5 Ways to Find the Best Real Estate Deals
Many people don’t know this, but I’m about to spill the tea. You don’t need to be a real estate agent to invest in real estate. There are many house flippers, landlords, and wholesalers that are not real estate agents at all. In fact, I was a real estate investor for years before I decided to become an agent (just to have access to the MLS).
But, you should totally use a real estate agent that has investment experience themselves. It is a completely different ball game and the average agent does not get it. The “investor agent” will not only find you great deals, but they will give you comps based on the after-repair value of the property.
With that being said, here are some different ways to find great deals on properties that you can buy and hold, rent out, or flip for a profit.
There are online auctions and ones that you can attend in person.
From personal experience (at the in-person auctions), people tend to get overly excited and overbid on properties. So, go in with a set number in your mind and plan on not going over that number. Maybe attend a few first and watch just to see how they go.
Some auctions do not allow you to access the property ahead of time, so keep this in mind. As with any property, make sure that you do your due diligence. Check out the neighborhood, get comps, do a property inspection, etc. Also, most auctions require cash or at least 10% down that same day.
- Classified Ads
Online classified ads websites (like Craigslist or newspaper ads) can be a goldmine for finding properties that are for sale by owner. These are great for doing lease options. I have a friend that would call distressed business owners on Craigslist that couldn’t sell their business after many attempts. She would contact pizza parlors, ice cream shops, and small mom and pop shops.
Then she would get them to do a lease option. This gave her control of the business for a small fee. My friend was able to put better management systems in place to turn the business around and make it profitable. Then, she would exercise her option and sell the business for a profit. This was a win-win situation for everyone.
- Bandit Signs
These are “WE BUY HOUSES” signs. You’ve probably seen these on a local telephone pole near you. But, guess what? They work! Your phone will ring off the hook with these if done correctly. So, it’s highly recommended that you get a Google Voice number or pay-as-you-go cell phone for this. You will definitely want a second dedicated phone number with a specialized voice mail. Unless… um you want your phone constantly ringing on Sunday Funday. No thanks.
This was definitely not a fave of the hubs. We literally spent one weekend going around local neighborhoods (within 20-25 minutes near our home) to hammer and nail yellow signs to telephone poles. But, the response was so HUGE that we went back out and did it again the following weekend.
- Real Estate Meetups
We’ve found some winners at these events! Most of the people who attend are seasoned real estate investors and are willing to do creative financing (Ahem! Be the bank!) since they get it. These meetups usually have forums and in-house classified ads postings for members on their website where you can find great deals.
So, for example: by attending a local real estate event (that was free) I was able to meet some really cool investors. One guy had a duplex that he wasn’t able to sell. He agreed to do a lease option with me. For a small (non-refundable) deposit, I was able to control the property, put better systems in place, and increase the rents to make a profit.
Then, I was able to refinance it later on and pay him back. But, guess what? Since it was a lease option – I had the option to refinance it – I could’ve walked away if I decided that I didn’t want it. But, I did want it. And that’s the beauty of a lease option. He was a private investor acting as the bank and there was no hit on the credit report.
So where do you find these awesome meetups? They are all over the US. Check out Meetup.com real estate investing groups or the NREIA local chapter.
- Your City Municipality Website
You guys! You can find awesome deals on houses and land for sale here. Often times the city and county government gets stuck with properties (from tax sales) that never sold. They list these properties on their website for cheap. City owned property deals are great because the city wants to get rid of them. We once picked up a piece of land for $250. I’m not kidding. Just Google it. For example, Chicago City and go to the real estate section of the government website for your town.
The city websites also provide information about investing programs or tax breaks for investors. Some municipalities will do a land trust with the investor for a small deposit. This is a win-win situation because the city gets the property off their books and the investor gets the property financed (by the city) without needing a bank.