For over ten years I’ve been managing a handful of single-family rentals in Minneapolis. Owning rental properties is a great way to diversify one’s assets and grow wealth.
Even though long-term rentals are a strong source of passive income, they do require some financial chops and a good amount of familiarity with houses (i.e., how houses work).
In this post, I’ll attempt to tease out whether an experienced landlord makes for a good real estate agent. I’ve got a strong bias for believing it’s true. Read on…
Reasons Why (Good) Landlords ROCK as REALTORS
- Save client’s time by avoiding or limiting time spent on houses with issues
- Save client’s money by avoiding surprises with inspection findings, or worse, after closing
- Help investors determine if the return on investment meets cash flow goals (rentals)
If you’re in the market for a new home or looking to sell, why wouldn’t you want to work with an agent who has a deep knowledge of houses? Of course, this assumes a given landlord REALTOR knows a thing or two about structures, mechanicals, etc.
Ten years ago, I knew as much about houses as a typical shopper on House Hunters: Enough to be dangerous, but not nearly enough to know what to look for beyond what the eye could see.
“Oooh, nice choice of paint! Oh, and are the curtains included?”
“Wow, I hope the big TV and that fancy stainless steel Weber grill can be included in the purchase agreement…?!?”
Don’t Be Afraid to Grab a Screwdriver and…
Eventually, given a curious mind and a will to act, I figured out a lot of maintenance tasks on my own. YouTube is a wonderful resource, lemme tell ya…
I repaired washers, dryers, plumbing leaks, and more. I learned how to replace drain piping, toilet gaskets (that’s a riot), and lots of kitchen faucets.
I’ve also learned over the past ten years the importance of hydrology with respect to keeping basements dry. 99% of the time it’s as simple as extending the downspouts six feet or more away from the foundation and keeping gutters CLEAR.
Having shopped for dozens of single homes as an investor, I learned what to look for structurally: are the floors uneven, are there odd dips in the roof? Are the walls in the basement showing signs of water intrusion and buckling? Why are there notches cut into structural joists and beams??
What a Landlord REALTOR CANNOT Do for Buyers or Sellers
I’m not suggesting that a landlord REALTOR is qualified to be an inspector, and we at Paratus would always recommend bringing in certified pros to perform inspections in home sales.
Home inspectors (the good ones) have an even keener eye and sophisticated tools to “see the unseen”. Nowadays they can deploy drones to get aerial inspections of a roof, its vents, masonry, gutters, and more. Inspectors use thermal gauges to detect insulation gaps in attics, windows, and walls.
That said, a knowledgeable landlord REALTOR can help his or her clients save TIME, money, and frustration. Disclosure of materials facts is helpful for buyers (and it’s REQUIRED by law!), but in many cases, the seller may not even be aware of problems lurking out of sight (mold, water intrusion, pests, rotted wood behind aluminum cladding, offset sewer lines, etc.)
A real estate agent experienced in dealing with these problems will instinctively inquire or look for evidence of these types of issues. A discovered problem may simply require the seller to make repairs as part of the purchase agreement, or in the worst case, a buyer can simply walk away from the negotiation.
How Paratus Realty Can Help You
If you’re looking to list your house and you’d like an agent in your corner who will work to maximize the return on your sale, look no further.
That includes an analysis of cosmetic improvements meant to bolster a home’s appeal. In most cases, we simply need a clean, uncluttered space that allows a buyer’s imagination to run wild. Most cosmetic changes will cost more than the return from the sale.
If you’re looking to buy, Paratus Realty can help you avoid the pitfalls mentioned in this post. Save your time and avoid the headaches of disclosure misses and “Surprise!” findings after closing. When was the last time that sewer connection to the city was scoped, anyhow?
That last question will be explored in a future post. You won’t want to miss it!
Reach out today for a free consultation, including a competitive market analysis on your most important asset.
Mike Baker, REALTOR (and rock star landlord!):