As most people know hurricane/ tropical storm Harvey has left a path of destruction in Texas and Louisiana. Now, only two weeks later, hurricane Irma is projected to hit Florida. These disasters do not come around as often as a foreclosure, fire, broken pipes, job loss, deaths or a number of other things but all these are life changing events in people’s lives. Keep this in mind when making an offer on their home.
The easiest way to make a profit in real estate, much like most things, is to buy low and sell high. If you are sourcing your own deals and speaking directly to these sellers you need to fully explain the reason behind your offer.
Make sure they know and understand that you are not taking advantage of them and kicking them while they are down. I have sellers tell me about other investors that visited their home, made a low-ball offer and left. These guys are playing a numbers game so they are in and out but if they took a bit of time to actually meet with the homeowner they would buy more. Many times these sellers just need or want someone to talk to or to vent.
They don’t want to vent to their spouse or children because the seller does not want them to worry. They don’t want to complain to their friends or co-workers for fear of looking or feeling weak or being judged. So, the next best option, if the investor decides to listen, is the investor who is usually a stranger and has seen these issues in the past. By doing this I have bought homes for the same price the other investors offered but I took the time, listened and explained the reason for the offer.
To all the wholesalers out there, please listen and listen good, DO NOT sign up a contract if you are not capable of getting the deal done. Know and understand that the moment you execute a contract with a person trying to recover from a disaster, or going through one, that you are literally dealing with a person’s life. Do not add to the disaster by making things worse. I have seen wholesalers contract a property that had no funds to close, they did not have a buyers list, no marketing plan and they contracted the property for a price that a landlord wouldn’t even pay.
Luckily, in this situation, the owner contacted me, told me the situation, put me in contact with the wholesaler and we closed on the home a few days from being foreclosed. The sad thing is there are many times a knowledgeable investor and/or wholesaler is not brought into the picture to get the transaction to closing. These houses are lost to foreclosure when they could have been saved and the homeowner’s credit is ruined and will affect them for years in all aspects of life. Will there be times when a deal cannot get done? Yes. But make sure you are ready to take on this type of responsibility and seeing it through before signing.
While we are all looking to make a profit at the end of the day we are in the people business. If you are great at running the numbers and doing the analysis part of the business but not great with people, you may consider partnering with or hiring a person to do the face to face meetings. Keep in mind that the win-win business is the best business to be in.