SCENARIO: I will be airlifted from my hometown and left in the middle of hostile and undisclosed territory.
MISSION: Secure at least 1 package (aka a real estate deal), which has a profit of at least $ 5K from a wholesale change, or a profit of at least $ 20K after a large-scale renovation.
TEAM: Starting with just:
My credit and cash
A PC with an Internet connection J
My knowledge of real estate investment strategies
TERM: 30 days, or I self destruct
Strategy: This is exactly what I would do, step by step, if the above scenario were presented to me. Please understand: there are 3 key elements that should take place for this to occur.
1) Market: learn and study the terrain, know where the hills and valleys are, and study / decide the best topography from which to launch my assault.
2) Marketing: Implement an action plan in accordance with my SOPs (Standard Operating Procedures), which would provide maximum overlapping coverage of my firing lanes. We need to create a plan to collect the package.
3) Make offers: try to retrieve a package. If you can’t, please try again. Remember: lives are at stake.
Objective n. 1 – Know the market
To provide an all-out assault, you must carefully study your enemy. Determine when they move and why. You will need to:
– Buy a map of your area at a local gas station / bookstore, or print one from your PC. This will help you understand your market and conveniently mark various sections of your map to explore.
– Check to see if the county has a “good” Tax Assessor site online. It could well be defined as one that has images, or possibly one with an exact property value. Be aware that the appraised value in many parts of the country is unreasonable. It’s right. MANY county assessors are online and many provide a good zero point for establishing home values. If all houses are selling at 200% of appraised value, multiply by 2. If houses are selling at 75% of value, multiply 0.75 by the appraised value of the home you are evaluating.
– Zillow.com: Although the values are often completely off-base, I can quickly look at photos of houses, see street layouts, and analyze SOLD compositions. You may or may not have access to the number of bedrooms, bathrooms, or amenities, but you can at least be in the ballpark of what a home can be worth.
– Find 2 or 3 real estate agents to work with.
– Once the neighborhoods and areas that appear to be vantage points are determined, then it’s time to take a closer look. You are looking for neighborhoods that are “families who want to live there” areas that are reasonably neat, clean, have well-kept gardens, but do not exceed the average price range for the area you are looking for. In my hometown, a typical bread and butter neighborhood has 2 story, brick ranches, and split levels in the $ 70 to $ 135,000 range. I don’t do war zones or areas where the “landlords” generally don’t want to live. You need to think: is this an area that a first-time home buyer or family would consider living in? Is it nice, well cared for, and desirable? Or, is it a place that someone lives or buys, simply because they are forced (more or less) to do so because of their financial difficulties?
Objective n. 2 – Marketing Assault
1) Immediately set up a tactical headquarters to conduct your research / make phone calls.
2) Set up a website that says “We buy houses.” Set up a Google AdWords campaign to locate anyone who types in keywords such as: “sell my house,” “homebuyers,” “in foreclosure,” etc., all centered within a 20-mile radius of the zip code from which I am operating. The AdWords campaign would look like this:
We buy houses
Easy money. Close quickly
FREE report. Help 1ClickAway
Your website address
On my site, they get my phone number, email, form submission tools, etc.
Understand, I normally have to speak to about 40 for sale by owners to get 1 deal. I also have to bid on 10 Bank REO’s to get accepted 1. We are going to follow the “Shock and Awe” strategy and get to many important but different angles all at once, as time is my biggest responsibility in this. Mission.
3) Have the agents put you on a “Hot List”. This is an email sent to you with property listings. I want to see any new listings, price reductions, or homes that have been up for 180 days in the areas I’m targeting.
These agents will do a lot for you. They will provide you with comparable sales information. They will show you properties and write their purchase offers. Choosing the “right” properties wisely will save time. If the neighborhood normally supports $ 115- $ 122K bi-level homes, and a bank foreclosure hits the market for $ 105K, I’m not going to rush to offer it. Could it be a deal? Yes, you never know what someone will accept until an offer is submitted, however I do know that they are less likely to get a “deal” on that property. If that same house costs $ 80K, yes, I’m going to drive by or look at it right away. That house may already be at a surprising distance.
4) Find local wholesalers:
Ask Bank REO agents who the big buyers of investment property are in the area. Call up any newspaper ads (large and small newspapers) that advertise “We buy houses.” Know that probably 80% of the ads are placed by “investors” who are just starting out and really have no idea what they are doing. Most couldn’t buy a home if they needed it. It’s okay. You will review them quickly. Look at their websites, if there are any on the list. Call people and find out what inventory they have. You can also have agents recall all properties sold in the area that were in the lower 20% of sales prices. See who are the names that appear continuously and locate them. You may need to visit the Registrar of Deeds office. These investors buy houses, sell houses, have a network and make deals.
5) Groups of local real estate investors
See if there is a local REIA online. Check with the investors you contacted in point 4. Ask everyone you interact with. We are gathering intelligence along the way, which will be used to acquire the package.
6) Order 200 Bandit Signs and saturate the area.
Get the 18 “X24” signs with blue lettering. Don’t put the website on them, just your 1-800 phone number. Bandit signs can make local bosses unhappy, but hopefully your mission is complete before they send their “special agents” after you. J
7) Call all for sale by owners and for rent by owners.
Call both those who appear on the garden signs you saw while driving and those who appear in classified ads.
8) As you drive through neighborhoods, any home that appears to be unoccupied, put a knock on the knob that says “We Buy Homes” with your phone number.
AAR – After Action Review
At this point, you have the following marketing methods to attract leads:
– Advertising / website on the Internet
– Real estate agents working in your corner
– Calling FSBO’s, FRBO’s
– Vacant houses
– Bandit signals
– Wholesalers / Investors
Last but not least:
Objective n. 3: make offers
This last objective completes the “3M” of real estate investment: market, marketing, making offers. It is no use knowing your real estate market and how to find deals, and then NOT making ANY offers. Make offers that don’t make you lose money. Make offers that make sense. If they are good deals, you can move the property for a cash profit.
Simply put, if you strategically deploy several different types of drones to search for your target and then start firing missiles, you will survive your mission and successfully return home with a pack.
MISSION ACCOMPLISHED.
Happy investment,
Brandon yeager
