Rental Property Investor · Fort Worth, TX · Member since 2019 · 38 posts · 7 votes
How do you get a seller to sell 20% below value. Most of them list way above value as it is. What is the easiest way to do this without turning off your seller?
Any property that goes on the MLS is off-limits to opportunistic investors as normal home buyers will outbid them 99% of the time. If you want to find sellers willing to sell well below market value, you need to find homeowners who need money ASAP, or who inherited the home via a death in the family and just want to cash out and move on.
How do you get a seller to sell 20% below value. Most of them list way above value as it is. What is the easiest way to do this without turning off your seller?
There is only three ways to do this:
1. Convince them it is worth less than it is (use logic to show them your offer is fair by pointing out deficiencies)
2. Find someone desperate (who is motivated by time, emotion or other factors more than money)
3. Find someone ignorant (who lacks knowledge or information of the true value)
How do you get a seller to sell 20% below value. Most of them list way above value as it is. What is the easiest way to do this without turning off your seller?
There is only three ways to do this:
1. Convince them it is worth less than it is (use logic to show them your offer is fair by pointing out deficiencies)
2. Find someone desperate (who is motivated by time, emotion or other factors more than money)
3. Find someone ignorant (who lacks knowledge or information of the true value)
You shouldn't have to "get" anyone to do anything. You should be finding people who have problems you can solve. You want owners to be excited to sell to you because you're relieving a headache. Explain the value you can provide. If they refuse, you need to either refine your value proposition or accept that they weren't a truly motivated seller; you can only lead a horse to water.
Thanks Nicole, I really like this approach. This makes me more comfortable and it’s more my style. Where do you find these people besides the obvious driving for dollars
You shouldn't have to "get" anyone to do anything. You should be finding people who have problems you can solve. You want owners to be excited to sell to you because you're relieving a headache. Explain the value you can provide. If they refuse, you need to either refine your value proposition or accept that they weren't a truly motivated seller; you can only lead a horse to water.
Thanks Nicole, I really like this approach. This makes me more comfortable and it’s more my style. Where do you find these people besides the obvious driving for dollars
I'm struggling with that myself. The investor community seems split between DM and SEO.
As far as populations to target, though--absentee landlords, estate sales/obituaries (be tactful here), tax delinquent properties, pre-foreclosures, divorce sales, and properties with recent evictions are all good lead sources.
What about getting a deal on multi families. Seems to me the odds of getting any deals on multi vs SFR are much lower. I too was struggling with this and being a newbie, was looking at MLS... Thanks for the learning opportunities.
Get creative, sellers motivated by terms are found in all kinds of places. Example: evictions records, newspapers (the worst place to advertise is often the mom n pop landlords go to), local (city) complaints department etc.
I would look at it this way: who is currently having a real bad time as an owner/ landlord and where would I find them?
What I do is following the deal for a long time, make offers, updated offers once in a while. It all comes down to sellers' motivation. And their motivation changes as time goes on. You need grasp the motivation, take action, and negotiate.
Any property that goes on the MLS is off-limits to opportunistic investors as normal home buyers will outbid them 99% of the time. If you want to find sellers willing to sell well below market value, you need to find homeowners who need money ASAP, or who inherited the home via a death in the family and just want to cash out and move on.
I disagree. Harder to get a deal? Maybe. But Not all MLS listings are "off limits" and you certainly can buy homes for under value off the MLS. I have done the large majority of my 25 deals off MLS listings.
I make an offer for what it’s worth to me and than it’s up to the seller to take it or leave it. That simple. Usually my finds are for houses needing light to extensive rehab, although I have bought move-in-ready.
My question to the original poster: why are you looking for 20% under perceived market value? For financing reasons? While I often buy houses for 20-75% off ARV I have also paid market price. If the numbers work and it cash flows like crazy I wouldn't be afraid to pay close to market value. *although I live in an area where rapid appreciation just doesn't happen, so that's not part of my long term planning, so disclaimer there on my opinion.