You are in real estate to make money, right?

Yet, the irony is that today so many businesses are making it increasingly harder for potential customers to give them money.

The slower money comes in, the higher the risk you will run into cash flow shortfalls, and miss out on the best buying opportunities.

The harder it is for buyers, renters, and investors to give you money, the lower the value of your product and service to them, and the higher the likelihood that they will just go fuel your competition with their capital instead. Today, convenience is even more important than price. Otherwise we wouldn’t have companies like Uber Eats, Doordash, and Instacart, all valued at over $20B.

Critical Mistakes Not To Copy For RE Pros & Businesses

One of the biggest problems in this industry is that so many otherwise highly intelligent real estate professionals and business owners think they ought to copy the competition, who they view as being successful.

Odds are that you don’t really know what’s working internally for others, or how broke they really are, and where they are bleeding money and customers.

Today, what is even more important than how many people are buying from you and giving you money, is how many are not, and who are going to feed your competition with more money to use against you.

Payment Options

Are you providing the payment options that work for your customers and are giving them the flexibility they need to pay you fast and consistently?

That may include Paypal, personal checks, bank wires, Cashapp, Bitcoin transfers, cash, or incorporating Buy Now Pay Later. Whatever your business model, incorporate as many as possible.

There should never be an excuse for them not to give you money.

Messy Websites & Detours

Some website operators appear to think that if one popup ad doesn’t work, it will work better if they throw up 5 or 10. More often than not, this is just going to turn off prospects instead.

You want to remove all roadblocks and streamline them purchasing from you, not add more hurdles.

Make sure your buy now button is big and obvious, and the process is simple.

Many sites now force people to sign up or register, which just sends qualified and serious prospects to the next competitor.

While list building can be useful, data is also becoming a bigger risk for businesses to collect as well.

Customer Service

Forget wasting money on expensive automated phone systems or chat bots that just drive customers crazy until they quit trying.

Whether you are renting or flipping real estate, investing $15, $33, or even $60 an hour for an on demand live phone rep to provide human service can more than pay for themselves. Especially when you consider the alternative is missing out on a $1,000 rent check, or $40,000 plus profit on a wholesale deal.

 

Successfully flipping real estate deals in 2018 relies a lot on finding end buyers with the financial means to purchase properties. The more that flippers and wholesalers can help prospective buyers find and connect with financing, the more deal volume to be done, and the faster they can be flipped.

Here are seven ways your flipper, rental property, and retail buyers can fund their purchases from you this year.

IRAs & 401ks

There is a lot more awareness of the ability to invest in real estate through self-directed retirement accounts today. Others still need to be turned on to the option. Though many more may begin to use these account options as the stock market continues to inflate and stocks become more expensive.

1031 Exchanges

Some US real estate markets appear to have matured, as have some individual investments. By using a 1031 exchange, investors can acquire your deals, while deferring tax liability on their gains.

Private Lending

Investor buyers without enough of their own cash and capital can find that individual private lenders are still the best option for financing. These lenders can be far more aggressive in terms and loan amounts, and are typically far faster and easier to work with.

Hard Money Loans

These loans are great for those who don’t want to deal with the hassles of conventional mortgage loans, or may be buying properties with repair needs that fall outside of conventional underwriting requirements.

Rehab Loans

Whether from investor specific lenders or the FHA 203k loan, there are great funding options for acquiring houses at a discount that need some repairs or updating.

Low Down Payment Loans

While investor loan LTVs have risen to 90% and even 100% in some cases, regular home buyers are also finding more and more low down payment options as well. This ranges from government loan programs like USDA and VA loans, to those offered by mortgage lenders like Flagstar which can be combined with local down payment assistance programs.

Seller Financing

Seller financing is still one of the best ways to ensure fast resales at maximum resale prices. That may be a low down payment large first mortgage, or carrying a second mortgage loan.

It’s a hot time for investing in real estate and there is no question these are not just the optimal conditions for flipping houses, but perhaps the best we have ever or will ever see. Unfortunately, the dramatically improving U.S. housing market is giving many the same idea and competition for homes is heating up.

Nationally foreclosures have fallen some 30% since February 2012 and the National Association of Realtors reports buyer traffic up 40% as of the beginning of 2013, while pending homes sales continue to rise.

This is causing multiple offer situations to rise rapidly from coast to coast. We are no longer just taking about 3 or 4 offers coming in on homes over a period of weeks. Realtors are frequently reporting a dozen of more offers within hours of homes going online on the MLS. In one of the most dramatic cases recently a West Coast real estate investor reported going up against 80 other cash offers and even bidding $15,000 to $20,000 over asking price with little hope of even receiving a counter offer.

So how can investors bid and win in among stiff competition like this?

With at least 30% of all real estate transactions being in cash today it is clearly a disadvantage not to be able to act as a cash buyer in this market. Fortunately using transactional lenders can enable wholesalers to effectively act as cash buyers with flash funding and Proof of Funds letters to back them up.

Sometimes it’s about price, other times it is just matching the seller and their agent’s desired timeline and quirks. Often they want to see higher deposits or fewer contingencies to prove how great a prospective buyer you are or it might just be a matter of spinning your personal story.

Another major part of this issue that many don’t understand is that Realtors often refuse to even present offers unless they are gaining both buying and selling side commissions and are effectively doubling dipping. While this certainly isn’t fair for the seller who is normally unaware, the best tactic for overcoming this is to make more direct Realtor connections and make sure you are always dealing with the listing agent, not a buyers’ agent.

Another major reason for such dramatic bidding wars is often the price range and property type investors are targeting. Their focus is often on the ‘bread and butter’ 3 bedroom, 2 bath single family home that also butts heads with the 30% of the market that is made up of first time home buyers. Perhaps targeting a different price range or property type could yield better deals with less competition.

Note that there are also many areas of the country where foreclosures are still spiking by double and triple digit rates and could offer many more choices and bigger discounts. This includes Washington, Florida, New York and others.

Of course switching acquisition strategies from bidding on publicly marketed properties to targeting off market properties and homeowners directly can also make a world of difference.

As the housing market improves all sorts of tempting real estate investing ideas get floated and become more ‘attractive’ from rehabs to rentals to getting into new construction, subdividing land and even investing in real estate stocks but there are at least 7 good reasons investors may be wiser to stick with wholesaling…

1. Rehabbing Can be a Nightmare

There are profits to be had from rehabbing and fixing up homes and it can be fun but you never know when a project is going to turn into a complete nightmare, money sucking pit which puts you in the hole.

2. Holding Properties is Risky

Every day a property is held means exposure to more risk. There is risk from natural and manmade disasters, vandalism, bad tenants who kill cash flow and changing in the market. Wholesaling real estate and flipping properties means being able to eliminate all of this.

3. Faster Returns

Being able to turn around a property in a day or even 3 days means an incredibly short cash cycle and rapid paydays. This means the ability to do far more deals a month and year, dramatically driving up income potential.

4. No Need to Take on Partners

It can feel a little more cozy to have someone else coming along for the ride but partners pose all sorts of potential issues and you never know when even the most apparently concrete partnerships will fall apart for a variety of reasons leading to big losses.

5. Growing Opportunity

As more real estate investors and home buyers gain confidence and jump into the market they need a source for good properties just like you. Don’t compete; serve them.

6. Minimal Risk of Lawsuits

Lawsuits, even bogus, malicious ones which end up going nowhere can be extremely expensive and stressful for real estate investors. This risk often comes from repair work done, missing seller disclosures, tenants and others being injured on properties and more. Just avoid it.

7. Easiest Deals to Finance

Wholesale real estate deals are the easiest to finance. By using transactional funding there is no need for jumping through the endless hoops that come with qualifying for conventional mortgages or having to burn significant resources to find private mortgage lenders or even getting burned by crooked seller financing deals.

How can you build big buyers’ lists of your own to flip more real estate faster?

Having lists of potential buyers to market to easily, quickly and cost effectively makes flipping houses a breeze and puts bringing in large lump sums of cash on autopilot.

Investors who have access to plenty of buyers can flip all the homes they want by capitalizing on transactional lending for 100% financing for their real estate deals.

Buying leads used to be much less expensive and far more reliable but it is no longer viable or highly profitable for most real estate investors. Fortunately there are at least 7 other methods for cultivating sizable lists of home buyer prospects for less…

1. Website Opt-In Forms

Building email lists via website opt-in forms is one of the most popular methods today. This can be done by offering newsletters or reports in exchange for email addresses. However, in order to be effective must be prominently placed and flow prospects further into the funnel.

2. Blogging

Blogging is a great way to both attract new prospects and build a list of prospects for ongoing marketing. Plus it also makes it easier for visitors to share your real estate services with others.

3. In-Person Networking

Everywhere you go there are people who want and need to buy houses. Plus, no matter where you live there are bound to be at least several professional networking events hosted every month. Don’t try too hard to close the deal on the spot, focusing on collecting contacts and setting appointments.

4. Put on Events for Home Buyers

Hosting home buyers education classes, as well as seminars, webinars and expos can all be great ways to draw hundreds or even thousands of buyers at one time and capture all of their contact details.

5. Social Media

Social media networks offer an easy and even fun way of building huge buyers lists very quickly and often without huge investments. New home inventory can be instantly broadcast across social networks to fans and followers wherever they are, though savvy real estate investors will also set up systems which demand more visitors lock in and provide alternate contact information for other forms of reaching them as well.

6. Signs

Using toll free numbers or text messages all types of signs can be used to capture caller information and alternate contact details for alerting buyers to the availability of future deals.

7. Use Other People’s Lists

Real estate investors often get frustrated at the time it takes them to build sizable lists of their own from scratch while more resourceful investors have found that they can actually cross promote with other companies and tap into their lists immediately, often without shelling out an upfront investment.

The last two months have seen an incredible rise in the amount of foreclosures being filed and the number of actual repossessions being followed through on. Add to this 2 million more foreclosures expected in 2012 and the real problem for most real estate investors is not a lack of discounted homes available but how to finance them.

It is no secret that mortgage financing has become incredibly tough to get these days. Besides a slew of new regulations banks are still afraid to lend and are being more cautious than ever about the loans they take on. They want zero risks. Even though there has been a recent spike in activity among subprime securities new rules make it virtually impossible for true subprime lending or exotic mortgages to make a big come back anytime soon. So where should real estate investors be turn for funding for their flips?

Sadly ‘hard money’ lenders are no longer anywhere near as easy to work with as they once were. Besides tons of equity in a property they now want to check credit, income, assets and require investors to have a proven track record before they will lend to them. Then they still want to charge ridiculously high double digit rates and points.

Fortunately a new option has emerged. Transactional funding has been created as the perfect alternative for investors flipping houses. It means no more jumping through hoops and far faster funding of deals for shorter cash cycles. What are the advantages of using transactional funding?

• No appraisal required
• No income verification
• No asset verification
• No employment needed
• Fast closings
• No pre-payment penalties
• Less paper work

Think it sounds too good to be true? What’s the catch?

Thousands of savvy real estate investors are using this type of flash funding to finance their deals every week. Though of course there is one catch. That is investors must also have an end buyer lined up who is qualified for a loan or has the cash to complete the transaction.

This really isn’t that difficult at all, especially as smart investors know they should have an exit strategy planned before they buy a property anyway.

These buyers can range from those looking for a new residence or second home to buy and hold investors who will rehab and rent them out. With a little regular networking and a good Internet marketing campaign for driving buyers to your opt-in list you too should be able to build a good sized list of potential buyers a lot faster than you think.

Valentine’s Day is one of the best days of the year for real estate investors. How many deals did you do and how can you take it up a notch for next year?

What better Valentine’s Day gift could there be than keys to a new home, romantic vacation getaway condo by the beach or retreat in the mountains? Without out a doubt it will be a Valentine’s Day to remember and the next person in line will have a hard time out doing you, that’s for sure. It’s probably one of the easiest sales any real estate investor will ever make and it comes at the perfect time of the year when tax refunds are rolling in, snowbirds are flocking to resort areas and consumer’s pockets are recovering from the Christmas holidays.

Of course marketing your homes to the Valentine’s Day crowd just a few days before is probably far too late, especially if those you are flipping homes to require financing. Those who can afford to gift properties for occasions like these are probably mostly allocating their budgets well in advance. Think about starting to market your homes as Valentine’s Day presents as early as the end of the year, especially when so much bonus money is floating around.

While incentives are generally a bad habit to get into when it comes to flipping real estate, this is one occasion that is clearly an exception to the rule. You probably saw the $10 Pizza Hut deal rocketing to $10,000, well why not use the same strategy for your real estate deals? You can offer an entire theme or event for those gifting keys to new properties on Valentine’s Day complete with wrapping the home in a giant ribbon, decorating the inside and perhaps even setting up a romantic catered meal for two in the new digs to celebrate. How much of a premium could you put on your properties then?