressing? What hours does the agent work? If you work with an agent that doesn’t mesh well with your work ethic, you may feel held back rather than empowered.
You may pay higher prices too. Remember, the seller must cover the realty fees. Most agents charge 5% of the sales price, which they split with the buyer’s agent. The seller may be less willing to negotiate the price if there’s an agent to pay. If you’re looking for bare bones prices, doing it on your own may provide higher profits.
Should you use a real estate agent to flip houses? Think about the effort you want to put in and the level of support you need. If you’re knowledgeable about the real estate industry and know what you want, you may do just fine without the support. If you’re new to the industry or you need access to a large number of listings, though, consider using an agent to get the best results.
Either way, do your due diligence. Know your bottom line and see how the property will fulfill it (or not). Real estate investing can be a great investment when done right – take your time and learn the ins and outs before getting started.