The more defined you are with the kinds of properties or deals you want, the more offers you should be able to take to closing. Regardless if you are new to the business or a seasoned investor, it can be difficult to stay focused and generate leads. If you chase every new lead that comes your way, you can easily end up running around in circles. Instead of only spending money on a direct mail campaign, you should narrow your focus to the kinds of properties you want. If you work backwards and make these properties your priority, you will get properties that you really want – and know what to do with. Instead of waiting for direct mail recipients to call you – go after the deals you specifically want. There are several alternative marketing strategies that can generate leads.
Direct mail is often a great way to jump-start your business, but only if it is done the right way. Too many investors spend thousands of dollars on a list – only to mail it once or twice. If the return isn’t what they expect, they will scrap the campaign all together and consider it a failure. Direct mail has to be sent multiple times. If you are looking for alternatives that any investor can do, you have multiple options.
The MLS is another popular lead source for many investors. Instead of looking at new listings that every investor in your area will be after, you can look at the ones that nobody wants. The longer a property sits on the market, the less valuable it becomes. Sellers become desperate and every day that passes they become more likely to accept an offer in the sellers favor. Target listings that have been on the market for 30, 45 and 60 or more days. Not every seller is looking for a fire sale, but you never know what they may accept if you don’t make an offer. Even if they don’t accept your offer, this could start a negotiation process that ends in your favor. They may not accept a deal tomorrow, but if you follow up in a few weeks they very well could change their position.
There are many landlords who would love to get out of their property, but either aren’t sure how to make a deal work or are close to a short sale if they sell. Not every landlord is renting a property because they want to. There are many that were forced to rent when the market collapsed and are not investors. By targeting properties with a different mailing address from the subject property or vacant properties, you can find more deals. You can lean on your realtor to help with an MLS search or you can go to town hall and search properties on your own. You can also go to Craigslist or other real estate sites and search for properties for rent and contact them through the websites. You may get an angry response or two, but you may also get a few owners who are eager to talk.
There are many investors who do not have access to capital and can’t put work into a property after they take ownership. If you have reserves, you can make offers on properties that have damage or need repairs. Again, using the MLS you can search through listings that state there are repairs needed or the property needs work. Some of these listings will be bank owned or short sales that can be accepted with the right cost of repair estimates included in the offer. By making a quick cash offer at your price, the lender may just take the offer and move on. It is important that you know what you are getting into with the property, but if it needs excessive work it could be a way to get a deal you normally would not have.
One of the worst parts of being an investor is when you spend months on a deal only to have someone back out at the 11th hour. This is particularly frustrating if you are the seller and needed the profits to work on other deals. Listings that were on the market under deposit and now back on the market fit this criteria. Anytime a property is taken off the market and put back on should be a red flag for buyers. This is done either because a deal may have gone south or the seller is looking to generate interest by making it appear as a new listing. Either way, this could be an opportunity for an investor to get a deal. In most cases, these type of listings will be greatly reduced from their original number and are just looking for an offer. If you can come in with a strong offer – with minimal inspections and a quick close – you will find more offers accepted.
There are many ways to find good deals if you are creative and you know where to look. Like anything else in business, the key is to be consistent with everything you do. This means not giving up on something just because you didn’t have success with it the first few times around. If you find a niche that works for you, stick with it until you need to change it. There are plenty of good deals if you know where to look, and are willing to put the work in.