Posted by IB (NJ) on October 27, 2005 at 22:25:08:
I’ve worked on deals that took months. In the end, the payday was $60k or more - just for a flip!
Never call back??!!
Don’t Ever Sell A Seller - Posted by EquityHunter
Posted by EquityHunter on October 26, 2005 at 16:11:00:
If you have to sell a seller on your offer, you’re in the wrong market. To succeed in rei, you have to be in a market where you make a seller a “firm” offer or better yet, multiple offers, wait for them to either accept one the spot, or call you back. Don’t Ever call them back. If you are in the “right” market 50% will call you back to accept your original offer. The others were not really motivated to sell in the first place. They will stay put or have the resources to carry the property. Follow up with them down the road if the property is Vacant.
You sell Buyers of your property. If you rely on a “realtor”/“agent” you are sunk. According to their assoc. only 14% last more than 2 yrs in the business. Most are part timers who sell a house or two then realize they can’t make any money and get out. Most “hope” another agent will sell your property so they can cash in. That’s why most listed properties in a “buyers” market don’t sell. In some markets it’s as little as 10%. You’ll have to sell your own properties for maximum gain.
If you are a big shot in a seller’s market and have so many properties you transact, then a “good” realtor working for you at a very steep commission discount makes sense. Remember, re agents and loan officers are a dime a dozen in both markets. They need us 1000 times more than we need them. Use them for your benefit.
Blanket statements can be inaccurate - Posted by John Behle
Posted by John Behle on October 27, 2005 at 19:51:18:
Blanket statements about things like “don’t sell a seller” might sound good, but are not always true.
It all depends on your type of offer, the seller, their needs, the property and your skills. Some of my very best deals come as a result of the ability to negotiate and educate a seller. Most would call it selling. I wouldn’t, but most would.
Some of the greatest profits available in real estate are by assessing and meeting a seller’s needs and that usually requires a presentation to them. Sure, some of what people are trying to teach these days may fall into the category that could be covered by your statement.
The worst mistake new investors make in real estate these days is assuming there is “One” way or a “Right” way to do things. I personally feel that is one of the most foolish errors anyone can make. It’s time to get back to some true education and real profits.
The “public” wants to hear a simple step by step process they can do from their kitchen table in their jammies with a beer in their hands. “Ten thousand dollars with only three hours of work!” blah, blah, blah. Baloney.
Success, longevity and the greatest long term profits in real estate come from a broad education and creative approach to meeting a seller’s needs in a profitable way. There are way too many “WIDGET SELLERS” right now. People want to hear the “BEST” way and have a step by step checklist to do it. Podium peddlers willingly serve them real estate “baby food” in pretty little packages. The greater the promises they make, the greater the price and profits for the peddler.
So, anyway. My best deals almost always involve many techniques, are tailored to a particular property and seller and their needs and can’t be found in a book or checklist. Instead, they’re spread among dozens of books, courses, educators and experience. If you are doing the job right - you “CREATE” techniques. You mix and match, combine and “piggyback”.
My best deals are usually fairly complicated. They involve finesse and tenacity. Some are on the third, fourth or fifth offer or MONTH. Some are a year or two later. Take what falls in your lap and move on if it is too challenging is very short sighted - and not very profitable.
For example, in note deals two of the best ones that come to mind are notes I passed on at first. One buzzed around in the back of my brain for six months before I figured out how to do the deal and bingo - a technique was born. The greatest profits are also in what others pass on - sometimes because they don’t want to sell a seller. Another profitable note deal took TWO YEARS before I figured out what to do with it and one of my very favorite techniques was born.
Maybe it is just the way my brain works, but I have seen similar thinking among most very successful investors. ?Widgeters?, people that just want some little simple factory assembly line, are rarely as profitable. But again, maybe it is just my brain. I love few things as much as profiting off of a deal that someone else had no clue how to do. I love it when some cocky graduate of some real estate evangelist makes a thousand bucks selling me a note - that I make ten thousand bucks on because I am not narrow minded and trying to force square pegs through a round hole. They can keep their assembly lines and make their tiny profits and I will use creative thinking, a toolkit of techniques and negotiating finesse to make much greater profits with less work.
So, yes, ?selling sellers? can be a bit of a trap that a newbie might fall into, but can be very profitable for someone with a rounded education. It is such an error to break into camps and be followers of gurus. Be a student of many, but follower of few. The greatest success in this business is to be a ?problem solver?. Someone that limits themselves to a certain technique and draws rules, boundaries, limits and paths for everything stunts the growth of their profits. Spending thousands or even tens of thousands to learn more and more about one particular guru or technique is counter-productive.
There can be a little confusion at first. But, on the other side of the confusion is enlightenment and profits. When many hit confusion, they try to limit themselves. If they don?t understand a technique or approach to investing, they rule it out. When you gravitate towards the ?simplest? ore easiest route, you end up with the smallest profit margin, greatest crowds and competition and even higher risk. Some even follow the simplest, easiest route and then when they find competition, they want a shortcut - an illegal one. Instead of exploring real and legitimate alternatives, they try to make it even easier by cheating or breaking the law. Kind of like running into a traffic jam and jumping the island to run down the wrong side of the road as a shortcut.
The simpler it sounds, the greater the promotion, the higher the price and hype, the greater the crowds and lower the profits. Learn it all. Learn from everybody. Read the seven dollar books at the library before dumping thousands on a bunch of promises from some wannabe guru with a camera and fake talk show host or full time pitch man running down the isle of a seminar room in a hotel. I?m not talking about anyone in particular, but there is a lot of hype out there. People that want the simplest path or are unwilling to fight their way through the confusion get suckered into promises and programs.
Just keep picturing the toolkit. More and more people run around like the axiom ?he that is good with a hammer thinks everything needs a nail?. They take a seminar about a technique (like how to use a hammer) and then run around looking for nails. The most successful people I have seen have a toolbox, look for a problem and using the right tools fix it for profit. Too many pitchmen and courses out there are like the Saturday Night Live skit about the ?Scotch Boutique? which is a store in the mall that sells scotch tape. ONLY scotch tape. Standing around in their Scottish outfits clueless to why they have no customers and are dead broke.
Contrast that to Walmart and a whole family of billionaires because of it.
I do a deal and it may involve 5-10 different techniques. I go into a deal and may come out with a discounted note, a property, a flip, a rehab, a hard money loan, a consulting fee or even real estate commission. Or several of the above. Sure, ?selling a seller? may be a total waste - if you are trying to sell them on your shiny hammer. But, finding out and exploring a seller?s needs and reaching into a toolkit for the right tool or tools and explaining, educating and negotiating with the seller can make a great deal of sense.
Just a couple thoughts.
John
You are missing the boat - Posted by DaveD (WI)
Posted by DaveD (WI) on October 26, 2005 at 20:05:03:
Once again, have to disagree with you. I’m pretty straightforward with what I can do for a seller. To suggest you never call back is nonsense. Many do not really know what they want to do; to not follow up is foolish. I’ve had many more than a few take my deal when they came to the conclusion that they didn’t really have a better way to get out of their situation. (It is called procrastination). Yeah, it took a lot of follow up. Nope, I’m not gonna share the details with you. See my post a few threads down. Deal with it.
Great post! - Posted by one admirer
Posted by one admirer on October 28, 2005 at 15:20:53:
Excellent, excellent post!
Wasted Time… - Posted by Phil Hendrey
Posted by Phil Hendrey on October 27, 2005 at 11:40:09:
and missed opportunities is all you got. Sure you may have closed that one but you let many other, more profitable deals go bye.
There is Power in Not Caring.
I Agree With Dave - Posted by phil fernandez
Posted by phil fernandez on October 27, 2005 at 19:17:57:
Deals are created, and often over time. It’s just not giving up after your first offer is rejected. The best deals I’ve done were the ones that at first got rejected. I’ve worked some deals for months and have eventually gotten 0% interest, low money down deals. It’s not always saying "next " when your offer is not accepted. It’s through persistence and creativity that great money making deals are crafted.
There’s no creativity in just accepting a no from the seller and moving on and it’s certainly not “wasted time.”