Build A Better Buyers ListBy Paul Esajian on May 10, 2019
Every investor should have a solid list of buyers they can turn to in the right situation. Whether your primary concentration is wholesaling or not you never know when there will be a deal you need to pass along. Instead of blindly scrambling to find a buyer you should have an already established list of contacts you can reach out to. Without this, you will be forced to consider the next best offer you can find and won’t be able to maximize the opportunity.
Your buyers list doesn’t have to be overly large, instead it should have a handful of people you know and trust. It is not hyperbole to say that the stronger your list of buyers the stronger your business will be. Even if you only need a buyer once a year it is easier to build as you go than find when you need. Here are four tips to help build a better buyers list.
- Data Retention: Every new contact you meet should be put in a dedicated file you can retrieve at any time. Where most investors get in trouble is not thinking they will need a potential buyer on any of their projects. They disregard solid contacts and fail to store the information properly. As simple as it sounds everyone you meet that you think is a buyer should be stored somewhere. Technology has made it easier than ever to keep information, but any way you are comfortable doing it is fine. As long as you have all the data you need either in a notebook or a spreadsheet you are ahead of the game. You should add a contact within 24 hours of meeting them. In many instances you will meet someone at an evening networking meeting forget about it in the morning and then a few days will pass before you remember. At this point, the specifics of the conversation are lost, and the data is watered down. The bigger the pool of names in your buyer pool the more likely you will find the right buyer when you need them.
- Get Specific: OK, so you strike up a conversation at a local networking meeting or investing event and you discover that the person you are speaking with is a real estate investor. Instead of asking them about their home run deals or biggest disasters, ask about their investing profile. You don’t need to run to your car to grab an application, but you should find out enough about to know what they like and don’t like. Ask about location, price points and style of homes. Tell them that you are a fellow investor and that a few times a year you come across deals that you can’t, or don’t want to do, for a variety of reasons. Any serious investor won’t have an issue answering a few questions that can help generate significant income. In fact, they should welcome the fact that you are willing to consider them on prospective deals. The more you know about what they want the easier it will be to match them up with deals when you get them.
- Communicate: Even the busiest real estate investor has some down time over the course of their week. You should use this time to reach out to the buyers in your spreadsheet. Staying in contact not only gives you some credibility, but it strengthens the relationship. An email is better than nothing, but a quick phone call is better. Tell your contact you are just reaching out to say hello and to make sure they are still interested in prospective deals when you get them. 99.9% will say yes and the .1% that is too busy to talk or doesn’t remember who you are you can take off your list. By calling your list every few months you will be surprised at just how big an impact it has. It will lead you in directions you had no previous interest in. Someone may ask if you have interest in a project they are doing or if you know a hard money lender, etc. The most basic thing you can do to fortify your buyers list is to stay in contact with them. A 90 second phone call once every three months will do just that.
- Cap Opportunities: Regardless if you are trying to sell a rehab property or simply looking to flip a wholesale deal, your goal is to find a buyer. Your first instinct would be to blast your opportunity out to as many people as you know and wait for people to pour in. Sure, this may ultimately work but if you are looking to build your business this isn’t the best way to do it. You are better off sending it out to a few people at a time. Start with the people you have done business with before. Ask them if they are interested and tell them you are offering them an exclusive window to make a decision. Next, move to buyers where the property fits what they are looking for, but you haven’t worked with them previously. Always be upfront with the competition involved and be clear on what you want from the transaction. Puffing the numbers up to make the deal look better than it is will only come back to bite you in the end. Real investors know the numbers and you will lose credibility by exaggerating them. Only after your top buyer’s pass should you open the deal up to the masses.
You should not underestimate the power of a solid buyers list. If you are in real estate long enough, you can bet that eventually you will have a property you need to find a buyer on.