Find the Right Sellers

Find The Right Home Sellers

Find The Right Home Sellers

Real estate investment, whether buying or selling, can be a gamble in today’s economy.  There are some days that you never know if you are going to make a profit or fall into the pit of woes of property owners and property buyers.  Things can get pretty shaky in the real estate market, if you have no idea what you are doing.  Making a large investment in a property can turn sour if you cannot find the right seller or buyer for the property or cannot get a turnover in a short period of time.  The other problem is in knowing if your purchase is at the right price in order to profit from a sale when it comes.  Inexperience can be damaging.

One young investor nearly lost everything, since he had no experience in the real estate world.  He made a purchase above his finances, and ended up carrying that debt for some time before he could resell the property.  He became homeless and nearly hopeless before his first big sale was made.  The lesson here is to find the right sellers before you make your purchases.  For example, if you are looking at a warehouse property, why is the seller getting rid of the property?  If it is for financial reasons, you may have found pay-dirt.  If it is because the property is too damaged, or outside of local codes and zoning ordinances you are probably not going to be able to get a profit on it.  That’s where our young investor made his first and only mistake.

He found a mentor in an experienced real estate investor that told him the importance of finding motivated sellers.  Most often, it is due to financial hardship and the property is ready for resale.  Of course, sometimes it can be difficult to determine the reasons why someone is selling a property that seems perfect.  Find their motivation for selling, and you can find your motivation for investing.  Every investment you make in real estate is a case-by-case investment.  First consider if your investment is worth it.  Do you have a buyer’s market for the type of property you are investing in, and how soon do you expect to resell it?  When you are in the real estate investment business it means that sometimes you have to do the numbers in your head on the spot.  When the contract is in front of all parties, it will be the final numbers that matter to both you and the seller.

Some sellers will forgo the use of an agent to speak on their behalf in order to save the cost of the agent’s fees.  Instead, they will make their own offers. You can get a great price on these deals and reap greater profits in a resale.  With highly motivated sellers, they get the benefit of your payment, and you get the benefit of selling to someone else for what the property is actually worth, or more.

The key is to know your sellers, as well as your potential buyers are.  If you find a highly motivated seller with a property you know will sell, you are going to get the bigger return on your investment.

Find Your Niche in Real Estate

The REI Marketing Club

The REI Marketing Club

Anyone experienced in real estate investment knows that the market can be fickle, especially in tough economic times.  But some niches still do better than others.  People still need a place to live, and some that are weathering the economic climate are looking to buy homes. In addition, businesses keep moving to find the best place to improve their businesses, with tax breaks on the properties through government incentives or through better location and proximity to customers.  Knowing these little small bits of information can be very profitable to even the most seasoned real estate mogul.

It is a simple science, really.  You buy a property for a low price and you sell it at a higher price for a profit.  But what seems simple on the surface takes a bit of vigilance and hard work.

When you go out to walk your dog, did you notice that two doors down Mary put up a “For Sale” sign in front of her house?  Or that Maurice is moving out if his rental apartment?  Those are the things to watch for.  Your local real estate climate can be your gold mine in this market.  Knowing what is right under your nose may be your key to being profitable. If you see your market starting to boom before anyone else it can lead to higher profits for you if you make the right decisions.

Talking to Mary on your way by the house can tell you why she is selling her home, what she expects to get for it,

and who she has it listed with, if anyone.  In talking to Maurice, you can find out who the landlord is, the price he paid for rent each month, and whether the apartment is already going to be rented to someone else.  On Mary’s house, you may be able to make an offer on the property, depending on why she is selling and her expectations.  On Maurice’s apartment, you may be able to make a commission in finding a new renter for the landlord.  The key is in who you know and what you can do for them.  If you are able to give them a good offer (“What’s in it for me”), they will be more than willing to provide you with the information you require.

A simple walk through your neighborhood can provide you with many ideas for some major income, if you know what to look for.  Sometimes, a newspaper ad can determine where you walk or drive in order to investigate a potential real estate transaction.  If you continue to stay in touch with people in your neighborhood, or at least stay visible to them, you can gain a lot of useful information.  Word of mouth is sometimes the best source of finding out information about an opportunity that can be life changing.

This method does not have to be a done alone.  Your family and friends can get involved, giving you more tips that you may have missed, making it a family business.  When others see what you are doing and your success at doing it, they will continue to assist you and start to look for their own path into real estate investing.