The ways a person can make money (and lose it) in Real Estate are nearly endliess. One of the easiest ways I’ve seen to make money in this business is becoming a Real Estate Bird Dog. Stop before you rush out the door! You’ll still have to work at it. However, many of us believe it’s far easier to make some money this way than with all the headaches that come with traditional real estate investments.
What is a Real Estate Bird Dog?
A Real Estate Bird Dog is a person, or in some cases a company, who locates investment property for Investors.
Why is there a need for this type of service? Many Investors are business people who are busy making money and don’t have time to hunt down good deals in major real estate markets. This is where a real estate bird dog comes in.
What do you have to do to become a real estate bird dog?
The most important thing to know to become a successful bird dog is know your local real estate market. Here’s how many get started; the bird dogs seek out relationships with real estate brokers, agents, bankers, lenders and anyone else who may have knowledge of a good investment. Then, when someone in their network here’s about a good investment, they call the bird dog and fills them in on the details.
In most markets, the bird dog will be a person who already works in the real estate field, for example a Agent or perhaps an assistant to a Real Estate Agent. However, I know Bird Dogs who do nothing other than find investment deals for investors.
How do you make money doing this?
Commonoly once an investment is located, they present the investment and the details to the investor. When/if they buy the investment, the real estate bird dog is paid a service fee which is typically a percentage of the price of the investment or it could be a flat fee, it depends on the bird dog.
Are their any advantages?
One advantage is that once you hand the property off to the investor, you job is done. You don’t have to worry about setting up financing, inspections or any other of the headaches that can come with investing in real estate.
What is the earning potential here?
Obviously it depends on what percentage of the deal you decide your time and effort is worth, but some command as high as a 10% finders fee. I’ve heard of higher fees, but most that I’m aware of run in the 3 to 6% range.
Are there any disadvantages?
Sure, as with any career track nested in real estate, there are some risk. For starters, in some states, if you find real property for an investor and then charge a fee, they feel you need a real estate license. Check with the State you live in before going into this.
Look at it this way, at the worse case, you’ll have to take a few boring classes and get your real estate license. There are worse things to do with your evenings! At the least, you’ll just have to start networking with the industry in your market to get in on the ground floor of becoming a real estate bird dog.