It takes time and effort for a real estate investor to locate a deal. There are lots of properties for sale, but finding the deals has not always been easy. Fortunately, many tools and websites now available are making it easier. There are sites which help generate leads from motivated sellers and there are sites which provide valuable information to assist the investor in determining property values. As a result, investors can get leads and do most of their analysis before they even see a property.
One site that is good for determining property values, is a subscription site called Real Quest (www.realquest.com). Real Quest allows subscribers to look at liens, tax records and comparable sales. Another site, http://www.zillow.com which is free, even shows an aerial view of some properties. In addition, many of the counties across the U.S. now have free access to tax records on-line. And, of course, if the investor is a licensed agent they have access to the MLS. Taking advantage of these and other on-line resources, an investor can calculate the retail value of a property without even seeing it.
Figuring out the offer amount is important, but most deals are won or lost in the negotiation. Before an investor even tries to negotiate price, they need to develop a relationship with the seller. The best way to do this is to listen. Why are they selling? What is their financial situation? Where are they moving to? It’s most important to build rapport. Just listen; there will be plenty of time to ask questions. If the investor can give the seller what they need, it’s much more likely a deal can be made. And, it’s not always about the price; sometimes they need something else, like a certain closing date, help with moving costs, etc.
Some investors focus just on rehabbing properties and don’t have time to screen sellers and locate deals. That’s where the value of a good wholesaler comes in. A wholesaler spends their time locating and negotiating deals and then selling them to investors who rehab properties. The good wholesalers know how to talk to sellers and negotiate the deals. They provide a valuable service when they buy right and some even provide financing for the rehabber.
Unfortunately, wholesalers sometimes have to hold properties longer than they plan. When that happens, holding costs are passed on to rehabbers and prices increase.
The good news is, the Internet is just starting to change that too. Wholesalers can now use on-line real estate investor auctions, e-mail lists or other creative Internet strategies to quickly find buyers for their deals. And thanks to the Internet, the wholesaler can cut their holding costs and pass those savings to the rehabber. As a result, everyone wins.
If you’re a real estate investor and you’re not using the Internet to locate, analyze or sell your deals, you’re missing out on a great opportunity to save time and cut your costs.