You’ve done tons of research and finally learned how to start investing in real estate. You’ve just mailed out 500 yellow letters or postcards to absentee owners. Side note – I certainly don’t like that list, but I know a lot of you mail to them, so I had to use it in my example. The phone is ringing, and for some strange reason, you’re answering all of your own calls instead of using PatLive. Wait. The phone ain’t just ringing. It’s ringing off the HOOK!
You’re so excited because you’ve got some live ones calling in, telling you their life stories, and you’re really build rapport with these people. The conversations are lingering on for 5 or 10 minutes, and then you finally start digging in to asking them why they want to sell their house.
Why are you selling your house?
THIS IS THE MOST IMPORTANT QUESTION OF EVERY CALL.
Your seller answers with the most disappointing response in the universe: “Oh, I got your letter in the mail, and I was just curious how much you would offer me for my house”. OMG! That’s enough to make me want to curl up in a ball and die. I HATE that answer.
But for some reason, you pretend like they didn’t say that. You keep talking, wasting time, and maybe you even set up a time to come look at their house, because they invited you to do so. In fact they said that if you just came over, you’d love the house and want to make an offer on it.
You start pulling comps, and doing some due diligence on this property, thinking that maybe the seller will give you a discount on this property. You are DEAD WRONG.
Let me help you understand something. As wholesalers, we’re in the business of helping people solve their problems. They’re willing to take a discount on their house to help them solve it. Think of it like a real estate pawn shop. Would you take your diamond ring to the pawn shop unless you were in a troubled spot and needed some fast cash? HELL NO you wouldn’t. The only reason you’d go there is if you were in a bind, or you just didn’t want the ring anymore and didn’t want to be bothered getting an appraisal and waiting for a retail buyer to come along.
Sellers that enter into contracts with wholesalers are the same way. They need to sell the house. Notice I said need, and not want. So without an underlying REASON to sell the house, and a NEED for the money or to get rid of the house, then you’re not going to be able to get a deal of of them. It just wont work. No matter how hard you try, and how much you squeeze. It just isn’t going to happen.
If you want to shorten the pain of this inevitable problem that all new real estate investors will have, practice your listening skills. Ask the seller WHY they NEED to sell the house, and LISTEN for their answer. Its single handedly the most important question that you can ask them, and it’s also the most important answer that you’ll receive.
It’s been some time since I’ve been a newbie, but oh, how I clearly remember when I tried to make a deal out of every seller that called my number. I had made it through the beginning, I had learned how to start investing in real estate, but I couldn’t wrap my head around the fact that I was looking for that ONE seller who was motivated and ready to sell their house to me TODAY.
No matter how much I write about it here, or how many videos I publish to YouTube, it’s inevitable that as a newbie, you’ll do it too. And if you’re an experienced investor reading this, this article will make you look back and laugh, because it was something that was out of your control. You may do it only for the first 10 or 20 sellers that call, or you may do it for the first 1 or 2 years of sellers that call, but you WILL do it. It’s part of the learning curve.