Investment Property Acquisition

 

What to Bring When

Speaking With a Potential

Seller 

 

Although we hope that substance beats style in any industry, there are certainly some areas where style is a major factor.  Real estate investing, like it or not, is one of these arenas.  The truth is, a seller is more likely to sell his property to the investor who looks professional and makes a more convincing presentation, as opposed to the investor who appears casual and shows up to the house with nothing but the intent to buy.  Here is a list of things that should be included in every investor’s “investment packet” when approaching a potential deal.

      The first page of the packet should be a letter of introduction.  This should briefly tell the seller who you are, what your company is all about, and provide a list of the benefits of working with your company (these could include no commission fees, buying as-is, working with a proven group with a lot of experience, etc.).  By the end of your letter of introduction, the seller should feel confident about entering into discussions with you, even having heard nothing at all about his own property—yet.

      In order to distinguish your company and your deal from the competition, consider including unconventional benefits in your packet such as coupons.  Coupons can be very effective, because although they provide for relatively small transactions (when compared to the likelihood that you are actually buying a house), they help save on common expenses which the seller is bound to encounter anyway.  For example, include a coupon for a fancy dinner for two and drinks at a nice bar, redeemable when the deal is closed.  Or a coupon for two to an all-day spa.  Your company will end up paying $100-200, but only once the deal is closed (and the deal is bound to make you quite a bit more than $200).  You will be amazed at how enticing these little perks can be.

      One of the most convincing sections of your packet should be the testimonials.  These are statements from former clients and customers, filtered (by your company) to select only the rave reviews, the ones which state what a pleasure it was to sell to you.  Obviously, if your business is new and you’ve not yet accumulated testimonials, you can’t include them here.  Sellers tend to be cynical in that it is difficult to take the presentation of a buyer at 100% of face value.  However, if you provide quotes from people in the same position as the seller, who walked away not only satisfied but elated, the seller is more likely to put his faith and property in your hands.

      Another effective tool is a worksheet which provides the seller with the likely cost of trying to sell his house on the open market.  Although this is impossible to calculate with certainty, your company can present a typical scenario in which agents, realtors, brokers, appraisers, etc. are involved (and paid!), and how much more expensive that will be for the seller than simply selling the home now to an investor, at a slightly reduced rate which will still save the seller money on the fees he would likely otherwise face.

      Finally, include some of your business cards for referral.  Putting together the packet may sound like extra work, but it really only takes a few minutes, and it can be used countless times on every deal you try to close.  The cost-to-sell worksheet must be amended, but aside from that it is highly standardized, and guaranteed to provide an extra edge to your presentation and deal, over the competition. 

      Let us know what you think. J

 

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