The SECRETS to Working with a Real Estate Agent in Multifamily!

But if you want to get your real estate agent license because you think that's going to make you a big baller investor, it's not. It won't. It won't help you in any way, shape, or form getting your license, and the 3% is meaningless.

Today we're talking about the pros and cons of using a real estate agent and should you get your real estate license.

Welcome back to the channel. My name's Cody. This is Christian. And today we're talking about real estate agents. Those people who take 3% from your deal.

Thieves! Thieves! I'm kidding.

They're the ones who bring us our deals. I'm a real estate agent, you used to be a real estate agent, and we still didn't rep ourselves. We don't care about 3%. Look, if 3% kills your deal, you're buying a bad deal. Now what's the pro? I'm gonna share some pros, but what's the pro of using an agent?

The biggest pro of using an agent is they get paid to find you deals, and when you pay them, they bring you more deals. And a good agent is is worth their weight in gold.

That's magic. And really, I mean, we don't pay them. They get paid from the seller. Yeah, it's magic. They just work for us for free and make money out of thin air.

Yeah, that being said, I would pay their commissions on a lot of these deals if we had to. It's totally worth it.

Our real estate agent right now, shout out to Eric, Foundation Group in Seattle. Don't snipe him, he's ours. No, you can definitely work with him, but he brings us deal after deal after deal, seller financed, low money down in Grant County where we love to buy. We're working on a ton of different deals from a ton of different owners right now with him, and he only gets paid when we close. I used to do all that work, and I'll tell you, that was a lot of work. Not worth the 3% in my eyes that he's, he's gonna get paid. However, for him, he's gonna make hundreds and hundreds and hundreds of thousands of dollars. For us, that, yes, that is an absolute lot of money, but if that changed our deals, we would be in big trouble.

And his hundreds of thousands of dollars of commissions makes us millions of dollars in real estate.

Yeah, and it allows us to keep buying, and the more we buy, the more we can buy, because the more money that we get out of cash flow. And then we can fix them all up, and eventually he can help us 1031 if we ever decide to sell, and he'll find us even bigger deals. But he has to do all the work because he gets paid the big bucks.

So let's break this down. What does the broker actually do? Because there's a lot of people, and it's probably in the top 3 most common questions asked to us: well, should I get my real estate license first before I invest? The short answer is no. No. Best practice in YouTube videos apparently to leave the answer till the end, but no, we're answering that right here, right now. Facts. There is a reason to become a broker, and that is when you want to be a broker. And we're in Washington State, by the way. A broker and a real estate agent is the same thing.

It's a synonymous term.

Yeah, just so we don't confuse people.

Now there's a designated broker and a managing broker. If you're just a real estate agent, you're not those. However, broker, agent, some people think designations matter. They don't really matter, but if you want to get your real estate agent license, because you think that's gonna make you a big baller investor. It's not, it won't. It won't help you in any way, shape, or form getting your license, and the 3% is meaningless.

Yep, I, in my broker exam, I learned about riparian rights, so I know what happens when your property's on the water. And is it still water or running water? Those are the type of—

I have both.

Yes, we do. However, that's not what you need to become a better investor. You might think, oh, a real estate license, I'm gonna learn how to write a contract. Guess what's not part of the real estate licensing course, at least not in Washington? Actually putting together the darn contract. All the pieces you want to know.

They'll teach you about lot and block.

Yeah, they'll teach you about how things are zoned a little bit, barely, but you're basically going to get a crash course on this is how real estate law works and you're done. That's it.

Yeah, it's not helpful. So when it comes down to working with them, you have to find the pros. Because there's a lot of people that think they're going to make big bucks, they're going to become great investors as soon as they have a license. They think that their designations make them above everyone else, and they know absolutely nothing about playing this game.

I'm a realtor.

A realtor. That was good.

Yeah, there's all sorts of designations.

Funny, because it's true.

People love that designation, and it means absolutely nothing to anyone who matters. However, that was kind of mean, but We're not cutting that. No, we're gonna keep that.

When it comes to working with real estate agents, real estate brokers, you need to find the pros. And the way you do that is you find people that own real estate. Eric, the person that we work with, he owns real estate. He owns a storage facility. He's made his millions already. Now I'm gonna help him make a ton of millions alongside Christian. We're gonna make him a deca-millionaire because he's gonna help us broker big deals, and eventually we're gonna joint venture on big stuff. But if we didn't get him paid, let's talk about pros, he would never bring us more deals, which is the number one pro of working with a good agent. If they know how to play the game, they're not— he's not competing with us. We can outbuy him right now. Eventually he might be able to buy the type of deals we're buying, but he's not focused on that. He's got a wife, he's got a family, and he's not focused on scaling right now. We've got our 4 business cycles. He's not in build phase. He's not in direct competition. So he's just sending us the best opportunities He's stacking his cash so one day we can partner on the really big stuff together.

And what do you want to do with your time? Like, if you want to be the one making all the calls every day, day in and day out—

I don't want to do that.

Yeah, I don't want to do that. If you're someone— and I have a few friends who can do that and are fine with doing that. They sit in the room, they're like, hey, you know what, for the next 5 hours I'm just dialing. And they get an auto dialer and they just roll.

They've got the 10 dialers where they'll dial 10 numbers and first person to pick up, they're talking with.

I've done years and years and years of phone sales, actually really successfully. I was really good at it. I hated it. Yeah, I made a lot of money dialing a lot of people under multiple industries. Not what I want to do in the long term. Find an agent who's willing to make those dials, to take that effort, and you're going to go so much farther so much faster because you can focus on the things that you want to do. We've talked about wearing different hats and Cody's giant hat, the many, many hats that I wear. Choose the hats that you actually want to wear and offload the other ones. For most people, if you You want to be an investor. The real estate agent hat is not going to be the right hat for you, for most. Now, what are some of the actual pros of getting your real estate license? If you work at a great brokerage, you might have a great mentor who helps you with the contracts. That is the number one thing that I got personally out of being a broker, is I can look at a contract and it is so much easier when you've written it. When you've made mistakes writing a contract before, and you go back and you go, oh, you know what? What mistakes am I looking for? Probably the ones that I made. I am better at reading real estate contracts because I got my license, and that is the one biggest benefit I think I got from that.

Absolutely. But as far as cons of working with a real estate agent, because I do want to stay on track with—

Yeah, yeah, you can go with that.

Working with a real estate agent, the only cons you're really going to have are when you work with a bad real estate agent, which we've done, which is the majority of them. Most agents suck. They find a deal that's on the MLS, they send to you and think they deserve $50 grand. They don't. They didn't do anything. And then they write a sloppy contract. We've worked with people that do that, and they think they deserve the world because they spent time on it, but we found the same exact deal. You have to find a real estate agent who not only understands what your goals are, but knows the quickest and most efficient path to get there. That's actually putting in the work to make it happen. The only cons you're really going to have is when you're working with someone like the first person that we mentioned. We're not thinking of an individual in an actual individual, but we're just giving you an example. The people that just send you the listings from the MLS, those are not the people who are going to help you make your dreams happen.

And there's a reason that most brokers are not very good at their job. Most real estate agents are not great because they're not the ones buying the deal. They're a service provider. They don't have skin in the game. And it's a really brutal, competitive business. There's a ton of people doing this, so they're trying to shotgun stuff out They have buyers who go under contract, drop out of contract, because turns out there's a lot of investors in real estate who are also really hard to work with. It's a brutal job. They want to get paid, and at the end of the day, they only get paid on transactions that close. So they're doing everything they can to close the transaction. The interests are not necessarily going to be aligned with you. If they're working with 100 different clients, they're just trying to get things closed. They're going to do whatever they can to do that. The brokers that you get the value from— I'm going to go back to our friend Eric, boss man, boss man. He will do what it takes to keep our business. He's invested in us and he will give us deals before anyone else because we will continue to close them. So if you want to work with the best agent, you got to be the best investor. You have to close your deals. You have to do what you say you'll do. And I think we've gone really far by making decisions extremely quickly. We can tell him yes or no to a deal on the call when he calls.

Yep, and that's how we negotiate all our deals. Last time they want— the seller wanted 5.5% interest. I said it's not going to work, it needs to be 4.5%. It has to be interest only for this amount of time, otherwise the loan factor rate is going to be too expensive in relation to the income. It's like, okay, and then we got it down to 4.5%. It was amazing.

If you want to learn how to analyze the deal very quickly and how to communicate that to a broker, take our course, multifamilystrategy.com. We have all the scripting and conversations and math we use to have these conversations with a broker so you can knock that out on the first call. But when you start applying these things, you get that one or two brokers in your market who are just fantastic, who are going to prioritize you above everyone else. And when you get there with an excellent broker, your job becomes so much easier and you will buy exponentially more real estate.

I like exponentially more real estate. I need to do that.

Well, it's been true for us so far. We'll see what we pull off this year.

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