Everyone loves a deal but are you going about it the right way? Add 4 creative ways to find great deals on homes with this article by Julie Broad of revnyou.com.
By Julie Broad
“Most people spend more time and energy going around problems than in trying to solve them.” – Henry Ford
When the property came on the market I knew there would be a lot of interest. It was a great area and priced really well. We went to look at it right away and I set to work trying to understand what the situation was. Turns out the owner had passed away and it was an estate sale. Two elderly sisters were the only remaining relatives and they lived out of town. I found out as much as I could and created an aggressively priced offer but an offer that solved their biggest challenge: what to do with all the stuff that their late brother had in his house. I offered a fast closing and that they could leave whatever they wanted in the property that they didn’t want. It worked! We grabbed ourselves a fabulous property for under market value because we solved the biggest problem of the seller.
Often, finding or creating great real estate deals is nothing more than figuring out what the problem is and fixing it. Here are five of the most common real estate problems, and some ideas for solving them:
- Landlord Burn Out
Being a landlord can be stressful and tiring. Picking just one bad tenant can make your life miserable. And, many landlords just find it easier to throw in the towel and run away rather than ever deal with another bad tenant again.Find the frazzled and frustrated landlords, and solve their problem. You can buy it from them and offer to deal with their bad tenants or you could potentially offer to become their partner on the deal and take over all the issues. There would be no money invested on your part, just some time, sweat and trouble to get rid of the terrible tenants, place some new ones and manage the investment from that day forward so the frazzled landlord doesn’t have to worry anymore.
- Increase the Density or Change it’s Use
Most investors just look at a property for what it is right now but the best play is to think about what it could be and what it should be. Adding units or changing the use can be a highly profitable move. In cities where the vacancy rate is low, the City is often anxious to add more units to the rental pool so approvals for changes should come easier. Find a house with a basement that could easily be turned into a suite. You also might be able to add a carriage house in the back. Or, if you’re more ambitious, find a house that could be lifted, extended or torn down and turned into a multi-unit property. This takes work, tenacity and an understanding of city planning (and permits), but the payouts can be big, especially if you’ve got handy friends and family or just a good relationship with a few contractors.
- Handy-man Special
Look for the property where the lawn has been overtaken by 2 foot high weeds, newspapers are piling up, and the lights are never on. That property might be close to foreclosure or just has an absentee owner that thinks there is no market to sell. Write down the address, stroll on over to the local municipal office and look up the owner’s name and address. You may just find a person that is really happy to hear from you. You could be saving them from foreclosure or just taking over a property they don’t have time to deal with. You might even find an older person who has moved into a home that would be willing to give you financing on the property as a stream of income for them to use to fund their retirement expenses. You just have to take that extra step to investigate so you can find out what is the problem that needs solving.
- Let the Neighbours Know You’re Shopping
One of our best deals last year was a triplex that our neighbour sold us. He had tenants and didn’t want to deal with multiple showings with the tenants as he feared they would leave before he sold. He wanted to get the deal done for a fair price and minimize the hassle. He knew we were investors and owned other properties in the area so he offered us the first shot at the property. It took a few weeks of negotiation but we bought the property at a good price with great tenants in place on day one.You never know who your neighbours know and sometimes they just might want to sell.
As the market heats up for spring across Canada, many people are finding it hard to uncover great deals. It’s not always easy to get the right property but a little creativity can go a long way! What are your tips? We’d love to hear them in the comments.
Julie Broad is a residential real estate investor in Nanaimo, BC, a #1 Amazon Best Selling author, speaker and investing coach. Connect with her at her website www.revnyou.com where she shares hundreds of videos, articles and real estate investing tips to help you in your business.