Sunday, November 3, 2013

Running Your Real Estate Investing Business - Replying to Ads to Find Deals on Craigslist

If you've read my previous article about posting ads on CraigsList to find deals then you may have become a little discouraged about the number of responses I told you to expect. However, you'll be happy to read that replying to ads on CraigsList can keep you busy ALL DAY LONG, for as long as you want to reply and for as many days per week as you want to work. There is really no limit if you decide to trade your time for marketing in this method in all but the smallest of cities on CraigsList.

So, what do I mean when I say replying to ads to find deals on CraigsList?

Well, I mean actually calling (or, as a last resort, e-mailing) people that have ads posted on CraigsList and finding out about the property they have for sale. Or, as the case may be when replying to "for rent" ads, the property that they might not even know they have for sale.

How exactly do I recommend that you reply to ads? What I recommend varies depending on the type of ad you are replying to. There are two major categories that you should reply to: houses for sale and houses for rent.

Let's first talk about the houses for sale.

When replying to someone that has a house for sale, I recommend working through your basic script and filling out a Property Information Form so you can gather all the information you need for determining what you should offer to purchase the house. Most real estate courses and many real estate investing books come with a Property Information Form and a general script for gathering this information. You can also get one from the Wholesaler Control Panel if you are learning about how to wholesale real estate with my program.

The process is simple. Find ads for people that have houses for sale and call them to gather information about the property. Go out and actually see houses that are interesting to you (based on your deal analysis criteria).

Should you call houses that are listed with real estate agents/brokers? Personally - I think that you should, for many reasons that I will not discuss here - but it is up to you to decide whether to focus solely on For Sale By Owner or if you will consider buying a listed property if it is a good deal as well.

Let's move on to a much more powerful method that far fewer people are utilizing: calling for rent ads.

If a seller, or their agent/broker, is doing their job, they should be marketing the property like crazy to generate the largest volume of qualified calls. That's not the best thing for you as an investor who is trying to buy the property with as little competition as possible. So, what's great about calling the "for rent" ads to try to find sellers? Many of these people would be sellers, but have convinced themselves, for any of a dozen plus reasons, that they need to rent their property(ies).

If you call inquiring about the rental property and ask if they'd be willing to sell the property too, you often can find a few people out of ten that are interested. These are houses you can buy that are often not being advertised anywhere else... no one else in the world knows they're for sale except you and the landlord (now also called the seller).

The way you handle these calls does make a difference, but your personality is different than mine, so I will allow you to find your own comfort zone. For me, I inquire about the generalities of the property. Early in the conversation, I explain that I am a real estate investor. Depending on how the conversation goes, I might first ask about renting it with an option to buy. Or, I might also ask if they would sell it outright. Sometimes I get to this point by asking about
why they are renting it to begin with. They may tell me that they could not sell it quickly in the current market or that they bought another house and couldn't afford two mortgage payments so they found a tenant to help cover their note. These are all great reasons for you to buy it.

Since we already know that the seller was willing to rent, we know that they can afford to accept monthly payments (at whatever the rent amount was). In future articles on deal analysis, I will talk about specific offers that you can make if you know that the seller can afford to take monthly payments and doesn't need to be cashed out. This makes calling on "for rent" ads even more powerful.

With all the properties for sale and for rent in your market on CraigsList and the research and other work that goes into determining what to do with each house you get information on, you could easily book your day solid dealing with motivated sellers with only this one method of finding deals.

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