Are you looking to invest in real estate? If yes, getting in touch with an experienced real estate agent can help you know the hidden risks so that you can make the best decision. Here we have come up with the seven questions to ask a real estate agent while investing.
What sets you apart from your competition?
Asking this question gives you a clear idea of what sets your agent apart from the competition. If you are satisfied with their answers, you can move ahead with the investments. And if they don’t mention that they are more experienced in guiding their investors in comparison to the average agent, you always have the option to find someone else. It holds true especially in the case of the first few properties, as you need an experienced real estate agent who can provide you with the information to make the best investment decisions.
What is the period the property has been on the market?
Knowing the answer to this question helps you a lot in finding out the information about the property. If your agent tells you that the property is brand new in the area and to the market, it is the prime time for the property when it will attract the most queries and spark up interest among the people.
It might be that the property on the market has been longer than the average for the area. Ask him the reasons for the same and if there is anything wrong with the property or the location. The reason could be ineffective marketing and unrealistic price expectations, to name a few.
Whenever the agent tells you that it’s been a while since the property was on the market, never forget to ask why.
Things included and excluded with the property selling
It seems like an easy question, but it is an important one to ask. There are many times when a property doesn’t include the things like curtains or a dishwasher. While sometimes, it may come with something unexpected, like an existing rental agreement.
It is always advisable to ask this question and get the details to make a wise decision. For instance – a property might be a deceased estate having all the belongings of the former occupier. Find out the information about the removal or disposal of the belongings and cleaning cost, if the mentioned case is true.
The vacancy rate in the neighborhood
Multi-family units have a vacancy rate that could be very telling. You should be sure of making enough profits at the estimated vacancy rate. Or, plan to lower the vacancy rate, keeping in mind that this could be more risky.
Get to know the operating costs of the building, which include property tax, maintenance costs, and costs of utilities. Your real estate agent can help you in this case.
This information has a lot of value if you decide to invest in a single-family dwelling. But you should always find out the vacancy rate of the neighborhood where you are deciding to invest. It will help you get an idea of the time period you can fill a vacancy and the market trends of the particular area.
For instance – A high vacancy rate indicates that there might be a diminishing supply of renters in the area. In such cases, ensure that the property you are investing in has advantages over the other properties in the same area to drive demand.
Are there any potential problems with the property?
No agents will come forward to tell you about the things that might refrain you from investing in the property. Their objective is to praise the property to the extent that will make you invest in the same. But here is the key: If you ask them directly whether there are any potential problems associated with the property, they will tell you.
The problems could be cracks in the property, termite damage, etc. There are some properties where there was a death or murder. These come under stigmatized properties, and the laws associated with these properties vary from state to state.
Fencing or tree disputes may also keep you away from purchasing the property. So, it is advisable to know the problems before signing the agreement.
What is zoning?
A good agent will always give you the details about the zoning. It can make all the difference, especially when you want to add value through development or sub-division.
Are the vendors really motivated to sell?
A simple question of how motivated the vendors are to sell their properties can give you insights into their reasons for selling a particular property so that you can make adjustments to your offer accordingly.
Sometimes the vendors might not be in a hurry to sell but just testing the market. However, sometimes they are highly motivated due to personal reasons or that they want to buy elsewhere.
Always learn about the story of both sides to make your offer as appealing as possible.
Who doesn’t want to get the best price for their property? With a little effort, you can make this process seamless. Gather as much information from the agent as you can during a property inspection before the final offer, and it will help you in the long run.