An epic quest to close on Zavala. It was a long road riddled with traps, ambushes, and surprises. Little loot or wealth was to be found on the trip, but at the very end we climbed to the top of the mountain and discovered a pile of gold.
One of the traps that could have killed the multiple times was that thing called an Agent. Sometimes a scary person, some times the wizened guide, sometimes the quirky princess, but a constant companion. It’s interesting to note that most full-time Investors do without a realtor or have gotten their own license. While I am definitely not advocating the purchase or dealing with real estate with out a licensed realtor they can be a roadblock on the path. On Zavala our Realtor whom we enjoy working with and have now closed on two properties with, was a frustrating roadblock.
He greatly dislikes working with short-sales. The time requirements, the waiting, the bank requirements, the reporting, the this and the that. He despises them. So he tried to dissuade us from keeping our claws dug into this property. Every couple of months he’d try to convince us to cancel the contract, telling us that it wouldn’t close and that we should be looking at other properties before prices went up. What he didn’t know was that we were working with other realtors on purchasing properties, because we want and need to purchase properties at short-sale prices! If we had listened to him we would’ve walked away from this property. And this is why it’s important to have a plan and re-evaluate your plans every couple of weeks.
Our goal is to purchase properties where the with 50% occupancy we can cover debt service and put ~$600/mo towards costs. Which means we need to purchase at a certain price-to-rent-ratio. So we had this deal on the table and EMD in the bank. We knew it was going to be a long journey. While this one sat on the back end we kept looking at other properties, we made offers on 10-12 different properties while Zavala was sitting there. Heck, we closed on two properties while this property was sitting there. If we’d found another property we always knew we had Zavala out in space at the right price, and we could look for the right properties knowing we had a backup.
Mr. Realtor continued to be a roadblock as we were trying to get into the closing process. When the appraiser (who in this story is the Big Evil) said repairs had to be made, Mr. Realtor said, “The Sellers are broke, Don’t Fix a property that isn’t yours.” And we thought about it and understood what he meant and how he was trying to help us. Probably, we would’ve walked away if we didn’t think creatively. I came back and said, “Well Mr. Realtor, here’s the thing give me an addendum, “Buyer to pay for repairs required to complete Appraisal process. If Seller, or Bank, cancels contract before close of escrow, Seller to reimburse Buyer Cost of repairs.” We then waived a magical wand and the world was a happy place again.
Don’t get me wrong, the constant companion has some great qualities and does work to protect my ass. But there’s something about finding a realtor who understands the investor mindset. Even if a realtor owns investment property that does not make them someone who has an investor mindset. Our own Mr. Realtor owns investment properties, but he thinks like a realtor and not an investor. And while he works almost exclusively with investors I believe he doesn’t have that switch clicked yet that. His bag of tricks however is the best! He has a guy for this and that. A guy who solves the other thing, and can do something else.
We love our Mr. Realtor. He works hard, he pounds the pavement and he has a rising star attitude If only we could flip that switch and make him see the potential that lies in how creatively an investor thinks.