Over time, your network will bring you the best and most deals. But it takes a while to build this. As you move through your real estate investing career, you will likely graduate from driving neighborhoods and calling for cash, but you will never graduate from networking. These two important contacts could help you find your best deals:
1. Wholesalers: A real estate wholesaler is an investor who is good at finding quality deals with the intent to sell them to other real estate investors. Be mindful that wholesalers typically mark these houses up a little in order to profit from finding the deal. You can find wholesalers through your local real estate clubs or other industry networking events. Be sure to give every wholesaler your card, and let them know you would like to be added to their buyer list.
2. Other Investors: You may have heard people say that real estate is not competitive. I may not fully agree with this, but it does drive home the point that real estate investors can work well together. Many investors are looking for properties with a lot of equity that they can get in and out of quickly. Others are looking for less equity but more cash flow, as they want to hold onto the property for the long haul. Investors generally fall into one of two categories: wanting great value or wanting great terms.
Examining investors by these two categories makes it easy to see if and how you can work together. Both types set up marketing campaigns to find sellers. Great terms include easy financing and an owner who will carry the loan or a long-term lease. If I am a terms buyer and value buyers know that, we could collaborate on deals that do not have enough equity for them. I can pay them a small fee and have leads come to me. The opposite is also true for terms buyers who don’t want big equity deals. They can mark those houses up and sell them to another investor. Big equity deals typically means rehab and resell, and not everyone is looking for that.
As you grow as a real estate investor, you will become able to allocate a marketing budget and start campaigns that will help get your phone ringing. After driving for deals or calling for cash, there is no better feeling than answering a call from a seller who wants you to buy their home.