Finding Good Motivated Sellers

Finding Motivated Sellers can lead to special sales on properties

Finding Motivated Sellers can lead to special sales on properties

Of course, one of the best ways to get a good deal as a real estate investor is to find a property that you can buy for under market. And, most of the time, when you find a property that you can buy for a price that is lower than it’s market value, you’ve found a motivated seller.

Keeping with the theme of last week’s blog post and website article on buying rental property from motivated sellers, I thought I would make a quick list of possible reasons why someone would be willing to take a lower than market price and whether this is a property to buy or not:

  • The property is condemned and the seller has to get rid of it. The Globe and Mail had an article in it yesterday about how the City of Calgary wants grow ups cleaned up or destroyed. There are almost 100 properties that will have very motivated sellers if you were willing to buy those properties – but unless you are looking to develop the land those properties are on, that is a property you can buy for under market value that you probably don’t want!
  • The house is priced under market because it needs a new roof and new wiring and the cost of making those repairs exceeds the difference between the price you’ll pay and the market value. In other words, you can buy the house that is worth $200,000 for $180,000 but you have to spend $35,000 to make it actually worth $200,000. That kind of motivated seller is not the kind you want to buy from. If, however, the house required $35,000 in work, and you can buy the property for $160,000 AND you happen to be friendly with an electrician that can do the wiring for a lower cost, then you have found an opportunity.
  • The seller is desperate to sell because of divorce, job loss, another home purchase, or some other personal reason. We’ve already mentioned that this type of motivated seller is a good one to find. You are helping them out by buying their property from them and solving their problem – and you get a good deal on the property for coming to their rescue.
  • The resale market is terrible, and houses just aren’t moving (sound familiar to you?). The house is really worth $350,000 but the seller doesn’t want to wait until 2010 to sell it, so they will sell it to you for $320,000.

Remember, when you are looking for properties that are being sold by motivated sellers, always find out why the seller is willing to take a lower price. If you find a property that you can pick up for less than a market price, DO NOT buy it unless you are sure you know why it is priced below market! If you need a reminder about why you should do that – just look at the pictures of the property we bought in Toronto from a motivated seller that was motivated to sell their property before it totally fell apart!

Free Email Newsletter on Real Estate Investing

Free Email Newsletter on Real Estate Investing

Learn the secrets to becoming a millionaire real estate investor…in your spare time.

Get the Rev N You with Real Estate Starter Tips Guide free when you sign up for our complimentary Rev N You with Real Estate e-zine.

Get started real estate investing today.

7 Comments

Filed under investing, real estate

7 responses to “Finding Good Motivated Sellers

  1. Pingback: Carnival of Real Estate #130 – Shares Prospective on the Stimulus Bill and More | vFlyer Blog

  2. Pingback: Article Featured in the Carnival of Real Estate #130 « Life as Real Estate Investors

  3. liverealestateinvesting

    A real good target for motivated sellers for me is Absentee Owners. I have had great success targeting them with a direct mail postcard.

    Another good method to find motivated sellers is probate. The hard part about probate is that you have to really stay on top of it or else it wont produce the results needed to make it worth while.

    • That is a great point!! Absentee owners are great place to find potentially motivated sellers. Many times they’ve stopped thinking about the property and are happy for an easy solution. Properties owned by owners like this can be very easy to spot just by doing drive by’s. The property might look run down, vacant or just unloved. Great suggestion – thanks for stopping by.

  4. liverealestateinvesting

    What I do Julie is Direct Mail. I use a data source provider to get leads and then I sift and sort them to find the best leads I believe. For example leads that have owned their house for 20 years or longer. I talk a lot about this on my blog and would be glad to refer your blog as it has great information. Please leave me a comment at http://www.liverealestateinvestor.com ….looking foward to chatting with you

  5. We must know that Every business owner share same goal in their mind: to increase their sales. That is why,for me i agree and everyone else here , that getting potential leads for your real state business is very important. The right thing to do is Identifying qualified clients or customers
    who want whatever a business have to offer is what businessmen need to do.

  6. The bottom line is motivated sellers are the key to your success as real estate investor. You have to know how to find them in places where most real estate investors wouldn’t even think about looking. For example you can find a great deal of motivated sellers at bankruptcy court, divorce court, probate, eviction list etc.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s