I am a newbie, just got my license one week ago. :)

I have heard for few people that know Realtors that are making good money on rentals. I am thinking doing them, I know that the commission is low, but you get paid those commissions faster than on buy/sale closings. At least for me as a new in this industry, will give me experience to work with clients and get more confidence and they can give me referrals. Rental clients are not that demanding like buyers and sellers, that they want Realtors with lot of experience. But have no idea how to start working with rentals, or getting leads for rentals.

Any good advice for this would be highly appreciated! Want to start working with rentals ASAP! :)

A lot of work for a little commission. I have heard just the opposite of rental clients. I would never do it but if the rental market is lucrative in your area then go for it. Around here there's no way I'd do it

Really? what of your rental clients have said about it?

But why its a lot of work? showing rental properties until they get what they want? or you mean the paperwork? because in rental communities or developments, you actually don't have to do any paperwork, they do it all. You only bring the tenant and you get your commission when the tenant moves in. And that generally doesn't take more than a month.

When I was looking a place for rent, I found on CL the one I like, called the Realtor, she showed up at the property, the manager showed me the property and the paperwork, the Realtor was just sitting at the clubhouse. She didn't do anything else, she was just the person who brought me to the landlord/lessor, I really don't think that's a hard work! Maybe I would have to fill out sometimes leasing contracts for the tenant, and showing the tenant the properties she/he might choose to rent from the pictures and listing information.

So I'm very confused, I don't know yet what is exactly the job of a Realtor on rentals. That's what I have tried to find out but I haven't found it yet... :(

I like the idea.

I have a few myself and am considering more. I am basing my interest on an agent in my office who has about 45 or 50.

Positives.
Great cash flow.
Work load is minimized by great system planning
Each rental is a mini farm. You have a tenant who is a possible buyer. Each Landord is a buyer, seller, or both--over and over again.
You benefit from having a good roledex of handymen.

Pressure is less. People are not making the deal of a lifetime, so there is not as much emotion. There is a lower key attitude.

Their is nothing wrong with rentals. I've been doing sales for almost 10 years now and just started doing a few rentals last month when things started to get real slow. At the end of the month I will have made 3K in 45 days or so in off season on rentals. It helps out with the slow sales and BPOs. I should have added rentals to my arsenal a few years ago instead of giving them away to other agents.

Rentals in my area are very different than in other areas I suppose.

We have no rentals on the MLS, not allowed...only resales. There are no "rental communities" or "apartment complexes" in my area; this is a very rural area. Vacation rentals are different, but I'm not interested in pursuing them either.

Rentals in more urban settings are different.

Oh no, in my area is everywhere! lots of rental communities, even condos, townhomes, houses that are for rent.

With a lot of foreclosures happening right now and that will happen in the next 2 years, where are this people going to live? they are going to rent of course!

So I really see it as a good start for me, I have no experience, getting listings with zero experience would be complicated now for me, getting buyers would be better but I have to wait longer to get paid, on rentals people are not that demanding if I have experience or not, just the basic knowledge on leasing contracts and a friendly personality. It's a good way to get good referrals!

Let me clarify a little. I do not work tenants looking for rentals. Generally, when they call I refer them to some sources, assuming I don't have one available for them. I was talking about property management.

Generally, working tenants does offer a coop fee. I have seen one (and only one) as high as $500. I would perform for that. Mostly though, the fees are $50 to $125. I got stiffed on a $50 coop fee once, totally a word of mouth referral. Boinkies.

Here in south florida, realtors get 50% of the rent. Let's say, the future tenant is looking an apartment for $1400 monthly rent. I will get $700. And of course, have to pay my broker his cut, so I will get $500. I don't think that's bad. Then imagine how many tenants you can refer in a month and multiply. ;)

Like I said - in a market where there are great opportunities, go for it. In my market, it's more headache than its worth.

Why, it could be in the Bazillions !

Just too bad you can't trust the Honor System, and most of these Parties will conveniently forget who made the connection.

I meant, imagine how many tenants you can refer to these rental developments or landlords, and therefore, the money you can make in short time. Of course, not expecting to be a millionaire with this, but its something that can help you pay your bills.

I think its a good way to get referrals in the future from those tenants I help to find their rental home. If they liked me, they would refer me people that they know want to sell or buy.

This depends on what you are talking about.

Property management is highly sue happy.If you are simply referring a tenant to a complex then you don't represent them you are simply handing them off for a fee.

If you are negotiating the lease for them then you are representing them.

Time is money so rentals would be about how many you had to show before getting a commitment.

Why wouldn't a tenant simply look on the internet and go directly to the building?? Usually the building is a offering a special and if they don't have to pay you money they can give more of an incentive to the tenant.

Every area is different but here I avoid it like the plague.

Good Luck

I regret to acknowledge that few Human Beans have a retention span much longer than that of a Day Fly.

You will be lucky if they remember your name for more than 5 Minutes.

Your experience may prove different; but you can't count on this Species.

Good Luck to you in trying it anyway.

Vermont, I will try for sure! :)

In my case, I still remember the agent who helped me to find my present place. That was more than 2 years ago. If I could remember, why other people can't? If you get referrals from buyers or sellers you have worked with and they liked you, why can't you get referrals from renters too? and I think, follow-up is important, if you send that person newsletters, postcards on holidays, and better, a birthday card on his/her birthday, that person not only will remember you, will refer you.

So let me ask you, what do you think are the best ways to get referrals?

Some of us are gifted with a great memory. I can still remember the first names of all of my teachers, going back to 1975. I can remember odd snippets of conversations from years ago and even things I DREAMED over 20 years ago. I can remember things my friend said to me that SHE doesn't remember. When an old episode of The Brady Bunch or Little House on the Prairie comes on TV I can tell you what the entire episode is going to be about within the first 10 seconds of the opening...

Other people can't remember anything.

Funny thing - I can remember a bunch of those crazy details but I do not have such a good "short term" memory.

So my question is: if a lot of people have bad memory, and your past clients forgot about you, how you get referrals?

I would appreciate if all of you can share your referral-based program! I'm trying to learn everything now, new strategies, methods of marketing, etc.

Thanks!

You do Top-Notch work for your current Buyers and Sellers and they will refer you. I don't think you can put the cart before the horse, and get referrals first.

It will always be hard to get someone to refer an unknown quantity.

Carpenters and Plumbers; Timber-Jacks and Building Inspectors; Attorneys and Mortgage Originators; Roofers and Insurance Agents . . . . they all want me to refer them. I can only feel comfortable referring out someone with whom I have had a substantive experience and become acquainted with the quality of their work. I may "like" them; but that won't support my reputation.

Do good work and your reputation will precede you. And remember, the opposite is also true; but even moreso.

Exactly! that's exactly what I'm talking about. Giving a quality job so clients like me and then they can refer me. Why can't that apply to renters too? I can give a top-notch work, showing honesty, competence, dedication, etc. to that type of clients too.

When I said "like", I didn't mean only with personality, it's more than obvious that is also the quality job you offered with competence, honesty and dedication. They will give value for that and therefore, they will refer. I don't think that this applies to sellers and buyers only.

But anyways, there are a lot of people that refer other people only because they "like" the person, without receiving any services from the agent.

So in this scenerio would the Agent receive a portion of the rent each month or just a 1 time fee for finding the landlord a tenant? FYI, I am just now learning about getting into RE and have a ton of questions.

Typically you receive a 1 time fee, often the equivalent of 1 month's rent. (Which of course you have to split with your broker.)

Rentals are a pain when you are trying to work with the tenants to help them find a place. The only way I would do rentals is if I were listing rentals and I would only show my listings.

I Love rentals. My broker tells me to stick to sales but hey it pays the bills. This month alone (July) I made around 4,000 minus fees etc. I am so desperately trying to get my first sale. Thank God Uncle Sam still supplying me with my military pay for now.
I believe if it works for you go for it. I have had a stressful listing and other agents laugh at me when they fell apart. ( I am kinda in a selfish office I guess) I try to partner up with other agents and co broke rentals to move large inventory faster since I still have my full time job. My market area NYC causes me to have plenty of business as far as clients needing rentals. If I could only be so lucky in sales.

Last year, two of my "rental" clients who found their rental home thru me (one rented for two years (one yr each at two different places (2 rental commishs!)) and the other - I showed him rentals but he decided to do military off-base housing.

BOTH came back to me last year and purchased homes. That was $12k in commishs so I'm not gonna knock "nice" people who want to rent.

I just keep the area close to my office - I won't go beyond a certain area b/c most aren't going to purchase but the rental fee does pay for groceries that week.

I'm just delighted that TWO different people came back in the SAME year and purchased from me! (Course, I kept in touch with them via drip and manual emails during that time.)

Yes most my rental clients have good job income so I advised them to stay in contact with me for buying in the future. I looking at rentals in a positive light also.

I have not personally worked with a tenant, and I've only helped family rent their houses through Craigslist. That said, we have agents in our office that do rentals on the side. From what I've seen, renters respect your time even less than buyers. They are more likely to stiff you on the appointment, and they are also more likely to just call a sign and sign all the papers without you there. That's not even my biggest problem with rentals, though. I firmly believe that if you want to be successful in this business, you need to look at your time as your most valued resource. Time spent working on rentals is time NOT spent working on resales.

Between my two renters, I don't think there was more than 8 hours total. I don't show a vast number of rentals to a renter, and, I stick close to home to save valuable time.

For the 8 hours I spent, it gained me over $12,000 last year.

No, I wouldn't do it on a regular basis. The real estate gods just had it right that time.

Showing potential renters places that our rental dept. manages? Not my idea of a way to make money. I'd have to be truly desperate to get into that.

As far as owning, remodeling, and managing my own rentals . . . I really enjoy that a lot!

In our area rentals are a waste of time. The agents that take the listings sometimes give a flat commission that only pays for the gas you use.

I only handle one client's rental inasfar as listing in the MLS and I give the tenant's agent the majority of the commission which is usually a bit higher than the usual commission found in our MLS because I know it's a pain doing rentals so I try to make it worth their while to show this property. I only handle one b/c I don't want to be in that business.

I counted all the people who I helped find a place to rent - a total of 6 people in 10 years (see, I don't do it much); but, out of those 6, 2 people bought homes last year so 1/3 was a winner and 2/3's was a loser in that respect, but, if it's close and it's not alot of bother - I'll do it again for a hopeful large payoff down the road - especially if there's nothing more going on that day.

You have to remember - I helped these two people - not just with a sale - my thoughts are when they know someone who needs the exact same help - how they gonna recommend? The agent that won't help them unless they are buying a house now, or, the agent who will help them rent until they can buy?

Just don't make a living helping every renter out there 'cause a good number of them can barely pass a rental application - gut feeling helps you learn when it's right.

The one stating 4,000 a month shows they work in New York.

Rentals have to be put into context.If you are in an area where rental rates per month run into the thousands to tens of thousands then the clientele is usually a more refined breed with access to cash.They simply want a rental for transitional reasons but might be a closing down the road.

In many other areas such as mine out in the suburbs rentals are maybe 600 to 1,200 a month max.Long,long hours for a tiny,tiny fee.

So it's all area and price point specific as to what works.Here rentals are a waste of time.Some mls's do not even allow rentals or only pay a 300.00 fee.

I am the one that stated I made $4,000 a month. It is not every month but it is a close estimate. Again I also said if it works for you then go for it. I live in the city so I can make a good amount renting in my area. I am new to sales and it's been hard for me but I am working on it. However, rentals have helped sustain my income until my sales come in. I wasn't making a general statement about the money you can accumulate everyone's farm area is different. I was just sharing my experience.

In my market I have found that for the most part, working with renters is a huge waste of time. Prospective renters get very flaky, and usually in addition to working with an agent, they'll also be looking on craigslist and other free or paid services that have homes not listed on the MLS. So you do just as much upfront work as in sales, but with less odds of closing anything, and for a tiny commission that barely covers your gas.

However - having said that, I will work with higher end leases on a case by case basis (either tenants or listings), if I see something to gain from it outside of the lease itself. For example it's a great way to meet new people who can potentially refer you, and people who lease do end up buying or selling (I have a deal in escrow right now that came from someone who I originally found a lease for last year). But I am very picky about these and I will fire the client very quickly if they seem wishy-washy or flaky, or I don't see any gain from getting to know them as people or spending time with them. It's just not worth the aggravation....

Then ask for more. If that is the only thing stopping you, call the agent tell him someone was interested in viewing the property but you work for X commission, will you increase to make up the difference. If the answer is no, you wasted 2 mins. If yes then you've made it worth your wild.

Is NY a good place to get into rentals?

New York City? You can't find a place with more rentals.

[quote=Anyelina]I have heard for few people that know Realtors that are making good money on rentals.[/quote]

Working with renters can lead to bigger commissions also. I got a call one day, it was a couple looking to rent a home and move from a home which they owned. Long story short, I sold there house for 900K made and got a big commission. So yes, go for it. Maybe you won't get the big one, but the smaller ones will add up too!
Best of luck,
George