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Chicago-based real estate broker Mara Morris brings her expertise and passion for empowering clients to the forefront in this exclusive interview. A spokesperson for Fair Housing and recipient of the “Most Prominent Agent” award by HomeSnap, Morris has been featured in Chicago Magazine’s “Best Places to Live” issue. She not only serves as a real estate broker but also as the Executive Assistant at the Illinois State Black Chamber of Commerce, where she advocates for Black businesses across the state.
What are the most important financial steps first-time home buyers should take before beginning their search?
Clients should fully understand and actively review their budget and credit before thinking about purchasing a home. Clients who understand their finances are a lot more likely to have a smoother transition into home ownership. One of the things that they also have to consider is having cash on hand. Even just the process of purchasing a home long before you get to the closing table, there’s money that’s going to need to be spent, for earnest money, inspections, closing down payment, all those type of things.
In addition to that, we can get started working with a lender, and if necessary, we can get you to the correct tax and credit professionals, but knowing your numbers as is, is probably going to be the most important step before you reach out to a real estate agent.
What strategies have proven most successful for your first-time home buyers to compete with investors and other buyers?
I do have a few good tips and tricks on making sure that my home buyers’ offers get accepted, especially in markets where we have to navigate bidding wars, supply is low and demand is high. One of the things that I do is educate my buyers, an educated buyer is going to be an easy buyer.
Calling and building a rapport with that other agent, getting to know them, the client and the situation has always been able to give me an edge. I’ve always been able to call an agent and say, ‘Hey, hey! My name’s Mara.’ Sometimes just allowing that other person to vent, and it’s just like, now they want to listen to what you’re talking about.
When I’m writing up that offer, it’s not always about cash, because my clients typically don’t always have the highest offer, but I know how to make sure to get those terms just right. All of those things together help build out a well-rounded offer, and it’s going to be a lot more likely that my client’s offer is gonna be accepted.
What key metrics do you prioritize when helping clients evaluate multifamily properties?
The top ones are going to be your net operating income. That is your property’s annual income after you deduct all operating expenses. You need to know the cap rate, that’s going to be the potential return on investment based off your property’s net operating income and the purchase price. And then you’re going to need to know your gross rent multiplier. That is a metric that’s used to assess the property’s value by comparing the purchase price to its gross rental income.
What are the most essential items clients should prepare before working with you as their agent?
I always encourage clients to do the research on their local market and know the area. One of the things that I like to tell first-time home buyers as well as investors is if you are looking to purchase a property, take at least 2 or 3 days, and run all of your errands in that area. Go to the bank in that area, go to the grocery store. Go to the coffee shop in that area. It’ll give you a good gauge of what the area is like, what the traffic is like certain times a day, what the people are like.
Determining your budget – we’re always going to keep coming back to knowing your numbers. Sometimes, when you’re renting, you’re literally just paying the price of your rent and utilities versus when you purchase a home, you have to add in the cost of home ownership which can be pricey.
How do you tailor your approach differently when working with first-time home buyers versus experienced real estate investors?
While every client is different, I tailor my approach to every client, and I don’t do it based off of whether a client is a new home buyer or an experienced investor, because sometimes I can meet investors who’ve purchased many properties and they have no clue what the experience is like.
What I typically do is check-ins with clients. I like to hold just a regular conversation just to see where they are. A lot of times just holding a basic conversation, getting to know one another – those things are going to come up in conversation, and I can hear you using certain terms, and I can hear that you understand certain processes. So I’ll know how much I need to give you, whether I need to hold your hand completely or whether I can just kind of step in where is needed.
What communication practices have you found most effective for building successful client relationships?
I think the most beneficial communication practice overall in real estate is listening, and I try to put myself in my client’s shoes. I always ask my clients what their major concerns are first, and I always want to address those concerns first, as a way to try to build trust, and let them know, ‘Okay, this is your issue. This is how I’ve dealt with it before. This is how we’re going to handle yours.’
Having a game plan a lot of times relaxes people and allows for that bond to get built. You really just want to focus on delivering value and fostering trust and transparency. You really want to say, ‘Hey, this is who I am. This is what I can do,’ and then you actually deliver on it, while keeping them informed in the process.
What unique challenges arise when helping clients purchase multifamily properties?
One of the things that happens when you’re purchasing a multifamily property is passing the self-sufficiency test. The property has to pass a self-sufficiency test, meaning that the rental income from the property must exceed the monthly mortgage payment – that’s with principal interest taxes and insurance. So the building’s got to be able to stand on itself, and a lot of times properties don’t.
Multifamilies are priced higher, which means there’s going to be a higher down payment, higher closing cost, which means your clients are going to have to bring a lot more money to the table. Also, complex tenant issues – my personal favorite. Sometimes you buy a property, and it already has tenant challenges.
What advice would you give someone considering real estate as a profession?
For individuals considering real estate as a profession, I would strongly advise them to do their research and speak to at least a few experienced agents. This job is not what people think it is. Real estate school teaches you legal, and it teaches you ethics. It doesn’t teach you how to sell real estate.
Being an agent is a way to work on your own home ownership or investment goals. You get to connect with your city, assist clients in their real estate goals. You get to help people start the beginning, or wherever they are in their investment journey and help people to build wealth. It is really a rewarding job.
Successful agents don’t just sell homes. We’re a crucial part of community building. We support local businesses. We attend community events. We show up. We’re contributors. So being an agent is more than just selling homes, you become a critical part, you become a staple of these communities, you become a staple of your city.
Mara Morris can be contacted on her website, Facebook, Instagram and LinkedIn.