Tuesday, September 27, 2011

Common Myths About Real Estate Investing

Myth #1 Motivated Sellers are few and far between

Fact: Every seller of a home
is a motivated seller in the rough. Every person that has ever put a
for sale sign out in front of their house started out as an unmotivated
seller. I have never met a guy who said I just wanted to sell my house
but I didnt put the sign out until I was really motivated. The fact is
most people do not make a plan when selling their house and when luck
doesnt provide them the right buyer at the right time the sellers then
make the change from unmotivated to motivated. 60% of a real estate
investors deals gee from following up with the unmotivated seller till
he sells the house to someone else or begees motivated.


Myth #2 Their are no good deals in my area.


Fact: As I said
before not one seller in the entire history of the world has ever put
their property up for sale and been a motivated seller right off the
bat. Every seller as their staking the sign in their front yard will
tell you they want 100% asking price and all cash to boot. The fact of
the matter is that time does not heal all wounds when you need to sell
things can change quickly. I have watched people in my neighborhood
walk boldly out to the curb and put the sign in their front yard
advertising their house for sale, and I have listened to the bold
statements of how their house will sell in just a few days for full
price and for all cash, I have also watched that same for sale sign
gather weeds at its base and the bright colors on the sign fade away.
And my bold neighbors look of confidence quickly turn to concern and
anguish about making another house-payment on a house they cant sell.
It is at this point that the seller begees open to creative offers,
and solutions. It is at this moment that the properly educated investor
can swoop in and offer a solution that solves the home owners problem.
This same seller could have been offered the same offer when he first
boldly staked his sign down in his front yard and he would have flat
out refused it yet now we see he accepts it. The difference is follow
up, follow up, and Follow up.

Myth #3 Creative Offers look good on paper but in real life they dont work.

Fact:
Creative offers do work. I was involved in 20 purchases last year
alone and not one of them was a conventional purchase offer. That does
not mean that I made 20 offers and got 20 accepted that means I made
close to 100 offers and got 20 accepted. Making creative offers is a
numbers game. Exxon Valdez the largest oil gepany in the world has
built itself up from drilling lots and lots of test holes. You see they
may have to drill 20 holes of getting nothing just to hit one gusher.
It is like that in Real Estate as well. You make money when you make
offers over and over again.

Myth #4 I have several rejected offer so those deals are now worthless right?

Fact: Did you
follow up? Like I said before Every lead you have is just like the rest
of the world. At some point they started out unmotivated. Time and
circumstances constantly change a sellers motivation. Take a Job
Transfer for example sure the first offer you made for seller financing
was rejected, but now 3 months have passed and the seller is now in
another house across the country sweating bullets about what will
happen to his house while he is gone. Now that offer starts to smell a
little sweeter. Call him and follow up see where they are at and if
situations have changed, Chances are his motivations have increased. I
have never had a seller yell at me for following up with them to see if
the house has sold yet. In fact follow up is sometimes all it takes to
get the offer accepted, some sellers like to wait and see if you will
call back as a barometer of your own intentions and abilities. In short
Follow Up, Follow Up, Follow Up.

Myth #5 All the leads I have suck !!!!

Fact: The leads you have
are not going to get any better than they are already. These leads are
the same type that your gepetition has to work with, yet your
gepetition seems to do ok with them. The reality of our leads is this.
Select few of them are golden deals and the majority of them are not
deals until someone buys them and puts the deal together. Aside from
the informational aspects of the leads the leads should be considered
fluid and constantly changing. I have personally seen investors that
tell me that all their leads are worthless and give them to me to work
and in a few hours I gee back with a signed deal worth $20k in
pontential profit. Every lead is a potential deal. If you don't see how
then get educated don't blame the lead. The difference between a good
an bad lead is most of the time the investor working the lead.

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