As a real estate investor, there are many different strategies and approaches you could take to turn a profit. For example, you could buy homes in poor condition, fix them up, and flip them for a direct profit, or you could spend your time scouting for in-demand rental properties, generating monthly income. Either way, your strategies will be contingent on your ability to find good deals—attractive homes at reasonable prices.
So what steps can you take to find better deals?
Get Your Real Estate License
First, consider getting your real estate license—which you can now get online. A real estate license will allow you to buy and sell property on your own, and give you more professional insights you can use to fairly evaluate the deals that cross your path. Real estate agents have access to listings that normal buyers and sellers may not—especially if you’re working for an agency. Essentially, that’s going to give you “first dibs,” and an opportunity to place a compelling offer before anyone else gets a chance to see the property. It takes some time and money to get your real estate license, but once you have it, your entire operation will probably run smoother.
Next, spend more time networking with other real estate professionals, including real estate agents, landlords, and property flippers. Even networking with non-real estate professionals can be valuable. The idea here is to let people know what you’re looking for, and encourage them to contact you if they have something you might be interested in. Oftentimes, this is mutually beneficial; they may have a rental property they no longer want to deal with that suits your needs precisely. Try to touch base with these nodes in your contact network on a regular basis to keep those connections strong.
Talk to Unlisted Property Owners
Most novice property investors rely on existing listings to find the deals they want. This is a convenient strategy, but it isn’t always the most effective. Instead, consider talking to people who own properties that fit your goals—even if they haven’t listed their properties yet. You could drive around a neighborhood and knock on doors, hoping to talk to property owners, or you could send out a mailer, expressing your interest in buying certain types of properties. Many homeowners can be persuaded to sell for the right price, even if they weren’t interested in moving previously.
Shop for Foreclosures
Some people aren’t able to make payments on their home, either because they bought a house outside their budget or because their financial situation changed. When this happens, the foreclosed property is often put up for auction by the bank that financed it. These auction events and foreclosed properties are often popular, drawing out property investors of all types, but it’s worth attending, since you can usually find an attractive offer. Just be cautious; in some cases, the previous property owner may not have taken good care of the property. Also, you may not have complete transparency to know the condition of the property before you buy.
Advertise Your Interest
If you’re interested in buying properties in a certain area, advertise yourself and let people come to you. If a homeowner decides they want to sell their property quickly for financial gain, they may come to you before trying to find a real estate agent, or before listing the property online. To make your ads even more compelling, make sure to explain any unique advantages you have. For example, if you’re buying homes in cash, make sure to include that information. This can get costly, depending on the advertising medium you use, but it’s often worth the cost.
Master the Art of Negotiation
Finally, spend some time improving your negotiation skills and better understanding the ebb and flow of real estate negotiations. In many cases, you’ll be able to talk to a property owner selling a home for more than you’re willing to pay, and get them to come down to a price that works for you and your goals. You can pay more attention to factors like how long the home has been on the market, and how quickly homes are selling in the area to offer a price that’s fair, yet advantageous for your pursuits.
Even with all these strategies in place, you still may struggle to find perfect deals on a consistent basis. You’ll need to be patient, reviewing each potential property with a critical eye, and understanding that you’ll see hundreds, or even thousands of properties before you find one that suits your needs.
Eventually, you’ll find the perfect additions to your growing real estate portfolio, and you’ll get even more proficient at sniffing out the best opportunities.