When renters are ready to become homebuyers, there’s a good chance they’ll turn to a real estate agent with whom they already have a relationship. Forward-thinking real estate agents who provide hands-on service during a person’s rental journey demonstrate that they are reliable and focused on adding value and put themselves in an excellent position to reap the rewards of that positive relationship.
How real estate agents can help renters become homebuyers
Agents can be a helpful resource in many ways.
- Schedule rental showings - Effective real estate agents, build an extensive network of real estate investors, landlords, and property managers. Many property owners and managers rely on agents to show and lease their rental property. When an agent works with a renter to identify the type of properties they want to consider, that network comes into play. The agent can reach out to their network to learn about vacant units, some of which may not have hit the market yet. If the agent has leasing contracts with property managers or landlords, they may be able to present units to a prospective tenant immediately. By providing responsive service to the renter, the agent becomes a problem-solver and a good resource for the renter to turn to when it comes time to buy.
- Negotiate lease terms - Agents are familiar with real estate contracts of all kinds, from residential lease agreements to purchase contracts. An agent brings expertise about which lease terms can be negotiated, such as parking, storage, pet approval, extra fees and deposits, guests, and more. When the renter first reviews a lease agreement, the agent can help ensure that all the lease terms are clear and may be able to guide negotiations with the landlord for more tenant-friendly terms. The agent’s transparency during the lease negotiation gives the renter confidence they can expect the same transparency when it comes time to write up an offer on a home – they know they can trust the agent to negotiate on their behalf.
- Offer helpful tips - Real estate agents know how much landlords and property managers value their tenants’ good credit history. Agents can encourage tenants to report their on-time payments to boost their credit scores, which will help them qualify for a mortgage for a home down the line. They can point them to online tools that allow them to self-report their payments even if the landlord does not report rent payments to the credit bureaus.
Why should real estate agents make an effort to work with renters?
The real estate landscape changes constantly. When the markets are booming, as they have been for the past ten years, many agents focus on buying/selling clients and turn down work with renters. As the market slows down, however, agents may find fewer buyers and sellers in the game and wish they had kept the door open with renters to build their first-time buyer client base.
All is not lost. People will always be looking to move up into a home from a rental. Agents can make an effort to reach out to any of their one-time renter clients and stay top of mind. Following up with past renter clients will help them make the decision to turn to them instead of employing someone else when it’s time to buy later. In short, missing out on fostering a relationship will likely translate into squandered commission opportunities.
Now is an ideal time to help renters become homeowners
Agents have lost an estimated $2.4B in potential rental commissions since the 1970s, by failing to use the MLS to lease rental listings and help renters find new housing opportunities. Everyone could tap into this billion-dollar well when agents commit to listing rental properties and buy/sell opportunities.
The current market is slowing down, and eventually, we will see more properties available. Agents who have developed relationships with renters can plant the seeds of home ownership and help their rental clients search for their first home.
How brokerages can support their agents to help renters
Many agents shy away from working with renters because they don’t know enough about their local rental market. Agents also feel they lack the right tools to efficiently qualify prospective tenants, get leases signed on the landlord’s behalf, and close the deal. On the ground, the demands of the rental market are actually very similar to the buy/sell market: Renters want good value for their money, and just like buyers, they have set criteria, including location, specific amenities, and a budget to stay within.
Brokerages that offer helpful rental proptech can give their agents a competitive advantage.
To bridge the expertise gap for agents, brokerages can employ proptech solutions to give their agents the tools to become intelligent and efficient rental experts. Many brokerages already do this.
- Good proptech includes tenant screening tools, similar to the pre-qualification and pre-approval process for a home mortgage. Potential tenants can complete an online screening process with the landlord or property manager’s criteria, and the agent can determine if they are a good fit for a vacant property. This process includes employment, credit, and criminal history checks.
- When the agent has shown the rental to a qualified potential tenant, the tenant can complete an online lease application. Once the application is complete it immediately is sent to the landlord for a response. An online application makes it easy for the property manager or landlord to respond within 24–48 hours and close the deal before the tenant moves on.
- The agent can direct the approved tenant to the secure online payment portal to pay security deposits, the first month’s rent, and any other fees and then turn over the keys so the tenant can move in. They are then set to pay recurring rent payments directly to the landlord through the system. This helps renters stay current with their payments and landlords happy.
Agents who work with landlords to lease rental property to renters can earn commissions when the buy/sell market slows down. Many agents earn the equivalent of one month’s rent or a percentage of a month’s rent for a few hours of work. Most rental transactions are closed within a week. Landlords in larger metro areas use real estate agents to list and show their properties, screen their tenants, and walk them through the application process. This allows landlords to focus on their business and not leasing the property.
This simple and efficient screening, showing, application, and payment process is available with RentSpree proptech solutions. RentSpree provides a complete set of easy-to-use digital tools that add immediate value to agents working with rentals.
A full-service proptech platform like RentSpree allows agents to advertise their services, list rental properties, and provide a secure online link to handle renters’ sensitive personal information as part of the tenant screening and application process. If at any time an agent feels challenged by the system, RentSpree provides hands-on training to help agents master the system to work with rentals effectively, safely, and profitably.
Agents can work smarter with RentSpree’s proptech solutions for real estate agents. Start building your rental business today and connect with renters who will become home buyers in the future.