I am a relative REI newbie (1 property and looking for more) but am unable to locate the below market deals that a substantial number of posts in this forum note (and I agree) are required for successful cash flow.
Cash is king (I have enough to purchase several properties 100% cash if necesary) , rehab skills are"prince" (I’ve done just about everything up to and including designing and building an addition to a house), motivation is “queen” (I’ve sent out dozen’s of letters to owners of distressed properties, checked HUD and VA)
I manage my current property myself and plan to manage additional future properties so I do limit my prospects to the market area I know well (Southern NJ)
What am I doing wrong or what am I missing.
Perhaps nothing…look for signs of motivated sellers. They will often sell below market price even thopugh they have it listed at market. The secret there is to make offers – sometimes lots of them. Unless you are in an overheated market, some of these offers might be accepted or at least given a reasonable counter.
As a second note, be very cautious about expending ALL of your capital. The secret to successful real estate wealth is LEVERAGE, e.g. the use of OPM!
What I have found in my short time of marketing is that exposure is a necessity. Don’t be reactive, but PROactive. You seem to be doing this with your mailings, but also focus on other avenues. Send out postcards, put an ad in the local paper/Pennysaver (and LEAVE IT THERE), put up bandit signs, hand out biz cards to everyone and put them everywhere, etc. At first you will probably get a couple (or more!) nibbles, but once your community keeps seeing the same advertisements over-and-over again, you will become the go-to person for their problems. People who pick up your postcards, see your signs, se your ads, see your biz cards may not even be the person in trouble, but may know someone who is. Spend a few $$$'s to make a lot more later, and never forget solving the person’s problem is #1.
Thanks to both of you for your replies. This does seem to be a very competetive market in SJ. There are already 5 full time “We buy homes for cash” ads in the local papers but not too many bandit signs. Maybe I’ll try some strategically placed signs.
Keith - thanks for the tip about capital conservation. My goal is building a portfolio of properties for passive incopme. There is an optimum balance of funds between cash and financing that will bring the optimum yield and I’m shoo1ting for that balance.
I’ve even chased down owners of vacant townhouses next to burnt down units, units with mnimal to modest damage, but no real luck YET!
Thanks again for the tips.
You are in the hot NorthEast corridor like I am so I can sympathize. I wanted to say that I have just started and my little paper ad has been running in my local paper for 3 weeks tomorrow. I have had only 2 calls, but alot of people have hit my website, which I monitor through its “traffic counter.” My business cards are coming in next week and I plan on getting rid of all 1,000 of them by mid-October if not sooner; I am going to drop 2 or 3 here and there wherever I am, whenever I leave my house. Make a weekly goal sheet for yourself; it helps me to stay on track when I get down.
Don’t give up - it can be frustrating. There are 2 other ads in my paper for We BUy Homes and one is very, very big so it grabs your eye right away. I can’t afford that (yet) so mine is rinky dink, but I purposely stayed away from some of the verbage in that big ad to make mine different and appeal in a different way. HOwever, even though that other ad was huge, the lady I’m talking with now (my second call) said she had already called some of these and long story short, she didn’t like what I guess she was ultimately told on the phone, that she’d have to sell at a discount. So I immediately shut up, after telling her that I work with each individual situation differently and that I needed to know more about her situation, and listened to her spill her guts about her bankruptcy. . . which she hadn’t mentioned when she filled out my form on my website obviously!
Bottom line, people may go with you because you don’t say this or that or because they like the sound of your voice or because you hate the Patriots or the Yankees (ha ha!) or because you’re giving them the same deal the other 2 guys would but you have presented it 180 degrees differently.
DON"T GIVE UP!!