No matter what strategy you're using, if you need a buyer, it's very important to have a list of ready buyers already in place. This buyer list can yield your buyer very quickly, and your holding costs will be much lower by selling the property in a hurry. So, how does one go about building an effective real estate investor buyer list? What does effective mean in this case? An effective buyer list for the real estate investor is one that has both retail prospects and other investors. It doesn't require that the retail buyers have good credit or down payments. In fact, some of the most successful strategies involve lease purchase or creative financing to get these credit and cash challenged people into a home.
Recognizing that other investors have their own goals and requirements opens up opportunities. A large percentage are buying for long term rental profits. Many of these investors will not be as aggressive in locating deals as others, and there's an opportunity to bring them homes ready to rent with a positive cash flow. Some investors are even advertising and getting the tenant first, bringing a turn-key profitable rental unit to the other investor. Let's look at tools and tactics to fill up a buyer list with good prospects.
Newspaper classifieds head up this category. It's inexpensive to run a line ad in the classifieds, and this makes it possible to run one consistently in the same section or area. This repetition is necessary, and you'll find that responses will come from people who say they've been seeing your ad every week for a while, and just decided to see if they can afford a home. Running ads with statements like "Credit Problem - you can buy a home now" or "No down payment homes available" will bring calls.
Of course, the old standby business cards and small flyers are also print media that still work. Whether you hand them out personally, tack them up on community bulletin boards, or place them in waiting rooms, people will pick them up. Once they contact you, they go on your buyer list.
Sometimes called "bandit signs," you've seen them stuck in the ground in yards or at street corners, and saying "I buy houses." Well, "No money down homes" will work just as well. Any variation of a very short statement that says you have homes for sale is a sign that can work for you.
This is just like the classifieds but it's free! And, because people can search in Craigslist for key phrases like "no money down home," you can attract phone calls and add people to your real estate investor buyer list from Craigslist ads. But, there's another way to build your buyer list with this resource. Go on yourself and do searches for people who are running ads that they want a home with low cash down, or they want a home with a low credit score. You can find them now and then and make the first contact.
Join Investor Clubs
While the previous tools are mostly focused on finding non-investor buyers, you can also use them for locating other investors. But, a great resource will be going to places where they congregate. Investing clubs are in most areas, and they are full of other real estate investors, some of whom may be good buyers for your properties. Just getting into conversations to see who is buying for long term rentals will add to your buyer list.
Your real estate investor buyer list can become one of your most valuable tools for real estate investing profits. Build it, maintain it, and use it.