help! my paper is a cesspool - Posted by Tony

import · August 16, 2003, 1:05am

Posted by Brent_IL on August 16, 2003 at 21:40:47:

This is a reference to one of those things I learned as an undergraduate and never used again. Oh, wait, that was my undergraduate degree.

When a good sample is taken for a statistical grouping and they are arranged in order and graphed, the connected points look like a bell. When people talk about a bell curve they are speaking about this kind of graph. Just like a drawing of a bell, the sample points will start out with a thin line and quickly rise upward. They round into a plateau and then drop to complete the other side of the bell. They points taper off again like the rim of a bell.

Little attention is paid to the beginning and ending parts of the bell graph because it?s more practical to ignore the relatively low percentage of the whole. All of the action takes place in the large part of the bell because it represents the most and the most significant points.

The parallel in real estate is that everyone who wants to be a real estate investor is trying to do the same thing that everyone else is doing. There’s a lot of competition because they are all in the middle part of the bell curve. Even within the creative real estate investing subset, it gets to be cutthroat.

In contrast, there is no competition at the fringes of the curve. No one wants to deal with these people. No one wants to talk to them. When agents come around, they use their property to sell someone else?s house. They sit there until someone is willing to put up with the flaws that took them and their house out of the mainstream. It could be legal flaws like title problems, or it could be property challenges like mold, or it could be seller irrationalities such as overpricing or terms that aren?t realistic and sometimes not possible.

Legal and property problems require diligence to reach a solution. Seller-based problems require a thick-skinned creative real estate practitioner. Most sellers want to sell. If those of us who search the fringes learn how to make our offers palatable to sellers, and they are the only offers they will see, ours will be accepted and the big bucks are ours.

import · August 16, 2003, 1:05am

help! my paper is a cesspool - Posted by Tony

Posted by Tony on August 16, 2003 at 01:05:46:

Every course that I?ve read and every book that I?ve bought on R/E investing have all had a section devoted to the classified adds in our local newspapers. And they go on about what great sources they are to find motivated sellers and leads that could turn into the purchase of that next great deal. Well, they sure wasn?t talking about my paper (Florida times union) because its infested with investors that ether are posing as motivated sellers to get you to call them, listing there properties, running there ? I buy houses, no ?I buy houses first? no, no ?I buy houses first all cash? adds. Maybe im being negative about this but it seems almost impossible fore me to operate or use it as a starting point for buying houses. Or plain out use it at all. I?ve been going through my paper going on 4 months and I haven?t had one lead. Its kind of discouraging because this is were my deals are suppose to be pouring out of. But there not. And my other sources are my bandit signs witch are nailed right across the street from ?I buy houses?, ?I buy houses any condition, any price any location? ?stop foreclosure call me?. And my neighborhood driving. That seems to a better source than the other two. I found three M/S and made three offers and all three were rejected. I guess they just didn?t realize how much the lease option solution could have benefited them and solved their house selling problems.
But anyway enough rambling. Is there anybody else out there that?s having a hard time finding deals in their local newspaper or is just I? And pleases don?t right back about the mass mailing because im in the process of setting that up. And from what I?ve read and heard it?s a powerful way to find the very elusive ?motivated seller?. Does any one know if they?ve made it to the endangered species list, yet.
Than-x for the input.

Tony

import · August 16, 2003, 10:25pm

Think outside the book - Posted by Potash

Posted by Potash on August 16, 2003 at 22:25:01:

Sorry, I promise not to give any more constructive advice for the rest of the year.

import · August 16, 2003, 11:09am

Re: help! my paper is a cesspool - Posted by Brent_IL

Posted by Brent_IL on August 16, 2003 at 11:09:10:

JoeSoCal’s post was insightful and food for thought.

For what it’s worth, here’s my experience.

Three rejects out of three offers that originated from the MLS is nothing to worry about.

The MLS is a huge lake 50 miles in diameter that contains seven big fish and thousands of small minnows. The big fish are large because they have evaded capture. Folks fishing with 30-foot lines surround the shoreline. They catch a lot of minnow types.

The big fish swim happily throughout the lake and mock the fishermen because they stay 40 feet from the shoreline. There are a handful of CREI fishermen who get in a boat and go out to where the large fish dwell. The lake is so large that they have to cast their lines many, many times while hoping they hit a spot where a fish is hanging around.

Two guys go out with the rest, but they understand that their objective is not to go fishing, but to catch fish. If they had an abundance of resources, they’d just stop at the fish market and call it a day. They don’t bother bringing poles with them. They bring a bucket of attractive bait, dump it into the lake, call, “Here fishy, fishy, fishy,” get out a net, and wait. Some days, or weeks, they don’t catch anything, but overall, they catch more than any of the rest.

Making offers based on the MLS is more akin to dumping pounds of bait into the lake than it is to fishing with single lines. Don’t worry about the misses; wait for the successes.

The vast majority of the people that run ads are seminar junkies and CREI wannabes. They will fluff the return calls or not answer them at all. Ads are not competition; people are competition. Most people are not much competition, either. Just continue making your best offers.
IMNSHO, WIN-WIN is a beautiful ideal, but unfortunately it is a myth when used in negotiations. To be Win-Win, all parties would have equal capacity to evaluate the subject of the negotiation, access to full information, and a willingness to look out for each other’s interests. Statistically, all RE financial negotiations result in Win-for-one-party/Better-than-you-were-before solution. The objective is to make your opponent believe he or she is the WIN side when you believe that it?s really you that?s the winner. It isn?t too hard because our sellers can value other things higher than money, while we are restricted to objectives that make business sense.

If you try to see things from the other guy?s perspective too much, you can mess yourself up.

Well, I’m rambling, too.

I have a firm belief that the most profitable deals are found at the ends of the seller bell-curve.

import · August 16, 2003, 2:35am

Re: help! my paper is a cesspool - Posted by JoeSoCal

Posted by JoeSoCal on August 16, 2003 at 02:35:59:

You wrote: “I guess they just didn?t realize how much the lease option solution could have benefited them and solved their house selling problems.”

You should really reread this statement. It might open you up to part of the problem. I am not hear to psycho-analyze or put you on the couch…but, that is ultimately your responsibility…to make them see the benefits.

If you honestly feel that you are offering these M/S great offers…then you should probably step back and reevaluate your pitch/sales process.

What apprehensions are you failing to address or assuage? Maybe they have come right out and told you and you missed it. Maybe they havent explicitly stated so and you are missing their subtle cues and not reading between the lines.

Perhaps you need to make a more concerted effort to analyze what your prospects are saying with their questions or statements.

Because of this medium, I want to make it perfectly clear that I am not trying to be sarcastic or a prick. I am just going off of a vibe I got from that comment.

Ultimately, if you honestly believe they arent realizing how beneficial the deal is for them…you have to ask yourself, “What am I failing to communicate? Where am I failing to show them how beneficial this deal is to them?”

Then, take another step back and view the problem from their angle. They have emotional attachments, equity loss concerns (if any), credit worthiness/score/report worries, etc.

What other concerns do they have or worries regarding their financial state?

Now, you go in and reevaluate your pitch and see what you are doing wrong.

Good luck.

import · August 16, 2003, 7:27pm

“ends of the seller bell curve” - Posted by Bryan-SactoCA

Posted by Bryan-SactoCA on August 16, 2003 at 19:27:44:

Could you explain what you mean, Brent? I didn’t get it.