The Most Cost Effective Way to Find DealsPosted on December 6, 2013 by
Alright – Winter Time! Time to hunker down and do some deals before Christmas. You want to give out good gifts this year right? Well get to it then! It’s cooler out so you will be less tempted by the beach and the pool and can focus on your marketing and getting the phone to ring.
So as I am writing this article in early November, I’m thinking about the deals we did in October. It was actually one of our best months (after a bunch of slow months). We did (9) deals in October. Yeah – that seems like a lot. And they were some of the easiest deals we have ever done – and the way we found and executed the deals was about the most cost effective way you can get them. We spent zero marketing dollars – directly – on getting these deals. How is that possible you ask? Well let me explain.
Networking. The (9) deals were all accomplished just through networking. I found the sellers of the properties and buyers for those properties just through networking. No direct mail, no fancy websites, no bandit signs, no door knocking. Over the past year and a half or so we have been out there in the real estate investing game and doing marketing, meeting buyers and sellers, meeting other investors, meeting other real estate professionals – whether its Realtors, Title Agents, Contractors, Property Management, etc. We get out of the house a lot and do a lot of networking and do our best to build relationships.
So how do you find wholesale deals that way? I’ll explain these (9) deals. Through networking, keeping in touch, following up – we found a buyer that wanted to buy a bunch of low end rental properties. I was already working with one “Buy & Hold” investor who wanted to get rid of a bunch of their low end rental properties and agreed to let me wholesale them for him (no marketing required – no deposit required). So I sold my buyer (4) of that guy’s properties for a slight markup. Pretty easy. The buyer wanted more, so I actually just reached out to a few more of my buyers – who are “Buy and Hold” investors to see if they wanted to sell anything in their portfolio. A couple of them had a few properties they didn’t mind parting with and agreed to let me wholesale them for them (no deposit required). My buyer was interested – after some price negotiations – and ultimately we sold him (5) more properties. So an easy (9) deal month – and none of it came from our usual marketing. I like it!! Just dealing strictly with investors – not unfortunate home owners looking to unload their house. This is much cleaner as you can imagine.
So what is the moral to the story? Network and build positive relationships in your investor community. Build a good reputation for yourself that you know what you are doing and are out there working the business. There is nothing better than another investor giving you properties to wholesale. So how do you get to the point where this is happening for you? Stay active in your area. Go to your local investor meetings, Meetups, and REIA meetings. With your marketing you should be meeting cash buyers (buy & hold or fix & flip), and you should do your best to keep in touch with them. Sometimes cash buyers are also motivated sellers – tired landlords – or at least have problem properties they want to unload. Offer your assistance. Add value of course. Make sure there is a benefit to working with you. Offer to do some dirty work or do some favors to build credibility and trust. Be a match maker. Find buyers that want to buy certain things and find it for them – find the sellers that have those things and start with other investors that you know personally.
So pretty easy to say that Networking has got be the most cost effective way to find deals. It doesn’t happen overnight though. Which is why I say you got to get things started and once things are rolling and you’ve been doing it for a while, it gets easier. You get better at it AND sometimes deals just find you. Let’s get you there sooner rather than later. Be sure to check out our newly renamed website: www.HowToWholesaling.com to get more tips, tricks, and helpful information.