Question on making offers

6 Replies

@Brandon Turner tells us that we should be making multiple offers weekly. My question is what is the best way to do this? I recently set up an alert on redfin.com that tells me when something comes on the market that fits my criteria - but once something comes up do I simply contact the listing agent and tell them what I want to pay? or should I have an agent represent me and make the offer. And if I do contact the selling agent and give them the opportunity to represent me but give them an offer bellow the listing price and I running the risk of offending them?

You can do either but you will have better luck with your own agent usually. Due to agency rules most listing agents will not agree to represent you (unless they are familiar with investors, typical RE agents are not that creative). But agents have an obligation to present all offers to their clients even if they are lowballs. Plus, unless you know the contract really well, you should use an agent starting out until you know what the contract should look like. 

Making lots of offers probably applies more to direct mail marketers and other forms of marketing where you are dealing with sellers directly. 

If you ask agents to make offers for you that aren’t realistic, you will burn bridges with those agents very quickly. If you want to use agents, I suggest you get to know who the agents are who work the neighborhoods you want to buy in. Let them know what you are looking for and ask them to call you when something comes across their desk.  In return ask them what you can do for them.

You will find new agents more willing to work with new investors but it’s the experienced agents who will have the deals. It will take time to break into their investor position pool. 

HTH

Making lots of offers in itself isn't a bad thing, but it can burn bridges when the majority of them are not realistic. 

It comes down to building a relationship with an agent and working together with them to develop your acquisition strategy. Once they understand what you're trying to do, a great agent will be able to help you identify properties that fit your invest criteria. It's not all about price, there are other ways to package terms that get you want you want without having to lowball every seller.

@Arthur Fuller II You can find more properties to make offers on if you do mail campaigns to find off-market deals. 

Find a list broker to suggest some targets that will be effective motivated seller leads for your market. This way you can be working directly with sellers who call you. After a conversation you can get an idea about what to offer and have a better chance of making it stick.

I agree with the other folks, don't burn bridges by making offers that aren't likely to be considered.

I want to thank all of you for replying. Just some background info: I'm in Los Angeles.. this market is over saturated with mailers and you need a budget of upwards of $20k a month to be successful here. I'm trying other methods, cold calls, door nocking etc... Also trying the Random deal that pops up on the MLS. That's why I asked about making low ball offers.

Originally posted by @Arthur Fuller II :

I want to thank all of you for replying. Just some background info: I'm in Los Angeles.. this market is over saturated with mailers and you need a budget of upwards of $20k a month to be successful here. I'm trying other methods, cold calls, door nocking etc... Also trying the Random deal that pops up on the MLS. That's why I asked about making low ball offers.

 Good to meet you Arthur.

Maybe I can help... As a California Broker and an Investor who has bought hundreds of houses I have only purchased one using a real estate agent or from the MLS (Multiple Listing Service).

Reason  is simple, I want to buy at a discount... Typically 35% off "As Is" value. 

The reality is that a listing broker who has a seller who would accept a 35% off offer would just buy it themselves... Sure there are disclosures to sign and fairness issues to deal with however its done everyday. It doesnt mean that you wont find an opportunity I am just saying the likelihood in the beginning of your career is slim... 

Agents will want to know you have the ability to perform before they waste their time... 

There are a host of other means for capturing sellers besides the MLS.

I bet your cell phone is full of local contacts who know and love/like you... Talk to them and let them know to spread the word about you.. I bet one of them know someone who is willing and needing to sell today.

Visit the foreclosure sale auctions. In the beginning it wont be seller fruit youll obtain however it will be loaded with buyer fruit.. And those buyers have cash. One may take you under their proverbial wing. 

Cold calling is excellent, I am happy to see you doing it... Dont stop... 2 hours a day everyday workday. Door knocking is tough.... Although can produce opportunity...

Join your local Chamber of Commerce or BMI group and start networking... Every luncheon, ribbon cutting and mixer... Be there passing out cards. 

Make certain that you always have a set or two of contracts on you at all times and always have business cards... If you need some let me know I will send some to you. 

Every time to have the opportunity say hello do so. I call it Purses, Shoes, News and Sports. If you listen to News Radio and Sports Radio 10 minutes a day youll have all of the ammunition you need to strike a conversation up with a male and if you spend an hour or so at Macys / Nordstroms studying Purses and Shoes youll have the same for females... Simple conversations lead to great relationships.

BTW - We dont Low Ball Offers... We offer an amount that causes a win win fair solution. 

Also... you have this... Go kill a house or 10.