Should you buy now? Is it a Sellers market?April 17,2022First of all, I do not know you, your objectives, or your financial situation, and I am just a guy that loves real estate and writes about it
Did you ever hear: “If you find a good deal, call me.”?
Dated: July 14 2020
I hear it often, and I would like to talk to you about it today. If you are a real estate agent, you have heard this statement. If you are an investor, you perhaps have posed it to an agent or friend in the business. I, indeed, received a call today from one of my EXP Realty team members that was asked to find a good real estate investment opportunity for a new client, and we discussed what her response could be at length. Let me share with you some insight I have learned over my 45 years in real estate, and you may be surprised at some of my key points on just what a good deal is. I have invluded links to articles I have writen more in depth about some of these points.
A “Good Deal” means many things to many people, and I can guarantee to you that every buyer has a different perspective on what that is. It is important for the agent to probe and find out what his client is trying to accomplish. Very often, a client gives me the solution to his objective without clearly understanding what his objective is. For example, he may say, “I'm looking for a single family home in Southwest Cape Coral that I can invest in that is a good deal”.
“What is a good deal to you?” I may query.
· “I want enough rent to pay the taxes, insurance, and maintenance.” May be the reply. This, I believe is doable.
· “I want a 8% CAP rate and 10% cash on cash” Not so doable.
· “I want to sell in ten years and have an Internal Rate of Return of 15%”. (IRR) Also doable.
· “I want to buy 10% below market”. This also can be done.
Here are some of the questions you must ask yourself (or your client).
§ *How much time, money, and brain power are you willing to invest? (Three kinds of Capital Article)
§ *Do you want to buy, improve, and flip? Buy, improve, and rent? Buy and hold?
§ *What are your expectations on a return? (Understanding CAP Rates)
§ *Are you an income investor or an asset investor? (Asset vs Income investing)
§ *What other investing are you doing and who are your advisors? (Things you should know about your advisors but don’t)
§ *What it your passion and can you relate it to real estate?
§ *Are you aware of these ten rules of RE Investing? ( Number one is you make money when you buy, not when you sell)
§ *How will you pay for the property and how fast can you move? (The Power of Cash in negotiating)
§ *Will you use the home for a vacation rental? (Owning a vacation home)
§ *Are you thinking of becoming a landlord? (Some things you should know)
§ * Are you an investor or a speculator and do you know the difference? (Find out here)
§ * Have you considered buying new construction? (Is New Better?)
§ *Let’s talk about leverage and how to use it to your advantage.
§ *What it your time frame?
Folks, these are just a few of the things I would discuss with a client that asked me to find a good deal. I don’t expect you to go to all the links, but pick a few, perhhaps they will help.
If I can help you be a better agent or a better investor or buyer, you need only ask. (and I am always looking for more team members – all over the US.)
Real estate has been my passion since I took my first Al Lowery class on real estate investing in the 1970’s. I vowed during that class that I would buy one property a year. Over the next five ....
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