I don't have to tell you that selling houses nowadays is difficult and painful. The market has changed, the rules have changed. And if you don't change your strategies, then you will go by the way of the dinosaurs - extinction!

Charles Darwin said that it's not the strongest or the smartest of the animals that survive but those who are fastest to adapt to their changing environments. The market is ever changing. For starters...

1. Prices are declining. How do you evaluate what the property is worth when its value is going down?
2. Buyers are scared of buying and waiting for even better prices (because of number 1 above)
3. Financing is still hard to come by despite the bail out money and the $8,000 first time home buyers' credit. Why? Banks are stricter with their lending guidelines sometimes to the point of being illogical about it (I've heard horror stories of people with 700+ credit score and 20% downpayment being denied for loans!)

SO how do we adapt to this kind of environment? I gave a webinar to my students where I gave them, in detail 5 tips on how to sell in this market. I drew from my own experience and the experience of other real estate investors who are still selling houses in this market. In this 10-part blog post - spread out over 5 weeks, I will outline, in broad strokes, the 5 ways of selling houses FAST in this really slow real estate market.

What is TIP # 1? Tip # 1 is so simple yet profound. When I finally understood and more importantly apply this principle in my real estate investing business, all my selling troubles evaporated literally overnight. Just when the market turned around for the worst, I was trapped with 3 houses I just couldn't find buyers for. Good thing I was just wholesaling these houses so I have no loans or mortgages to carry. However, I lost my earnest money deposits on these deals. I lost $3,000. Ouch.

So what did I do differently? Tip # 1 is this - FIND BUYERS FIRST. That's right. I told you it's awefully simple yet the ramifications of this principle is profound. How do you do this exactly?

For one, depending on what you do in your real estate business, you could have three or even four different types of buyers. These are:

1. Landlords
2. Renovators
3. Retail or end buyers
4. Tenant/buyers

Landlords want houses they can renovate quickly or inexpensively so they can rent these houses with a good Return on Investment. They don't spend as much as the renovator in rehabbing these houses and they can sometimes pay a higher price than renovators. Landlords with the cash are KINGS in this market. Why? People can't get financing but they need a place to live and so they end up renting. Hence, landlords flushed with cash are making a killing in this market. They are buying low and so their cashflow and cash-on-cash return is awesome. If you're a wholesaler, how do you find landlords? Drive around and call For Rent signs. Then ask them if they're still looking for properties to rent out. Attend your local real estate investors meeting and network with landlords. Ask property management companies or leasing agents to refer you landlords that they are working with or working for. Tell them that you can provide properties to their landlords - and if they manage or lease these properties, they will generate more income. You can even give them a referral fee as an added incentive.

Renovators are also in the market albeit their numbers have significantly dropped over the past 2 years for obvious reasons. They are still out there. How do you find them? Check out Craigslist website in your area and look for keywords such as "new", "like new", "newly renovated". Renovators look for properties they can buy cheap and are in good areas where people are still buying houses. They generally don't care about the extent of rehab or renovation unlike the landlords. How else can you find these renovators? Check with real estate agents in your area. Some of these renovators list houses with real estate agents. Ask around. You can also attend foreclosure auctions. Pass out your business cards to the people bidding in these auctions. Some of these are renovators.

Retail or end buyers are buyers who will live in the properties they are buying. They pay a higher price than landlords and renovators. To them, being able to afford the monthly mortgage payment is crucial. Also, they are looking for properties that are already renovated or liveable. To them getting financing is crucial. You are looking for qualified buyers who are ready and able to buy. How do you find retail or end buyers? Ask mortgage brokers or bankers for people who are applying for mortgage loans or who are already pre-qualified. You can also ask real estate agents for any buyers they are dealing with.

Lastly, we have tenant/buyers. These buyers will pay the highest price among the 4 different buyers we've discussed. However, they can only afford to give you a small downpayment (anywhere from 1% to 5% of the sales price) and to them, like the retail buyers, being able to afford the monthly payment is crucial. The difference between them and the retail buyers is that they are technically renting the house from you with the option to buy it at some future date - typically anywhere from 1,2 or 3 years. How do you find these tenant/buyers? One way to do this is posting a "blind" ad in Craigslist like "Why rent when you can own? 3 bed/2 bath home, $1000 a month. $5,000 moves you IN even if you have bad credit!" The people who will email you back are tenant/buyer prospects.

If you take the time to look for qualified buyers first, you will save yourself valuable time and money because if you have buyers lined up, selling becomes a NON-ISSUE. In fact for me, I have 5 cash buyers (renovators) who are ready to buy 10 houses from me NOW and my problem is finding enough properties for these buyers fast enough. What a great problem to have!

SO, apply this principle right now in your own real estate business!

Dedicated to your financial success,
Trace Trajano
blogspot: tracetrajano