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Step 2: Make an enticing offer
There are several strategies used by savvy investors to make compelling offers. The obvious goal is to get sellers to take your offer. However, you don’t want to bid too high so that the exit strategy isn’t a winning deal.
Negotiations can be seen as a daunting task for new investors, but if you keep in mind that the deal is a win-
If you have a good funding source and some working capital, you can make an all cash offer. Otherwise, you might have to enlighten the seller to finance the deal themselves. Both offer strategies have to line up with the exit strategy.
How much should you offer?
There are a good many tools available to help you determine the property’s value. Remember, you can always re-
Now, go out there and make offers on SFR’s and multifamily properties!
Step 3: Get funding for your deal.
Now that you have found a great deal, you need the funds to take it down. First, you will need a solid rehab estimate. Be sure that you account for all the necessary repairs and include a contingency value. Building a good estimate is a great way to add value.
Are you going to rehab and rent the property? Or are you going to sell it to another investor who will actually perform the rehab? Selling to a seasoned investor is a “wholesale” method. Or are you going to rehab the property and flip on the “retail” market?
Lining up your buyers should have happened before you went looking for houses.
All of these options will require different funding strategies, so it is important to finalize the exit strategy before looking for funding.
For your ongoing real estate education, we recommend one of our partners:
Listen to Ken Sheppard’s FREE radio internet show at www.blogtalkradio.com. It is called "Making Money In Real Estate When You Have No Money". They broadcast live each week at 8 AM in Los Angeles on Wednesday and all the shows are archived. Please join for an informative discussion on many topics in this exciting industry. Many times they have very compelling guests from various sectors in this industry for your listening pleasure.
Step 1: Find a great deal!
There are many places to find good real estate deals. Book mark our webpage and check the ever changing inventory often.
Another place to find deals is via direct mail marketing. There are many places to find lists of potential sellers. Finding sellers is key and you want to have a pipeline of deal flow. It is very exciting to get sellers calling you to take their property off their hands.
Craigslist and newspaper ads are great sources to find sellers for investors who have a small budget. In the newspaper, search the “For Sale By Owner” section or the “For rent” section. Many times a seller is tired of trying to rent their property and they may sell their SFR to you.