I am wanting to take a more active role in finding deals and am wanting to do some door knocking. Is there anyone who has a strategy when it comes to door knocking? Like a script? Specific houses you target?
I read some threads about this a while ago but I never found a comprehensive guide either.
I actually met a guy at the REIA tonight who only "advertises" by door knocking. He said he did "plenty" of deals last year. His main target was preforeclosures he could take over Sub2. He said he used to send letters to all of them, try to get their number and call and stuff like that, but a week of driving around is better than a month of that other stuff.
Eric is right, there is no comprehensive guide on bp. He's also right that a weeks worth door knocking is a like a month's work.
It's funny he mentioned door knocking pre-foreclosures because that's exactly what I do. I'm a short sale specialist in Miami.
What kind of leads are you going after?
I haven't been at it for long so I'm currently working on/waiting for results, but what I've been doing is driving around looking for distressed properties (which in wholesaling, is most of the deals regardless of type), noting the address, knocking on the door, and qualifying the prospect if someone answers, or leaving a simple handwritten note with a call to action if no one is home. Some are obviously absentee/abandoned, but I've still been leaving notes in those cases because they are often still visited, even if no one lives in them. Someone probably comes to mow the lawn every once in a while, bad as it may look.
If someone answers, I go through a pretty standard script. You just want to seem casual, but professional, and you want to find out some key things from pretty much everyone:
- Are they the homeowner? (identity)
- Are they looking to sell? (qualification)
- Why are they looking to sell? (motivation)
- Is there a mortgage on the home? (situation)
- How much is owed on the mortgage? (equity)
- What kind of shape is the property in? (condition)
- What would they like/need/want to get for the property? (expectation)
If possible, you want to get into the property. The first time I went door-knocking, a friend of mine with experience in D2D told me an old variant of "assuming-the-sale" where you don't ask to come inside, you assume they are inviting you inside. When you get to the point where you ask how the condition of the property is, if you've made the homeowner comfortable enough at that point you can often confidently walk a couple steps forward (you should be several feet away from the door in the first place) and ask with sincerity, "Should I take my shoes off?" and the homeowner will say, "Oh, sure," or "Oh, no, doesn't matter." Now you're in. If they became defensive instead, just apologize (maybe look a little confused), and say with a casual tone that the sooner you can see the inside (purely for the purposes of seeing what condition it's in and taking some photos to show your "partner," whether they actually exist or not) and you just thought it made sense to get it out of the way. You can also try to jokingly ask, "Oh, are you in the middle of your Spring Cleaning?" or something like that, but if you had built any rapport and the person objects to you coming in, you may just not have a motivated seller. That, or it could be an old lady who thinks her house is a mess (sometimes, it really might be, too). The bottom line is, you need to see the inside, and why not on the first meeting? When you proceed with confidence, people tend to want to go with the flow and not break a social norm.
So you're inside. If you have enough experience and are okay with the risk, you can look around, estimate repair costs, find out about how much is owed and all, and make an offer on the house based on what the seller said they would like. If they'd like $50,000, obviously you want to offer $35,000 if it works based on ARV and reno-cost. I've never done this, partly because I'm not good enough at estimating repair costs on a dime like that, and partly because by all accounts, I'm still a beginner; I'm actually still working on closing my first deal because I started recently as mentioned. I've heard of this being done by pros, though. One important idea/strategy is you don't want the decision to depend on you. Your contractor is going to have to run the numbers, your partner is going to have to run the numbers, et cetera. If you try to close a contract in their house that day (I've also heard other people condemn this, by the way, because it can be a waste of time if they lie to you or there ends up being something on the title they don't know about, and then you have to break the contract) you should go outside and "send the pictures to" and "call" "your partner," who may or may not exist. Maybe your partner said due to the state of the bathroom or the HVAC needing replacement, you can only offer $40,000 instead of their asking. Shoot, darn your partner, but you ran the numbers and he's right.
This is getting to be a long-winded post, but if you don't want to sign the contract that day (I don't feel comfortable even trying this yet), you just want to get as much info as you can (and as many pics as possible, make sure you see everything), and let the seller know you will run the numbers, and if everything checks out you may be able to buy their house. Don't make an offer unless you're a reno-genius that's comfortable with the risk. Thank them, leave a business card or flyer if you have one, and offhandedly mention that if they know anyone else who is looking to sell their home you may be interested in buying theirs as well, so keep your card on hand and give them your information. I've heard of some people offering a referral fee of $500-$1000 for this as an incentive.
Later on, after I've done all the driving I intend to do for that day, I will put everything I know into a spreadsheet and research more online. You'll find out whether the owner is really an absentee, who the homeowner is, et cetera. So far I'm loving what I'm doing (I work in sales for my 9-5) and I'm looking to start sending direct-mail to all the property owners I haven't been able to find. I'm really busy right now, so I don't have as much time as I'd like, but I'm hitting the streets as much as I can.
P.S., it helps to have a partner to back you up, and also for security.
Please let me know if you have any questions!
hi @Nick Kent go to fsbo homes to talk to owners,when you get in the house ask them why do you want to sell this beautiful home and then don't say another word and just listen to their story the homeowner will tell you what you need to know to buy the house
@Devin Beverage great post! I got a lot of information from that. I haven't tried knocking on doors but I think I'll give it a try one of these weekends.
Hi @Account Closed , just curious, have you started door-knocking? If so, how did it go?
I'm not the door knocking kind of person. It just not in my nature. But I love to hear other's stories about door knocking.
That's awesome that you've decided to take it a step further and start door knocking. I'm actually starting a door knocking campaign this coming week for the first time. But I'm targeting absentee owners that still live in my city. It's something that I will do on a weekly basis, and feel it's defiantly not where the crowd of other wholesalers and investors are, because everyone else is sending letters or post cards. So by separating yourself from what everyone else is doing will give you an awesome advantage.
You must be a BiggerPockets member to post on the forums
Join the world's largest, most open Real Estate Investing Community online, 100% free forever!