Where did you find your first deal?

Question

I've been looking at and making offers on duplexes and some single-family homes for about 6 months now. This will be my first property and I'm looking to do a house hack or find a single-family that needs some work in a good area of my city. I've made about 10 offers and almost every time, have been beaten by an all-cash offer or someone forgoing an inspection and closing faster than I'm willing to.

I know 10 offers in 6 months isn't a crazy amount, but since this is my first property I'm being quite cautious. I've also pretty much exclusively found these properties through the MLS.

For those of you who have done 1 or multiple deals, how did you find your first one? Is this just par for the course? Do I need to lower my standards or try to find alternative ways to source deals?

David Krulac · Answer

@Caleb Graham I've bought and sold over 1,000 properties for my own inventory.  I talked about the first purchase in bigger Pockets Podcast #82.  I looked for months, and looked at SFH, apts, houses on leased land, mobiles homes and everything that was cheap because I had so little money and had just started a new entry level job 9 months earlier.  Houses/properties that I liked I could not afford, and properties that I could afford I did not like.  I looked at MLS property, FSBOs, private ads, signs on properties, word of mouth, everywhere I could think of/find.  A co-worker told me of a house being auctioned on his street (a cul-de-sac).  It was owned by the state highway department and was originally bought to put in a limited access highway interchange.  The neighbors protested the interchange emptying into the middle of a subdivision and cause the state to redesign the highway.  They ended up owning the house for 7 years and renting it out for below market rent before an act of the legislature and the signature of the governor before it could be sold.  It was poorly advertised and I might have missed it if not for the co-worker.  It was newer, and nicer than any of the other places I looked at. I had never been to any auctions and never bought any real estate, yet prevailed at the auction, buying a 17 year old brick 3 bedroom house with hardwood floors, ceramic baths, and a brand new roof.  I could not have bought a better house and first house hacked, then rented the whole house and kept for 24 years.

Michael Brattelli · Answer

@Caleb Graham I drove around the neighborhood I wanted to buy in (lots of multi family). Wrote down all the addresses. Then went in to public records to see time if ownership, ruled out all the separately owned twins and made a priority list. From there I went to white pages to get phone numbers and started calling owners. Some people are open to selling and just haven’t thought about it. Keep in mind if you’re not a licensed agent this may be a little harder to do so I would find a local agent to help you, they could be a younger hungrier agent even. It dosn’t take that much time so it shouldn’t be hard to find someone to do the public records part of it.

Alecia Loveless · Answer

@Caleb Graham Most of my deals have been from the MLS. On my latest deal that I’m currently working on my contractor hooked me up with another investor he sometimes works for that was looking to sell.

I own another property across the street from the new one so it’s a really good fit.

Network, network, network.

Also I find that when I search the MLS every night I find the new listings 2 days earlier than they come to me in my automatic searches.

If possible attend real estate meet ups. I live about 2 hours from my closest so this hasn’t been much of an avenue for me but others swear by it.

Austin Steed · Answer

I've found that some of my best deals have been off market with older investors that are wanting out of the game. These deals have been direct to seller and sometimes I've put 5-10k hard earnest money. I've closed all the ones I've done this with but locking it up at a good number is most important.

I've even found deals by calling on for rent signs in an area and just asking if they would entertain an offer.

Ask, text and email. Count your no's and eventually you'll get a yes

Wale Lawal · Answer

@Caleb Graham

To find your first property, network with local investors, expand your search beyond MLS, and work with a real estate agent. Prepare for competitive offers by getting pre-approved, having a proof of funds letter, and being flexible. Source deals from wholesalers, auctions, foreclosures, short sales, and real estate auctions. Stay persistent and learn from unsuccessful offers.

Good luck!

Sarita Scherpereel · Answer

The MLS. Especially right now, when it's such a strong sellers market. Most seller's get more than what they'd expect on market verses off market deals. It's obviously depends on the market you're buying it. But for non-distressed properties that qualify for owner occupied financing the MLS is a great resource. Your realtor should also be working with you to find more opportunities if the MLS is lacking. Make sure your team is investor friendly.

Where did you find your first deal?

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