Advise on Ways to get deals

[Nhi Nguyen]

I know about getting a list and contact them using different methods. I don’t have plan to do that yet since I’m only looking to get my first 1-3 deals. Also, I don’t have the resources set up for it at the moment.

So, at this time, I mostly search/get deals from:

- loopnet

- mls

- local agents relationships

I’m also looking into getting deals from wholesalers but I don’t know any good wholesalers in this space around my areas (Bay Area, CA). Tips would be appreciated.

There are a couple of deals I looked at, but the listings have been expired. I really want to approach the sellers on my own. What should I do?

Thanks

[Erik W.]

@Nhi Nguyen, hi.

Each area is going to have a different set of strategies that work best, and a lot depends on what you're doing to do with deals once you find them.

If you're going to wholesale, the most common strategies to get started on a budget are a combination of "Bandit" signs, yellow letters/postcards, and a website that drives traffic to you.  Be advised: the successfully wholesalers in my market (i.e. "We Buy Ugly Houses", Home Vestors) spend around $3,000 - $5,000 per MONTH marketing.  Does that mean you have to?  No, but just realize that your competition is out-marketing you and also has a team following up on leads.  This means that on average, they will get far more deals than you do at the beginning at least.  Eventually, if your goal is to become a major wholesaler in your market, you will be doing something similar and spending similar amounts.

If you're going to buy and hold, that's a different ball park entirely.  Calling expired listings is good.  So is door knocking.  Tons of free videos on YouTube show you how to do that.  You can still do bandit signs, mailings, and websites, but more often I've seen buy and hold target specific neighborhoods, so "blanket" advertising doesn't fit their model quite as well.

In my market, loopnet is where the picked over listings go to sit for months or be bought by newbies who pay too much. Not saying it's impossible, but the deals are VERY rare and you have to move with lightning speed when they show up. MLS is the same. MLS = retail buyers.

I recommend setting up a Zillow filter that screens for properties in the areas, price ranges, and criteria you like.  As you find properties you like but that are overpriced, add them to your Liked list (click the little heart on the picture), and you'll be emailed instantly whenever there are price drops.  Also, you can schedule time to review them once every 1-2 weeks. I like to pitch offers at the 41-43 days market and at the 55-58 days mark.  When I was a real estate agent, we'd typically make the first price cuts on day 45 and day 60.  Getting an offer in right before a price drop sometimes helps take some psychological pressure off the Seller: they're already emotionally prepped by their agent (if their agent is doing his/her job) that a price drop is coming in a couple of days.  You're simply beating them to the punch, and sometimes a Seller's agent can use this to their advantage: "Well Joe, we were going to drop your house by $10,000, but that means other buyers would still probably offer less than that.  Nhi is here today and he's asking for $20,000 off which isn't much less than what we would have expected from another buyer at the lower price.  It's a bird in the hand, Joe.  You should consider his offer."