Tuesday, November 15, 2011

Selecting property agent in New York - 3 simple steps

After leaving the corporate world in 2006, I became a full time property investor in New York during which my partner and I viewed thousands of properties and interacted with a lot of property agents.  Back then, I seldom actually interviewed agents and would just look at properties with any agent as long as the listings they sent me looked OK.

Through experience, I learned that there is a process in selecting a property agents similar to the process of interviewing an employee or financial adviser.  Spending time to properly interview agents and selecting the best fit will save a lot of time, money and ensure a productive experience.
Most people view an agent as a mere salesperson who just needs to send some listings and open doors to properties.  Most don't give much credibility to agents because the thought is that anyone can become a property agent.  That's true in 90% of agent/client interactions.  That's also the reason why most clients don't have a good experience with their agent.

The best agents are highly qualified, well educated and do majority of the property transactions in New York.   The average agent is concerned about the next commission check to pay next month's rent.  The top agent is concerned about growing relationships.  The best agents likely match the client in education, income and investments. The commission structure is the same hence why not spend time interviewing and hiring a good agent.

Here are my suggestions if I were interviewing a property agent in New York.

1.  You need to like the agent:  Obvious but it's the most important.  The agent is usually the main point of contact.  You need to feel comfortable that the agent will be available to you as needed and not be irritable if you're calling in the middle of dinner.

2.  Relevant experience:  If you're looking for investment property, get an agent who focuses on investment property or even better, get an agent who is also an investor.  If you're looking to buy a property to live in, the most value will come from an agent who works with buyers and who actually owns property (as opposed to still renting).

A foreign buyer definitely should work with an agent experienced in this niche.  I found that most agents have an easy out answer and that is to speak to a lawyer or accountant.  However, when I was a foreign buyer, I expected the agent working with me to have an overview level understanding of subjects specific to foreign buyers.

3.  Ability to coordinate the team:  The agent plays the role of coordinator throughout the purchase process.  This includes coordinating with the attorney, property manager, tax consultant etc.  By having a central coordinator, the process flows better as the coordinator picks up lags and ensures the relevant party follows up.

In most cases, agents view their role ends after contract signing and everything is then handed over to the attorney.  I personally feel the agent's role should extend until closing and even after that in making sure the buyer/seller is transitioning well.

Further, an agent should have the proper contacts to refer the buyer/seller.  For example, 95% of attorneys or accountants do not know about foreign buyer tax implications.  What ends up happening is that the foreign buyer gets treated like a regular (US person) buyer and gets a huge shock when the time comes to sell the property.

Good luck with your search :)

Wei Min Tan in Managing Director of Castle Avenue Partners, focusing on foreign buyers interested in buying Manhattan, New York property.  He has appeared on CNN, New York Times and the Wall Street Journal on the topic of foreign buyers of Manhattan property.  Wei Min speaks Cantonese Chinese, Malaysian and conversational Mandarin.  He can be reached at tan@castle-avenue.com

1 comment:

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