Re: Selling to Investors - Posted by Alex Gurevich
Posted by Alex Gurevich on January 12, 2004 at 14:07:39:
You’re onto something…conceptually.
Obviously, if you could have buyers lined up to buy from you for cash for 80-85% LTV, you’d be much better off than trying to flip to rehabbers for 65-70% LTV, or even listing in MLS for that matter.
Your buying criteria would change - you can afford to pay a bit more. Therefore, you could be moving many more homes and cashing out quickly.
But I think you’re defining your market slightly wrong. It’s not the new or intermediate investor, per say.
Somebody who is hanging around on this forum, buying no money down courses and attending seminars is already conditioned to pay less. Chances are also high, they have no cash or means to get financed and cash you out.
They won’t make good prospects for this plan.
You’d have to go after (a) existing part-time single family landlords, or (b) “create” your own market among busy professionals (engineers, accountants, doctors, etc.) with money and credit to get financing.
Creating a new market like that means running ads, sending mail, getting them into a seminar room, educating them about advantages of “buy and hold”, showing how wonderful cash flow works with the discounted prices they’ll be paying and the lowest rates they’ll be getting, etc.
You’d have to organize the whole thing into a turn-key, low or no time and personal involvement “package” where a property property manager is available with resources to do “make readies”, maintain and lease rentals, take care of tenant calls, etc.
I think you get the point.