How do you find the properties you buy?
That is a question that I get asked all the time.
The answer is something along the lines of “all kinds of different ways.”
I have found properties by responding to ads in the paper, from the MLS, from wholesalers, like I said, all kinds of ways.
The best deals I have found however have come from a source you might not think of, that is the owner of the property.
If I can get in touch with the owner of a property I am interested in and if they are somewhat motivated to sell, I can likely work out a good deal for me and a good deal for them.
So for me, the best way to buy properties is talking directly to the owner.
Why?
For one thing it is just you and the owner. You can build rapport. You can both talk through what you want out of the deal. You can both tell your side of the story. You can both negotiate. You can sleep on it and call the owner later. You have more input into and ability to affect the negotiation process.
For another thing there is no one else involved. There are not 20 or even 1 other investor knocking on the door offering too much or promising things they can’t deliver on. There is not a realtor involved talking the seller out of it for who knows what reason or telling them that you are one of those “evil” investors. This is often times the real advantage.
So that is why talking directly to the owner is best for me, but did you notice the two “ifs” in there? Those “ifs” mean that making the deal work is not always easy.
I might be able to make a deal “If I can get in touch with the owner.” That is not always as easy as it seems. I try all sorts of ways to get in touch. I write letters. I talk to lawn people at the property (I did this to get the property shown in the picture). I knock on neighbor’s doors. I will go through friends of friends if possible. But not all owners will talk to you. They simply do not want to talk to you. Plus, some owners are very good at hiding themselves. That address the property assessor has, who know where that really goes.
But, even if you can get by the first “if” I think the second one, “If they are somewhat motivated” is even more important. The property owner has to be somewhat motivated, not necessarily “fire sale and have to sell tomorrow” motivated, but just somewhat motivated. If they are not, they are just kicking tires. There is likely no deal and I am not going to spend a lot of time on it.
But if there is a bit of motivation then perhaps a deal can be worked out. Sometimes it takes a bit of effort on your part. You may need to educate the seller about what you do and what services (speed and reliability) you are bringing to the table. You may need to educate the seller on the value of their property. You may need to let them think about things a bit. You may need to let the seller’s emotions subside before you can move forward. There are all sorts of things you may need to do and every situation is different. But at least when you are dealing one on one with the property owner you know what the situation is and you know where you stand. You are somewhat in control of the situation.
So yes looking at the MLS and keep reading those ads in the paper or on craigslist because those deals do come along. But also develop ways to get yourself talking directly to the owner of the properties you are interested in. Because when you are dealing with the owner, that is often when the best deals can be made.
