Helping Agents Build Wealth: The Opportunity Brokers are Overlooking

During the past decade of my career, I have had the pleasure of working with real estate

agents and brokers across every pocket of the country. These entrepreneurs and

business owners influence and shape arguably one of the most exciting and

newsworthy industries in the US – the housing market. A question kept coming into my

head, an “ah-ha” moment of sorts:

Why aren’t more real estate agents – who understand housing better than anyone –

investing more in the housing market?

From my own estimates (from interviewing real estate brokers and agents from across

the US) show that about 10-12% of real estate agents are active in real estate

investments – mostly in ownership of rental properties or fix & flips.

So why aren’t more agents active in this space?

Recently I had the opportunity to speak with a long-term partner and friend, Kathy

Connelly who is the Chief Operating Officer of Berkshire Hathaway Home Services

Georgia Properties based in Atlanta. Kathy said, “A while ago I heard a speaker say you

should have at least one rental property for every child you have.  I took that to heart

and now own 2 rental properties since I have two children.” She adds, “Rental

properties expand the opportunity to further build wealth.  What other opportunity allows

you to finance the majority of your investment and have tax write-offs for your

expenses?   As a small investor, it’s important to understand that someone else (tenant)

is making the mortgage payment and covering other property expenses while the asset

continues to appreciate.”

According to the U.S. Department of Treasury, home prices have increased by

approximately 160% between 2000 and 2022, making real estate investments a great

long-term opportunity to earn appreciation on housing assets. Kathy Connelly is a great

example of a real estate professional benefiting from the appreciation of housing assets!

Other agents partake in buying undervalued properties, rehabilitating them, and selling

them for a profit, often called “fix & flipping.” Realtor, Linda Leporowski of Keller

Williams Advantage in Michigan purchased a “fixer-upper” last year on Houghton Lake

in northern Michigan. She plans to sell the rehabbed home for a profit and invest in a

more upscale lake community. “I saw a great property with a gorgeous view of the lake

and a house with good structure,” said Linda. “As an experienced real estate agent, I

knew exactly what I could do to the house to increase value. I added 2 bedrooms, a ½

bathroom, converted the sunroom into a living room, and opened up the kitchen. I

purchased the house in 2022 for $225,000 and I believe this property is now worth

about $625,000.”

So why are Kathy and Linda successful in these real estate investments? Because real

estate agents possess a powerful tool set for building long-term wealth in real estate

investments and are uniquely positioned to excel at it. They understand market trends,

neighborhood dynamics, buyer psychology, and property values – the very same skills

that successful investors rely on to create profitable deals. Let’s break down this

expertise.

First, real estate agents know their markets better than anyone. They know which

neighborhoods are appreciating, where new developments are planned, and what local

buyers and renters want. They pay close attention to where demand is rising, which zip

codes are shifting, and how school districts, amenities, and other community attributes

impact value. These insights give real estate agents a significant advantage in

identifying areas poised for profitable flips, rental growth, or long-term appreciation.

Second, real estate agents know how to source the best deals. They are “deal-finders”

by nature – scanning listings, talking to homeowners, and networking across the

community. They know when properties are undervalued, mis-priced, or sitting too long

– all potential signs of an investment opportunity. Agents also know how to access off-

market inventory through expired listings, pocket listings, and direct outreach which

gives them a competitive edge that most investors pay a premium to acquire.

Agents also understand how and where to create value on any given property, just like

Linda shared above. They can spot the difference between cosmetic updates and

structural issues and determine what type of additions will significantly increase property

value – whether it’s opening a kitchen layout, adding a bedroom, finishing a basement,

or upgrading curb appeal. This expertise makes agents natural rehab strategists – one

who can see the finished product (and calculate After Repair Value) before the rehab

work even begins.

Finally, real estate agents have the network they need to excel in residential

investments – they know appraisers, inspectors, general contractors, and other agents.

This ecosystem is the same one that expert investors use to execute deals successfully

and profitably.

So why aren’t more agents active in real estate investments?

My conclusion is that while agents possess the incredible skill sets discussed above,

many lack the confidence or capital strategy to take the leap into residential

investments.

And here is the full circle “ah-ha” conclusion – their real estate brokers should be

providing this value-added service to their agents. Agents are hungry for new programs

and strategies to increase their earning potential and wealth 1 .

Some are already catching on – for instance, Joe Delia, broker/owner of the Delia

Group within Keller Williams says that investor activity is a main value proposition for

agents working within his brokerage. It attracts great talent to his team and helps retain

them for the long term.

It is my hope that more visionary brokers like Joe empower their real estate agents to

begin or expand investment activity in real estate. These real estate professionals are

huge contributors to our communities and neighborhoods; I would love to see them

capitalize on their expertise, and deepen their impact and earning potential through

increased real estate ownership.