Selling strategies in down market? - Posted by Tom

Real Estate Investing
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Posted by StevenS(CPA) on August 04, 2007 at 09:49:19:

You’re on the right track, but don’t limit yourself to one broker. Call several brokers and they will help you create a very good note. Then I would shop it to a direct buyer. Do not broker your note if you do not have too. Unless the broker’s price is better than the price you can get yourself. But verify they can perform before you sign anything with them. A lot of brokers are more talk than action or worse just plain liars.

But it shouldn’t be too hard to create a good note if you just talk to a few people.

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Selling strategies in down market? - Posted by Tom

Posted by Tom on August 02, 2007 at 18:55:28:

Anyone having any luck with alternative selling strategies in this slower market such as weekend sales, 5 day sales or adding cars into the sale?

I live in an area where houses can sit on the market for a year, so creativity is a must.

Thanks for your input.

Tom

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Thanks for all the advice! nt - Posted by Tom

Posted by Tom on August 03, 2007 at 16:17:57:

nt

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Re: Selling strategies in down market? - Posted by David Alexander

Posted by David Alexander on August 02, 2007 at 22:38:48:

What price range houses are you dealing with in your market… is that the median range… below… above…

In some market ranges… offering financing is what will drive the sale… making it easy to buy…

In others… it’s price…

And in others it’s amenities…

The bottom line though… is traffic, traffic… and more traffic… with the marketing message to sale the houses in your specific market…

And of course you could probably guess what I do to drive traffic the most…

Lot’s of directionals… just the standard little ones (6 x 24)… they don’t get removed as often…

Coupled with the right type of marketing… out and about… before they get to the house…

Examples…

If it’s a higher priced house…

You could put Bandit Signs out everywhere about a House Auction… and lead them to a voicemail that tells the details… and basic directions…

If it’s a house you’re flipping and maybe have a great short sale deal worked on… Maybe you got the house discounted by 45k on a 200k loan… and a house worth $205k…

The sign would read:
3/2/2 Beautiful House for sale
Discounted $27k - Must Be Sold
By Noon Sunday
(877)877-8664

And again a voicemail that tells all and leads to the house… pleanty of directionals…

Always… drive traffic to the house and then have someone answer the phone live from there at a different number…

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Re: Selling strategies in down market? - Posted by Rich-CA

Posted by Rich-CA on August 02, 2007 at 21:15:25:

You have to understand how buyers look for properties. First they tell their agent what price range they want to look at and where they want to look. Agent provides lists. Buyers select properties to look at.

If your PRICE is not in the range being looked at your property will not be looked at.

The rest of my observations are attached to the same question, different person, earlier in the week.

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Re: Selling strategies in down market? - Posted by KN

Posted by KN on August 02, 2007 at 20:18:37:

Sure the easiest way to sell a house is PRICE PRICE PRICE. If a property is on the market for a year it’s because of bad pricing. Also marketing host an open house and advertise the heck out of it. Hire a clown and a moonbounce if it’s in a family oriented neighboorhood.

Offer to raffle a lease on an upscale car if it’s in a upscale neighboorhood with you paying for it. PS. Only qualified people are elgible and by qualified I mean people who put an offer on the property and show they have the funds to purchase it…(you may have to check to make sure thats legal)

Marketing and Price go hand in hand make sure you do both well.

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NO IT’S PAYMENT PYMT PYMT - Posted by StevenS(CPA)

Posted by StevenS(CPA) on August 03, 2007 at 09:34:10:

This is only my opinion but from what I have found is Buyer’s could care less about the price of a home if it meets their needs.

What most Buyers care about is Down Payment and Monthly Payment.

If they can afford those two things and they like the house they ARE going to buy. I never ask a buyer what price range they are looking for. I ask them how much do they have to put down and how much can they afford monthly and try to work out a deal using those two numbers. Sometimes it works well other times I still can’t get a deal done. But it’s rarely ever because of the overall price of the home.

If I could buy a 2007 BMW M5 for $200.00 per month you bet I’d be driving one now.

But that’s just my opinion.

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Yep… - Posted by David Alexander

Posted by David Alexander on August 03, 2007 at 11:58:18:

Absolutely 100% right…

That’s why being able to sell financing moves property better than any other method…

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Re: Yep… - Posted by Tom

Posted by Tom on August 03, 2007 at 16:16:08:

I’d like to be able to offer seller financing and then sell the note at close and I’ve read numerous articles on how best to create a saleable note but I’m thinking that I should either read some additional books, or be in contact with a a note buyer than can guide me. Any advice on the best book or note buyer to ask for guidance?

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Selling Notes… - Posted by David Alexander

Posted by David Alexander on August 05, 2007 at 21:24:57:

is almost an animal of the past in my opinion… (when dealing with institutional type buyers)

Back in about 1998 through 2000 you could sell a note if a borrower had down payment and could fog a mirror…

The guidelines were based on LTV’s (loan to value), ITV’s (investment to value), Yields (return on the money) and loosely on credit.

Back then there was a lot of money chasing notes… and the note buyers were more investor savy…

Around 2001 - 2002 things started changing… and the notebuyers started hiring Bankers to manage these portfolio’s and make the decisions…

When the note deals went bad instead of being investors that owned notes… (they had started selling/hypothecating these notes to wall street)… and they had to move fast… to replace these notes…
And instead of having the time to resell and fix and create a new… they took losses… eventually they went to the same system as the banks…

Bankers of course don’t give a rats patooti about the security and focus more the borrower…

So, now to sell a note… (haven’t sold one in over 8 years, but, recently tried) it’s all about the borrowers credit…

Example…

Recently went to sell a note… 95k note secured by 107k piece of real estate, where buyer put down 5k… and has perfect payment history for a year…

I offered it up at 9.5% yield on about a 75 - 77% ITV… on just a sale of a partial (x number payments) expecting a counter…

The counters were with yields in the 25% yield range…

Anyway, long story short… my borrower is refinancing in 2 weeks… I’ll cash out completely… just waited a few weeks more and cleared off a 2k judgement that was on her credit that wasn’t hers…

The note buyers… never looked the deal in depth… and instead only looked at fico’s…

Just bankers disguised as investors…

On the otherhand if you grow your own investors… then you could just hypothecate the notes yourself as the sole collateral for the loans…