Check with Brokers... Find Motivated Sellers...
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Home Buying,
Home Selling
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September 9, 2010 6:34 AM |
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Check with Brokers
The real estate broker will move on these words. Any agent worth his or her salt knows that a motivated seller means a quick sale. The broker will alert every potential buyer, including you, that this seller wants out.
Consequently, your first source of motivated sellers is the real estate broker.
Won't Agents Buy All the Good Properties?
There's nothing you can do about this, so don't worry about it. However, most agents would rather get a commission than buy an investment house.
My experience the agents that will work for you making the kind of offers you need to be making often will need to take your advice on what and how to offer. A savvy seasoned agent probably isn't desperate for income and most likely doesn't want to be bothered writing many offers that may not get accepted.
TIP: If you get too many offers accepted, your probably paying too much!
The exception to this is flip-able property. If the agent feels he or she can buy the property and quickly resell for a big profit, they may do it. However, agents have special problems in flipping. If they buy themselves and then quickly resell for a profit, the seller may feel cheated. Agents are required to disclose they are agents and intend on purchasing for a profit, however, the seller may feel that the agent wasn't fulfilling his or her fiduciary relationship. And that seller can do nasty things such as calling the state regulatory board or even taking legal action. - Ouch!
If the agent is foolhardy enough to "double escrow" the property (in essence, concealing the resale from the original seller), the sale might even be illegal. And few agents would dare to risk the consequences of such action.
Therefore, while it is true that in a hot market agents will sometimes pick the cream of the crop, there's usually still plenty of good properties out there to go around.
TIP: Find a new agent who is more interested in a paycheck (i.e. a commission) than find a bargain property for his or herself
Check with Sellers
Remember, a good way to find out a seller's motivation is to point blank ask. In some cases, when you look at a house, the seller will be there. Just begin a conversation and ask why that seller wants to sell.
If the sellers hedge or hem and haw or give a reason that is not indicative of strong motivation, pass. On the other hand, motivated sellers are very likely to simply let you know that they are extremely eager to get a deal. They may say something like "Make me an offer" or "Let's talk. If you're interested, put it in writing. I'm very anxious to get out of here." The motivated seller will seldom try to hide his or her eagerness. Rather, they will do everything to let you know just how they feel.
Check with Neighbors
Ask around. Oftentimes neighbors are an excellent source of information. And neighbors may feel little loyalty to the existing owner who is selling and leaving the neighborhood.
Of course, this is not an invitation to be a snoop or to invade anyone's privacy. However, anyone who is interested in buying a property always talk to the neighbors first. (It's a lot easier on the nervous system to learn there is a bad neighbor next door before you buy, rather than after.)
As part of your conversation with the neighbor, you will certainly ask about the house, the neighborhood, and eventually the conversation will drift over to the seller. The neighbor may volunteer some critical information as to why the seller is getting out. While your striking up a conversation, ask the neighbor if they know of anyone else around who might want to sell or if they know of any vacant houses in the area. A vacant house often creates motivation, even if there isn't a "for sale" sign in the yard. Most of my really good deals never had a sign in the yard.
Motivated Sellers in Foreclosure
Thus far, we've been assuming that we will find motivated sellers who have their homes listed for sale. But what about sellers who haven't been able to sell their homes for one reason or another and are now in foreclosure? They are the most motivated of all to sell, and they, on occasion, may be able to present some terrific bargain opportunities to you. Have your agent look for foreclosure properties or short sale properties for you.
To your investing success,
Udo Ginczek
http://www.diversityrealty.com
The real estate broker will move on these words. Any agent worth his or her salt knows that a motivated seller means a quick sale. The broker will alert every potential buyer, including you, that this seller wants out.
Consequently, your first source of motivated sellers is the real estate broker.
Won't Agents Buy All the Good Properties?
There's nothing you can do about this, so don't worry about it. However, most agents would rather get a commission than buy an investment house.
My experience the agents that will work for you making the kind of offers you need to be making often will need to take your advice on what and how to offer. A savvy seasoned agent probably isn't desperate for income and most likely doesn't want to be bothered writing many offers that may not get accepted.
TIP: If you get too many offers accepted, your probably paying too much!
The exception to this is flip-able property. If the agent feels he or she can buy the property and quickly resell for a big profit, they may do it. However, agents have special problems in flipping. If they buy themselves and then quickly resell for a profit, the seller may feel cheated. Agents are required to disclose they are agents and intend on purchasing for a profit, however, the seller may feel that the agent wasn't fulfilling his or her fiduciary relationship. And that seller can do nasty things such as calling the state regulatory board or even taking legal action. - Ouch!
If the agent is foolhardy enough to "double escrow" the property (in essence, concealing the resale from the original seller), the sale might even be illegal. And few agents would dare to risk the consequences of such action.
Therefore, while it is true that in a hot market agents will sometimes pick the cream of the crop, there's usually still plenty of good properties out there to go around.
TIP: Find a new agent who is more interested in a paycheck (i.e. a commission) than find a bargain property for his or herself
Check with Sellers
Remember, a good way to find out a seller's motivation is to point blank ask. In some cases, when you look at a house, the seller will be there. Just begin a conversation and ask why that seller wants to sell.
If the sellers hedge or hem and haw or give a reason that is not indicative of strong motivation, pass. On the other hand, motivated sellers are very likely to simply let you know that they are extremely eager to get a deal. They may say something like "Make me an offer" or "Let's talk. If you're interested, put it in writing. I'm very anxious to get out of here." The motivated seller will seldom try to hide his or her eagerness. Rather, they will do everything to let you know just how they feel.
Check with Neighbors
Ask around. Oftentimes neighbors are an excellent source of information. And neighbors may feel little loyalty to the existing owner who is selling and leaving the neighborhood.
Of course, this is not an invitation to be a snoop or to invade anyone's privacy. However, anyone who is interested in buying a property always talk to the neighbors first. (It's a lot easier on the nervous system to learn there is a bad neighbor next door before you buy, rather than after.)
As part of your conversation with the neighbor, you will certainly ask about the house, the neighborhood, and eventually the conversation will drift over to the seller. The neighbor may volunteer some critical information as to why the seller is getting out. While your striking up a conversation, ask the neighbor if they know of anyone else around who might want to sell or if they know of any vacant houses in the area. A vacant house often creates motivation, even if there isn't a "for sale" sign in the yard. Most of my really good deals never had a sign in the yard.
Motivated Sellers in Foreclosure
Thus far, we've been assuming that we will find motivated sellers who have their homes listed for sale. But what about sellers who haven't been able to sell their homes for one reason or another and are now in foreclosure? They are the most motivated of all to sell, and they, on occasion, may be able to present some terrific bargain opportunities to you. Have your agent look for foreclosure properties or short sale properties for you.
To your investing success,
Udo Ginczek
http://www.diversityrealty.com
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