Where are the best RE deals found? sheriff sales? auction? other?

Question

Where did you find your best deal?

I'm guessing each market has it's differences. But generally speaking where and how do the pro's get the best deals on real property?

I would like to find a good cash flowing multifamily, and from basic internet searches I cant find anything in my neck of the woods that makes good business sense.

(applying the 50% rule on my numbers)

I'm not deterred here, because I'm hopeful that something will eventually come up. Just not sure where the best place to look is.

If cash buyers get better deals ( which at this point I'm not sure they do, just an assumption) how much of a discount will cash buying actually get you?

Rob Gillespie · Answer

Marcello,

NETWORK, NETWORK AND THEN NETWORK SOME MORE!!

The best deals out there never hit the market, they are created by realtionships and great negotiating.

Yes, all cash can get you some great discounts!! :mrgreen:

Marcello Di Gerlando · Answer

Thanks for the Input guys. It is truly appreciated.
Justin S. 
I have an idea of the business model I want to pursue. I have a few months to learn and refine before I pull the trigger on my first REI. I am developing a business plan, not necessarily to present to anyone but simply to put my thoughts on paper. I have no illusion that my plan will be static but always involving with the things I learn. I don’t want to fail before I start. So I plan to start right!

Danny D.
I have attended a few County Trustee auctions in my area to observe the process and talk with buyers. Very interesting. But I can’t see myself buying real property without walking through a building first and having a solid idea on rehab costs. It seems insane to me that folks will pony up tens of thousands of dollars on a property sight unseen.  How do investors justify this? This is not a rhetorical question, literally, how do investors justify buying property sight unseen?
Multi family is the route I’m pursuing for the passive income. Definitely not in warzones.  Maybe in the future I will move into other areas of REI such as wholesaling or flipping – I’m not there yet and I don’t believe the market in my area is there yet. (But what do I know!)

David A.
This is a recurring theme that savvy REI investors seem to adhere to- Go where the best potential for growth is- I will be doing lots of research as far as infrastructure growth is concerned. Thanks for bringing this up.

Mark U.
Brother, your input is always appreciated. Thanks. My focus at this time is to become intimate with my local target market. I know who I want for customers/tenants . I know their income and I can predict their growth.  
My situation being the way it is (I’m in Afghanistan) I don’t have “eyes on” any properties.  I have basic internet searches at the moment. But I have plenty of time to prepare for my REI for when I return! Failure is not an option!

Mark Updegraff · Answer

You need to be analyzing deals in your target market, consistently and continuously.  You need to find a "good deal" - use it as a benchmark, and then try to find a better deal.  Eventually, you'll be able to spot the terrific deal and snatch it up before someone else.  Without a pulse on your LOCAL TARGET MARKET, you will NEVER find a DEAL.  Scrutinizing comps is not good enough IMO, you need to feel the pulse.  Watch real time.  Feel the days on the market.  Go to showings and feel the attitude of other buyers.  Without that information, you won't find the best deals available.

As far as method.  You should be keeping pulse on all options (sheriff sale, short sale, MLS, FSBO, etc).  BUT you MUST DO YOUR DUE DILIGENCE or be subject to mistakes that will cost you dearly!

David Ackerman · Answer

Best deals are where u can be cash flow positive and where you think in 10-15 years the appreciation in the area will be solid.  Use population growth, infrastructure growth, and job growth now to determine if your area will be vibrant in 10 years.

Danny Day · Answer

Marcello

Justin took the words out of my mouth, as "it depends".

What are you looking to do? You might hear of a good cash flowing multi-family for sale at auction, but might not be able to walk inside of it.. What if this one has fire damage? Mold? That can put an unexpected stop to your cash flow.

Personally I would like to visit the property and at least do a visual inspection. Like Justin said, the best deals are the ones no one knows about.

Depending on your area, you can find decent deals in the MLS. That is where I would look for multi-families for sale.

If you were looking for single family, you could place bandit "we buy homes" signs and your phone should ring. This would give you the opportunity to do a visual inspection, find a deal that most don't know about, and either purchase or wholesale it.. Win-win situation for you, of course if the deal makes sense.

Having a good strategy comes before all that though..

Good luck

Danny

Justin S. · Answer

The "pros" have a business model, so the answer to your question is "it depends."

Ignoring all outside factors the best deals are the ones no one knows about.  If you have 2M in cash the best deals are the readily available properties,  like auction properties.  If you have lots of money, you need to invest it.  If you don't, waiting for the best deal is a good strategy.

Where are the best RE deals found? sheriff sales? auction? other?

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