Investment Property: Showing Properties and Finding Tenants

   One of the most frustrating elements of being a real estate professional is reading between the lines to determine the nature of a person’s intentions.  This is true at every level of the game—you have to investigate 100 leads before you find one good one, you have to go through 20 deals before you close one, and you have to schedule 50 open house appointments before you find a qualified tenant.  Understanding one universal behavioral trend of people will save an enormous amount of time, money, and frustration when dealing with this last category: people only show up about half the time.

      This means, for any given property and no matter how many appointments you set up to show that property, only about 50% of those appointments will actually be met.  While it is up to the owner how he wants to show the property, there are a few considerations which should be made in nearly all cases, with this trend in mind. 

      The first is, never hold an open house.  This is not to say you can’t invite 100 people to look at the house at the same time—just never call it a come-one, come-all “open house”.  No one shows up to an open house, because it is too impersonal, and potential buyers/renters fear the competition.  Invite every potential buyer/tenant by personal appointment, even if you end up inviting 20 people to the same time slot.  After all, the 50% rule states that only 10 people will show up anyway.

      Never, never set an appointment time for just one person.  Half the time, no one will show up, and you will end up wasting your time and money waiting for nobody at an empty house that you already own.  There is nothing wrong with showing a property to five different parties simultaneously; if you get used to operating this way, then get used to having more free time and money because of it.

      If you want to go one step further in saving time and money, consider using a lock box to show the home (only if the home is in a nice neighborhood where you feel comfortable with the population of potential buyers/renters).  Basically, a qualified tenant will inquire to see the property, you will provide the code to a lock box, and they will retrieve the house key from that lockbox to show themselves the property.  Obviously, this requires trust, but it bears the potential to close a deal without the owner having to show up at all.

      These are just a few strategies for showing properties, among the myriad that are out there.  When choosing a strategy, remember to “look out for #1”; that is, don’t be the victim of a potential tenant’s indecisiveness or deceit.  Preserve your interests, schedule numerous appointments at the same time, and understand going into the process that only about half of the people you deal with will show up when they are supposed to. 

      Tell us what you think. 

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