Realtor Investors - Posted by John

Posted by Nate(DC) on August 07, 2003 at 22:22:42:

MLS is not one system; each area has its own MLS. Typically, yes, it’s owned by the Board of Realtors, but any licensed agent can join. The way it works with MRIS (here in DC) is that if you are a Realtor you get a discounted rate on your MLS subscription, which partly offsets the cost of joining the Board of Realtors.

NT

Realtor Investors - Posted by John

Posted by John on August 06, 2003 at 21:33:59:

Are there any legal or code of ethics standards licensed realtors have to abide by when flipping/rehabbing properties?

Re: Realtor Investors - Posted by BrokerScott(Mich)

Posted by BrokerScott(Mich) on August 07, 2003 at 05:43:10:

Each state has its own laws that licensees are required to follow, regardless of wherther that are NAR members (Realtors) or simply licenced. Could you specify what it is that you are looking to establish?

Re: Realtor Investors - Posted by Arthur

Posted by Arthur on August 06, 2003 at 22:29:47:

If what i have read on this site is correct, you have to tell the person you are buying from that you are a realtor (and when you are selling too i think).

Re: Realtor Investors - Posted by Brent_IL

Posted by Brent_IL on August 06, 2003 at 22:23:35:

Licensed RE brokers and agents are held to higher standards than are folks that are not licensed by the state whenever they interact with a seller or buyer.

REALTORS® belong to a club for RE agents. All REALTORS® are licensed. Not all RE license holders are REALTORS® because some, maybe most, have chosen not to join the club.

Re: Realtor Investors - Posted by John

Posted by John on August 07, 2003 at 09:03:07:

I am a realtor in Arizona and have found a property that I either want to flip or rehab and rent. I’m just wondering if I can flip a property being a realtor.

Say the property is worth 100,000 and I can get the seller to sell it for 70000. NOw say I bring in a buyer that will buy it for 100000, but I know that the seller will sell it for 70000. Isn’t it my fiduciary duty to tell the buyer that he could get it for 70000 not 100000. Or is there some disclosure for I could have the buyer sign?

Re: Realtor Investors - Posted by frank

Posted by frank on August 07, 2003 at 09:18:09:

How does a licensed agent get access to mls data without becoming a REALTOR?

Re: Realtor Investors - Posted by Kristy-AZ

Posted by Kristy-AZ on August 08, 2003 at 19:55:13:

John,

There are MANY Realtor/Investors here in AZ. You didn’t say how you found the property? If it’s in the MLS, you will have to go through your Brokerage.

If it’s a private party that hasn’t listed yet, then you should by all means disclose to the owner that you are a Realtor. Depending on their situation, you can let them know that you could list the property at a higher price and HOPE to get it sold and closed in time, OR they could sell it to you/your company (I hope you have a Corp. or LLC) for a discount and be rid of the debt and know the property is off thier hands.

I always have the sellers sign various addendums and disclosures stating that they realize they are selling the house at a discount and that I will be making a profit when I decide to re-sell the property, and that they are perfectly fine with that.

Of course the main thing is, you NEED to talk with your Broker! Some Brokers here will not allow agents to sell thier own houses. The Broker requires that you have another agent list the property if you plan on putting it in the MLS!

Best of luck to you, and remember to ALWAYS disclose!!

Kristy-AZ

Re: Realtor Investors - Posted by BrokerScott (Mich)

Posted by BrokerScott (Mich) on August 07, 2003 at 15:58:27:

John- eric-fl pretty much stated my thoughts on the matter and as Ron said you need to take your particular states laws into account. In Michigan you need to disclose both that you are a licensee and your professional opinion as to true market value. Of course the qualifer is that sometimes for the right kind of seller a fast nickle is better than a slow dime, and that’s who we’re looking for anyway when it comes to investing. Best, Scott

Re: Realtor Investors - Posted by eric-fl

Posted by eric-fl on August 07, 2003 at 10:41:16:

Assuming you are acting as a principal in the transaction, and not an agent, I don’t believe you have any fiduciary responsibility to the seller, per se. It’s an “arms length” transaction, just like any other. However, as a licensed agent, at least in my state, you always have the obligation of “honest & fair dealing with all parties”, whatever that means. I pretty much try to be honest & fair whether I’m acting as an agent or not, as I’m sure you do as well, so I don’t worry too much about it. The main thing is to disclose that you are a licensed agent, and that you are buying the property as an investment, not as an owner/occupant, and you intend to make a profit. It’s not for you or anyone to say when, or how much of a profit. After all, what if you CAN’T sell it for 100 and make 30k. What if you can only flip it for 80? Stranger things have happened. Of course, a seller could always come back and cry foul later, but they could do that anyway. With a plain-english disclosure that they signed to the effect of that which is stated above, I think you’d be ok in front of most ethics boards.

Re: Realtor Investors - Posted by Ronald * Starr(in No CA)

Posted by Ronald * Starr(in No CA) on August 07, 2003 at 10:28:47:

John–(AZ)------------

I think you are right to be asking the question. I’d recommend that you study the ethics propounded by your state office that oversees real estate licensees. Or talk to the attorney for the local association of realtors.

I am not an attorney.

I have heard of real estate brokers telling a potential seller that the property could sell for less than the owner wants. When the owner said “I don’t care, I’ll still sell for what I said” the brokers bought for themselves.

Good InvestingRon Starr*******

Re: Realtor Investors - Posted by kgreen

Posted by kgreen on August 07, 2003 at 11:54:05:

A REALTOR has joined the NAR. A licensed agent is licensed through the state and can join local MLS services.

Re: Realtor Investors - Posted by rm

Posted by rm on August 09, 2003 at 10:20:22:

>Depending on their situation, you can let them know >that you could list the property at a higher price >and HOPE to get it sold and closed in time, OR they >could sell it to you/your company (I hope you have a >Corp. or LLC) for a discount and be rid of the debt >and know the property is off thier hands.

My approach is slightly different. When I meet with a seller, I decide whether they should sell to me or list their home with an agent.

If there’s not enough equity, or their motivation isn’t high enough, or the deal just doesn’t make sense, THEN I’ll refer them to an agent.

After having sold real estate for 9 years, and seeing how much better the profits are when I buy on my own behalf, I can’t imagine why you wouldn’t rather refer the listings than handle them yourself.

Among the things I no longer miss: dealing with agents, the complete lack of control you have in a co-op situation, “testing” a list price that isn’t going to fly, dealing with brokers who don’t understand marketing, RE office “closing” departments, the 19 extra forms I was forced to fill out, last-minute showing calls, calls from agents who forgot the keybox combination, agents who disappeared once an offer was accepted, clients who “changed their mind” after 80% of the work was done, rent-back agreements, oh yes- and dealing with agents…

Not that I dealt directly with most of that stuff, but just having to hear about it would make my blood boil for some reason.

You might try sending out the deals that don’t work for you as an investor. I wonder how many deals you could do for yourself, at more profit, in the time it takes to service just ONE client.

Are you sure about MLS and REALTOR? - Posted by frank

Posted by frank on August 07, 2003 at 14:36:07:

Are you sure? I am told that NAR…the professional association for REALTORS run the local MLS services.

To use MLS you must also be a REALTOR.

Some please correct me.

Thanks

Re: Realtor Investors - Posted by Kristy-AZ

Posted by Kristy-AZ on August 09, 2003 at 14:12:24:

Hi RM,

uh, I was just giving suggestions to this guy. I don’t know his experience level in Investing or RE. If he is hungry and can’t put the deal together for himself, he may want to list the property instead. At least he would get some type of income, rather than nothing!

As for myself, I don’t go out looking for NEW RE clients. I deal only with our own properties and any past clients from the past 10 years. If I can’t buy the property as an Investor, I refer it out to another agent. Like you, I don’t like dealing with all the office “politics”. I currently have a pre-foreclosure listed, only because they are good friends and past clients and it’s not their primary home, it’s their daughters. I am the only Realtor they call on, so I couldn’t turn them away,(I’m just an ole softy when it comes to dedicated clients) BUT it has been a nightmare!

So I am with you on referring the listing out. They take up too much time, that can be spent out looking for profitable properties for us to purchase.

Kristy-AZ

Re: Are you sure about MLS and REALTOR? - Posted by kgreen

Posted by kgreen on August 07, 2003 at 16:36:52:

This is true with our local MLS. All you have to have is a real estate license from the state. My wife and I are licensed appraisers in florida and they consider that a RE type of RE license. So in turn we have access to the MLS. But we are not members of NAR.

Yes - Posted by Bill

Posted by Bill on August 07, 2003 at 14:55:19:

That’s what realtors would like you to believe, it’s not true, not in my area anyway. When I was a broker I was not a member of NAR but was able to join the MLS, no problemo. You don’t get discounts on forms and stuff but that’s offset by not having to pay National and State dues.

Buyers are liers and sellers are too; and so are realtors.

Bill

Re: Are you sure about MLS and REALTOR? - Posted by frank

Posted by frank on August 07, 2003 at 19:31:37:

Thanks. I thought MLS is run by NAR so you have to be a nar member to use.