As a residential real estate investor, one of the main things you need to know is how to find inventory at the most competitive price. If you’re paying too much for a property, you won’t be able to find a suitable exit strategy that will allow to profit from the deal, in which case you don’t have a deal!
Here’s a system I’d like to share with you: the process of a residential transaction and being able to buy it at a discount and exit with the right exit strategy at the right time.
One of the ways I get inventory at the right price is I have multiple agents; I call them bird dogs. I have an extensive network of professionals and I am always networking.
I network with different individuals that are professionals in the real estate industry, and I have them search and hunt for properties that fit our criteria. I give them the specifics of what I’m looking for, and they go out there and start submitting offers on my behalf.
As a result, people are always looking at me as the individual that is going to be able to purchase the inventory, and I become that exit strategy for those bird dogs out there.
I have a put-together system to incentivize those agents, those bird dogs out there, to bring me inventory. Every day people are out there motivated, looking for inventory so they can bring it back and sell it to me. I have the infrastructure in place to enter and exit the properties.
I get properties from banks as well, known as REOs. Recently the market has changed a little bit, and the banks are holding back that inventory to some degree. But the moment those properties are released again into the market, I already have the systems in place that allow the banks to come immediately to me and say, “Hey, I have this inventory. Here it is, buy it.” The banks know that I have these tools to quickly and easily purchase those properties.
Short sales are another opportunity to buy property below market value. A few years back nobody knew what a short sale was, and even though many real estate professionals still don’t properly understand the art of them, they can be avenues to investing wisely. I do short sales for multiple agents that have the ability to scout the properties and therefore I get the offer submitted at the discounted price.
Another method to building your residential real estate portfolio at the right price is through buying nonperforming notes. I like to buy nonperforming notes because I have the systems that help us acquire the real estate, and that is key.
Again, I’m very specific as to the criteria I use to buy. And none of this would be successful without having first built the correct systems to handle this inventory. But all of the above have worked well for me, and, with the proper training, can work for you too!